The African Energy Chamber welcomes the recent memorandum between Sonatrach and Sinopec as a positive step toward reinforcing Algeria’s upstream sector through strategic collaboration and renewed investment.

The recent signing of a Memorandum of Understanding between Algeria’s Sonatrach and China’s Sinopec marks a promising step forward for upstream collaboration in North Africa. Under the agreement, the two state-owned companies will jointly evaluate and potentially develop hydrocarbon reserves in the Gourara and Berkine-Est basins, building on decades of cooperation that began with operations at the Zarzaitine field in southeastern Algeria.

The African Energy Chamber (AEC) voices its support for the agreement, citing it as a strong example of cross-border collaboration that balances international expertise with African resource leadership. The Chamber views such partnerships as essential to unlocking new energy reserves, attracting investment and building a more robust and competitive upstream landscape across Africa.

“This agreement shows how strategic partnerships can drive exploration and production in ways that benefit both national energy goals and global supply needs,” said NJ Ayuk, Executive Chairman of the AEC. “Algeria remains one of Africa’s most important hydrocarbon producers, and this continued engagement with long-term partners like Sinopec sends a clear message that the country is open for business and committed to growth.”

In recent months, Sonatrach has significantly scaled up its investment and exploration activity nationwide, including strategic partnerships with Occidental Petroleum, Eni, TotalEnergies and others across Algeria’s key basins. Notably, a recent 30-year production-sharing contract with Eni focuses on exploration and development in the Zemoul El Kbar contract area, with planned investments totaling $1.35 billion. In parallel, the newly concluded Guern El Guessa II gas block award to Sinopec covers 36,000 km² in the Gourara‑Timimoun region and targets both conventional and shale gas resources – underscoring investor optimism across diverse resource types.

This broad investment portfolio reflects Algeria’s confidence in its energy strategy under the country’s new hydrocarbons law of 2019, which has helped attract major international players and streamline upstream planning.

Meanwhile, the Sonatrach–Sinopec agreement lays the groundwork for upcoming contractual phases in the Gourara and Berkine-Est regions, which Sonatrach sees as high-priority targets for future exploration and sustainable development. Unlike formal production-sharing agreements, this MoU establishes the legal and technical foundation for studies that could evolve rapidly into full-scale projects, while incorporating best practices in environmental stewardship and responsible resource management.

For the AEC, such agreements serve as critical signals to the global energy industry. They demonstrate that Algeria – and by extension, Africa – continues to welcome long-term investment, while simultaneously strengthening capacity within its domestic energy institutions. Through cooperation frameworks like this, the continent’s energy sector deepens its ability to attract capital, deploy advanced technical skills and make balanced, market-based decisions that benefit both public institutions and private operators.

Looking forward, the Chamber sees the partnership between Sonatrach and Sinopec, alongside investments by other international and regional players, as evidence of a more sophisticated, multi-partner upstream ecosystem in Algeria. As new exploration and development contracts materialize in Gourara, Berkine‑Est and beyond, this diversified approach to energy collaboration will be integral to unlocking Africa’s full hydrocarbon potential.

KeyFacts Energy: Sonatrach Algeria country profile   l   Sinopec  l   KeyFacts Energy Industry Directory: African Energy Chamber