Pertamina secures 35-year contract in Algeria and plans LPG plant establishment

Indonesian state-owned oil and gas company Pertamina has successfully obtained a contract extension for the concession management of the Menzel Ledjmet Nord (MLN) block in Algeria. 

The Menzel Ledjmet Nord (MLN) Oil Field, located in the Sahara Desert, Algeria, has been fully operated by PT Pertamina (Persero) since May 2014 through its upstream subsidiary. 

The block has an oil production capacity of 35,000 barrels of oil per day (BOPD) and already features 58 solar panels, producing 1,141 kilowatt-hours (kWh) per year, resulting in a reduction of approximately 7,507 tons of CO2 emissions annually.

Contract extension

The contract was signed in Algiers on June 15, 2023, by the Algerian government, entrusting Pertamina with the management of the oil block for the next 35 years.

Nicke Widyawati, the CEO of PT Pertamina (Persero), stated that the MLN block in Algeria is one of the company’s key contributors to foreign oil production. She emphasized that this contract extension demonstrates the Algerian government’s trust in Pertamina’s capabilities. 

“Acquiring oil blocks abroad with the concept of bringing the barrel home is a strategic move for Pertamina to maintain national energy resilience,” Widyawati said on Sunday, June 18, 2023.

LPG factory establishment

Furthermore, in this new contract, Pertamina has been granted permission to build an LPG plant with a production capacity of 1 million metric tons per year. The LPG produced by the plant will be transported to Indonesia. 

“With this new breakthrough, we hope to reduce LPG imports and strengthen Indonesia’s trade balance,” she said. 

Simultaneously, the Algerian oil block also holds potential for renewable energy development, particularly in solar photovoltaic (PV) energy. This renewable energy source will be utilized to supply green electricity for the oil block’s operations.

“By embracing this new breakthrough, we aim to reduce LPG imports and strengthen Indonesia’s trade balance,” Widyawati stated. 

Potential solar power energy

At the same time, the Algerian oil block possesses potential for the development of renewable energy, especially solar PV, which will be harnessed to generate green electricity for the block’s operations.

“This demonstrates Pertamina’s strong commitment to reducing carbon emissions across all of its activities in line with ESG implementation,” stated Nicke.