Egypt and Algeria sign crude supply deal, expand energy cooperation

Egypt and Algeria have signed a memorandum of understanding (MoU) to facilitate the purchase of Algerian crude oil, while also exploring broader cooperation in the oil and gas sectors, Al Akhbar reported on May 6.

The agreement establishes a formal framework for supplying Algerian crude to Egypt. According to Egypt’s petroleum ministry, it aims to secure domestic supply, enhance the resilience of energy systems and strengthen Egypt’s position as a regional energy trading hub.

The agreement follows an official visit by Egypt’s Minister of Petroleum and Mineral Resources, Karim Badawi, to Algiers. It was signed between the Egyptian General Petroleum Corporation and Algeria’s state energy company Sonatrach

The two sides also witnessed the signing of a major contract for the second phase of development at the Hassi Bir Rekaiz oil field in southern Algeria. The project, valued at around $1.1bn, will be executed by a consortium led by Egypt’s Petrojet in partnership with Italy’s Arkad. The development includes the construction of a central processing facility with a capacity of 32,000 barrels per day (bpd), as well as 217 kilometres of pipelines and associated infrastructure.

Both countries also discussed plans to strengthen strategic cooperation and accelerate joint projects, including a potential Egyptian-Algerian company to localise the production of industrial equipment in Algeria.

Egypt and Algeria are actively working to scale their bilateral trade volume to $5bn annually, driven by new agreements in energy and industrial localisation.