Algeria: Top 5 Energy Cooperation Agreements in 2024

Algeria Energy Sector Investments

Emerging as Africa’s third-largest economy, Algeria’s GDP is projected to reach US$266 billion by the end of the year. With abundant energy and mineral resources, the country is poised to capitalize on its potential through key partnerships in oil and gas production, renewable energy, electricity distribution and high-tech manufacturing. These agreements not only strengthen Algeria’s position in the global energy market, but also align with its ambitions to drive sustainable development, diversify its economy and enhance regional cooperation.

Algeria-Niger Oil Cooperation Deal

Algeria’s national oil company (NOC), Sonatrach, signed a Memorandum of Understanding (MoU) with Niger’s NOC, SONIDEP, to strengthen cooperation in hydrocarbon exploration, production and refining. The agreement facilitates collaboration in petrochemical development and petroleum product distribution, while enabling joint exchange programs between the two nations. The October signing followed discussions between Sonatrach CEO Rachid Hachichi and Niger’s Minister of Petroleum, Sahabi Oumarou, on enhancing oil and gas ties. These talks also revisited the Kafra oil field in northern Niger and progress on the Trans-Saharan Gas Pipeline, a transformative project linking Nigeria to Algeria via Niger.

Energy Interconnection Agreement with Europe

In August, Sonatrach and Sonelgaz partnered with energy major Eni on a feasibility study for an electrical interconnection project between Algeria and Europe. The proposed project envisions a submarine cable connecting Algeria to Italy, facilitating electricity exports to European markets. As part of Algeria’s efforts to transition to renewable energy, the project will also focus on the production, transmission and marketing of carbon-free electricity. The study includes market assessments and a detailed implementation timeline.

Local Partnerships to Boost Energy Production

Sonelgaz signed an MoU with Elec-El Djazïr, a state-owned manufacturing group, to enhance local production of electrical equipment for Algeria’s industrial zones. The agreement aims to expand the national grid, improve public services and bolster the agricultural sector by electrifying remote areas. Signed in September, this collaboration supports Algeria’s economic independence by reducing reliance on imports, lowering costs and generating sustainable employment opportunities across the country.

Sonatrach, Petrojet Joint Venture Agreement

Building on a 2022 framework agreement between Algeria and Egypt’s energy ministries, Sonatrach and Egypt’s Petrojet signed an MoU to explore the creation of a joint venture (JV). The JV will focus on designing and manufacturing static pressure equipment for the oil industry and providing related services. This initiative aligns with Sonatrach’s strategy to foster high-value partnerships that advance local manufacturing of high-tech oil equipment.

Algeria-Libya Energy Cooperation Agreement

In July, Sonatrach subsidiary ENTP and Libya’s National Oil Wells Drilling & Workover Company signed an MoU to enhance drilling and workover cooperation. ENTP will provide rigs, maintenance and training, while both parties will explore joint projects in drilling, geophysics and well intervention. This agreement expands on previous collaborations between the two nations, which include oil and gas exploration, renewable energy projects and knowledge transfer programs.