Algeria’s parliament Thursday adopted a controversial law aimed at boosting investment in the oil and gas sector, state media said, as activists warned that multinational companies would plunder the country’s wealth.
The National Popular Assembly vote came a month after the draft legislation had been approved by the government, and ahead of a presidential election due to take place in December.
Although the text has not been officially published, the plan has stirred passions among a months-old anti-regime protest movement that fears “the nation’s wealth” is being sold off to foreign oil companies.
The activists distrust any decisions taken by a regime that has been in place since Algeria’s independence from France in 1962 and have clamoured for the ouster of the entire ruling elite.
Algeria is Africa’s third-largest oil producer and a top 10 global gas producer.
Experts say the new law is expected to keep Algeria’s oil and gas wealth firmly in the hands of the state.
While the text makes “adjustments” to the legislation, “the broad direction of Algerian policy on oil and gas is absolutely not called into question,” said industry expert Francis Perrin.
It will guarantee that state-owned oil company Sonatrach has a majority stake in all projects involving foreign players, said Perrin, director of research at the French Institute for International and Strategic Affairs.
The law aims to “make the legislative and tax framework more attractive, simple and flexible, to draw more (foreign) investments in the oil and gas sector,” he added.
Many Algerians suspect those in power plan to hand over Algerian natural resources to foreign firms with the new law, having already “squandered” oil revenues, said Paris-based economics professor El Mouhoub Mouhoud.
“These opinions are a testament to the current government’s lack of credibility in the eyes of the people,” said Mouhoud.
Nevertheless, everything “suggests that in this new draft law, the mineral title (rights to underground resources) stays in the hands of the state, while exploitation and investment operations can be shared” he added.
Oil and gas production steadily declined after the previous law was adopted in 2005, as has the interest by foreign companies in Algerian resources. AFP
