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FACTBOX: Algerian President's resignation brings energy sector into focus

London — Algerian President Abdelaziz Bouteflika's resignation on Tuesday threw the country's long-delayed oil and gas reforms into doubt, with no clear successor and a new election still to be determined.

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Algerian exports help to meet about 9% of European gas demand. The country is the fourth-largest crude oil producer in Africa, after Nigeria, Angola and Libya, after the recent recovery in output there.

Hydrocarbon revenues provide 60% of the OPEC member's budget, which has suffered since oil prices slumped a few years ago.

Bouteflika on Sunday named Mohamed Arkab as Algeria's fourth energy minister in three years.

Arkab, who was CEO of Sonelgaz, or the National Society of Electricity and Gas, will be tasked along with state oil company Sonatrach CEO Abdelmoumen Ould Kaddour with implementing far-reaching reforms to shake up an energy sector hamstrung by political squabbling and security issues that had dented foreign investment.

There was no visible impact on prices and trade flows in European gas markets.

"Both the military and the public seem aligned in Algeria, so I do not see where a political risk premium could arise," a UK-based gas trader said.

"We do not think gas exports have been affected by the political instability in Algeria, and we see disruptions as highly unlikely in the short term," said Konstantinos Pantazopoulos, Gas Analyst at S&P Global Platts Analytics.

"Longer term, our forecast is not impacted significantly as we expect similar levels of investment and production growth will continue despite political uncertainty" Pantazopoulos said.

TRADE FLOWS

* Algeria exported some 33 Bcm of pipeline gas to Italy and Spain in 2018 -- or 33% of domestic consumption -- and also shipped some 15 Bcm of LNG, mostly to European markets.

* Algerian pipeline gas supplies to Europe were as high as 78 million cu m/d late February, but exports dropped at the start of March on weaker market conditions.

* Algerian gas production totaled 91.2 Bcm in 2017, 43% of which was consumed locally, according to BP Statistical Review of World Energy 2018.

* Algeria's proved reserves are 4.3 Tcm, or 47.5 years at current production, according to BP Statistical Review of World Energy 2018

* Algeria produced 1.03 million b/d of crude oil in February, according to the latest S&P Global Platts survey of OPEC production

* Production peaked at 1.40 million b/d in September 2008, but project delays and a lack of investment have caused output to suffer.

* The country's crude exports have averaged around 600,000 b/d in the past year, according to Platts estimates.

* The bulk of the crude the country produces is light and sweet oil that is low in sulfur and yields a large amount of gasoline and naphtha.

* The main export crude grade is Saharan Blend, which has an API of 45 and a sulfur content of 0.10%.

* The bulk of its crude exports end up in the Mediterranean and Northwest Europe. Italy, Spain, France, US, Greece, Indonesia, Taiwan, India and the UK are regular buyers.

* Algeria is also a key exporter of refined products such as gasoline, naphtha and low sulfur straight run fuel oil.

PRICES

* The key Dutch TTF Winter 2019 contract was seen trading at Eur18.65/MWh early Wednesday afternoon, slightly higher than the assessment of Eur18.50/MWh Tuesday, with market participants citing both carbon and Brent crude as factors behind the move.

* Saharan Blend crude has averaged a premium of 1 cent/b to Dated Brent so far this year, according to Platts data. That compared with an average of a discount of 11 cents/b to Dated Brent in 2018.

INFRASTRUCTURE

* Algeria exports gas to Spain via two pipelines -- the 32 million cu m/d capacity GME pipeline to Tarifa and the 32 million cu m/d capacity Medgaz link to Almeria.

* Algeria sends gas to Italy, through Tunisia via the 90 million cu m/d Transmed pipeline to Mazara del Vallo.

* Algeria also has two operational LNG export plants at Skikda and Arzew with a combined nominal production capacity of 25.3 million mt/year, according to data from industry group GIIGNL.

* Arzew, Bejaia and Skikda are the country's main oil export terminals.

* Refining capacity is estimated to be around 600,000 b/d across six refineries: Skikda, the biggest at 330,000 b/d, Algiers, Arzew, Hassi-Messaoud and Adrar.

* Algeria's Sonatrach purchased the 160,000 b/d refinery in Augusta, Sicily, last year from ExxonMobil.

* The government recently scaled back plans to expand its downstream sector rapidly, dropping plans to build five new five refineries, and pushing ahead with only two projects, at Hassi Messaoud and Tiaret.

-- Staff, newsdesk@spglobal.com

-- Edited by Dan Lalor, daniel.lalor@spglobal.com