TotalFinaElf and Sonatrach Sign Gas Agreement
TotalFinaElf and Sonatrach have signed a letter of intent governing the purchase by the Group of one billion cubic meters of Algerian gas per year. The gas will be delivered to TotalFinaElf in Europe via the future pipeline connecting Algeria directly to Spain, currently under study by the company Medgaz.
Sonatrach and TotalFinaElf have a respective 20% and 12% stake in the Medgaz project along with Cepsa (20%), BP, GDF, Endesa and Eni (each with 12%). The pipeline, of a planned capacity of 8 billion cubic meters of gas per year and with the possibility of increasing capacity to 16 billion cubic meters per year, will be laid at water depths of more than 2000 meters.
In Algeria, TotalFinaElf was recently awarded an exploration permit for the Timimoun fields and is joint operator with Sonatrach in the Algerian natural gas field Tin Fouyé Tabankort. Furthermore, TotalFinaElf is partnered with the national Algerian oil and gas company for production in the Hamra gas field.
With this agreement TotalFinaElf continues to strengthen its position in gas trading and marketing in Europe, particularly in Spain. It also confirms TotalFinaElf's commitment to develop new infrastructure as concerns gas transport, such as Medgaz.