Algeria

Algeria's Oil and Gas in Brief

Algeria is the bedrock of energy security for the western Mediterranean. It is Africa's largest natural gas producer and its second-largest producer of total liquid fuels, based on the U.S. Energy Information Administration's (EIA) estimated 2024 production levels, and it has been a member of OPEC since 1969. Its crude oil averaged about 907,000 barrels per day (b/d) in 2024, while dry natural gas production reached a record 3.7 trillion cubic feet (Tcf) in 2023, according to the EIA's Country Analysis Brief: Algeria of June 5, 2025 (checked November 8, 2026).

The country's importance is not its oil, which is modest next to the Gulf producers, but its gas and its pipes. Algeria supplied 39.2 billion cubic metres (bcm) of gas to the European Union in 2024, about 14.4% of EU gas imports, according to European Commission data reported by Platts, and it is the EU's second-largest pipeline gas supplier after Norway, at about 19% of EU pipeline imports in 2024. When Europe moved away from Russian gas after 2022, Algeria's Sahara-to-Sicily and Sahara-to-Spain pipelines became some of the most strategically watched infrastructure in the energy world. Readers can follow the price context in Brent and WTI price coverage, in our inventory analysis, and in the OPEC+ explainer.

The central tension in the Algerian story is decline against renewal. Total liquid fuels production fell from about 1.7 million b/d in 2014 to about 1.4 million b/d in 2023, the EIA reports, because mature fields are depleting and few large new oil discoveries have arrived. Gas has moved the other way, with new projects and expansions at Hassi R'Mel lifting output to its 2023 record. Whether Algeria can hold its export role now depends on the licensing rounds it restarted in 2024, on keeping its giant gas field producing, and on managing fast-growing domestic demand for gas-fired power at home.

Discovery: Hassi Messaoud and Hassi R'Mel

Algeria's energy age began in 1956, when both of its super-giant fields were discovered in the Sahara: Hassi Messaoud for oil and Hassi R'Mel for gas. The finds turned a largely agricultural territory into a hydrocarbon province within a few years, and they did so before independence from France in 1962. The state company Sonatrach (Societe Nationale pour la Recherche, la Production, le Transport, la Transformation, et la Commercialisation des Hydrocarbures) was formed in December 1963 and grew into the operator of the whole value chain, from Saharan exploration to the Mediterranean LNG terminals.

Algeria also holds a first in energy history. In 1964 the Arzew terminal shipped the world's first commercial cargo of liquefied natural gas (LNG), opening the seaborne gas trade that now moves hundreds of billions of cubic metres a year. The country joined OPEC in 1969, about ten years after it first began producing crude oil, and it remains a participant in the OPEC+ agreement. Its December 2026 required production level under OPEC+ is 1.007 million b/d, set by the seven core producers at their November 1, 2026 meeting and held unchanged for a third straight month, according to OPEC's statement as reported by Arab News and TASS. Actual crude output has run below that level: about 907,000 b/d in 2024, per the EIA.

The Production Picture

The table below uses the EIA's June 2025 brief and its international statistics, with the OPEC+ figure from OPEC itself. Gas volumes are dry gas unless noted. Figures are rounded; the EIA is the source for every row except where another source is named.

