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Africa First: AEC Working Visit to Algeria Sees New Alliances Between North African and Private Sector Players

An AEC working visit to Algeria this week drew attention to the efforts being undertaken by the country to expand its presence and contribution to the African energy sector, with the Ministry of Energy and Mines strengthening its collaboration with the AEC and private sector to advance this very objective.

An AEC working visit to Algeria this week drew attention to the efforts being undertaken by the country to expand its presence and contribution to the African energy sector, with the Ministry of Energy and Mines strengthening its collaboration with the AEC and private sector to advance this very objective. 

Algeria continues to make great strides towards advancing its contribution towards the development of key oil and gas markets in Africa. During the African Energy Chamber’s (AEC) most recent working visit to the country – taking place this week and led by AEC Executive Chairman NJ Ayuk – Algeria’s Ministry of Energy and Mines provided insight into how the country is playing a much larger role in Africa’s energy sector, with H.E. Minister Mohamed Arkab emphasizing the ways in which the country is leveraging its experience as an oil and gas producer, strong slate of private players and service companies, and world-class energy training facilities to usher in a new era of prosperity across the continent.

As one of the biggest oil producers in Africa, the fifth-largest global exporter of liquefied natural gas (LNG) and a rapidly growing renewable energy player, Algeria is committed to using its experience and expertise to support the development of burgeoning energy markets across the continent. The AEC’s recent market report, The State of African Energy Q1 2023 Outlook, provides a snapshot of the Algerian market. According to the report, African gas output is largely driven by North African countries such as Algeria, with the country representing one of six set to drive African LNG capacity in the long-term. Algeria is expected to maintain its LNG infrastructure capacity of 29 million tons per annum and is also expected to remain one of Africa’s top five producers of liquids this year, contributing to over 80% of Africa’s 2023 liquid output alongside Nigeria, Libya and Egypt. The country currently produces approximately 970,000 barrels of oil and 9.9 billion cubic feet of gas per day, with proven reserves measured at 12 billion barrels and 159 trillion cubic feet, respectively, making it both an attractive and highly strategic hydrocarbon market.

Going forward, the country is looking using this expertise to amplify its influence in Africa, underpinned by Algerian President Abdelmadjid Tebboune’s vision that states that Africa is a priority for the country. The AEC’s working visit to Algeria this week saw the organization collaborate with the Ministry of Energy and Mines to advance this goal, laying the foundation for Algerian energy firms and service companies to invest in and collaborate with other African countries. With priority placed on advancing the participation of private players – both domestically and continentally – the collaboration will see Algeria leverage the AEC’s continental network to support development, increase investment and open up new markets across Africa. The AEC will create a platform whereby Algerian firms and providers can enter other African markets, providing high-level oil and gas services and opening new doors in growing industries.

For its part, Algeria is already providing high-level support for emerging markets. The country currently has various technical support programs in place with countries such as Uganda, Tanzania, Kenya, Zimbabwe and more, with Algeria providing workforce training, investment and fiscal support, as well as service provisions across the upstream, midstream and downstream oil and gas industries. This support will be key for burgeoning markets, and with new hydrocarbon discoveries being made in frontier markets such as Namibia and South Africa, Algeria is looking at further strengthening collaboration and investment across Africa, providing a range of support mechanisms. Notwithstanding technical cooperation, Algeria is home to the Gas Exporting Countries Forum’s Gas Research Institute among other world-class facilities, and thus serves as the destination of choice where energy personnel can be trained. The country is committed to improving local content in Africa, and collaboration with the AEC and private sector will support the training and development of human capital in emerging markets by opening up programs whereby African individuals and companies can be trained at world-class hydrocarbon institutions in Algeria. 

Domestically, Algeria continues to offer a suite of lucrative investment opportunities. The country has made great strides towards reforming its fiscal and legal frameworks as part of efforts to simplify procedures, incentivize investment, and unlock new private capital and participation. With H.E. Minister Arkab set to deliver a keynote speech during the AEC’s annual event, African Energy Week (AEW) – scheduled for October 16-20 in Cape Town – the Ministry will showcase new Algerian production licenses and opportunities. AEW 2023 will see a large delegation of Algerian stakeholders participating, including National Oil Company Sonatrach and various service companies and investors, all of which are looking at signing deals and forging partnerships.

What’s more, during AEW 2023, the Minister will provide insight into the country’s new licensing round. Spearheaded by the National Agency for the Valorization of Hydrocarbon Resources (ALNAFT), the round will open Algeria up for new investment, triggering a new wave of exploration and production activity in the North African country. In addition to their meeting with the Ministry, the AEC conducted bilateral meetings with ALNAFT, whereby the parties’ discussed potential collaborations regarding the promotion of licenses and the advancement of Algerian players in African energy. As Algeria looks to exert its influence in Africa, both the AEC collaboration and AEW 2023 will serve to advance this agenda, driving investment and development in emerging markets on the back of Algerian expertise and cooperation.

In addition to oil and gas, Algeria has one of the highest rates of access to electricity on the continent, with 99.8% of the population connected. The country produces approximately 76.69 billion kWh of power a year, and with consumption measured at 66.65 billion kWh per year, the country exports surplus power to the region. On this front, Algeria is committed to advancing regional connectivity, and is pushing for the development of an African Power Pool. While the country already offers surplus power to regional markets, new developments across the continent have resulted in opportunities for advanced power trade, and Algeria will be working towards developing the relevant infrastructure to support intra-African trade and collaboration on this front. Algerian-led projects in this area are already underway with the country providing technical assistance to countries such as Uganda, Kenya, and Zimbabwe, among others.

“We held great meetings with the Minister of Energy and Mines, Sonatrach, ALNAFT and many private sector players this week in Algeria. The country is moving fast. Representing one of the continent’s heavyweights, Algeria’s new focus on collaborating, investing and partnering with other African countries will open up a new era of energy growth and prosperity. The AEC will support Algeria in its drive to develop the continent, and during AEW 2023, we look forward to the insights and opportunities that will be shared by the Algerian delegation,” stated NJ Ayuk, Executive Chairman of the AEC. 

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