Algeria has advanced its energy partnership with U.S. firm Occidental Petroleum.
Alnaft, the National Agency for Hydrocarbon Resources Valorization, announced that it signed two study agreements to evaluate the oil and gas potential in El Ouabed and Dahar in southern Algeria.
The agreements will assess these regions’ resources and set the stage for possible future projects.
“By signing these two study agreements, Alnaft and Occidental Petroleum demonstrate their commitment to jointly advancing the assessment and development of Algeria’s hydrocarbon resources,” Alnaft said in a statement reported by local media.
Algeria aims to remain a dependable hydrocarbon supplier while maximizing the value of its reserves.
The International Energy Agency (IEA) forecasts that global oil supply will surpass demand in 2025, despite ongoing Middle East tensions.
In a separate report, the IEA reduced its world oil demand growth forecast to 730,000 bpd in 2025, citing trade disputes and weaker consumption in China and the United States.
Between 2019 and 2023, Algeria exported hydrocarbons for roughly 83% of its total exports and generated nearly 47% of its budget revenue from the sector, according to World Bank data.
The country expects a budget deficit of 14.5% of GDP in 2025, up from 13.9% in 2024, mainly due to lower oil revenues.
Given this structural dependence, each new potential field carries significant importance for Algeria’s financial stability.
The agreements currently do not permit direct extraction.
They cover an initial stage of technical and geological studies to determine resource availability and development feasibility before making major investments.
Occidental strengthens its presence in Algeria’s energy sector through these agreements, while Algerian authorities aim to expand international partnerships to attract capital and technology.
Future steps will depend on the study results.
If studies confirm significant potential, the projects could attract foreign investment, boost Algeria’s oil services industry, and increase budget revenues.
These initiatives align with the $50 billion investment plan announced in December 2024, which allocates 71% of funds to exploration and production.
source: www.ecofinagency.com
African Energy Council