February 8, 2018 / 11:52 AM / 10 months ago

UPDATE 1-Algeria's Sonatrach to invest $56 bln from 2018 to 2022 - CEO

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By Lamine Chikhi

HASSI RMEL, Algeria, Feb 8 (Reuters) - Algerian state energy firm Sonatrach will invest $56 billion from 2018 to 2022, its chief executive said on Thursday.

“We will give more details very soon,” Abdelmoumen Ould Kaddour told reporters during a visit to the Hassi Rmel gas field.

He spoke after launching a new gas pipeline pumping from southwestern fields including Reggane North, Touat and Timimoun with capacity of 8.8 billion cubic metres a year.

“We are so proud of this project because it has been constructed 100 percent by Algerian firms,” Kaddour said.

OPEC member Algeria has been hit hard by a slump in world oil prices and struggled to attract energy investment to help develop new fields and increase existing production.

Algeria is a major gas supplier to Europe.

In December, Sonatrach said it planned to work more closely with France’s Total on offshore, petrochemical, solar energy and shale exploration projects after settling disputes over profit-sharing on oil and gas contracts.

Algeria remains dependent on oil and gas earnings, which provide 60 percent of the state budget, and Sonatrach’s performance is key to the health of the economy.

The North African country has been working on a new energy law to provide better incentives for foreign firms, which had been deterred by current terms.

But there are still divergent views within Algeria’s ruling classes over how hard to push for foreign investment and domestic economic reform to boost revenues and spur growth.

Kaddour, a U.S.-educated engineer, has sought to improve the performance of Sonatrach, a sprawling state empire, and attract more foreign investment to boost its oil and gas production. (Reporting by Lamine Chikhi; Editing by Dale Hudson and Ulf Laessing)

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