By: AGBI

Algeria has approved a five-year plan to develop its hydrocarbon industry following declines in reserves and production due to lack of investment.

The plan aims to “boost Algeria’s security energy and develop the value of its natural resources”, the ministry of energy and mines said last week.

State-owned Sonatrach, one of the world’s largest oil and gas companies, endorsed the 2026-2030 development plan at a general assembly meeting headed by Algeria’s energy and mines minister Mohammed Arkab, the ministry said on its website.

“The plan has a dual objective including strengthening the core activities of the oil and gas industry – exploration and production – to ensure a sustainable supply, alongside the intensive development of downstream industries, particularly in the refining and petrochemical sectors,” the statement said.

“This approach is not merely technical as it is also profoundly economic and social, aiming to fully meet domestic market needs, reduce the import bill and bolster export capabilities to enhance Algeria’s position on the global energy map,” it added.

Arkab unveiled plans in October to invest nearly $60 billion in hydrocarbon projects over the next five years and that nearly 80 percent of the funds would be for boosting oil production and reserves.

He said the Algerian government has set a clear vision for developing the hydrocarbons sector, based on intensive investment in upstream, refining and petrochemical projects.

He noted that the projects aim to increase Algeria’s oil production and storage capacity and to make more discoveries, stressing that recent reforms in the hydrocarbon sector have made the legislative framework more attractive and stimulating for investment, particularly in offshore exploration and production.

Algeria has launched a large-scale drive to develop its oilfields to reverse a decline in reserves and production over the past few years.

In July, Algeria formally finalised five oil development projects with several foreign companies awarded contracts within the 2024 licensing round.

Algeria has one of the world’s largest gas deposits, officially estimated at 160 trillion cubic feet. It also controls nearly 13 billion barrels of recoverable oil reserves, which could run out within 30 years at present production levels in the absence of new major discoveries, according to the Kuwaiti-based Arab Energy Organization.