Algeria Amends Spanish Supply Contracts

Algerian state oil and gas producer Sonatrach CEO Toufik Hakkar and his counterpart at Spanish gas supplier Naturgy, Francisco Reynes, have amended gas contracts between the two companies, they said October 8. 

The two companies have been business partners since the 1970s when LNG deliveries to Spain began, They are also sole partners in the Medgaz pipeline company that delivers gas directly to Spain. Naturgy is thinking of quitting LNG trade – it tried to sell its half of Union Fenosa Gas to partner Eni in a complex deal involving Damietta off-take agreements – but the statement did not give any details of which contracts had been amended or why.

They said the meeting was an opportunity for the two officials to discuss other possibilities for future co-operation and on the best ways to expand their commercial relations.

Hakkar said the oil and gas industry had been strongly impacted by the Covid-19 pandemic and Sonatrach was "overcoming, in close collaboration with its customers, the effects of this pandemic on commercial activities. The agreement reached by Sonatrach and Naturgy reflects the strategic nature of the long-term and trusting relationship that binds them and through which they aim to consolidate their positions on the Spanish market.”

This strategic alliance is essential for the competitive and secure gas supply of the Spanish market, and therefore essential for the economic and social development of both countries, Reynes added.