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Algeria’s energy export volumes drop 2.8% in first 9 months of 2015

Algeria’s energy export volumes drop 2.8% in first 9 months of 2015

ALGERIA: Algeria’s energy export volumes dropped 2.8 percent in the first nine months of 2015 due to a fall in output and a sharp rise in domestic consumption, the energy ministry said. Energy exports had fallen in 2014 from the previous year as oil and gas output declined in the North African OPEC member.

Algeria, a major gas supplier to Europe, relies heavily on energy earnings, which make up 95 percent of total exports and account for 60 percent of the country’s budget. Its finances have been hit since global crude oil prices started falling in June 2014 and in the first nine months of 2015, energy earnings fell 45 percent to $25.8 billion.

The government has already said energy earnings would fall by 50 percent to $34 billion in 2015 before reaching $26.4 billion this year, pushing down reserves to $121 billion.

Algeria’s central bank governor on Wednesday said falling energy revenue would cause foreign exchange reserves to drop to $152.7 billion in the third quarter of 2015 from $178.94 billion at the end of 2014.

Overall energy exports reached 74.7 million tonnes of oil equivalent in the first nine months of 2015 against 76.9 million tonnes a year earlier, the energy ministry said in the latest edition of its magazine “Algeria Energy”.

Crude oil shipments increased for the January-September period of last year, it said, without giving a figure. Algeria’s full-year crude exports had declined 16 percent in 2014 from the previous year.

Natural gas sales abroad fell 7.5 percent, while oil refined products exports dropped 5.3 percent for the first nine months of 2015, according to “Algeria Energy”.

The decline in exports was due to a 1.9 drop in overall energy output, which reached 112 million tonnes of oil equivalent, in addition to a 7.5 percent rise in demand from the population of 40 million, the ministry said.

It did not provide further details on production. It said natural gas consumption rose 8 percent to 30 billion cubic metres, while demand for gasoline and diesel oil increased 5.7 percent and 5.6 percent respectively.

Algeria this week started implementing rises in subsidised electricity, gasoline and diesel oil prices for the first time in more than a decade in a bid to reduce consumption after struggling to attract foreign investment to its energy sector.

It has delayed an energy bidding round for foreign oil companies previously planned for the third quarter of 2015. In 2014, It awarded only four of 31 oil and gas blocks on offer to foreign consortiums. That followed a disappointing bidding round in 2011 when it secured bids for just two of 10 fields in the auction.