Energy Law at Algeria
Here’s a detailed overview of Energy Law in Algeria, covering key legislation, regulatory bodies, and the investment environment as of 2025:
🇩🇿 Energy Law in Algeria: Overview
1. Legal Framework
Algeria’s energy sector is regulated by several laws and decrees focused on hydrocarbons, electricity, and renewable energy:
Hydrocarbon Law No. 05-07 (2005) — The cornerstone of oil and gas regulation, covering exploration, production, and export of hydrocarbons.
Electricity and Gas Law No. 02-01 (2002) — Governs electricity production, transmission, distribution, and sale, as well as natural gas.
Renewable Energy Law No. 16-09 (2016) — Promotes development and investment in renewable energy projects.
Numerous implementing decrees and regulations issued by the Ministry of Energy and Mining.
2. Regulatory Authorities
Ministry of Energy and Mining — Sets policy, grants licenses, and oversees the sector.
Sonatrach — State-owned national oil and gas company; dominant player in upstream and downstream.
Sonelgaz — State-owned utility responsible for electricity and gas transmission and distribution.
CREG (Commission de Régulation de l’Électricité et du Gaz) — Independent regulator overseeing tariffs, licensing, and market rules.
3. Oil and Gas Sector
Algeria is a major oil and gas producer, heavily relying on hydrocarbon revenues.
Exploration and production primarily through Sonatrach with foreign partners under joint ventures or service contracts.
Hydrocarbon Law No. 05-07 regulates licensing rounds, local content requirements, and profit-sharing.
Export duties and royalties apply based on production volume and price.
4. Electricity Market
Predominantly state-controlled, with Sonelgaz holding a monopoly over generation, transmission, and distribution.
Efforts ongoing to liberalize the market and introduce independent power producers (IPPs), especially in renewables.
Tariff structures are regulated by CREG.
5. Renewable Energy and Energy Transition
Renewable Energy Law No. 16-09 incentivizes investment in solar, wind, hydro, and biomass.
Algeria targets 27 GW of renewable capacity by 2030 to diversify the energy mix.
Feed-in tariffs and incentives available for solar PV and wind projects.
Public tenders and PPPs are common for renewable energy projects.
6. Foreign Investment
Foreign investment allowed but subject to regulations under the Hydrocarbon Law and Investment Code.
Joint ventures with Sonatrach or Sonelgaz usually required in hydrocarbons.
Investment incentives include tax exemptions, customs duty waivers, and guaranteed repatriation of profits.
Algeria is a signatory to several bilateral investment treaties (BITs).
7. Environmental and Social Regulations
Environmental impact assessments (EIA) mandatory for energy projects.
Community consultation and social responsibility increasingly emphasized.
Compliance with international environmental standards encouraged.
✅ Key Opportunities
Large-scale solar and wind projects supported by government programs.
Upstream and midstream oil and gas exploration with evolving service contract models.
Expansion of natural gas infrastructure and LNG terminals.
Modernization and partial liberalization of the electricity sector.
RELATED Blog
0 comments