The reform of the algerian mining sector: Law no. 25-12 of 3 august 2025 governing mining activities

1.  What are the prospects for the mining sector in Algeria?

Algeria possesses significant and diversified mining potential, notably rich in iron, phosphate, and zinc, with further prospects extending to gold and diamonds.

However, this potential remains largely untapped, as it is estimated that only 10% of the national mining potential is currently being exploited.

In response to this situation, the Algerian authorities have, for several years, implemented an ambitious policy to develop the mining sector, with the aim of diversifying Algeria’s sources of revenue and reducing its dependence on hydrocarbons.

This development policy for the mining sector has firstly been implemented through of five major mining projects—current or forthcoming— across Algerian territory: the Gara Djebilet mine (iron ore), the Djebel Onk mine (phosphate), the Tala Hamza-Oued Amizour mine (zinc), the Amesmessa mine (gold), and the Djebel Reggane mine (diamond).

At the same time, the Algerian authorities have modernised the legal framework applicable to mining extraction activities by introducing structural reforms affecting both governance and the regime of mining titles.

It is within this context that Law No. 25-12 of 3 August 2025 governing mining activities was adopted, repealing the previous regulations. One of the stated objectives of this legislation is to attract and encourage private, particularly foreign, investment in the Algerian mining sector.

2. What measure characterises the opening of the mining sector to foreign investment introduced by Law No. 25-12 of 3 August 2025?

In order to enhance the attractiveness of the Algerian mining sector to foreign investors, Law No. 25-12 significantly eases the capital constraints applicable to investments in mining operations.

While mining operations remain reserved for companies incorporated under Algerian law, Law No. 25-12 abolishes the requirement for a majority Algerian shareholding in the capital of companies applying for a mining exploitation permit.

Previously, as mining was considered a “strategic” sector, it was subject to the “49/51” rule: any company seeking an exploitation permit had to be owned by one or more resident Algerians (legal or natural persons) to the extent of 51% of its capital.

This requirement considerably limited the autonomy of foreign investors.

Now, the mandatory Algerian shareholding is reduced to 20% of the share capital, and this stake will be held by a company in the mining sector (or its subsidiaries) wholly owned by the Algerian State (Article 101 of Law No. 25-12).

This provision offers foreign investors greater freedom in managing their investment. The Algerian shareholder does not hold a blocking minority either.

However, the requirement for a majority Algerian shareholding remains in place for quarrying activities: quarry exploitation permits are granted exclusively to legal entities under Algerian law whose capital is held by Algerian legal or natural persons to the extent of at least 51% (Article 102 of Law No. 25-12).

3. What other innovations introduced by Law No. 25-12 should be noted by foreign investors?

Law No. 25-12 also modernises and simplifies the regime for mining titles.

It subjects all mineral resources to a unified regime without hierarchy between them, thereby standardising the procedure for granting mining titles, whereas the previous regulations distinguished certain so-called “strategic” mineral substances by subjecting their exploitation to a specific regime (notably by reserving such activities for public enterprises or public institutions owned by the Algerian State).

Furthermore, Law No. 25-12 extends the initial duration of exploration permits to four years, renewable twice for periods of two years each. Similarly, the exploitation period is set at thirty years, renewable for maximum periods of twenty years.