Page 6 - EurOil Week 29 2022

EurOil COMMENTARY EurOil

Italy arranges to import more

gas from Algeria

The North African state has now surpassed Russia as the largest supplier of gas to the Italian

market, but Europe is still a long way away from replacing Gazprom

ITALY ITALY’S Prime Minister Mario Draghi paid a Italian-Algerian deals
visit to Algeria on July 18 with the aim of finalis- According to press reports, the two heads of
WHAT: ing an agreement on additional natural gas sup- state signed no less than 15 agreements and
Italy has formalised plies from the North African country. He was memoranda of understanding (MoUs). One of
a deal that will boost certainly eager to do so, as Russian supplies to the agreements formalised plans for the deliv-
Algerian gas imports to Europe have become uncertain. ery of the additional 4 bcm of gas in 2022, while
25 bcm this year. Before the trip, Draghi had good reasons to another extended the term of a production-shar-
hope for a deal with Algiers. As Reuters reported ing contract (PSC) covering two oil-bearing
WHY: on July 16, Algeria’s national oil company (NOC) blocks in the Berkine basin. (Eni is a party to the
European concerns about Sonatrach has said it is ready to provide Italy PSC, while France’s TotalEnergies is serving as
energy supplies are with an additional 4bn cubic metres of gas in operator of the project.)
mounting ahead of the 2022, in addition to the 21 bcm agreed earlier Draghi hailed the signing of the documents
heating season. by both countries. Those additional supplies as beneficial for both countries, saying: “Algeria
were expected to start being delivered to Italian is a very important partner for Italy, in the energy
WHAT NEXT: customers – including Eni, which is majori- sector, in the industry and business fields, in the
The EU has yet to secure ty-owned by entities linked to the Italian govern- fight against criminality and in the search for
adequate replacements ment – this week. peace and stability in the Mediterranean.”
for gas from Russia, its Draghi had originally planned to visit The prime minister also emphasised Alge-
single largest supplier. Algeria for two days, but he cut the visit short ria’s growing importance as a source of gas for
after the main partner in his unity govern- the Italian market. He pointed out that the North
ment, the populist 5-Star Movement, boy- African state had “become in recent months the
cotted a confidence vote on an energy costs biggest supplier of gas” to his home country.
relief bill. Nevertheless, he did meet with Russia used to provide Italy with nearly 29 bcm
Algerian President Abdelmadjid Tebboune of gas per year, covering about 40% of the coun-
and finalised a number of joint agreements try’s needs. Algeria, meanwhile, exported nearly
designed to boost co-operation between the 23 bcm to Italy in 2021. Thanks to new agreement,
two countries. though, that figure is set to rise to 25 bcm.

P6 www. NEWSBASE .com Week 28 15•July•2022