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Algerian energy conference weathers criticism, volcanic eruptions

Energy scandals and volcanic eruptions disrupted Algeria's major energy conference, but ministers managed to endorse a plan to raise natural gas prices on the international market.
A group of international energy officials, gathered in Oran for the 16th International Conference and Exhibition on Liquified Natural Gas (LNG 16), agreed Tuesday (April 21st) to index the price of gas to that of petrol.

The LNG 16 decision follows an agreement reached Monday at the separate Gas Exporting Countries Forum (GECF) in Oran. GECF member nations Bolivia, Egypt, Equatorial Guinea, Iran, Libya, Nigeria, Qatar, Russia, Trinidad and Tobago, Venezuela and Algeria approved a long-term plan to achieve petrol and gas price parity, Algerian Energy Minister Chakib Khelil said. Each country may still determine its own indexing approach.

Energy ministers also decided to form a working team of experts in the field to develop hands-on mechanisms to increase natural gas prices in global markets over the next five years.

Some voiced scepticism over the meeting's success.

"The LNG 16 is just a waste of money and will hardly do the poor any good," Algerian National Front chief Moussa Touati said. "The cost of preparing for the event, to the excess of 5,000 billion centimes, is a manifestation of squandering public funds."

New facilities built to host the LNG 16 initially cost 400 million euros, according to the Al-Khabar daily, but that price rose to 500 million given construction costs for the 3,000-seat conference centre and its annexes, roads and tunnels. Total costs for the event, also including the construction of the 300-bed hotel Le Meridien, totalled 800 million euros, Taheya Al-Djaza'er reported.

"It is just another episode of a series of squandering public funds, akin to the scandals of Al-Khalifa, Al-Tarik, Al-Sayyar and finally Sonatrach ," Touati said.

Touati's comments followed media reports that Algerian President Abdelaziz Bouteflika skipped the event's inauguration ceremony in response to the recent scandals that have rocked national energy giant Sonatrach .

"Indeed, the president is very embarrassed because the conditions and context prompt him to step back," an "informed source" told Le soir d'Algerie.

Authorities are investigating Sonatrach officials - including Mohamed Meziane, company CEO and a relative of energy minister Khelil, and two of Meziane's sons - on charges that company employees approved several high-stakes financial deals without due research.

"Conditions inside the company are not alright, because of everything that is being circulated in the media regarding this case," one company official told Magharebia on condition of anonymity. "Officials with integrity at the company refuse to tar their reputations because of the misbehaviour of a few managers who did not respect the rules of the responsibilities assigned to them."

Leaders of major natural gas companies also skipped the conference, or sent representatives in place of their CEOs. No top executives from multi-national oil companies operating in Algeria attended, either.

Most officials were unable to attend because of the closed airspace in Europe resulting from the ash cloud expelled by the recent volcanic eruption in Iceland, according to event organisers. The disaster disrupted flights to the LNG 16 and postponed opening ceremonies by one day.

By Walid Ramzi for Magharebia in Algiers

© Magharebia.com 2010