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EIA gives mixed report on Algerian natural gas

May 23, 2013 at 5:39 AM   |   Comments

WASHINGTON, May 23 (UPI) -- A terrorist attack in January and steady field maturation are harming Algeria's natural gas potential though shale is promising, a U.S. report says.

The U.S. Energy Department's Energy Information Administration reports that Algerian natural gas production has been in decline since 2005 because of field maturation. There have been several new projects discussed but few have gone on stream.

Algeria has the 10th largest gas deposits in the world and is the third-largest supplier to Europe. Its exports have been in decline, however, because of lagging foreign investments.

Militants sympathetic to al-Qaida in the Islamic Maghreb stormed the In Amenas natural gas facility in eastern Algeria in January. Foreign workers with BP and Norwegian energy company Statoil were among the dead in the attack.

The EIA said the attack highlights the security risks in the area. It adds that only one of the three processing units at the natural gas facility is back in service.

The EIA report adds that Algeria hosts "vast" untapped reserves of shale natural gas, however. An EIA study from 2011 puts the Algerian shale natural gas estimate at 231 trillion cubic feet.

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