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TotalEnergies and SONATRACH extended 2mil mt/year LNG supply deal for 2024

TotalEnergies and SONATRACH have signed an agreement to extend LNG supply deal for 2mil mt/year for one more year in 2024. Under the agreement, SONATRACH will supply 2 mil mt/year LNG to TotalEnergies at the port of Fos-Cavaou, near Marseille, France.

These deliveries of Algerian LNG contribute directly to energy security in France and Europe. Both the companies had signed original contract for LNG supply in 2020 for three years which would end in Dec 2023. With the latest agreement, the supply contract has been extended for one more year.

TotalEnergies and SONATRACH also signed an agreement to increase gas production at the Tin Fouye Tabankort fields by 40,000boe.

Under the agreement, which remains subject to the approval of the Algerian authorities, SONATRACH and TotalEnergies have agreed to convert the production contracts for the Tin Fouyé Tabankort II (TFTII) and Tin Fouyé Tabankort Sud (TFT sud) fields in southern Algeria (Sonatrach 51%, TotalEnergies 49%) to the framework established by the new Algerian Petroleum Law enacted on December 11, 2019.

In this context, SONATRACH and TotalEnergies will pursue the investment program already launched to increase the gas production of TFTII and TFT South, which includes the upgrade of existing facilities and the drilling of additional wells. The combined production of the two fields is expected to exceed 100,000 boe per day by 2026, versus a level of around 60,000 boe per day in 2022, thus increasing the potential export of Algerian gas to the European market.