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Italy's prime minister visits Algeria to finalise gas deal

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Italy's prime minister visits Algeria to finalise gas deal
Algerian President Abdelmadjid Tebboune shakes hands with Italian PM Mario Draghi prior to their meeting at Chigi Palace, in Rome, on May 26, 2022. Photo by Andreas SOLARO / AFP.

Italian Prime Minister Mario Draghi sealed 15 agreements with Algeria's president on Monday as part of plans to increase gas imports and reduce Italy's reliance on Russian supplies.

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Draghi was received by President Abdelmadjid Tebboune, and the two went on to sign agreements and memorandums of understanding in areas ranging from
energy to sustainable development, justice and micro-enterprises.

The energy agreement signed on Monday is "a testament to our determination to achieve even more in this domain," Draghi said, ahead of the expected
signing of an oil and gas supply deal between Algeria and a clutch of companies including Italian energy giant Eni.

READ ALSO: Italy signs gas deal with Algeria to reduce reliance on Russia

"Tomorrow, an important agreement between (US energy firm) Occidental (Petroleum), (Italian energy giant) Eni and (French oil company) Total providing significant volumes of natural gas" to Italy will be signed, Tebboune told reporters at a joint news conference with Draghi.

He was referring to a deal reported on Friday by Algeria's APS news agency to raise gas deliveries to Italy by an extra four billion cubic metres this year.

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Italy buys the majority of its natural gas from abroad, with some 45 percent of its imports historically coming from Russia.

But Rome has increasingly looked to Algeria, historically its second biggest supplier, to reduce that dependence after the war in Ukraine sparked sanctions against Moscow and sent energy prices soaring.

Algeria has therefore supplanted Russia to "become in recent months the biggest supplier of gas" to Italy, Draghi told reporters on Monday.

The two countries also expect to sign accords to bolster judicial, industrial and cultural cooperation, according to Draghi's office.

According to APS, Algeria was set to furnish Italy with a total of around 20 billion cubic metres of gas in 2022 as a whole, before the latest deal.

Draghi previously visited Algeria in April, when he concluded a deal increasing Algerian deliveries to Italy through the Transmed pipeline by up to nine billion cubic metres per year in 2023-24.

In May, Eni signed a memorandum of understanding with Algeria's Sonatrach to boost gas exploration in the North African country.

READ ALSO: What does Italy’s Algerian gas deal mean for energy supplies?

The MoU "will allow Sonatrach and Eni to evaluate the gas potential and opportunities for accelerated development at specific fields already discovered by Sonatrach in Algeria", Eni said at the time.

Algeria is Africa's biggest gas exporter and supplies around 11 percent of the natural gas consumed in Europe.

The trip could be Draghi's last state visit: the prime minister attempted to resign on Thursday after the largest party in his coalition government boycotted a key vote.

At the request of President Sergio Mattarella, Draghi agreed to temporarily remain in post. He will address parliament on Wednesday to see whether a resolution can be reached.

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