Gazprom Netherlands, a subsidiary of Gazprom, and the Algerian state-owned energy company Sonatrach have signed an agreement for the transfer of rights for hydrocarbon exploration and production in the El Assel onshore area located in the Berkine Basin of Algeria.

Gazprom said that its share in the project will account for 49%. Based on provisional estimates, the oil recoverable reserves of the area amount to some 30 million tonnes. El Assel includes three blocks covering a total of 3,083sqkm.

According to the company the contract, if signed, will enable the company to initiate in Algeria the first hydrocarbon exploration and production project, which will foster the company’s position in the region.

On December 13, 2008 Gazprom was announced the winner of the hydrocarbon exploration and development tender for the onshore area El Assel.

Algeria’s proven natural gas reserves total 4.58 trillion cubic meters (second-largest in Africa after Nigeria’s reserves – 5.15 trillion cubic meters). The main part of the natural gas reserves is concentrated in the central and eastern parts of the country, said the company.

The country’s proven oil reserves amount to 1.58 billion tons (third-largest in Africa after Libya and Nigeria’s reserves). In the energy balance of Algeria natural gas accounts for 62.5 per cent, oil – 34.5 per cent, coal – 2.5 per cent, hydro energy – 0.5 per cent.