Tunisia reaches deal with Petrofac protesters, seeks company talks

TUNIS, Sept 23 (Reuters) - Tunisia has reached a deal with protesters who have disrupted gas production by Petrofac (Amsterdam: PF6.AS - news) for months, the government said on Friday, part of an effort to stop the British energy firm closing its business.

Petrofac, which supplies 13 percent of Tunisia's gas through the Chergui venture in the south, officially informed the government this week that it had started shutting down its local gas operations.

Since January, Petrofac has been forced to interrupt gas production because of sit-ins by people seeking jobs. Violent protests erupted and the army intervened to protect the company in Kerkennah Island in southern Tunisia.

"A ministerial delegation has reached a deal with the protesters to end the sit-in," Social Affairs Minister Mohamed Trabelsi said. "The agreement is done and everyone has signed."

The accord, which involves helping 266 young unemployed and creating a local development fund, may be a step to resolving the crisis with Petrofac, which officials say had been demanding guarantees its production would not be disrupted.

A local Petrofac representative declined to comment about the agreement, but a government official told Reuters the authorities had started talks with the company. A spokesman for Petrofac in London had no immediate comment.

Losing Petrofac would be a major financial and political blow for Prime Minister Youssef Chahed, who took office last month promising to spur growth and create jobs that Tunisians are demanding.

Government officials say importing gas from Algeria to make up for the shortfall caused by output disruptions has cost the government about $100 million in the first nine months of 2016.

Since its 2011 uprising against autocrat Zine El-Abidine Ben Ali, Tunisia has been praised by the West for its progress to democracy with free elections and a new constitution. But economic progress has not followed, and many young Tunisians are frustrated about the lack of jobs. (Reporting by Tarek Amara; Additional reporting by Costas Pitas; Writing by Patrick Markey; Editing by Mark Potter)