Hakkar to take over the reins of Sonatrach

Hakkar to take over the reins of Sonatrach

/ News & Interviews / Monday, 10 February 2020 12:00

According to state television, Algerian President Abdelmadjid Tebboune has appointed Toufik Hakkar as new head of state energy firm Sonatrach, to replace 3-month president Kamel Eddine Chikhi.

Algeria, a major gas supplier to Europe, relies on hydrocarbons sales for 60% of its budget revenue but they have slumped since the oil price fell in 2014, leading to a big decline in foreign currency reserves.

Latest figures show oil and gas earnings reached $30.25 billion in the first 11 months of 2019, a 15% fall from the same period a year earlier as domestic demand and lower output reduced export volumes. The North African country has responded by trying to boost production capacity, and is seeking investment from international oil companies to help it to do so.

In December, it passed a new law to encourage such investments while still barring foreign companies from owning a majority share in Algerian energy projects.

Falling energy revenues are hitting the state budget, for which a 9% cut in public spending was approved for this year, while leaving politically sensitive subsidies unchanged. Any major cuts in government programs would be particularly difficult given the major political crisis that has rocked Algeria for the past year, with a mass protest movement that helped oust the veteran president in April.

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