Forbes: Algerian Shale's Water Problem
Of the many ways to reverse Algeria’s recent decline in hydrocarbon production, the country’s push for shale development looks the best on paper. After all, the U.S. Energy Information Administration, Algeria is home to the world’s third largest shale deposits behind China and Argentina with 707 trillion cubic feet. Who cares if the country continues to see lower output rates of traditional oil and gas if it can kick-start the kind of new energy production that has transformed markets as large as the U.S. from importers into viable exporters? If they can make this work, it could establish the country as the type of producer eager customers in Europe so desperately want, while strengthening the local economy.
To be sure, Algeria’s current leadership appear to be aware of the country’s shale potential and have taken measures to make sure the unconventional extraction process has a firm foothold. After amending national law to allow more favorable conditions for those firms interested in shale projects last year, Algeria announced a $100 billion budget for new hydrocarbon development, including “blocks for unconventional resources, with tax incentives for foreign companies interested in investing in shale gas and shale oil,” an important component of the country’s energy plans moving forward, according to a Reuters report. Additionally, in June of this year, the country’s government announced plans to launch a dozen test wells over the next 7 to 13 years.