UK's Neptune to begin gas exports from Algeria's Touat field 'this week'

Algeria's delayed Touat gas project is set for its first commercial supply "this week," a spokesman for project partner Neptune Energy said Monday.

The much-delayed Touat field complex -- one of several new gas projects coming online in Algeria to offset falling output at older fields -- has been beset by operational delays and missed deadlines.

But having started commissioning in February, the 4.5 Bcm/year project is now set to begin commercial operations.

"We put gas into the process plant a short while ago and are expecting first official gas export this week," the spokesman said.

The project -- comprising 10 gas fields in the Sbaa Basin 1,500 km southwest of Algiers -- was originally scheduled to start production in April 2018, but the project suffered delays to the construction of the central production facility (CPF).

The delays were caused by a conflict between the building contractor and its workers.

PLATEAU PRODUCTION

Neptune has said it expects Touat to ramp up to plateau production of 450 Mmcf/d (12.5 million cu m/d) in the third quarter.

Neptune and Algeria's state-owned Sonatrach operate Touat via their joint venture Groupement TouatGaz (GTG) in which they each hold 35%.

France's Engie -- which was previously in the partnership with Sonatrach -- sold part of its stake to Neptune in 2018 as part of the$3.9 billion sale of its upstream assets to the UK company. The French company retained a 30% stake in Touat.

The project consists of 41 production wells, with gas production sent via pipeline 800km north to Algeria's main central gas hub at Hassi R'Mel.

In 2018, Algeria exported 16.6 Bcm of gas via the Medgaz and GME pipelines to Spain, 16.3 Bcm of gas via the Transmed link to Italy and 14.4 Bcm of gas equivalent as LNG, according to data from S&P Global Platts Analytics.

Total exports of 47.3 Bcm were down by 2 Bcm on the previous year's total of 49.3 Bcm, according to the data.

Its domestic consumption is now above 40 Bcm/year, having risen quickly from just 27 Bcm in 2010, according to data from the Gas Exporting Countries Forum.

Algeria is looking to increase renewable electricity production to limit domestic gas demand growth in a bid to maintain gas export levels into the 2020s.

Related Links: Neptune Energy

Source: SP Global