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Algerian state energy giant Sonatrach has signed a landmark agreement of principles with Chinese oil and gas conglomerate Sinopec, marking a pivotal step toward deepening bilateral energy cooperation and unlocking new hydrocarbon resources in Algeria.
The deal, signed on Sunday in Algiers by Farhat Ounoughi, Vice President of Business and Marketing at Sonatrach, and Wu Xiuli, CEO of Sinopec Overseas Oil and Gas, was witnessed by Algeria’s Minister of Energy and Mines, Mohamed Arkab.
The agreement outlines a framework for future contracts related to hydrocarbon exploration and development in the Gourara and Eastern Berkine basins—areas identified as holding significant energy potential.
Over the next six months, the two companies will jointly assess the feasibility of operations in the targeted zones, with an emphasis on environmental safeguards and responsible resource management.
“This signing is the result of a long path of collaboration and joint work,” said Sonatrach CEO Rachid Hachichi.
“It opens promising prospects for both parties to explore hydrocarbon resources in these regions and to conclude fruitful agreements that support the responsible and sustainable valorization of our country’s wealth.”
Hachichi described the agreement as “a new and constructive step” in what he called the “historic relationship” between Sonatrach and Sinopec.
He emphasized that the renewed partnership reflects mutual trust and a shared vision for developing natural resources based on robust scientific and technical foundations.
“I am confident that this agreement will allow us to lay the groundwork for high-impact projects aligned with the aspirations of our countries and peoples, contributing to the sustainable development of the energy sector,” he added.
The accord grants both companies an initial six-month window—extendable by mutual consent—to work in the identified areas.
Hachichi expressed hope that this will culminate in a full hydrocarbon development contract, significantly enhancing Algeria’s production capacity.
He also stated that the agreement aligns with Sonatrach’s development strategy to broaden its strategic partnerships and explore new horizons in energy innovation, exploration, and development. Hachichi praised Sinopec’s “clear readiness” to elevate the collaboration to a level befitting the deep-rooted Algeria-China ties.
Sinopec CEO and board member Xu Weisheng echoed the sentiment, calling the agreement a “turning point” in the companies’ cooperation.
“Sinopec is keen to contribute to Algeria’s hydrocarbon sector by sharing its expertise and working together with Sonatrach,” he said.
Weisheng affirmed Sinopec’s belief that its projects in Algeria will add long-term value to the partnership and allow both companies to progress “at a rapid pace.
” He also expressed a strong interest in launching joint studies and exploring the possibility of building manufacturing plants for essential petroleum tools—an initiative aimed at mutual benefit and economic momentum.
Sinopec has operated in Algeria since 2002, where it jointly develops the Zarzaitine oil field with Sonatrach under a contract focused on hydrocarbon recovery and enhancement.
The Chinese firm is also a partner in a hydrocarbon exploration and exploitation deal signed on February 25, 2025, covering the Hassi Berkine North area.
