Algeria’s new mining law, which came into force on August 10, 2025, promises to modernize the sector and attract foreign investment, but experts warn that structural barriers may curb its real impact.
Adopted in July, the legislation fundamentally reshapes the legal framework governing mining operations in a country heavily reliant on hydrocarbons.
It introduces provisions aimed at opening the sector to international capital while maintaining significant domestic safeguards.
Under Text No. 25-12, prospecting authorizations and exploration permits are restricted to companies incorporated under Algerian law, including those partially or fully owned by foreigners.
The long-standing Rule 49/51, which required at least 51% domestic ownership, has been abolished for mines but continues to apply to quarries, reflecting ongoing protectionist tendencies.
A major innovation under Article 101 allows the national mining company to hold a minimum 20% stake in projects involving foreign partners, a share that cannot be diluted without agreement.
Companies can negotiate a higher participation if they demonstrate an “economic interest,” creating room for flexibility while preserving state influence.
The law also formally recognizes artisanal mining, permitting Algerian citizens to operate within designated safe zones. Yet analysts suggest this provision may remain marginal, given the technical and financial demands of modern mining.
Penalties for non-compliance are strict: unauthorized prospecting can lead to two months to two years in prison and fines up to €13,640, while illegal exploitation carries one to three years and fines up to €20,460.
Unauthorized collection or sale of minerals, meteorites, or fossils may result in six months to one year in prison and fines of up to €6,820.
While authorities hail the reform as a “modernizing step,” its combination of quotas, bureaucratic hurdles, and limited liberalization leaves questions about its practical attractiveness to foreign investors. In a system still marked by administrative rigidity and cautious engagement with external capital, the law’s promise of a more open mining sector may remain largely aspirational.
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