ALGIERS — Italian Prime Minister
Mario Draghi announced a deal on Monday to boost gas deliveries from energy
heavyweight Algeria, as he steps up efforts to reduce Rome’s heavy reliance on
Russian imports.
اضافة اعلان
Addressing journalists after meeting President Abdelmadjid
Tebboune, Draghi told journalists the two governments had signed a preliminary
deal on energy cooperation.
“There is also a deal between ENI and Sonatrach to boost gas
exports to Italy,” he said, referring to the Italian energy giant and Algeria’s
state hydrocarbons firm.
The firms agreed to boost gas exports through the Transmed
undersea pipeline starting this autumn, gradually “increasing volumes of gas
... up to 9 billion cubic meters per year in 2023–24”, ENI said in a statement.
The Ukraine war has sparked a Western push for sanctions against
Moscow, including moves to drastically cut purchases of Russian gas.
Italy buys the vast majority of its natural gas from overseas, and
is one of the most Russia-reliant gas importers in Europe, with over 40 percent
of its imports coming from the country.
But Italy also imports significant amounts from Algeria, including
some 6.4 billion cubic meters of Algerian gas during the first quarter of 2021,
a 109 percent uptick from the previous year.
The war in Ukraine and the subsequent campaign of Western
sanctions have prompted Rome to step up the search for alternative sources,
with gas giant Algeria an obvious option.
“Immediately after the invasion of Ukraine I announced that Italy
would organize quickly to reduce its dependence on Russian gas,” Draghi said.
“The deals today are a significant response to reach this
strategic goal, and others will follow.”
Spare capacity
Draghi arrived in Algeria weeks after Foreign Minister Luigi Di
Maio made the same trip, during which he confirmed that Italy was “committed to
increasing energy supplies, notably in gas”, including from Algeria, which he
said had “always been a reliable supplier”.
Algeria’s Sonatrach said at the time that it was prepared to
increase deliveries, notably via the Transmed pipeline linking Algeria to
Italy.
Its CEO Toufik Hakkar said Europe is the “natural market of
choice” for Algerian gas, which accounts for about 11 percent of Europe’s gas
imports.
But he said any boost to exports would depend on first satisfying
Algeria’s ever-growing domestic needs.
Sonatrach and Italy’s ENI jointly operate the Transmed pipeline,
which has a capacity of some 32 billion cubic meters per year.
Aydin Calik, an energy analyst at the Middle East Economic Survey,
said Monday’s deal implied additional exports that would push the limits of the
Transmed pipeline.
“That’s assuming Algeria actually has the capacity to supply more,
given its other commitments,” he told AFP. “There are lots of questions.”
Former Algerian energy minister Abdelmajid Attar previously told
AFP that “Algeria exports a maximum of 22 billion cubic meters (per year) via
the Transmed pipeline”, leaving some 10 billion in spare capacity.
Attar, also a former CEO of Sonatrach, said that Algeria’s
liquefaction facilities, which allow gas to be exported by ship, are “only
being used at 50–60 percent of capacity”.
He noted that in the short term, Algeria could boost its gas
exports to the EU by at most three billion cubic meters per year, meaning “it
can’t make up for a fall in Russian gas supplies on its own”.
However, “within four of five years, Algeria could send bigger
quantities” to Italy, he added.
Algeria expects to invest some $40 billion on gas and oil
exploration, production, and refining between 2022 and 2026.
Draghi did not say how much exports were to be boosted under
Monday’s deal.
The two countries have a contract for gas deliveries up until
2027.
Draghi said last week that Italy would “follow the decisions of
the European Union” on new sanctions against Russia, including a possible gas
embargo.
His visit also follows a spike in tensions between Algeria and
Spain, another major gas importer, after Madrid dropped a decades-long policy
of neutrality over Western Sahara and backed an autonomy plan put forward
by Algeria’s arch-rival Morocco.
Sonatrach warned earlier this month it could increase the price of
its gas sales to Spain, which make up more than 40 percent of the country’s
imports.
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