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Update: Saturday, 15 May 2010    

Anadarko says at impasse with Algeria’s Sonatrach

Friday Mar 02 2007.

Anadarko Petroleum Corp. said on Wednesday it has reached an impasse with Algerian state oil firm Sonatrach in a dispute over whether the companies should renegotiate their production sharing contract.

In its annual report filed with the US Securities and Exchange Commission, Anadarko said it was notified by Sonatrach in March 2006 that it would seek to renegotiate the contract to "reestablish the equilibrium," citing a newly passed Algerian law.

Under new Algerian law, Sonatrach could take at least a 51% share in every oil and gas exploration contract awarded to foreign companies.

Anadarko said it has started a formal nonbinding conciliation process in an attempt to resolve the dispute.

The company, which has 111-million barrels of proved undeveloped reserves in Algeria, said it is unable to reasonably estimate the economic impact of renegotiating the contract.

Anadarko would not provide any further details.

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