Tunisian oil output rebounded to 40,300 b/d in September and 41,200 b/d in October after blockades protesting unemployment in the country’s south saw it collapse to a mere 23,500 b/d in August – the lowest level since the country’s first year of oil production in 1966 (see charts).

Protests began in May. By June almost all concessions in southern Kebili and Tataouine provinces, collectively accounting for around half Tunisia’s oil output, had been shut in (MEES, 2 June).

But though the 26 August deal to end the protests brought an immediate boost to output, the fundamental problems remain.

Output has been in long-term decline, the result of a collapse in exploration. The country had over 50 active exploration permits at the start of the decade. The number fell after instability rose following the revolution at the start of 2011, which also saw key officials ousted and others decline to take any decisions on permits and the like for fear of being branded corrupt (MEES, 31 October 2014). But, in an echo of the situation facing smaller firms in Egypt (MEES, 1 December), the bigger fall came with the collapse in oil prices in the second half of 2014.

Many of the minnows in Tunisia, for whom their operations in the country were a key or the only asset, have either quit the country or gone bankrupt. The number of active permits fell to 31 at end-2015 and a mere 21 as of end-October. Ireland’s Circle went bust at the start of 2017 (whilst Canada-listed SDX bought Circle’s Egypt and Morocco acreage from the receivers, it turned up its nose at Circle’s three Tunisia blocks). Syria-focused Gulfsands walked away from its Chorbane permit earlier this year, as did Australia’s Cooper Energy from its three permits last year after failing to find a buyer.


Larger firms are also quitting. Numbers one and three producers Eni and Shell have both been strongly rumored to be selling up in recent years, whilst number two producer OMV in August agreed to sell its 50% operator’s stake in the offshore Ashtart field to French firm Perenco in a deal backdated to 1 January 2016. Of OMV’s 11,400 b/d gross Tunisian oil output for 2016, some 6,200 b/d came from Ashtart.

US shale experts Anadarko in 2013 flagged up southern Tunisia as central to their plans to leverage shale expertise abroad (MEES, 8 March 2013). However in July the firm relinquished its sole Tunisian permit, Borj El Khadra Sud at the country’s southern tip. “In 2016, the Company recognized a… $92mn [impairment on] unproved international properties primarily in Brazil and Tunisia due to the Company’s current intentions to not pursue future exploration activities,” Anadarko says in its latest annual report.

A mere two exploration wells have been spudded in 2017, both by Eni on its MLD (Makhrouga, Laarich, Debbech) permit in the south of the country. ‘Laarich Est-2,’ an appraisal well on a 2016 discovery, tested at 460 b/d, whilst drilling on the ‘Makhrougha SE-1’ well is ongoing. The largest discovery announced this year was on the same Eni permit: ‘KRD SW-1’, drilled in late 2016, tested at 1,300 b/d of oil and 2.9mn cfd of gas.


Work at the country’s only sizeable ongoing project to bring on new output, OMV’s $1.1bn, 85mn cfd, Nawara project in the country’s deep south has also been seriously impacted by recent instability. “At Nawara, work was halted between 23 April and the end of August. This has pushed back start up by six months and engendered additional costs estimated at TD150mn [$61mn],” state oil firm ETAP says.

Projected Nawara output of 85mn cfd is equivalent to 40% of Tunisia’s 216mn cfd 2016 gas production. Though gas output has been affected much less than that of oil by the protests (after all little gas from the south of the country is currently captured – Nawara is the key project intended to rectify this), it is still down 5% year-on-year at 201mn cfd for January-October 2017. Output was 310mn cfd as recently as 2010.

Nawara, on which FID was taken in March 2014, was already much delayed. OMV officially says it is aiming for 2018 start-up, though back in February, ie before the latest protests, CEO Rainer Seele was already saying that “for Nawara... we have to look at the end of 2018 and not the beginning of 2018” (MEES, 17 February). OMV’s November corporate presentation says of Nawara “impacted by social and political unrest in Tataouine... Working on solutions to minimize impact on delivery of first gas, evaluation ongoing.”

This year’s instability has not surprisingly blown a hole in Tunisia’s already stretched finances. The country spent $1.62bn on oil imports in January-October 2017 (84% of this on products, with $536mn on gasoline alone), up by 30% on $1.24bn for January-October 2016.

Charts included Tunisia’s Exploration Collapse


Charts included Tunisia Oil Output Rebounds To 41,000 B/D In
October After Plumbing 40-Year Lows With Mid-2017shut-Ins ('000 B/D)

Charts included Despite Recent Gains, 2017 Output Will Be The Lowest Since 1966, Tunisia’s Virgin Year Of Production

*JAN-OCT 2017.