2022 Year in Review

As an exporter with substantial reserves and most of the required infrastructure,
high gas prices are likely to protect Alegria from the economic impact of Russia’s
invasion of Ukraine. Estimates find that Algeria is expected to earn an additional
$15 billion USD from energy exports this year alone.
Outright optimism regarding Algeria’s capacity as a dominant exporter has been
cautioned against by those who cite Algeria’s tendency to use gas as a ‘political
weapon.’ In the past, Algeria has cancelled gas contracts with Spain over its
support for Western Saharan autonomy. Furthermore, in 2021, due to escalating
tension with Morocco, the Maghreb-Europe pipeline which connected the two
states to Spanish and Portuguese gas grids was closed.
This did not stop the Italian oil and gas company, ENI, from finalising a deal with
the Algerian state-owned Sonatrach in July. Overseen by former Italian Prime
Minister Mario Draghi, Algeria will export an extra 9 billion cubic metres of gas
by 2023 via the Transmed pipeline. The deal makes Algeria Italy’s primary gas
supplier.
Much like Egypt and Qatar, Algeria looks promising and is projected to benefit
immensely in comparison to its North African neighbours. But the successful
expansion of Algerian gas production, particularly considering increasing
domestic demand, is something that must be monitored closely.
As Qatar, Iran, Egypt and Algeria vie for prominence in the energy market, it is
indisputable that none of these states can provide the quick fix that Europe is
looking for. Due to years of dependency on Russia and the subsequent disregard
of MENA exporters, infrastructure and funding issues have tainted attempts to
replace Russian gas in the short term.
P A G E 1 4 1