Algeria's state-owned oil company Sonatrach has taken significant steps to strengthen its position in the global energy market by signing two memorandums of understanding with the American Occidental Petroleum Corporation. This landmark agreement was finalized during the Algerian-American Energy Forum 2025, held recently, and is poised to expand cooperation in the exploration and production of hydrocarbons.
The first memorandum focuses on developing carbon capabilities, while the second aims to apply enhanced extraction technologies to boost oil production. These initiatives reflect Sonatrach's commitment to exploring new investment opportunities in the energy sector, particularly in hydrocarbons, renewable energies, and carbon capture technologies.
Rachid Hachichi, the Director General of Sonatrach, emphasized the company's ongoing dedication to fostering partnerships that can lead to innovative solutions in energy production. "We are committed to exploring new investment horizons, especially in areas related to hydrocarbons and renewable energies," Hachichi stated. This sentiment aligns with Algeria's broader strategy to attract significant investments in its hydrocarbon sector, which has seen renewed interest from international players.
Since 2022, Sonatrach and Occidental have been collaborating under a joint contract that also includes two other companies to exploit the Berkine Al-Taqadi region, a crucial area for hydrocarbon extraction. This collaboration has set the stage for further advancements in Algeria's energy landscape, as the country seeks to enhance its production capabilities.
Algeria's efforts to establish itself as a key player in the global energy market are underscored by its recent launch of an international call for bids, which is part of a five-year plan aimed at attracting new investments in the national hydrocarbon sector. This initiative has already captured the attention of 36 international companies, indicating a strong interest in Algeria's oil and gas resources.
During the energy forum, President Abdelmadjid Tebboune met with directors from Occidental, Eni, and TotalEnergies, highlighting the government's commitment to fostering a robust energy sector. The meetings emphasized the importance of collaboration between Algeria and international companies in driving growth and innovation in the hydrocarbon industry.
In February 2025, Sonatrach engaged in negotiations with several global companies regarding seven contracts related to the development and exploration of hydrocarbon fields in Algeria. Notable companies involved in these discussions include the Chinese Sinopec, Italian Eni, French Total, and American giants Chevron and ExxonMobil, alongside a Swedish firm. These negotiations reflect a concerted effort by Sonatrach to diversify its partnerships and enhance its operational capabilities.
Moreover, Sonatrach recently signed a contract with Sinopec valued at $850 million to develop and explore oil and gas resources in Algeria. This deal is indicative of the growing interest from foreign investors eager to tap into Algeria's rich hydrocarbon reserves.
Occidental Petroleum, known for its expertise in discovering, developing, and marketing crude oil and natural gas, has expressed its commitment to working closely with Sonatrach. The company's involvement in Algeria is expected to bring advanced technologies and operational efficiencies that can significantly enhance production levels.
As Algeria continues to refine its legal framework to attract major investments, the government is optimistic about the future of its energy sector. The new regulations are designed to create a more favorable environment for foreign investors, which is crucial for the country's economic growth.
In summary, the recent agreements between Sonatrach and Occidental mark a pivotal moment for Algeria's energy landscape. With a clear focus on enhancing production capabilities and attracting foreign investment, Algeria is well-positioned to solidify its status in the global energy market. The collaboration with Occidental is just one of many steps the country is taking to ensure a sustainable and prosperous energy future.
