Sonatrach chief plans to shake up the Algerian company

Subject

Energy politics in Algeria.

Significance

The CEO of state-owned energy company Sonatrach, Abdelmoumen Ould Kaddour on October 17 said during an oil and gas conference in London that Algeria would move away from from oil-indexed, long-term contracts and towards more flexible terms. Since he took the helm in March, the head of Sonatrach has called for radical changes in the way the national oil and gas corporation operates, in the face of the fall in global energy prices. Ould Kaddour has made it clear he thinks the corporation is weighed down by bureaucracy and lacks strategic vision.

Impacts

• Foreign companies are likely to welcome Ould Kaddour’s initiative, but will be wary of the political ramifications.
• Sonatrach’s priority will be to maintain or increase market share against more competition from Russia, Australia and the United States.
• Ould Kaddour may not have enough time to deliver results; turnover of senior personnel in Sonatrach over the past few years has been rapid.