Sinopec, a Chinese company, signs a contract with Algeria to explore saline gas blocks

Sinopec Group, China's oil and gas state major, announced that it had signed a contract for the exploration of a natural-gas block in Algeria which could hold a large shale-gas resource.

Sinopec International Petroleum Exploration & Production Corporation, a subsidiary of Sinopec International Petroleum Exploration & Production Corporation, and Sonatrach, the state-run Algerian oil company Sonatrach signed a contract earlier this week.

Sinopec was awarded by Algeria last month via an international bid to explore and develop the block Guern el Guessa II (GEG), which covers an area of 36 000 square kilometers in the Gourara - Timimoun Basin, in southwest Algeria.

Sinopec (formerly China Petrochemical Corp) said in June the GEG Block has proven conventional gas resources but also potentially holds a sizeable shale-gas resource.

Sinopec's internal newspaper reported that before bidding on the block, it conducted several rounds of evaluations, "fully leveraging company expertise and integration", in developing unconventional oil-and-gas resources.

Sinopec was one of China’s first shale-gas developers. It operates the Fuling field, China’s largest shale-gas project.

Sinopec, Sonatrach and Sinopec signed a $850 million contract in February to explore and develop the Hassi Berkane North field jointly.

ZPEC, the official WeChat platform of ZPEC, announced that an independent Chinese company, Zhongman Petroleum and Natural Gas Company, also signed a contract last week for exploration and development of Zerafa II, a natural gas block located in Algeria. This follows a successful tender awarded by ZPEC earlier this month.

(source: Reuters)