Measure	Figure	Source and date
Crude oil production, 2024	About 907,000 b/d	EIA, June 2025 brief
Total liquid fuels production, 2023	About 1.4 million b/d, down from 1.7 million b/d in 2014	EIA, June 2025 brief
Dry natural gas production, 2023	3.7 Tcf, a record	EIA, June 2025 brief
Dry natural gas production, 2024	98.3 bcm, down about 7%	Argus Media, June 2025
Natural gas exports, 2023	About 1.9 Tcf, mostly to Europe	Energy Institute, 2024 Statistical Review, via EIA
Natural gas exports, 2024	48.5 bcm, down about 7%	Argus Media, June 2025
Gas supplied to the EU, 2024	39.2 bcm, about 14.4% of EU imports	European Commission, via Platts
Crude oil and condensate exports, 2024	About 402,000 b/d, of which Europe took 295,000 b/d	EIA, June 2025 brief
Petroleum product exports, 2020-2024 average	About 563,000 b/d, 96% fuel oil, LPG and naphtha	EIA, via Vortexa
Domestic oil consumption, 2024	About 457,000 b/d	EIA international statistics
Proved crude oil reserves, early 2023	12.2 billion barrels	EIA, June 2025 brief
Proved natural gas reserves, early 2023	159 Tcf	EIA, June 2025 brief
OPEC+ required production, December 2026	1.007 million b/d	OPEC, November 1, 2026

Three patterns in the table matter. First, crude oil is on a long slow decline while gas has grown, so Algeria is steadily becoming a gas country that also produces oil rather than the reverse. Second, exports still dominate the economy: hydrocarbons supplied an average of 47% of budget revenue and 83% of exports between 2019 and 2023, according to the EIA's summary of the period. Third, domestic consumption is rising. Electricity demand grew about 61% over the decade to 2023, almost all of it met by gas-fired generation, which is why every new gas molecule is contested between the export pipelines and the power stations at home.

The main crude grade is Sahara Blend, a light, sweet crude at 43.2 degrees API gravity with about 0.10% sulfur, produced in the Hassi Messaoud region. Its quality is one reason Algerian crude still finds buyers in Europe and Asia even as volumes fall: South Korea took 33,000 b/d and India 24,000 b/d in 2024, the largest Asian buyers, per the EIA.

Worked example: how fast is the oil decline?

Total liquids fell from about 1.7 million b/d in 2014 to about 1.4 million b/d in 2023, a drop of 300,000 b/d over nine years, or roughly 33,000 b/d a year on a straight line. At that pace, holding crude output near 900,000 b/d requires replacing roughly 30,000 to 40,000 b/d of natural decline every year through enhanced recovery and new wells. That arithmetic is why the EIA ties Algeria's outlook to enhanced oil recovery at Hassi Messaoud and to the licensing rounds discussed below, rather than to any single new discovery.

The Fields: Hassi Messaoud, Hassi R'Mel, and the Berkine

Algeria's hydrocarbon wealth sits in a handful of Saharan basins, each with a different technical problem.

Hassi Messaoud: the oil landmark

Discovered in 1956 in the central Sahara, Hassi Messaoud is the largest oil field in Africa and the source of the Sahara Blend. Its reservoir is Cambrian sandstone at depths beyond 3,300 metres, hard and abrasive rock that needs advanced drilling and enhanced recovery to keep producing after nearly 70 years. Sonatrach runs one of the world's largest miscible gas injection programs there, forcing high-pressure gas back into the reservoir to thin the oil and sweep more of it toward producing wells. The field's age is the whole story: it still anchors national output, but every year of production from it costs more effort than the last.

Hassi R'Mel: the gas sovereign

Also discovered in 1956, Hassi R'Mel is one of the world's largest gas fields, with estimated recoverable reserves of about 2,500 bcm, according to Enerdata's country profile. Its Triassic sandstones feed all three export pipelines and act as the balancing hub of the national gas grid, absorbing seasonal swings in European demand. The EIA credits upstream investment and expansions at Hassi R'Mel for the 2023 gas production record, and notes that less gas reinjection into oil fields, as crude output fell, freed more gas for domestic use and export.

The Berkine Basin: the modern frontier

Developed from the 1990s through partnerships with international companies, the Berkine Basin in the east holds the Ourhoud cluster and other fields produced with horizontal drilling and waterflooding. It is the basin where the newest licensing activity is concentrated: the Toual II block awarded in the 2024 round sits in the Berkine, and the Ahara block straddles the Berkine and Illizi basins.

