The Algerian Hydrocarbon Development Master Plan
Authors: Khelil Chakib , Harouaka Abdallah 
Published: December 2007

Introduction

Having the fourth largest reserves of gas in the world, Algeria has decided to develop them and make them available to the world markets. SONATRACH embarked on the study of gas reserves 5 years ago with the help of several consultants. While the study was going on, the development of certain areas was undertaken.

At the time SONATRACH was negotiating the possibility of selling gas to El Paso in 1969, possibility of selling gas to El Paso in 1969, arguments were made that Algerian gas reserves at that time might not be sufficient to cover that contract. From 1970 to date, SONATRACH has developed additional reserves that will more than cover the El Paso No. 1 contract. Since then, SONATRACH has met the challenge to find money to develop these reserves and gained meanwhile a tremendous experience. Today SONATRACH appreciates the opportunity to present the valorization hydrocarbon development plan (VALHYD), which consists of a review of the progress achieved in the development of its large oil and gas resources and an insight into what remains to be done in the next few years.

This presentation will cover: objectives of the VALHYD program, programmed actions, gas and liquid hydrocarbon reserves and the planned production potential, investment requirements, financial potential, investment requirements, financial projection over the period 1976–2005, total gas and oil projection over the period 1976–2005, total gas and oil cash flow analysis, and sensitivity analysis to variation in revenues, costs of capital, and escalation.

OBJECTIVES OF THE VALHYD PROGRAM

The VALHYD program aims at achieving the following:recovery and utilization of gas associated with oil production;processing of associated gas and nonassociated gas from gas condensate and LPG (liquefied petroleum gas) within acceptable economic constraints;reinjection of gas, especially associated gas, whenever this will lead to a better oil reserves recovery;maximum recovery of condensate by total or partial cycling in gas condensate fields;maintaining a level of gas sales volume as high and as stable as possible during the longest period of time while taking into account gas needs for cycling operation, reinjection in oil fields, and gas lift;systematic production of LPG at the level of gas processing production of LPG at the level of gas processing units in the fields using gas from condensate stabilization units and intermediate pressure units. In addition to this production in the fields, LPG extraction will be achieved at the level of gas liquefaction units.

The map enclosed with this presentation shows a visualization of the VALHYD presentation shows a visualization of the VALHYD project and its major components. project and its major components. PROGRAMMED ACTIONS PROGRAMMED ACTIONS In order to fulfill these objectives, SONATRACH has engaged the following actions and programs:reservoir engineering studies, surface facility studies, infrastructure, and manpower needs studies;drilling of various types of wells for extension, development, injection in gas condensate fields, dry gas fields, and oil fields, and water wells for the needs of injection in oil fields, human consumption, and industrial use;laying gathering lines and reinjection lines between wells and fields;construction of separation units for processing oil and associated gas;construction of compressor stations for gathering and delivery of associated gas to gas processing units;construction of wet gas processing centers;construction of recompression processing centers;construction of recompression booster station whenever necessary;construction of gas reinjection station besides gas processing units on gas condensate fields and oil fields;construction of gas pipeline for the delivery of gas to the coast, condensate pipelines for delivery to storage and loading facilities at the coast, and LFG pipelines for delivery to LFG separation units at the coast;construction at the coast of installations for storage and loading of condensate, refrigerated storage installations of LPG for separation into propane and butane and loading, and gas liquefaction units and their associated units for LPG extraction.