✏️ BY: Dr. Hana Saada
Algiers, Algeria | June 15th, 2024 — Sonelgaz, Algeria’s state-owned energy group, is set to expand its horizons beyond national borders with ambitious plans to penetrate European markets. This strategic move was highlighted during a meeting between Sonelgaz CEO, Mourad Adjal, and the director responsible for exploration-production at Total Energies for the Middle East and North Africa.
Adjal emphasized that “the future of Sonelgaz lies in its deployment in Europe,” unveiling plans centered around the realization of an ambitious undersea electricity cable linking Algeria to Italy via Sardinia. This project necessitates significant financial backing, positioning Sonelgaz to diversify its economic and commercial activities, thereby integrating a new economic model focused on value creation.
The Algeria-Italy Electricity Interconnection Project
The proposed undersea electricity interconnection between Algeria and Italy is poised to become a cornerstone of Algerian-European energy relations. First reintroduced by President Abdelmadjid Tebboune during his 2022 visit to Italy, the project aims to enhance energy security and sustainability across the Mediterranean region.
Mohamed Arkab, Algeria’s Minister of Energy, highlighted the project’s critical importance, noting that discussions with Italian counterparts, including recent meetings between Sonelgaz executives and the Italian ambassador to Algeria, have entered their final stages. Once completed, the cable will initially provide a capacity of 1000 to 2000 megawatts (MW), managed by Sonelgaz on the Algerian side and Italy’s electricity transmission system operator, Terna, on the Italian side.
Project Scope and Investment
The Algeria-Italy undersea cable project spans approximately 360 kilometers and reaches depths of up to 2000 meters in the Mediterranean Sea. Initial estimates suggest an investment requirement between $1 billion and $1.5 billion USD, with a projected completion timeframe of 6 to 7 years.
Sonelgaz has made significant strides in preliminary studies for the cable’s construction, affirming its technical feasibility and strategic importance. Attention now turns to securing financing, a focal point of ongoing discussions between Algerian and Italian officials. The project aims to position Algeria within the European electricity market, particularly in the realm of green energy, enhancing its profile as a major electricity producer and exporter.
Algeria’s Energy Landscape
Algeria currently boasts a robust electricity production capacity exceeding 25,000 MW, with peak-hour consumption reaching 17,000 MW. This surplus allows for significant exports, including 500 MW annually to Tunisia and experimental interconnections aimed at supplying electricity to Libya via Tunisia. Looking ahead, Sonelgaz plans to extend its reach into the Sahel region following the completion of interconnection projects linking southern Algerian grids with the national network.
With ongoing efforts in renewable energy, including a solar energy program slated to generate 15,000 MW by 2035, Algeria is poised to further solidify its position as a key player in regional and international energy markets.
Sonelgaz’s strategic pivot towards European markets underscores Algeria’s ambition to leverage its energy resources for economic growth and regional integration. As the Algeria-Italy undersea cable project progresses, it promises not only to bolster energy security but also to forge closer ties between Algeria and its European counterparts, setting a precedent for sustainable energy collaboration across the Mediterranean.
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