The Illizi Basin: the southwestern gas tier

The Illizi Basin in the southwest holds tight gas and shale potential that Sonatrach is evaluating as the next phase of growth. The Reggane Nord tight-gas development sits in this region, and the 2024 round's Reggane II and Zerafa II blocks are nearby. The EIA's 2013 assessment credited Algeria with 707 Tcf of technically recoverable shale gas, the third-largest total in the world after China and Argentina. That figure is a geological estimate of what could technically be recovered, not a reserves number, and no commercial shale production exists yet.

Pipelines and LNG: the Gas Bridge

Algeria's strategic weight comes from its midstream. Three pipelines carry gas to Europe, two LNG terminals ship it worldwide, and two more pipelines are proposed but unbuilt.

Pipeline	Status	Route	Start	Length	Capacity
Enrico Mattei (TransMed)	Operating	Algeria to Italy via Tunisia	1983	1,547 miles	1,183 Bcf/yr (about 33.5 bcm/yr)
Maghreb-Europe (MEG)	Operating, reversed	Algeria to Spain via Morocco	1996	844 miles	359 Bcf/yr
Medgaz	Operating	Algeria to Spain, direct subsea	2011	473 miles	378 Bcf/yr (about 10.7 bcm/yr)
GALSI	Shelved	Algeria to Italy via Sardinia	Unknown	538 miles	283 Bcf/yr
Trans-Saharan (TSGP)	Proposed, no final investment decision	Nigeria to Algeria via Niger	Unknown	2,580 miles	1,059 Bcf/yr (about 30 bcm/yr)

Source: EIA, Country Analysis Brief: Algeria, June 5, 2025, Table 4, drawing on Hydrocarbons Technology, Global Energy Monitor and the Medgaz company website.

Two rows in that table need explanation. The Maghreb-Europe pipeline stopped delivering Algerian gas to Morocco and Spain in October 2021, when Algeria declined to renew the transit arrangement amid its diplomatic break with Morocco. The pipeline now runs in the opposite direction, carrying gas from Spain to Morocco. The Trans-Saharan Gas Pipeline, which would bring Nigerian gas to Hassi R'Mel and on to Europe, has no final investment decision. In June 2022 the energy ministers of Niger, Nigeria and Algeria signed a memorandum of understanding to update the existing feasibility study, and the project remains at that stage.

TransMed is the workhorse. It carried about 21 bcm to Italy in 2024, well below its 33.5 bcm capacity, according to Eurostat-based analysis. Medgaz, the direct subsea link to Spain, was expanded by about a third from its original 8 bcm/yr, and the EIA lists its capacity at 378 Bcf/yr. Together the two operating export pipelines give Algeria a direct, sea-free route to its two largest gas customers, which is the core of its value to European energy security.

Algeria's LNG terminals are at Arzew and Skikda, both owned and operated by Sonatrach:

Terminal	Start	Trains	Nominal liquefaction capacity
Arzew GL1Z	1978	3	379 Bcf/yr
Arzew GL2Z	1981	3	394 Bcf/yr
Arzew GL3Z	2014	1	226 Bcf/yr
Skikda GL1K	2013	1	216 Bcf/yr
Total		8	1,215 Bcf/yr (about 34 bcm/yr)

Source: GIIGNL 2024 Annual Report, via the EIA brief. In February 2022 Sonatrach signed with Sinopec to expand and upgrade the Skikda terminal, adding storage capacity and modernising port facilities for larger vessels. About 672 Bcf of Algeria's 2023 gas exports moved as LNG, with the remaining 1.2 Tcf going by pipeline, per the Energy Institute.

