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Statoil, Shell to assess Algerian shale

Reserve area north of area targeted in 2012 by al-Qaida allies.

By Daniel J. Graeber

STAVANGER, Norway, Sept. 30 (UPI) -- Norwegian energy company Statoil and its counterparts at Shell said Tuesday they'd spend the next two years assessing the shale gas potential in Algeria.

"Statoil is entering this shale play to test the prospectivity and commerciality through a step-wise approach," Nick Maden, a senior vice president of exploration for Statoil, said in a statement. "The first exploration phase is expected to last up to 2017 and include the drilling of two wells."

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Statoil and Shell entered a license in an Algerian shale area alongside state energy company Sonatrach, which holds the controlling interest.

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

It's been reviewing prospects for shale natural gas, which Shell and Statoil said may be substantial. With Europe looking to diversify an energy sector dependent on Russia, the companies said any shale from Algeria could be an important part of energy security ambitions.

The license area is just north of the In Amenas gas facility in eastern Algeria. Terrorists sympathetic with al-Qaida stormed the facility in January 2013, leaving 38 civilians and 29 militants dead.

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"The decision to re-enter [Algeria] was the result of a thorough and stepwise process to identify the necessary security measures, implementing them and validating that they are in place and operational," Statoil said.

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