ALGERIA - Anadarko Operations - Berkine.

Anadarko Algerie, a unit of Houston-based Anadarko Petroleum Corp., is the largest foreign oil producer in Algeria thanks to huge discoveries it has made since 1993. The company is also the biggest foreign investor in the country. It has found over 3,000m barrels of oil reserves in Algeria, where it is involved in 530,000 of oil production. This will rise to 630,000 b/d by 2007 and its gas production eventually will exceed 4,000 MCM/y.

Anadarko has two oil producing systems, with fields having connections involving other companies: (1) the Hassi Berkine stream of 300,000 b/d, and this capacity is sustainable for a long time; and (2) the Ourhoud stream of 230,000 b/d, sustainable for a long time as well. A third system, Block 208, will be on stream in 2007 with a sustainable capacity of 100,000 b/d.

Anadarko and co-operator Agip in late 2003 raised Hassi Berkine system's production capacity from 285,000 b/d to 300,000 b/d in their unitised Blocks 404a and 403. In June 2002 they had pushed oil output to 285,000 b/d after having brought the system's fourth and final oil treatment train in Hassi Berkine South (HBNS) on stream in April. They have found most of the fields in this block, with a major extension found in an adjacent block by Agip. The production stream now is for a consortium consisting of Sonatrach (51%), Anadarko (24.5%), Maersk Olie Algeriet of Denmark (12.25%), and Agip's Lasmo (12.25%). Anadarko has invested more than $2 bn in this. The crude oil is exported through the Nezla pipeline, which can handle over 300,000 b/d (see background in Vol. 56, Gas Market Trends No. 6).

In its Hassi Berkine North-East prospect on Block 404, where its partners are Maersk and Lasmo (Agip), Anadarko in January 2003 made a big find as its HBNE-1 exploration well tested 4,092 b/d of oil and 6.7 MCF/d of gas in a 16-metre net pay.

In mid-2002 Anadarko in partnership with Maersk got Block 403c/e, next to Block 404a, which increased the US company's gross acreage in the Berkine basin to 4m sq km. Anadarko was to shoot 200 km of 2D seismic and drill one exploration well in its first three-year period. It holds 67% in this venture, with Maersk owning the rest. Block 403c/e is close to Anadarko's existing production facilities at Hassi Berkine South. With this infrastructure already in place, future discoveries could be developed quickly and economically". In 2001 Anadarko got Block 406b in the same region and on the border with southern Tunisia. In November 2002 it gave a 40% stake in this to Kuwait's KUFPEC.

In its Block 208, where partners are Maersk and Lasmo (Agip), Anadarko is developing seven oil and gas fields - EKT, El Merk, El Merk N, El Merk E, El Merk C, El Kheit, and El Tessekha - for an oil production stream of 100,000 b/d to start up gradually from 2006. Anadarko is also spending $882m on development of the gas structures at these fields. Together, they will be producing about 4,000 MCM/year by 2007.

Investing over $3 bn in this country, Anadarko has made Algeria its main oil zone. To the US firm, in which Sonatrach has had a stake since the 1980s, Algeria is more important than Yemen has been to Hunt. Anadarko is the biggest among the US independents, having acquired Canada's Gulfstream Resources, Berkley Petroleum and Union Pacific Resources (see Vol. 56, Gas Market Trends No. 6).

In December 2003, Anadarko and its partners announced a major oil discovery in the prolific Berkine Basin. The BKNE-AAC-A well, within the Berkine North-East area, followed earlier successes in Block 404 with Hassi Berkine North-East (HBNE-1) and Sif Fatima South West (SFSW-1) and, more recently, the Sif Fatima South-West appraisal well (SFSW-2), which was completed in late 2003. BKNE-AAC-A was drilled to a total depth of 11,200 ft and encountered 36 ft of net oil pay in the Upper TAGI (Trias. Argilo-Greseux Inferieur) Fm. It was tested at a stabilised flow rate of 3,400 b/d of 40[degrees] API oil on a 40/64 inch choke, with a wellhead pressure of 620 pounds per square inch absolute (psia). Previously, SFSW-2 was drilled to a total depth of 10,840 ft and confirmed the extension of the field. It also encountered a new pay zone in overlying TAGS sands. Earlier test rates reported for the SFSW-1 and HBNE-1 discovery wells were 2,689 b/d and 4,092 b/d, respectively.

In a press release, Anadarko then said: "We are delighted by our continuing trend of exploration successes in the Berkine Basin, which confirms the significant potential and opportunity for growth that lies in this region. We have drilled a total of seven exploratory wells in Algeria since our exploration drilling program resumed in September 2002, and we plan to drill two more by year end, both in Block 404. In addition, we are planning an aggressive appraisal program next year". Tony Meyer, Anadarko's vice president for international and Alaska operations, said: "Using advanced interpretation techniques on 3D seismic data volumes, coupled with a good understanding of reservoir development, we have been able to successfully identify and pursue subtle targets". The company said: "Over the last 10 years, Anadarko, together with its partners, has found 14 fields in Algeria").