Following the signing of a production-sharing hydrocarbon contract regarding the Illizi South contractual perimeter in the Illizi basin, the Minister of State, Minister of Hydrocarbons, Mohamed Arkab, hosted the CEO of the Saudi firm Midad Energy North Africa, Abdelilah Ben Mohamed Ben Abdallah Al-Aiban, on Saturday. Regarded as one of the strategic ventures for oil and gas exploration and extraction in Algeria, this alliance highlights the positive cooperation dynamic between Sonatrach and the Saudi group Midad Energy.
Received at the Ministry of Hydrocarbons headquarters alongside executives from both entities, the head of Midad Energy North Africa discussed with Mohamed Arkab the progress of cooperation between Sonatrach and his enterprise, specifically following the finalization of the Illizi South perimeter contract.
Discussions centered on preparations for the entry into force of this accord, particularly the technical and organizational frameworks of the work schedule outlined in the contract. Both parties emphasized the obligation to adhere to the established deadlines and quality benchmarks required to execute this massive undertaking, according to a ministry statement.
The talks also provided an opportunity to assess the possibilities offered by this venture to bolster capital investment throughout the oil and gas industry value chain, notably in exploration, development, and extraction. Mr. Arkab and Mr. Ben Abdallah Al-Aiban highlighted the anticipated contribution of this venture toward increasing national production capacities, upgrading local content, developing skillsets, and transferring technology, the same source added.
Furthermore, the meeting served to reaffirm a shared desire to broaden fields of cooperation and explore fresh partnership opportunities in the energy sector. “This approach aims to solidify the strategic relationship between Sonatrach and Midad Energy through the development of high-value projects,” the statement underlined.
During the gathering, Mr. Arkab pointed out that this alliance fits into Algeria’s broader economic blueprint to foster balanced commercial cooperation with international entities while backing the growth of the domestic hydrocarbon sector.
Midad Energy Aims to Bolster Investments in Algeria
For his part, Abdelilah Ben Mohamed Ben Abdallah Al-Aiban reiterated Midad Energy’s interest in increasing its financial commitments in Algeria. He praised the commercial climate and the potential available within the energy sector, while reaffirming his corporation’s dedication to continuing its work with Sonatrach and accelerating the execution of joint operations.
The contract between Midad Energy and Sonatrach, signed in October 2025 under the framework of Hydrocarbon Law 19-13, spans a duration of 30 years, with an option to extend for an additional decade. It includes an initial exploration phase lasting seven years.
Under the terms established between the two entities, the entirety of the financial capital required for exploration and extraction within the Illizi South perimeter will be 100% funded by Midad Energy North Africa. The total funding package mobilized is valued at approximately 5.4 billion dollars, with 288 million dollars specifically allocated to research and exploration activities.
The operational schedule tied to this agreement will be carried out in rigid compliance with the environmental regulations enforced in Algeria. Planned operations will also incorporate the latest digital solutions and technologies to optimize exploration and production activities.
Additionally, the project places heavy emphasis on local content, giving priority to domestic subcontractors and Algerian suppliers throughout the execution phases of the contract. By the conclusion of the contract period, the projected cumulative output from the Illizi South field is estimated at 993 million barrels of oil equivalent (BOE). This total volume includes roughly 125 billion cubic meters of commercial gas, alongside about 204 million barrels of liquid hydrocarbons, consisting of 103 million barrels of liquefied petroleum gas (LPG) and 101 million barrels of condensate.