Refining: 671,000 b/d of Nameplate, One New Plant Coming

Sonatrach solely owns and operates Algeria's refineries, most built between the 1960s and the 1980s. Total nameplate capacity is 671,000 b/d, according to the Middle East Economic Survey data in the EIA brief:

Refinery	Operator	Status	Nameplate capacity
Skikda I	Sonatrach	Operating	355,000 b/d
Skikda II (condensate splitter)	Sonatrach	Operating	122,000 b/d
Arzew	Sonatrach	Operating	81,000 b/d
Algiers (Sidi Rezine)	Sonatrach	Operating	77,000 b/d
Hassi Messaoud	Sonatrach	Operating	23,000 b/d
Adrar	CNPC and Sonatrach joint venture	Operating	13,000 b/d

A new refinery at Hassi Messaoud has been proposed since 2012 and delayed for years. The engineering, procurement and construction contract went to Tecnicas Reunidas and Samsung Engineering in January 2020, construction reportedly began in February 2025, and the plant is scheduled to come online in 2027. Proposals for two further refineries, at Biskra and Tiaret, have stalled and are unlikely to proceed, the EIA reports. Despite the large nameplate total, Algeria still imports small volumes of refined products, about 32,000 b/d on average between 2020 and 2024, mostly bitumen and biodiesel, while exporting about 563,000 b/d of products, 96% of it fuel oil, LPG and naphtha.

The 2024 Bid Round and the Investment Return

The most consequential Algerian energy event of 2025 had nothing to do with prices. In October 2024 the government launched its first hydrocarbons licensing round since 2014, offering six onshore gas blocks under the 2019 hydrocarbons law (Law No. 19-13), which reintroduced production sharing contracts and broadened the contractual options for investors. The round was the first of four additional rounds the government said it would schedule annually until 2028, and it targeted about 20 bcm/yr of new gas output, according to Argus Media.

On June 17, 2025, the regulator ALNAFT (National Agency for the Valorisation of Hydrocarbon Resources) announced the preliminary results in Algiers. Five of the six blocks were awarded, from seven bids received:

Block	Basin	Winner
Toual II	Berkine	Zangas (Austria) and Filada (Switzerland)
Ahara	Berkine / Illizi	TotalEnergies (24.5%) and QatarEnergy (24.5%), with Sonatrach (51%)
Zerafa II	Ahnet-Gourara	ZPEC (Zhongman Petroleum, China)
Guern El Guessa II	Gourara-Timimoun	Sinopec (China)
Reggane II	Reggane	Eni (Italy) and PTTEP (Thailand)
Grand M'Zaid	Oued Mya	No bids received

Sources: ALNAFT preliminary results, June 17, 2025, as reported by Oil and Gas Journal, Argus Media and Enerdata. Only Zerafa II attracted more than one bid, so competition was thin, but the round still ended a decade-long licensing drought. Argus reported that the awards were expected to lead to around $1 billion of mainly exploration investment, and ALNAFT's chairman put committed capital at a minimum of $553 million. A second round was already being prepared: ALNAFT opened a nomination process covering 24 onshore perimeters, from which six to eight were expected to be offered in the 2026 round.

The bid round was followed within weeks by a concrete development deal. On July 9, 2025, Eni and Sonatrach signed a 30-year exploration and development contract for the Zemoul El Kbar area, about 300 km southeast of Hassi Messaoud, with total investment estimated at $1.35 billion and expected production of 415 million barrels of oil equivalent, including 9.3 bcm of natural gas. Sonatrach also reported 18 new hydrocarbon discoveries of its own during 2024, split about evenly between oil and gas, with 58 million tonnes of oil equivalent of proven and probable hydrocarbons in place, according to Enerdata's country reporting.

Energy Transition: Solar, Flaring, and Hydrogen

Algeria's transition story is shaped by one fact: its electricity system runs almost entirely on gas. In 2023 the country generated 96.3 terawatt-hours of electricity, 97% of it from fossil fuels, with installed capacity of 22.6 gigawatts. Renewable capacity, mostly solar, grew by nearly 1 gigawatt between 2014 and 2023, but its share of generation remains small. The government has set a target of 15 gigawatts of installed renewable capacity by 2035, plus about 1 gigawatt of off-grid renewable capacity by 2030, and it created a dedicated ministry and a national renewable energy company to deliver it.

