The Algerian national hydrocarbon company, Sonatrachhas just announced a new milestone in its commercial development strategy in Europe.
In fact, the company delivered its first cargoes of natural gas to the Czech Republicthus marking the arrival of Algerian gas in a fifth country of Central and Eastern Europe in the space of two years.
This agreement, concluded with the Czech energy company ČEZ, was formalized on October 1. Algerian gas passes through the gas pipeline connecting Algeria to Italy (TransMed / Enrico Mattei).
According to Sonatrach, this contract is the result of two years of successful negotiations and constitutes a strategic step to strengthen its presence on the Czech gas market.
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The Czech Republic thus joins the Slovenia, Germanythe Croatia and the Hungary among Sonatrach’s new clients in this region. It should be noted that the Algerian company had already resumed its gas deliveries to Slovenia in January 2023, after an interruption since 2012.
Sonatrach expands its gas network in Central and Eastern Europe
This commercial dynamic is part of a geographic diversification strategy initiated by Sonatrach several years ago. According to Baghdad Mendouchenergy expert, this approach, which targets distant markets such as Chinethe South Korea and now central and eastern Europeis both ambitious and relevant. It allows Sonatrach to secure its outlets and reduce its dependence on certain customers.
“This strategy is positive and important at the same time. It is based on client diversification and avoids remaining locked in with specific clients,” explains Mr. Mendouch.
He points out that Algeria’s traditional customers are often courted by competitors, notably American liquefied natural gas. However, in terms of price, Algerian gas remains competitive.
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Thanks to this diversification, Sonatrach was able to negotiate contracts at advantageous conditionsparticularly in Central and Eastern Europe where new customers had less room for maneuver. “Algeria, through Sonatrach, imposed its conditions on gas prices,” says the expert.
Sonatrach favors long-term contracts, even if prices can be slightly higher than those on the spot market. This approach allows secure supplies over the long term and to make the significant investments necessary for exploration and production profitable.
In conclusion, this new stage in the commercial development of Sonatrach demonstrates the competitiveness of Algerian gas on the world market.
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By diversifying its customers and securing its supplies, the Algerian national company is strengthening its position as a major player on the international energy scene.
