SONATRACH and Sinopec are looking to expand their co-operation through this agreement.

SONATRACH and its Chinese partner Sinopec have signed an agreement with a view to assessing and developing hydrocarbon resources in the Basins of Gourara in south west Algeria and East Berkine in the south east of the country

As part of the agreement, the parties will discuss a work programme for the evaluation and exploitation of these resources, integrating best practices for the preservation of the environment and responsible exploitation of natural resources.

“The signing of this Head Of Agreement expresses the willingness of both parties to bolster their existing relationship and expand their cooperation through new partnership opportunities in hydrocarbons exploration and development,” said SONATRACH in a statement.

Sinopec has been present in Algeria since 2002 and operates the Zarzaïtine field with SONATRACH under the framework of a contract of association focusing on hydrocarbon recovery and development.

Sinopec is also SONATRACH‘s partner under the hydrocarbons agreement signed on 25 February 2025 under  Law 19-13 relating to the exploration and exploitation of the Hassi Berkane perimeter. The two companies signed a production sharing contract (PSA) for hydrocarbon development and exploration worth US$850mn, and will carry out exploration and appraisal drilling on the licence, which lies 80 km from the huge Hassi Messaoud field.

Algeria is rich in oil and gas resources and offers significant potential. It holds approximately 12.2bn barrels of proven crude oil reserves, making it the third-largest in Africa, along with 159 trillion cubic feet of proven natural gas reserves, and is the largest gas producer in the continent. Around two-thirds of Algeria's territory remains underexplored or underdeveloped.

The country is seeking international investment to boost hydrocarbons production. The National Agency for the Valorization of Hydrocarbon Resources (ALNAFT) unveiled six new onshore licensing opportunities for conventional hydrocarbon exploration in 2024, as part of a five-year licensing plan designed to attract global upstream investors. The six opportunities span a cumulative perimeter size of 152,000 sq. km, supported by over 102,000-line km of 2D seismic data and more than 45,000 km² of 3D seismic data.

In June, TotalEnergies, jointly with QatarEnergy, was awarded the Ahara exploration license following the 2024 bid round. It covers an area of approximately 14,900 sq km, located at the intersection of the prolific Berkine and Illizi Basins.

In early July, Sonatrach signed a PSA with Italy’s Eni to explore and develop the Zemoul El Kbar area in the Berkine Basin, around 300 km east of Hassi Messaoud.

Global gas production by region. (Image source: Rystad Energy)

The Middle East is set to overtake Asia to become the world’s second-largest gas producer in 2025 after North America, according to Rystad Energy research and analysis

Gas production in the Middle East has grown by about 15% since 2020, as regional producers seek to monetise gas reserves and develop export potential to meet global demand.

The region currently produces about 70bn cubic feet per day (Bcfd) of gas, a figure that is forecast to increase by 30% by 2030 and 34% by 2035 thanks to significant developments in Saudi Arabia, Iran, Qatar, Oman, and the UAE. By 2030, the region will add another 20 Bcfd, around half of which will be needed to meet rising domestic demand, with the rest available for export to Europe – which is keen to reduce its reliance on Russian energy – and fast-growing markets in Asia. Iran is currently the Middle East’s leading gas producer, at around 25 Bcfd, followed by Qatar at 16 Bcfd and Saudi Arabia at 8 Bcfd. But with Qatar’s production projected to rise nearly 50% to 24 Bcfd, driven by the ongoing development of its massive North Field, the country is expected to overtake Iran as the Middle East’s largest gas producer in the early 2030s.

“As more long-term gas contracts are signed and export volumes rise, the Middle East is on track to become a key energy hub for countries seeking stable and dependable sources of natural gas,” said Mrinal Bhardwaj, senior analyst, Upstream Research at Rystad Energy.

Qatar, the UAE and Saudi Arabia are leading this growth, with Qatar’s ambitious North Field expansion set to boost its LNG capacity by 80%, from 77 to 142 million tonnes per annum (Mtpa) by the end of the decade, while maintaining a competitive breakeven price of under US$6 per MMBtu.

“A drop below US$6 per MMBtu is not ideal for investments, but Middle Eastern projects remain highly resilient due to their low breakeven costs, typically below US$5 per thousand cubic feet. Even in a prolonged low-price environment, we expect strong production growth from the region. While some final investment decisions could be delayed in such a scenario, the overall impact on output should be limited,” added Rahul Choudhary, vice president, Upstream Research at Rystad Energy.

