22nd World LP Gas Forum, Rio de Janeiro - Brazil
7th – 9th October 2009
ALGERIA : A LEADING LP GAS EXPORTER AND
CONSUMER
Said Akretche , Chairman and Managing Director of NAFTAL - Algeria
1. Introduction
Algeria is a leading LPG producing country.
In 2008, Algerian exports reached 7.5 million tons and domestic consumption
exceeded 1.95 million tons.
However, the on going policy proping up natural gas consumption has hampered
the growth of LPG in particular bottled butane, a product that remains the vital source
of energy in rural areas.
Nevetherless, opportunities for development of the domestic market of LPG (bulk
butane, bulk propane, small public distribution network of LPG and LPG auto gas) exist
and can be a valuable alternative.
Thanks to abundant resources and because of their properties, LPG can play a greater
role in meeting energy needs in transportation, industrial and agro business sectors in
the future.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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2. Place of LPG in the Algerian energy policy
The consumption energy model : Rank of LPG
Natural gas & LPG
Renewable and solar
energies promotion Act
Promotion of use of the most available
energy forms
The Algerian
energy
consumption
model
Energy efficiency
Saving Energy Act (1999)
Energy Auditing (déc 05-495)
The SavingEnergy NationalPlan
The saving Energy National Fund
Intergouvernement Commetee
for Saving Energy
Tariff policy
Environment Act
Environment protection
New fuels pricing structure
New tariffs on Electric power & gas
Strategic options
Conventional fuels substitution by
Widespread use of LPG Fuel
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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3. Exports of LPG
Algerian LPG development
strategy is based on :
Million tons
 The strengthening of its leadership
on the European market in general
and the Mediterranean market in
particular;
 The increase
capacity;
of
its
shipping
 Downstream integration;
 Investment in terminals & storage
capacity ;
 Arbitrage opportunities.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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4. LPG meeting energy needs in Algeria
Large specter of uses…
Product
Propane
Uses
Industrial sector ( bulk propane and
bottled propane, petrochemicals, power,
generation, fuel for agro business and
small industries ….)
Domestic sector (collective propane for
small isolated agglomeration, small tank,
bottled propane…)
Commercial
butane
Industrial sector (bulk butane, fuel for
clean industries, etc.)
Residential and commercial sector
(bottled butane)
LPG auto gas
transportation
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
…Consumption
In 2008, LPG consumption in Algeria represented
7 % of the total final energy consumption.
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4. LPG meeting energy needs in Algeria
LPG in the Algerian energy chain
LPG is produced in oil and gas
fields, located in the southern
region of Sahara.
It is transported
by a an
extended
pipelines network
to separation plants in Arzew.
LPG is also produced by oil
refineries and LNG plants.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
4. LPG in meeting energy needs in Algeria
LPG supplies
Production of LPG
in gas fields
Production of GPL in
oil fields
LPG production in Algeria (2008)
Separation units
(in oil and gas
fields)
Treatment units
(GP1Z and GP2Z)
LNG plants
Million tons
Oil refineries
Propane
Production
Butane
Production
Treatment units
GP1Z and GP2Z
4.50
4.05
8.55
Oil refineries
0.08
0.49
0.57
LNG plants
0.65
0.29
0.94
Separation units
(in oil and gas fields)
0.095
0.20
0.295
Total
5 .325
5.03
10.355
Source
Propane and
Butane
Export
Domestic market
Bulk Propane and
Bottling Propane
Bulk Butane and Bottling
Butane
22nd World LP Gas Forum, Rio de Janeiro– Brazil
LPG/F
7th – 9th October 2009
Total
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5. LPG Market in Algeria
NAFTAL : the leading LPG distributor in Algeria (1)
NAFTAL
is
an
Algerian
company for distribution of
petroleum product and LPG.
NAFTAL is 100% subsidiary
of SONATRACH GROUP.
Naftal missions
 Sales of petroleum products and LPG
 Development
of
distribution
infrastructures and complying with the
environment and safety energy policy
 Training
in
petroleum
products
distribution business
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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5. LPG Market in Algeria
NAFTAL : the leading LPG distributor in Algeria (2)
Storage
Distribution network
 49 fuels storage facilities;
 03 LPG bulk storage facilities;
 42 LPG bottling plants;
 47 bottled LPG storage outlets;
 26 aviation fuels storage facilities
 06 marine fuels storage facilities
 27 lubricants and tyres warehouses
 15 bitumen units
 1 940 service stations
Transportation
 910 km of transmission pipeline (180kmunder construction)
Organization
Staff
LPG
Division
Fuels
Division
LPG
Districts
Fuels
Districts
Marketing
Division
 3 000 vehicles (heavy duty trucks and tankers)
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
