Gulf Nations Boost Energy Investments in North Africa
Gulf Cooperation Council states have increased capital commitments to energy projects in Libya and Algeria.
Updated on Sept. 30, 2026 in Oil and Gas
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Gulf nations have ramped up investments in the Libyan and Algerian energy sectors to diversify portfolios and address supply gaps. This marks a strategic shift as Libya reopens its energy licensing to foreign firms for the first time since 2007.
Why it matters
Regional energy market disruptions and conflicts in Ukraine and the Middle East have encouraged Gulf countries to seek opportunities in North Africa. These partnerships help secure energy supplies while providing Libya and Algeria with necessary capital to modernize infrastructure.
Gulf-backed projects in Algeria reached $9 billion between March 2025 and September 2026, while UCC Holding secured a $1 billion contract in Libya. These deals include a target to raise Ghadames Basin output from 33,000 to 80,000 barrels per day.
The players
UCC Holding
This investment firm signed a $1 billion contract to boost oil production in the Ghadames Basin.
Midad Energy
A Saudi Arabian energy company that finalized a $5.4 billion oil and gas deal in Algeria during October 2025.
Baladna
This company is leading a $3.5 billion dairy venture project in Algeria.
Sonatrach
The Algerian state-owned oil and gas company is overseeing a massive infrastructure modernization plan through 2030.
The details
Gulf states are actively building diplomatic ties with both Tripoli and Benghazi to navigate the complex Libyan political landscape. Meanwhile, Algeria is utilizing foreign capital and technical expertise to drill 1,450 new wells by 2030 and develop seven recently opened oil and gas blocks.
Timeline
Libya reopened energy licensing to foreign investors in February 2026.
Libyan authorities approved a common state budget in April 2026.
Algeria expects to sign new oil and gas contracts in January 2027.
Sonatrach aims to complete the drilling of 1,450 wells by 2030.
Market Landscape
This move signals a pivot from the 2007 closure of Libyan energy licensing toward a more integrated regional market. By securing these contracts, Gulf firms are positioning themselves to capitalize on North African resource extraction as the region modernizes its infrastructure.
Increased investment in North African energy production could help stabilize global supply chains and mitigate volatility in energy markets. For consumers, this expansion is intended to fill supply gaps caused by ongoing international conflicts.
The takeaway
The surge in Gulf-backed capital highlights a broader trend of regional diversification as nations seek to strengthen their energy security. Investors and industry stakeholders should monitor the January 2027 contract signings as a key indicator of project viability in Algeria.
What happens next
Algeria is scheduled to sign a new series of oil and gas contracts in January 2027 following the conclusion of its current licensing round.
Further reading
Learn more about shifting global energy trends in our Oil and Gas section.
Source note: This article includes information reported by Global Finance Magazine.
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