There has been a lot of ink spilled on the energy relationship between Russia and Europe. Russia is, after all, Europe’s top supplier of natural gas.
But it is not the only source of natural gas. Just across the Mediterranean is a country that often doesn’t make it into the headlines, but one that the European Union could not do without. That country is Algeria. Algeria is Europe’s third largest supplier of natural gas, and those flows could continue to rise into the future.
Consider this: Algeria has the third largest estimated reserves of shale gas in the world (after China and Argentina) with 707 trillion cubic feet. It is Africa’s largest natural gas producer, and one of the continent’s top three oil producers. There is a lot of promise for Algeria. But to become one of the world’s great shale producers, there is a lot to overcome.
Lots of Potential But Big Hurdles
The North African OPEC member depends on oil and gas for 95% of its export revenues. But production levels have declined. There are several reasons for this including bureaucratic red tape, a dearth of infrastructure, and a shortage of investment.
Its eastern neighbor Libya has been struck by a massive bout of violence, which has tossed its oil and gas sector into disarray. Although Algeria avoided much of the instability during the Arab Spring, it is not immune to security threats. In 2013 there was…