INTERVIEW-New Algeria oil finds to add bbls soon-Anadarko

Forbes.com-Reuters, 04.17.03, 11:06 AM ET By Jonathan Leff LONDON, April 17 (Reuters) - Algeria's prolific Hassi Berkine oil basin may further boost production growth this year as leading foreign investor Anadarko expands infrastructure beyond initial plans, a top manager said. While the Ourhoud mega-find in the Saharan Desert will stay at a plateau 230,000 barrels per day (bpd), on target for next month, the Hassi Berkine South (HBNS) facility capacity may be pushed over 300,000 bpd, Anadarko's Algerian manager Rex Alman told Reuters in an interview. "We think we can handle more there with some de-bottlenecking. We could bring on stream the new discoveries within the year," he said. Anadarko, Algeria's leading foreign investor, has made two new finds this year near the HBNS centre, which was commissioned last year and has already reached capacity. Alman declined to say how much additional capacity could be added at the facility. Anadarko is also planning another or four exploration wells in Block 404, in which the foreign investor group it leads holds 49 percent. Its partners are Italy's ENI and Danish Maersk, each with a quarter of the Anadarko Algeria Comp. Sonatrach holds 51 percent of the block's equity. "This is our backyard now, it's a core area," Alman said. HBNS and Ourhoud are tied into Algeria's trunkline with a 30-inch (76-cm) pipeline, indicating capacity of 600,000 bpd up to 750,000 bpd, more than sufficient for the estimated 530,000 bpd plateau output from the two facilities. Other export bottlenecks are being unclogged by Sonatrach, which is commissioning a new pumping station to help boost flows from the Berkine basin, Alman said. They are also in the process of constructing a new export pipeline from Haoud el Hamra to the port of Arzew. Alman said there had been some production constraints earlier this year due to infrastructure improvement and a more than week-long bout of bad weather on the Mediterranean coast.

OPEC ISSUE LOOMS But the main obstacle for Algeria is not infastructure but politics -- the north African nation is pumping nearly 50 percent over its official 782,000 bpd OPEC limit. Most of that capacity is less than a year old, as Algeria's own production of some 700,000-800,000 bpd had plateaued until the HBNS and Ourhoud fields came onstream. So far the extra oil has not been a major issue -- between Venezuela's strike last year and the stoppage of Iraqi oil last month, OPEC has been pumping practically at will. But an attempt to rein in production is expected at next week's cartel meeting. Alman would not be drawn to comment on whether Sonatrach or the foreign partners would be required to take the brunt of cutbacks that most analysts now believe are necessary. Algeria's low cost of development for the massive, on-shore Saharan fields should help ease the pain of any constraints on production, he said.

OURHOUD IMMINENT, BLOCK 208 YEARS OFF Alman said the Ourhoud field, where the last of three trains came onstream in February, should reach capacity over the next month or so. Ourhoud has an estimated 2.3 billion barrels of oil in place, with more than half recoverable. The field, covering three blocks, has been monatised between the three joint-venture groups: Anadarko 37.5 percent, Cepsa 56.8 percent, Burlington 5.7 percent. Anadarko's next major developoment is set for Block 208, to the south of the current facilities, which is expected to produce around 100,000 bpd no sooner than 2007, Alman said. And exploration activities are set to continue in two other recently acquired blocks -- 406B and 403 -- at the end of this year and later next year, respectively.