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Tunisia - Petroleum Law Focuses On Gas & IPPs.

Tunisia's integrated petroleum law in effect since Feb. 20, 2000, gives attractive terms to gas E&P investors branching into the IPP business. The Ministry of Industry and Energy regulates the petroleum industry and the energy sector. Its petroleum decisions are executed by the state-owned and integrated Enterprise Tunisienne d'Activites Petrolieres (ETAP). The power and gas markets are regulated by Societe Tunisienne de l'Electricite & du Gaz (STEG).

STEG negotiates power and gas purchase prices with both ETAP and the E&P operator. On the basis of an agreed price, the operator can have an IPP in line with STEG's plans for expansion of the power sector. Small, remote gas fields can be developed for IPPs.

The law gives E&P operators tax relief when profits from oil and gas operations are reinvested in Tunisia. This applies for the upstream and downstream sectors, such as gas-fired IPPs. The tax relief is negotiable on a case by case basis as the law gives both ETAP and STEG flexibility on this. BG, the leading lobbyist for the new system, has a big IPP business.

Unlike its prolific oil producing neighbours Algeria and Libya, Tunisia's oil industry is modest. Tunisia has proven oil reserves of less than 300m barrels. Tunisia has natural gas reserves of about 2.75 TCF. The outlook for Tunisia is still fairly good, and it has much promising acreage on offer which is experiencing interest by foreign companies.

Tunis' efforts include trade agreements with the EU and free-trade accords with Arab states. Sound fiscal policies have resulted in Tunisia being listed as the African country with the soundest growth prospects.

Intensive exploration has been carried out in Tunisia since the discovery of oil in neighbouring Algeria. In May 1964, Tunisia's first oilfield, el-Borma, was found in the south on its frontier with Algeria. Areas of hydrocarbon importance include the Gulf of Gabes and the Paleozoic Ghadames Basin in the south. Exploration in central Tunisia has revealed potential oil and gas fields. Discoveries were made in the Ghadames basin and along the north and east of the Central Tunisian Cretaceous carbonate platform.
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Publication:APS Review Gas Market Trends
Date:Apr 5, 2010
Words:351
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