Algeria plans to pass a new energy law that offers tax incentives to attract investment and is in discussion with foreign firms such as BP and Anadarko regarding its shale gas reserves, Reuters reported.
Growing domestic consumption has decreased energy exports, the main source of the state budget. In an attempt to reverse the fall, the energy ministry began drafting amendments to the current energy law, offering more incentives for foreign investors.
“We will remove all obstacles, wage a battle against bureaucracy and change tax procedures,” Energy Minister Mustapha Guitouni stated. “The amendment is required by our energy security,” he continued. “The current system must change. We will intensify consultations with our partners.”
Algeria has previously attempted to boost shale output but plans were hindered by protests from residents in the affected areas over fears of pollution.
“Evaluation studies on shale gas potential are going on. This will take five to 10 years,” Guitouni said.
State oil company Sonatrach is trying to expand operations abroad as the country looks to attract foreign investors. “Egypt is interested in working with us,” Guitouni said.
Earlier this year, Sonatrach penned an agreement with Iraqi companies to form joint ventures for gas projects. Sonatrach has already begun operations in Peru, Libya, Niger and Mali.
Algeria plans refine its own oil and gas instead of selling it as crude.
About 11.5 million tons of fuel are currently refined in Algeria, however annual consumption reached 15 million tons in 2017.