Summary:

On 7 July 2025, Algeria’s state-owned oil company Sonatrach and Italian energy firm Eni signed a $1.35 billion production-sharing agreement focused on hydrocarbon exploration and extraction. The deal targets the Zemlet El Kbar area in the Berkine Basin, located about 300 kilometers east of Hassi Messaoud in southeastern Algeria. 

The contract includes a seven-year exploration phase, with the option to extend it for an additional ten years. Out of the total investment, $110 million will be allocated specifically to exploration and research activities. During the contract period, the goal is to recover an estimated 415 million barrels of oil equivalent, including 9.3 billion cubic meters of natural gas. 

Sonatrach CEO Rachid Hachichi hailed the agreement as a “qualitative leap,” highlighting the integration of cutting-edge digital technologies to enhance exploration, boost oil well efficiency, and maximize resource recovery. He emphasized that the partnership aligns with Sonatrach’s broader strategy of modernization and international innovation. Echoing this sentiment, Eni CEO Claudio Descalzi described the deal as “a new milestone” in the longstanding strategic partnership between the two companies. 

In a separate development highlighting Algeria’s growing regional role in the energy sector, a delegation from an Algerian company specializing in electricity and gas met with Syrian Energy Minister Mohammad al-Bashir in Damascus on 9 July 2025. The two sides explored ways to strengthen technical cooperation, with the Algerian delegation proposing the rehabilitation of the Jandal power station’s training center, the development of training programs for Syrian technical staff, and the provision of technical support. 

Outlook: 

Algeria is positioning itself as a rising regional leader in the energy sector by deepening partnerships with international firms like Italy’s Eni, among others. The $1.35 billion Sonatrach-Eni deal highlights Algeria’s commitment to modernizing its oil and gas industry through advanced technology and substantial investment in partnership with established multinational firms.  

At the same time, Algeria is broadening its regional influence by supporting neighboring countries, as demonstrated by its recent cooperation with Syria on electricity infrastructure upgrades and technical training programs. These moves underline Algeria’s strategy to attract foreign expertise, boost regional collaboration, and strengthen its role as a key energy hub in North Africa and beyond. 

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