Tunisia - The Gas E&P Sector.
Tunis had increasingly turned to natural gas to meet domestic energy demand before 2016. The state's utility, Societe Tunisienne de l'Electricite et du Gaz (STEG), had promoted gas E&P blocks through an incentive system begun in 2005. The share of gas in Tunisia's energy mix was more than triple its 14% level in 2003. Tunisia's energy base had grown in pace with its high GDP growth rates in pre-2011 years.
Tunisia produces about 242 MCF/d of nat. gas, down from 750 MCF/d in recent years. Of this, BGI accounts for most of the gas. Tunisia's demand for nat. gas in 2018 was expected to be far higher than that level. STEG is still getting 950 MCF/d from the TransMed system, of which about 150 MCF/d is in lieu of transit fee for the gas passing from Algeria to Sicily and the rest if purchased.
Before 2011, the government of Zine el-Abidine Ben'Ali had a two-tiered solution to the problem of import-dependency and soaring power demand. It wanted the state's integrated Entreprise Tunisienne d'Activites Petrolieres (ETAP), which oversees development of the petroleum sector, and its partners to boost oil and gas output. It sought to encourage private investment in new capacity using both traditional petroleum-based technology and renewable energy projects. However, those plans suffered from a high degree of over-confidence.
In 2008, for example, ETAP's then CEO Khaled Becheikh announced that total Tunisian gas production would exceed domestic demand by 2010. By the end of that year, however, gas consumption still out-stripped production by a wide margin.
Gas Production: Some of the new output came from the Chirgui gas field, which ETAP had developed along with the Petrofac of the UK at a cost of $100m. But the big boost came when ETAP and BGI commissioned the $1.3bn development of the offshore Hasdrubal gas field.
In June 2010, production began in another offshore field, Bakara, which was jointly developed by Agip and Etap at a total cost of $300m. That added 300,000 CM/d of capacity. But since then, the output is way below planned levels.
Although some smaller fields were under development, ETAP pinned its hopes on development of the Hadouma gas field, a JV of Agip, OMV and ETAP. The project was to cost about $2bn to develop. In late 2010, the partners said they hoped to bring the project on stream by end-2012. But the field came on stream in the summer of 2014, in view of the unrest in late 2010 and through most of the 2013-15 period. Still, the output is way below expectations.
In June 2011, Repsol of Spain won a contract to explore three potentially gas-brearing offshore areas along with ETAP.