Algeria awards 3 E&D licenses; 10 offered

Eric Watkins
OGJ Oil Diplomacy Editor

LOS ANGELES, Dec. 22 – Algeria’s Minister of Oil Chekib Khelil, citing success of the country’s latest bidding round, said a new round will be conducted in 2010.

“We are very satisfied with the results of the oil licenses. We’re going to do it every year,” said Khelil after his ministry awarded 3 exploration and development licenses out of 10 on offer.

Total SA and partner Partex won rights to the Ahnet project, CNOOC and PTTEP won the Hassi Bir Rekaiz permit, and a consortium of Repsol, GDF Suez, and Enel won the rights to the South-East Illizi block.

Despite Khelil’s upbeat tone, analyst BMI said the result “seems rather sobering, particularly after the previous licensing round also only resulted in the award of 4 out of 16 permits.”

BMI believes that “the low level of registered bids in both the previous and the latest licensing rounds highlight the prohibitive implications of Algeria's rigid business environment.”

The country’s rigidity was underscored earlier this month when Khelil said Algeria counts the freedom of movement of its citizens in the European Union (EU) as a precondition for signing an agreement to supply EU countries with LNG.

"Algeria sets other conditions because the important issue to us is not only to sell gas but also to achieve, for example, the freedom of movement between Algeria and the EU," Khelil said in a statement to Algerian Radio.

Contact Eric Watkins at hippalus@yahoo.com.

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