Construction is now visible. In March 2024 the Turkish firm Ozgun Insaat began building the 362-megawatt Hassi Delaa solar plant in Laghouat, due for completion in late 2025 or early 2026. In September 2024 a consortium of China International Water and Electric Corporation and China Nuclear Industry Huaxing Construction began five solar projects with a combined 780 megawatts. The ministry responsible for energy was split in September 2025 into a Ministry of Oil and Mines and a Ministry of Energy and Renewable Energies.

Two other transition items deserve attention. First, flaring: Algeria flared about 289 billion cubic feet of natural gas in 2023, the sixth-highest volume of any country, according to the World Bank's Global Flaring and Methane Reduction Partnership. Capturing that gas would add supply without drilling a well. Second, hydrogen: in July 2024 Sonatrach and Sonelgaz signed a memorandum of understanding with Eni to study a submarine electricity interconnector that would let Algeria export power to Italy and other European markets, and the government has discussed a green hydrogen corridor using Saharan solar power blended into the TransMed pipeline. Both ideas are at the feasibility stage, not under construction.

Risks and Constraints

• Mature-field decline. Crude output has fallen for a decade and the giant fields need ever more enhanced recovery. The 2024 bid round helps, but exploration wells take years to become production.
• The gas allocation squeeze. Domestic gas demand for power is growing, and every cubic metre burned at home is one not exported. The 2024 fall in gas output and exports, both down about 7%, shows how thin the margin is.
• Flaring and methane. Sixth-highest flaring in the world is both a wasted resource and a reputational problem with European buyers who now track methane intensity.
• Pipeline politics. The Maghreb-Europe pipeline's reversal shows that Algerian gas routes depend on regional diplomacy as much as on geology. The Trans-Saharan pipeline's future depends on three governments and on financing that has never been committed.
• Quota against capacity. Algeria's OPEC+ required production of 1.007 million b/d sits above its actual crude output of about 907,000 b/d in 2024, so the quota is not currently the binding constraint. Capacity is.
• Concentration. One field, Hassi R'Mel, feeds the export system, and one company, Sonatrach, runs it. A long outage at either would be a national export event.

Common Misreadings

• "Algeria produces 1.1 million barrels of crude a day." The EIA puts 2024 crude output at about 907,000 b/d. Figures near 1.1 million usually count crude plus condensate, or they quote the OPEC+ required level of 1.007 million b/d, which is a target rather than output.
• "The Maghreb-Europe pipeline still carries Algerian gas to Spain." It has not done so since October 2021. It now carries gas in the opposite direction, from Spain to Morocco.
• "Algeria will double gas production to 200 bcm a year." In March 2025 the government announced an objective of doubling gas production to 200 bcm/yr within five years. That is an announced target, not a forecast and not a funded program, and 2024 output was 98.3 bcm.
• "707 trillion cubic feet of shale gas." That is the EIA's estimate of technically recoverable shale gas, a geological figure. It is not proved reserves, and Algeria has no commercial shale production.
• "TransMed runs at full capacity." It carried about 21 bcm to Italy in 2024 against about 33.5 bcm of capacity. The constraint on Algerian gas exports is upstream supply, not pipeline space.

What to Watch Next

1. The 2026 bid round, for which ALNAFT opened nominations on 24 perimeters. The number of blocks offered and the bidders will show whether the 2024 round's momentum holds.
2. The Hassi Messaoud refinery, scheduled online in 2027. It is the first major new refinery in decades and a test of Sonatrach's project delivery.
3. Gas output and exports in 2025 and 2026, against the 2024 fall to 98.3 bcm produced and 48.5 bcm exported. A second year of decline would put the EU supply role under strain.
4. The OPEC+ meeting on November 29, 2026, when the wider group is expected to decide production quotas for 2027.
5. Medgaz and TransMed flows, the monthly read on whether Algeria is holding its roughly 14% share of EU gas imports.
6. The Zemoul El Kbar development, the first large post-round project, for its drilling results and timetable.