Rystad expects investments of more than US$50bn in the region’s LNG developments, as the region looks to strengthen its position in the global LNG market, with Qatar adding 48 Mtpa through its North Field East and North Field South projects. The UAE will contribute an additional 10 Mtpa from the Ruwais LNG project, and TotalEnergies is developing the Marsa LNG project with a capacity of 1 Mtpa in Oman. The new volumes of LNG produced in both Qatar and the UAE are primarily earmarked for Asian and European buyers, with Chinese national oil companies and global energy majors emerging as key buyers.

Libya is looking for foreign investment to redevelop its oil and gas sector.

bp and Shell have signed agreements with Libya’s National Oil Corporation (NOC) to evaluate hydrocarbon redevelopment prospects in some of Libya’s major oilfields

Under the MoU signed by bp, the company will evaluate redevelopment opportunities in the mature giant Sarir and Messla oilfields in Libya’s Sirte basin, including the exploration potential of adjacent areas, and look at the wider unconventional oil and gas potential within the country.

The agreement provides a framework for bp to assess a range of technical data and to work with the NOC to evaluate opportunities and determine the feasibility of future development and exploration programmes.

William Lin, bp executive vice president gas & low carbon energy, said: “This agreement reflects our strong interest in deepening our partnership with NOC and supporting the future of Libya’s energy sector. We hope to apply bp’s experience from redeveloping and managing giant oil fields around the world to help optimise the performance of these world-class assets. We look forward to conducting thorough studies, working closely with NOC, to evaluate the resource potential of this promising region.”

The Sarir and Messla oilfields are among Libya’s largest, offering scope for a significant potential addition to bp’s Libya portfolio, according to a bp statement.

bp has confirmed its intention to resume operations in Libya and reopen its office in the capital, Tripoli, within the last quarter of 2025. bp resumed exploration in the onshore areas of Libya in 2023 after a 10-year joatis. along with a number of other international oil companies.

The MoU was signed at a ceremony in London, when Eng. Masoud Suleman, chairman of the NOC, welcomed bp’s return to operations in Libya and the expansion of the partnership between the two parties. He called for the cooperation between the NOC and bp to include training technical and leadership staff in Libya’s oil sector.

The NOC has also reached an agreement with Shell for the company to evaluate hydrocarbon prospects and conduct a comprehensive technical and economic feasibility study to develop the al-Atshan field and other fields fully owned by the NOC.

Libya is currently producing around 1.2mn bpd but is looking to bump this up to 2mn bpd by 2028. However, progress has been hampered by political unrest and factionalism in the aftermath of the civil war, and the existence of two rival governments. Libya is keen to attract international companies to redevelop its oil and gas sector, and there is significant international interest in its largely untapped hydrocarbon potential, as demonstrated by the number of bids submitted following the launch of its international bid round earlier this year, results of which are expected in around November. This offers 22 blocks for exploration and development (11 Offshore and 11 Onshore) including areas with undeveloped discoveries estimated to contain a minimum of 2.0 Bboe in hydrocarbon resources.

QatarEnergy to make its debut in Algeria

QatarEnergy has landed a stake in its first onshore exploration license in Algeria, expanding the group’s upstream footprint in North Africa

The company secured the Ahara block as part of Algeria’s 2025 bid round, marking its first entry into the country’s upstream sector.

“We are delighted to be awarded the Ahara block, which marks our first entry into Algeria’s upstream sector and further and expands our footprint in Africa,” said Saad Sherida Al-Kaabi, Qatar’s Minister of State for Energy Affairs, and president and CEO of QatarEnergy.

Located in eastern Algeria, at the intersection of the prolific Berkine and Illizi Basins, Ahara covers an area of approximately 14,900 square km.

QatarEnergy will work as part of a consortium, alongside operator TotalEnergies and Algeria’s national state-owned oil company Sonatrach.

TotalEnergies and QatarEnergy will each hold an effective interest of 24.5% during the exploration phase, while Sonatrach will hold 51%.

The results of the competitive bid process were announced by The National Agency for the Valorisation of Hydrocarbon Resources (ALNAFT).

“I would like to take this opportunity to congratulate and thank the Algerian Ministry of Energy, Mines, and Renewable Energies and ALNAFT on the successful management of this bid round,” said Al-Kaabi.

“We look forward to a successful and collaborative exploration endeavour with the Ministry alongside ALNAFT, Sonatrach and TotalEnergies.”

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