BP Exploration Operating Co. Ltd. and Algerian state firm Sonatrach have announced the first sales contract for their joint venture planning to develop gas fields in Algeria for export of gas to Europe.
In Salah Gas, a 50-50 marketing partnership of the two companies, has been assigned an existing sales contract between Sonatrach and Italian electricity generator ENEL.
In Salah Gas will take over a contract to supply ENEL with 4 billion cu m/year of gas. Deliveries under the contract started in late 1996 and will be met by Sonatrach until first gas from the BP/Sonatrach venture early next decade.
In December 1995, BP and Sonatrach signed an agreement for a $3.5 billion development of gas discoveries in the 25,000 sq km In Salah area, with produced gas to be exported by pipeline (OGJ, Dec. 25, 1995, p. 26).
Exports will be via Hassi R'Mel field facilities and the Maghreb pipeline to Spain and then on to Italy for the ENEL contract. In Salah Gas aims to deliver as much as 11 billion cu m/year of gas to southern Europe.
BP and Sonatrach began seismic survey work in February and plan to drill their first appraisal well this summer.
The In Salah area has seven finds with estimated reserves totaling 5 tcf of gas, and a number of prospects that may have reserves of another 5 tcf.
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