The Algerian groups Sonatrach and Chinese Sinopec signed on Saturday in Algiers a contract worth 490 million US dollars for the sharing of hydrocarbon production in the south of the country, according to a statement from Sonatrach.
“Sonatach and its partner Sinopec Overseas Oil & Gas Limited (SOOGL) proceeded on Saturday May 28, 2022 in Algiers to the signing of a production sharing contract relating to the contractual perimeter of Zarzaitine, located in the Illizi basin (south- east of the country), specifies the press release, adding that the two parties undertake to carry out a program of development and exploitation works whose objective is the recovery and valorization of hydrocarbons in the Zarzaitine field.
Putting forward more details, Sonatrach explains that the program in question includes the revamping works of the Gas Lift Unit, the drilling of twelve new development wells, the Work over works for the replenishment of six existing wells, the connection of new development wells and maintenance of existing surface facilities, as well as the recovery of flared gases and the reduction of carbon emissions.
For the implementation of this development plan, the statement reveals, the total amount of investment planned is estimated at 490 million US dollars and will allow a recovery of nearly 95 million barrels.
The signing of this contract crowns the negotiations carried out within the framework of the memorandum of understanding signed between the two companies on May 20, 2021 and reflects the desire of the two parties to continue their historic partnership and to strengthen their cooperation in the field of the production of hydrocarbons.
The signing ceremony took place in the presence of the Algerian Minister of Energy and Mines, Mohamed Arkab.
Sinopec has been present in Algeria since 2003 and operates the Zarzaitine contractual perimeter with Sonatrach, under an association contract aimed at increasing the recovery rate of crude oil reserves.