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Petrofac Halting Tunisia Gas Output Again due to Protests

Source: Reuters 12/14/2016, Location: Africa

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Oil and gas industry contractor Petrofac is halting gas production in Tunisia after two weeks of renewed protests on the southern Kerkennah islands, officials said.

The announcement comes just three months after Petrofac restarted operations at Kerkennah's Chergui gas field, following nine months of disruptions due to protests.

Petrofac had threatened in September to shut down operations entirely and leave Tunisia, but the government reached a deal with protesters demanding jobs and development.

Tunisian Energy Minister Hela Cheikh Rouhou said the production stoppage had been expected because protesters "had not respected the deal signed in September".

"Unfortunately, trucks have been blocked several times to force Petrofac to close the field," she told Mosaique FM radio.

A senior Petrofac official confirmed that production was being stopped after stocks had run out during two weeks' of protests.

He declined to comment on local media reports that the company had once again told Tunisian authorities it would leave the country.

Petrofac's operations supply around 13 percent of Tunisia's domestic gas needs. It holds a 45 percent share at Chergui, with the rest held by a state-run company.

Any closure of operations would be a blow to Tunisia just as the government pushes to revive foreign investment, rein in the deficit, and spur growth through economic reform. Investment, growth and employment have been hit by labour unrest and militant attacks since Tunisia's 2011 uprising.

Government officials say importing gas from Algeria to make up for the shortfall caused by disruption to Petrofac's production during the first nine months of 2016 had cost the government about $100 million.

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