Economist's Corner

Resurgence of an Old Oil Player: Tunisia’s Strategy To Secure Energy for Economic Expansion

Abdurahman Benyezza, Vice President, Algeria, Tunisia, Morocco, and Mali Region, Eni E&P

Abdurahman Benyezza of Eni presents an overview of the oil and gas industry in Tunisia—an old oil country with a new focus on developing gas fields. His theme is to highlight how an emerging economy is trying to ensure the energy supplies needed to sustain economic growth.—Francesco Verre, Editor, Economist's Corner


Traditionally not listed among the world’s big oil producers, Tunisia for many years produced hydrocarbons at levels sufficient only for internal consumption needs. For this reason, Tunisia’s energy sector often has been overlooked, with the success of the country’s economy usually associated with agriculture, tourism, and textiles.

While typically the attention of the oil and gas press focuses on oil-producing neighbors Libya and Algeria, Tunisia, nonetheless, has managed its energy resources effectively so that it has avoided excessive energy expenses and enabled the Tunisian economy to develop and grow. Increased energy demand has opened the door for oil alternatives, such as natural gas, and that now is becoming a critical resource for Tunisia.

Tunisia reached peak oil production of 114,000 B/D in 1992, and that was sufficient to meet domestic consumption requirements. Since then, oil production has fallen to an average of 69,000 B/D in 2006. With that declining trend and the impact of increasing demand as the economy has developed, Tunisia has been a net oil importer since 2000.

Tunisia’s major production statistics are summarized below.* 

Liquids

Natural gas

*World Bank website [World Development Indicators database, April (2007) and Eni World Oil & Gas Review (2007)]

Two oilfields, the Eni-operated El Borma and Adam fields, contain most of Tunisia’s oil reserves and account for most of its production, together producing 26,000 B/D. Other foreign companies, including Pioneer, BG, OMV, and Petro-Canada, also are heavily investing in Tunisia—leveraging the good technical background of the local personnel, good logistics infrastructure, and the high degree of security.

The modest 400 million bbl in reserves will not last long, with Tunisia’s internal consumption needs and continuing economic growth, and further discoveries will be needed. All of the companies now active in Tunisia are investing heavily to find and develop new reserves, in cooperation with the state-owned oil company Enterprise Tunisienne d’Activités Pétrolières.

The government is interested in attracting further foreign investment to develop many small fields that previously were considered uneconomic. Additionally, domestic refining capacity is very limited, and growing refined-product demand internally could lead to construction of new refineries, easing the burden of product imports.

However, the major future opportunity and challenge for Tunisia is the development of its gas reserves. The country possesses 2.12 Tcf of proven reserves and until 2000 had produced cumulatively only 66 Bcf.

The main gas field in production is Miskar, on the Amilcar offshore block, which is operated by BG and contains an estimated 1 Tcf of gas.

Eni is focused strongly on gas development in Tunisia and is working on three main projects.

Fig. 1—South Tunisia gas project layout.

Overall, Tunisian field-development plans are designed to respond to national power demand that is increasing at a 7% yearly rate. Even though Tunisia does not have net oil-export income to fuel economic growth, Tunisia’s objective is to draw on the joint commitment of private oil companies and the government to make the most out of the existing assets and to focus on the exploitation of gas reserves. The government’s policy on energy exploitation and the use of the latest reservoir-management techniques are enabling Tunisia to sustain a strong level of economic growth.


Abdurahman Benyezza is Vice President, Algeria, Tunisia, Morocco, and Mali Region, Eni E&P. Before assuming his present position, he was Executive Officer, Operations and Production, Eni Oil. Previously, Abdurahman served with the Libyan National Oil Corporation as General Manager, Joint Ventures, and before that as Manager, Production and Reservoir Engineering. An active member of SPE, he was responsible for re-establishing the SPE Libyan Section and served as Chairperson for two years.