Frequently Asked Questions

How much oil does Algeria produce?

The EIA estimates crude oil production of about 907,000 barrels per day in 2024. Total liquid fuels production, including condensate and natural gas liquids, was about 1.4 million b/d in 2023, down from 1.7 million b/d in 2014.

How much gas does Algeria produce and export?

Dry natural gas production reached a record 3.7 trillion cubic feet in 2023, then fell about 7% to 98.3 billion cubic metres in 2024. Gas exports were about 1.9 Tcf in 2023 and 48.5 bcm in 2024, mostly to Europe.

How important is Algeria to Europe's gas supply?

Algeria supplied 39.2 bcm of gas to the EU in 2024, about 14.4% of EU gas imports, according to European Commission data. It is the EU's second-largest pipeline gas supplier after Norway.

What are Algeria's oil and gas reserves?

Proved crude oil reserves of 12.2 billion barrels and proved natural gas reserves of 159 trillion cubic feet, as of early 2023, according to the EIA. The country also holds an estimated 707 Tcf of technically recoverable shale gas, which is a geological estimate rather than proved reserves.

What happened in Algeria's 2024 licensing round?

ALNAFT awarded five of six onshore gas blocks on June 17, 2025, the first licensing round since 2014. Winners included TotalEnergies with QatarEnergy, Eni with PTTEP, Sinopec, ZPEC, and a Zangas-Filada consortium. About $1 billion of exploration investment was expected.

Does the Maghreb-Europe pipeline still carry Algerian gas?

No. Deliveries through the pipeline to Morocco and Spain were suspended in October 2021. The pipeline now transports gas in the opposite direction, from Spain to Morocco. Algerian gas reaches Spain through the direct Medgaz subsea pipeline instead.

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References

1. U.S. Energy Information Administration (EIA). "Country Analysis Brief: Algeria." Last updated June 5, 2025. https://www.eia.gov/international/content/analysis/countries_long/Algeria/algeria.pdf
2. OPEC. "Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman reaffirm commitment to market stability," press release, May 3, 2025, and required production table, November 1, 2026, as reported by Arab News, November 1, 2026. https://www.opec.org/opec_web/en/press_room/8032.htm
3. European Commission. Algeria gas supply to the EU, 2024 (39.2 bcm, about 14.4% of EU imports), via S and P Global Platts, February 2026. https://www.spglobal.com/commodity-insights/en/news-research/latest-news/natural-gas
4. Argus Media. "Algeria unveils encouraging bid round results." June 20, 2025. https://www.argusmedia.com/en/news-and-insights/latest-market-news/2701646-algeria-unveils-encouraging-bid-round-results
5. Oil and Gas Journal. "Algeria awards five licenses in 2024 bid round." June 17, 2025. https://www.ogj.com/exploration-development/article/55297771/algeria-awards-five-licenses-in-2024-bid-round
6. Enerdata. "Eni and Sonatrach sign US$1.35 bn deal to develop hydrocarbons in Algeria." July 9, 2025. https://www.enerdata.net/publications/daily-energy-news/eni-and-sonatrach-sign-us135-bn-deal-develop-hydrocarbons-algeria.html
7. Energy Institute. Statistical Review of World Energy 2024, Algeria natural gas exports. https://www.energyinst.org/statistical-review
8. World Bank, Global Flaring and Methane Reduction Partnership. Global Gas Flaring Tracker Report, June 2024. https://www.worldbank.org/en/programs/gasflaringreduction
9. GIIGNL. Annual Report 2024, Algeria LNG terminals. https://giignl.org/publications/
10. IEEFA. EU Gas Flows Tracker, Algeria pipeline share. https://ieefa.org/eu-gas-flows-tracker

All sources checked November 8, 2026.