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UPDATE 3-Algeria names new Sonatrach chief executive
November 17, 2011 / 2:37 PM / 6 years ago

UPDATE 3-Algeria names new Sonatrach chief executive

* Former vice-president takes over at state oil firm

* He replaces CEO fired after just 18 months

* No reason given for change in personnel

* Reshuffle risks destabilising company: analyst (Adds analyst in paragraphs 11 & 12)

By Lamine Chikhi and Christian Lowe

ALGIERS, Nov 17 (Reuters) - The chief executive of Algeria’s Sonatrach state energy firm, Nourredine Cherouati, was replaced on Thursday after 18 months in the job.

Abdelhamid Zerguine, a former Sonatrach vice-president for pipelines, was named as the new chief executive.

“Abdelhamid Zerguine has been installed ... at the head of Sonatrach,” the official APS news agency reported, without giving a reason for the change.

The report confirmed information from three government sources who had earlier told Reuters that Cherouati was to be replaced by Zerguine.

Cherouati was appointed in May 2010 after the previous chief executive, Mohamed Meziane, was removed as part of a judicial investigation into corrupt practices in the awarding of contracts to Sonatrach suppliers.

Cherouati gave a briefing to local media on Wednesday at which he denied speculation he was to be fired. Newspapers quoted him as saying the changes he was pushing through were upsetting certain people and interests.

Sonatrach controls energy exports from Algeria and partners foreign firms in all the country’s oil and gas projects.

The firm was convulsed by last year’s corruption allegations and has also been struggling with ageing infra-structure and a reluctance by foreign oil majors to invest in new energy projects.

Zerguine is 61 and was until now head of a Sonatrach subsidiary based in Switzerland. He has been in the company for over 30 years and also served as an adviser to one of Sonatrach’s previous chief executives.

He becomes the fourth Sonatrach chief executive in two years after Meziane, caretaker CEO Abdelhafid Feghouli, and Cherouati.

“The change could be necessary, but it also could destabilize a big company like Sonatrach,” said Salah Mouhoubi, an Algerian academic and specialist on the economy.

“I think Sonatrach needs stability, and changing CEOs once every year is not good. I am also wondering about how international companies will read the change ... I am afraid that it could isolate Sonatrach and Algeria’s oil sector.” (Additional reporting by Hamid Ould Ahmed; writing by Christian Lowe; editing by William Hardy)

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