Berlin Identifies Algeria as Key Green Hydrogen Partner

Germany has identified Algeria as a crucial partner in the energy sector, aiming for positive outcomes in their cooperation, particularly in green hydrogen development. The Algerian market is considered among the most attractive investment destinations in the Mediterranean region for European companies committed to energy transition. A recent report by the German agency GIZ on green hydrogen investment in Algeria further describes the market as one of the most promising in the Mediterranean.

Algeria's appeal stems from its significant potential in this field, complemented by natural assets, modern basic infrastructure, and considerable efforts to establish a favorable legal framework for foreign investment. As a major producer of oil and gas with substantial chemical production, Algeria is also a primary raw material supplier to Germany. Furthermore, Algeria offers a critical advantage in transport costs, with the SoutH2 corridor underscoring proximity as a key factor in future energy markets.

German companies are actively exploring the possibility of establishing electrolyzer production facilities in Algeria, with some, like the VNG group, also showing interest in producing green hydrogen for the Algerian market itself. This engagement supports Algeria's strategy to produce 40 terawatt-hours of green hydrogen annually by 2040, with short-term objectives including several pilot electrolyzer stations (2-4 MW) and a 50 MW reference station by 2030, backed by KfW. Ongoing projects include the potential for up to 15,000 tons of ammonia production annually using green hydrogen at the Arzew industrial complex and a pilot station for sustainable aviation fuel (e-SAF) at Algiers Airport, stemming from a German government-funded VNG project initiated in 2024.