Marketing
Districts
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5. LPG Market in Algeria
Butane : Consumption
 The
Algerian
butane
consumption rose from 1 million
tons in 1990 to 1.5 million tons in
2008.
1000 tons
 During this period, the annual
average growth rate had been
2.4%. This low growth was due
mainly to rural exodus and natural
gas grid expansion.
 In 2008, butane represented
75 % of total LPG sales.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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5. LPG Market in Algeria
Propane & autogas : Consumption
1000 tons
 Propane consumption rose from 48 000
tons in 1990 to 166 000 tons in 2008
 The annual average
period had been 7.6 %
growth
 The growth in demand is
bolstered by the industrial sector.
on
this
mainly
 Sales of bottled propane stabilized
in
the
1990s.
Before
2004, sales
maintained the same growth at a rate of
0.5 % a year.
 During the last ten years, the LPG fuel
average consumption growth rose by 10 %
per year
 The share of LPG fuel in the total
consumption of fuels is small (4 % in
2008).
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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5. LPG Market in Algeria (LPG bottling plants)
Bottling plants Naftal (42)
Bottling Plants Other Operators(15)
Bottling Plants on project (30)
GP1.Z
GP2.Z
Oran
Skikda
Alger
Blida
Bouira
Tissemsilt
Mascara
Relizane
Tlemcen
SBA
Saida
Sétif
El Taref
OEB
Guelma
Constantine
Mila
S.Ahres
BBA
Médea
Batna
Tebessa
M’Sila
Tiaret
Annaba
Jijel
T.Ouzou
A.Defla
Mostaghanem
A.Timouchent
Béjaia
Boumerdes
Tipasa
Chlef
RA1.K
RA1.G
Khenchela
Biskra
Djelfa
El Oued
Laghouat
Naama
El Bayabh
Ghardaia
Ouargla
Centres emplisseurs
GPL
Tindouf
Adrar
HMD
H.
R’mel
Tamanrasset
Djan
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et
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5. LPG Market in Algeria
LPG demand
1 000 tons
Bottled
 Shrinking of demand for bottled butane .
 Expansion of LPG consumption will be carried by propane development and LPG
fuel promotion.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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6. natural gas grid expansion
 Sonelgaz, the public company for power generation and natural gas
distribution is the main competitor for LPG distributors;
Between 2004 and 2008 : the natural gas distribution network increased
by 4000 km to a total length of 27 000 km;
 2008 : natural gas grid expansion reached 30% of households. The expansion
of natural gas affected negativelly the sales of LPG; especially bottled butane.
 Sonelgaz had an ambitious program for the 2004-2009 time span of
connecting many villages and towns to its natural gas grid;
 2012 : Sonelgaz objective is to reach up to 50 % of households.
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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6. natural gas grid expansion
Sonelgaz natural gas grid : 27 000 km
• Electric facility
•
Natural gas plant
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7. market deregulation
Market deregulation objectives (2005-07 Law and 1997-435 Decree ) :
 Opening of the domestic market of petroleum products
 Promoting investments in storage and distribution of petroleum products.
 Improvements in terms of public services, safety and environment concerns.
Results of 1997-435 Decree :
 Emergence of 15 private operators in bottling and
LPG sales.
 Distribution operations improvements ;
 better services to the customer.
With some difficulties :
 Cross filling;
 Safety issues;
 Marketing unfair practices.
New legislation (2005-07 law and 08-289 & 08-290
decrees ) :
 Unbundling ;
 Open access with creation of the Storage Infrastructures
Manager ;
 Supervision by the Regulation Hydrocarbons Authority
(ARH).
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7. Impacts of the market deregulation
LPG Market after the 2005-07 law and 08-289 & 08-290 decrees
Providers
Storage Infrastructures
Manager
Distributors
Oil refineries
Storage Infrastructures
Manager (Gestionnaire
des Infrastructures de
Stockage - GIS)
LNG plants
Service-stations
Sales points
Field treatment units
(GP1Z and GP2Z)
Wholesale distribution
Bottling plants
Wholesale customers
Input prices
Wholesale prices
Post stamp rates for logistics
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
Retail prices
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8. CONCLUSION

Algerian energy policy promotes the development of exports and consumption
of LPG;

Algeria is a one of the leaders in the international market of LPG;

Naftal is LPG historical actor and currently the market leader in Algeria alongside
with new private operators ;
Naftal is shifting its development strategy of LPG from bottled butane to
promoting of autogas and bulk propane in order to make up for loss of market
(actual and coming) to natural gas.

22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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Thank you
22nd World LP Gas Forum, Rio de Janeiro– Brazil
7th – 9th October 2009
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