May 29, 2019 / 10:58 AM / 2 months ago

Algeria to take months to make final Total deal decision

ALGIERS, May 29 (Reuters) - Algeria could take months to decide if Total can buy Anadarko’s assets in the North African country as officials focus on the political transition after April’s ousting of President Abdelaziz Bouteflika, two Algerian energy industry sources said.

Occidental Petroleum has agreed to sell Anadarko’s assets in Algeria, Ghana, Mozambique and South Africa to France’s Total for $8.8 billion if the U.S. oil company succeeds in completing a takeover of Anadarko

But the deal comes at a sensitive time for Algeria, which has been shaken by the mass protests which forced out Bouteflika on April 2 and are continuing to demand wider political reforms.

A deal involving Total is likely to be closely scrutinised as Algeria which remains wary of investments by French companies given the country’s past as a former colony.

Although Total signed energy deals with Algeria in 2018, some Algerian officials fear France will get too much control over its energy sector, one energy industry source said.

Energy minister Arkab Mohamed said on Sunday that Algeria will block the sale, but a day later struck a more diplomatic saying that Algiers wanted to seek a compromise.

He also said that state oil and gas firm Sonatrach needs foreign partners to implement its development programmes.

Anadarko’s holdings in Algeria represent about 260,000 barrels per day (bpd) of oil, more than 25% of the country’s crude production, which is estimated at 1 million bpd.

Algeria has stopped previous business deals with foreign firms. In 2010 it blocked the sale of Djezzy, the Egyptian Orascom telecom operator to South Africa’s MTN.

A second energy source said the government was unlikely to make a final decision on the Total deal as it was only meant to be in place until presidential elections planned for July 4.

But a political source told Reuters this month the vote might be postponed as protests meant more time was needed.

“The timing not is appropriate, Algeria is busy with the post-Bouteflika transition,” the energy industry source said.

However, the other energy source reiterated Algeria’s opposition to the Total deal, saying that Sonatrach “needs to be able to choose its partners”.

Relations between Algeria and France remain scarred by the trauma of the 1954-1962 independence war in which hundreds of thousands of Algerians were killed.

Algeria has repeatedly asked France to apologize for atrocities blamed on French soldiers.

Tensions have risen in recent days after armed forced chief Lieutenant General Ahmed Gaed Salah, who has been managing the transition, said unidentified foreign powers were trying to undermine Algeria by exploiting unrest.

Although Salah did not directly mention France, he was quoted as referring to parties with an “historical background with our country”.

France has not responded directly to Salah’s comments, but on Tuesday the French foreign affairs minister Jean Ives Le Drian told lawmakers: “We hope that Algerians can find together the paths of a democratic transition.” (Reporting by Lamine Chikhi; Additional reporting by John Irish Editing by Alexander Smith)

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