A New Energy Race Begins as Vietnam and the EU Bet on Algerian Gas
The 12-month studies, led by ALNAFT Director General Abdelkader Cherfaoui, focus on optimizing extraction at two aging fields where recovery rates lag behind global benchmarks. Vietnam’s Ambassador Phuc Duy Long framed the deal as a “concrete step” toward deeper energy ties, calling Algeria a “key partner” in Africa. But the real prize isn’t just oil—it’s hydrogen, a sector where Algeria could carve out a niche as Europe scrambles to replace Russian gas.
Why This Deal Matters for Algerian Entrepreneurs
1. Tech Transfer and Local Partnerships
The Vietnamese firm’s involvement hints at a broader push for foreign expertise in EOR and hydrogen production. Algerian startups in energy tech—especially those specializing in digital reservoir modeling or carbon capture—could position themselves as local partners. The Berkine Basin, with its vast but underutilized reserves, is ripe for innovation. “Algeria has the data; it needs the tools to unlock it,” says a senior energy analyst at the Algerian Institute for Petroleum Studies.
2. A Hydrogen Boom Could Create New Markets
The EU’s REPowerEU plan targets 10 million tons of hydrogen imports by 2030—much of it from North Africa. Algeria’s $20 billion Sonatrach hydrogen strategy (announced in 2025) aims to produce 1 million tons annually by 2035. Entrepreneurs in renewable energy, logistics, or green ammonia stand to benefit if the government follows through on its commitments. The catch? Financing. Most projects require 50-70% foreign investment, leaving room for Algerian venture capital to step in.
3. Diaspora Investors Are Watching
Algerian expats—particularly in France, Canada, and the Gulf—are already funneling capital into African energy. The NAPEC deals could accelerate this trend if they lead to public-private hydrogen projects. “The diaspora has the networks; Algeria has the resources,” notes Karim B., founder of a Paris-based Algerian energy fund. “But the government must simplify licensing for foreign-Algerian joint ventures.”
The Hidden Risk: Can Algeria Avoid Gaza’s Energy Crisis at Home?
The issue isn’t just Gaza—it’s Algeria’s own energy security. Despite being Africa’s second-largest gas producer, the country faces:
– Aging infrastructure: Sonatrach’s 2025 report flagged $15 billion in needed upgrades to pipelines and refineries.
– Subsidies straining budgets: Household electricity subsidies cost $3 billion annually, diverting funds from renewable projects.
– Renewable delays: Algeria’s 5 GW solar target (by 2030) is behind schedule, with only 1.5 GW operational as of 2026.
For entrepreneurs, this means opportunity and caution. While hydrogen exports could create jobs in engineering and logistics, domestic instability could derail projects. “You can’t sell green energy abroad if you can’t keep the lights on at home,” warns Leïla M., CEO of an Algerian renewable energy firm.
The Bottom Line: Who Wins in Algeria’s Energy Transition?
For hydrocarbon-linked startups, the Vietnamese deals could unlock new contracts in EOR tech or data analytics. For renewable energy entrepreneurs, the hydrogen push is a chance to pivot from solar to green ammonia or fuel cells. And for the Algerian diaspora, this is a moment to invest in local energy firms—but only if the government fixes its infrastructure and regulatory hurdles.
Key takeaway for entrepreneurs:
Algeria’s energy sector is at a crossroads—foreign partnerships are opening doors, but domestic instability remains the biggest obstacle. Entrepreneurs in tech, logistics, and renewables should target hydrogen supply chains and EOR innovation, while monitoring government reforms on licensing and subsidies. The diaspora’s capital will be crucial—but only if Algeria proves it can deliver on its promises.
Sources
💡 Starting a business in Algeria? GlobalStart guides you step by step: procedures, real costs, company forms (SARL, EURL, SPA) and CNRC registration.