Toufik Hakkar takes over as new CEO of Algeria's Sonatrach

Algiers — Algerian President Abdelmadjid Tebboune has appointed Toufik Hakkar as the new CEO of state-owned Sonatrach, according to an official statement released late Wednesday.

Oil production in Algeria -- along with gas, the mainstay of its economy -- has fallen over the past few years, averaging just 1.03 million b/d from January to November this year, its lowest average since 2002, according to S&P Global Platts data.

Algeria's pipeline gas exports to Spain and Italy fell by more than 11 Bcm year on year in 2019 to just 21.1 Bcm, according to S&P Global Platts Analytics data, only partly offset by higher LNG exports, which rose by almost 2 Bcm to 16.4 Bcm of gas equivalent.

Hakkar is credited with being the brains behind the country's new hydrocarbon law, which has been designed to reverse the declining foreign upstream investment through improved contract terms and tax rates.

The new law is considered essential for restoring the attractiveness of the sector against the background of low oil and gas prices, and increased competition among producing countries to attract new investors.

Under the new legislation, the tax burden on state-owned Sonatrach and its international partners will be cut from 85% to around 60%-65%.

This is the second leadership change at the state-owned oil firm in three months, with Hakkar replacing Kamel Eddine Chikhi, who was only appointed as CEO in November.

Hakkar was previously vice president of business development and marketing for Sonatrach, as well as being the head of the group responsible for reviewing the hydrocarbon law.