Algerian state-owned Sonatrach has signed a Memorandum of Understanding (MoU) with America’s ExxonMobil Corporation to pave the way for talks on exploration opportunities in Algeria, following a press release

According to Reuters, Algeria has been seeking foreign partnerships to boost output and exports which have dropped in recent years due to the growing domestic demand and the lack of foreign investments.

The most recent oil price drop has forced the government to cut public spending by at least 30% and decreased their planned investment by 50% from $14 billion to $7 billion to relieve financial pressure.

In a bid to attract foreign investors, Algeria approved in 2019 a new energy law offering incentives including easing the tax burden. The press release further states that “the signature [of the MoU] shows the interest of the parties in evaluating the options for collaboration following the promulgation of the new hydrocarbons law.”