Algeria plans to begin construction of its long-planned Trans-Saharan gas pipeline in 2026. The project, designed to transport 30 billion cubic meters of natural gas per year from Nigeria to Algeria and on to European markets, will cement Algeria’s position as an important hub for post-Russian supply diversification and strengthen its role as Europe’s main energy partner. This milestone comes as Algeria secures new hydrocarbon reserves and expands its export capacity while diversifying into green hydrogen in 2026, strengthening its position not only as a transit country but also as a long-term energy supplier to Europe.
Impact of pipeline capacity enhancement
Construction of new pipeline infrastructure has emerged as a central pillar of Algeria’s 2026 gas strategy as authorities move to protect export volumes to Europe. The 4,000km Trans-Saharan Gas Pipeline will export Nigeria’s gas reserves to European markets via established corridors such as the TransMed and MedGaZ pipelines. Like the Africa-Atlantic Pipeline linking Nigeria and Morocco, the Trans-Saharan Gas Pipeline would provide Europe with an important alternative supply route, especially after the continent was banned from Russian gas imports in January 2026.
Algeria also plans to undertake a major pipeline maintenance project in 2026 to ensure uninterrupted gas exports. State oil company Sonatrach is working with Chinese partners to inspect and renovate around 3,576 kilometers of pipelines to strengthen flows through the Medgaz link to Spain and the TransMed corridor to Italy. Additionally, state-owned enterprises are modernizing their long-distance networks to reduce power outages and improve operational efficiency.
Expanding gas production to support exports
Natural gas will remain the backbone of Algeria’s economy in 2026, accounting for 90% of exports, but a decline in aging gas fields continues to threaten production. To help increase production, the country’s hydrocarbon agency Arnaft is preparing to launch a 2026 licensing round targeting frontier lands and unconventional resources, including vast shale gas potential. At the same time, Sonatrach is moving forward with major projects, including a $5.4 billion production-sharing agreement with Saudi Arabia’s Midad Energy in the Ilij Basin and a $2.3 billion upgrade of the Hassi Rumel gas hub to enhance export reliability.
The Iridi development alone has the potential to extract around 125 billion cubic meters of gas, and the new booster station at Hassi Rumel is scheduled to come online in stages from the end of 2026. Framing the strategy at the Africa Energy Week 2025 conference in October last year, ALNAFT President Sameer Bekhti said there was a firm focus on expanding reserves and production.
“Today we are focusing on frontier zones to increase reserves and production (…). We also want to explore and develop offshore,” he said.
Hydrogen and renewable energy: building a new value chain
While natural gas continues to support export revenues, Algeria is simultaneously building a green hydrogen industry aimed at long-term demand in Europe. The government aims to produce 40 TWh of hydrogen and derivatives per year by 2040, starting with a 50 MW semi-industrial green hydrogen project being developed in Alzeu. To support large-scale electrolysis, authorities are accelerating the deployment of solar power, with 3,200MW of new generation capacity expected to be completed by the end of 2026.
Export infrastructure is also in the spotlight, with Algeria launching a feasibility study on the 3,300km Southern H2 Corridor in November last year. The proposed pipeline targets a capacity to transport up to 4 million tonnes of green hydrogen per year by 2030. The project will link Algeria and Tunisia to industrial hubs in Italy, Austria and Germany, and approximately 70% of the route will reuse existing gas infrastructure to reduce costs and emissions.
Algeria’s 2026 strategy thus suggests more than infrastructure expansion. It reflects a calculated repositioning at the heart of Europe’s evolving energy structure. The key question now is whether sustained upstream investment, pipeline execution and hydrogen scale-up can translate this strategic advantage into long-term supply advantage and diversified revenue growth.
