Algiers – Algeria significantly strengthened its energy sector in 2025, marked by record investments and strategic projects aimed at bolstering oil and gas reserves, developing renewable energy initiatives, and solidifying its position in the global gas and hydrogen markets.
The year witnessed a surge in activity focused on enhancing production capacity and securing crucial partnerships. A key highlight was the signing of numerous cooperation agreements designed to elevate gas production to over 200 billion cubic meters annually, with a substantial portion earmarked for export. These agreements included the awarding of licenses from the ‘Algeria Bid Round 2024’ for five out of six sites, with contracts spanning 30 years, including seven years dedicated to exploration. These licenses are expected to attract investments totaling $936 million.
Eight international companies successfully secured these licenses, targeting the exploitation of approximately 700 billion cubic meters of gas and 562 million barrels of crude oil. Furthermore, Sonatrach, Algeria’s national oil company, and Italy’s Eni inked a 30-year production sharing agreement for the Zemoul El Kbar area, with total investments reaching $1.35 billion and anticipated production of 415 million barrels of oil equivalent.
Algeria also expanded its offshore exploration efforts, highlighted by an agreement between the National Agency for the Valorization of Hydrocarbon Resources (ALNAFT) and US-based Chevron to assess offshore oil potential, paving the way for international tenders in 2026. Additionally, Algeria secured its largest energy deal to date with Saudi Arabia, through a contract with Medad Energy North Africa for production sharing in the ‘Illizi South’ basin. This agreement is valued at $5.4 billion and spans 40 years, with projected production of 993 million barrels of oil equivalent and 125 billion cubic meters of gas.
In regional cooperation, Egyptian company Petrojet, in partnership with Italy’s Arkad, won a contract to develop the second phase of the Hassi Bir Rekaiz field in the Berkine Basin. These collaborations underscore Algeria’s commitment to regional energy development.
Algeria continued its push in renewable energy, laying the foundation for a new solar power plant in El Abadla. This project is part of the nation’s broader strategy to diversify its energy mix and promote sustainable energy sources. The investments and strategic projects undertaken in 2025 position Algeria as a key player in the global energy landscape.
