- Algerian exports of oil and gas, mainly to Europe, peaked in 2005 and have since fallen by 24% / 628,000 barrels oil equivalent per day . Those countries thinking of switching supplies from Russia had best not look to Algeria, N Africa’s biggest gas producer and exporter.
- The Algerian economy is dominated by oil and gas production and exports. The country is a member of OPEC and is one of the more stable countries in N Africa.
- The country’s population has grown from 15 million in 1970 to 39 million today . Per capita energy consumption has not changed significantly since the early 80s but population growth has driven gross domestic energy consumption up. Sharply rising electricity consumption  must surely bear witness to rising living standards.
- From 1965 to 2005 Algeria witnessed an immense rise in oil and gas production from 27 to 166 million tonnes oil equivalent per annum in 2005 (0.54 to 3.32 million barrels oil equivalent per day). But since 2005 oil production has declined and gas production has been static / in slow decline. This combined with rising domestic consumption has given rise to a steep drop in exports of both oil and gas . This is one marker for the squeeze on global energy supplies since 2005.
Figure 1 A peak in oil production in 2007 (Figure 10) and a plateau in gas production since 1999 (Figure 12) combined with rising domestic consumption has seen Algeria’s export energy balance decline steeply since 2005. Algeria has no coal production but has imported small amounts of coal in the past. 
More of the story and 12 more charts below the fold….
- Algeria exports gas to Italy, Spain and Turkey by both trans Mediterranean pipelines and LNG .
- Algeria has historically run a large trade surplus which is presumably saved as government bonds with their European trading partners. But this trade surplus has fallen from $26 billion in 2000 to under $2 billion in 2012 (US$ 2005). The cumulative surplus since 1970 is $504 billion and so Algeria can tolerate a number of years of deficit .
- Algeria covers a vast territory with many smaller oil and gas fields awaiting development . The challenge will be to attract foreign investment to develop fields in remote areas, distant from market. The country, and Sonatrach, its national oil company, have historically proven to be extremely difficult for western companies to work with and that won’t help attract future investments (see caption to Figure 12).
Figure 2 Oil and gas production has grown strongly since 1965 but since 2005 has been in decline. With combined production of 3.3 million barrels per day, Algeria is a major oil and gas producer and exporter .
Figure 3 Oil and gas production is matched by soaring energy consumption . Per capita consumption has been effectively flat since 1983 (Figure 6) and the rise in gross consumption therefore mirrors the dramatic rise in population (Figure 5). The flat spot on the chart reflects a recessionary period brought about by falling oil prices. It has to be noted that sharply higher oil prices since 2000 have caused consumption to fall in the OECD but have brought prosperity to the energy exporting nations.
Figure 4 Algeria is connected by pipelines to Italy and Spain  and also exports liquefied natural gas (LNG) to Italy, Spain, France and Turkey. With falling exports, these countries will be looking to secure new suppliers – NOT RUSSIA!?
Figure 5 The Algerian population is smaller that Egypt’s but has shown even greater growth of 160% since 1970 . The economy stagnated from 1985 to 1994 with falling energy prices. With oil and gas production in decline the economy has been kept going since 2005 by rising energy prices.
Figure 6 Algeria has operated a conservative trade policy running a significant trade surplus  that is presumably locked away as government bonds of its main trading partners – Italy, Spain, France and Turkey. Algeria must be a little concerned about the quality of some of the debt that it owns. With energy exports in decline since 2005, Algeria’s surplus is fast disappearing but this should not create problems for some time given the cumulative surplus from the past that amounts to $504 billion.
Figure 7 The relationship between per capita energy consumption and GDP [1, 2] is more complex in Algeria than the very simple picture seen in Egypt . The most notable feature on the chart is the dramatic rise in per capita consumption from 1970 to 1983. This must have been a period of sharply rising prosperity. In this case consumption was driven by oil wealth and was largely not being used to create wealth (See Figure 8). Per capita GDP has barely risen since the early 1980s.
Figure 8 The expected correlation between energy consumption and GDP exists in Algeria but is made complex by the resource dominance of the economy, how that has been used to spread prosperity, further complicated by the recessionary 1980s. In 1970, Algeria produced $9775 GDP per TOE consumed. By 2012 it was $2749 GDP produced for every TOE consumed. Much of this consumption is simply providing comfort to Algerians and little of it will be used to produce wealth. Algerians are still much wealthier than Egyptians with per capita GDP of $3189 in 2012 compared with $1643 in Egypt.
Figure 9 I am anticipating that electricity generating statistics may provide useful insight to the rate and level of development of countries. Per capita electricity in Algeria has risen 2.8 fold since 1985 . In 2012, Algerians used 1.49 MWh each per annum compared with 2.01 in Egypt. Egypt has a large tourist industry that may distort the figures but at face value Algerians are richer but use less electricity. Russians, by comparison use 7.45 MWh .
Appendix: Oil and Gas production and export balance charts
Figure 10 Algerian oil production plateaued at just below 2 million barrels per day in the period 2004 to 2008 and has since shown a significant decline . Algeria is a member of OPEC and OPEC countries do withhold production to control global supply demand balance and price. Post-2008 financial crash, OPEC did reign in production but most OPEC countries have since ramped up again to meet global demand. It is therefore unclear if the fall in Algerian oil production is resource constrained or voluntary.
Figure 11 The impact of declining oil production is exacerbated by rising domestic consumption leading to a sharp fall in oil exports since 2005 . But rising prices have protected the Algerian economy.
Figure 12 Algerian gas production has been on a plateau since 1999 . The country has large untapped gas resources and I can’t help but feel that the Algerian authorities, imposing a slow pace of development, are preserving resources for future generations. This enlightened policy, if true, does not mix well with attracting foreign capital where immediate returns are expected.
Figure 13 With gas production on a plateau and domestic consumption rising, Algerian gas exports to Europe have been falling since 2005 .
 BP: Statistical Review of World Energy 2013
 UN: National Accounts Main Aggregates Database
 Map of Algerian Oil and Gas fields and infrastructure
 Egypt – energy, population and economy
 Russian Power