Algeria Launches 2026 Bidding Round for Oil & Gas, Expands Renewable Energy Capacity
Image: Rass El Mal
Takeaway
The launch of Algeria's 2026 bidding round and expansion of renewable energy capacity presents a mixed bag of opportunities for international investors. While the hydrocarbon sector offers potential for significant returns, companies should also consider Algeria's commitment to renewable energy, particularly solar, as a long-term investment avenue. Monitoring Sonatrach's contract awards and the progress of renewable energy projects will be crucial for assessing the evolving energy landscape.
Algeria is making significant strides in its energy sector, balancing hydrocarbon exploration with renewable energy development. On April 20, 2026, the Algerian government officially launched the “Algeria Bid Round 2026,” offering seven new zones for hydrocarbon exploration to international companies. The launch ceremony in Algiers was presided over by Minister of State for Energy, Mines and Renewable Energies Mohamed Arkab and was attended by representatives from major international energy firms. Simultaneously, Energy Minister Mourad Adjjal inaugurated a 200 MW photovoltaic power plant in Biskra as part of Algeria's broader energy transition strategy.
The seven exploration blocks offered in the “Algeria Bid Round 2026” are located in Ouargla, Illizi, Touggourt, and El Bayadh. Authorities estimate that these areas could hold hundreds of millions of barrels of oil, along with significant volumes of natural gas. The technical phase of the bidding process commences on June 1, 2026, with tender documents and online presentations being made available. Bid submissions are due by November 26, 2026, and hydrocarbon contracts with Sonatrach are expected to be signed by January 31, 2027, under either production-sharing or participation agreements. This round follows the “Algeria Bid Round 2024,” the first such process since 2014, which resulted in exploration licenses being awarded in five zones.
In parallel with hydrocarbon exploration, Algeria is actively expanding its renewable energy capacity. The country plans to commission nine photovoltaic power plants with a combined capacity of 1,480 MW by August 2026. This initiative is part of the first phase of a national program targeting 3,200 MW of renewable energy capacity. Two of these plants, each with a capacity of 200 MW, are already operational in El Ghrous (Biskra province) and Tendla (El Meghaier province). Algeria aims to install 15,000 MW of solar capacity by 2035.
The push for increased hydrocarbon exploration and renewable energy capacity reflects Algeria's dual strategy of maintaining its position in global energy markets while diversifying its energy mix. Hydrocarbons currently account for 92% of Algeria's exports and 43% of its budget revenue. The "El M'Zaid Nord” zone holds resources estimated at nearly 100 million barrels, while the "Touggourt Sud" zone has projected resources surpassing 576 million barrels. The country's vast solar resources, with solar irradiance levels of 1,850‒2,100 kWh/m²/year and up to 3,500 hours of sunshine annually, position it well for renewable energy development.
Looking ahead, the deadline for bid submissions for the “Algeria Bid Round 2026” is November 26, 2026, with contract signings expected by January 31, 2027. The commissioning of nine photovoltaic power plants with a combined capacity of 1,480 MW is expected by August 2026. Sonatrach aims for annual gas production of 200 billion cubic meters within five years, up from approximately 137 billion cubic meters in 2023. These developments will be crucial in determining Algeria's energy landscape in the coming years.