Italy’s Iron lady energy conquest in Africa
By: contribution for Syrializm
At a time when the world is still preoccupied with the ongoing war in Ukraine since last year, which has cast a heavy shadow over the European continent and its economy, there is another type of war is raging in onther place, and almost no one pays attention to it.
This war involves two of the most important countries in Europe, and two of the most important countries in North Africa.
Italy’s Iron lady, Giorgia Meloni, the prime minister of an important large economy in Europe, with total GDP that surpass $1.88 trillion.
Meloni took office less than 5 months ago, as she’s leading the first right-wing Italian government since World War II.
Meloni is pushing for confrontation with another large European country, which is France.
Italy, currently is taking a part in the Algerian struggle against France.
Meloni’s first visit to an African country, was to Algeria, as she stayed there for two days only, but those two days were quite enough to ignite the anger of the Élysée Palace and the French media.
What made France angry and furious over the new Italian prime minister is that, as soon as she landed at the Algerian capital airport, she visited the shrine of the martyr, which is the famous symbol that overlooks the Algerian revolution and the martyrs of Algerian people who died while struggling against the French colonization.
Meloni also visited the Enrico Mattei Garden, named after the founder and legendary Director of the famous giant Italian oil and gas Eni Company.
Enrico Mattei was one of the biggest supporters of the Algerian struggle against French colonialism in the 50s and 60s.
The story of his death in a plane crash was surrounded with mysteries, and exciting theories which suggested that his death at the plane crash was nothing but an assassination incident, not an ordinary plane crash accident, such as that of Philippe de Vosjoli, a former French Intelligence agent, known at the time as SDECE, who said that agents from the SDECE were responsible for the crash of Mattei’s airplane, and the fact that he was killed because he was about to orchestrate an Italian takeover of the French oil interests in Algeria.
Giorgia Meloni’s visit to Algeria sent obviously a strong message to Paris, which the new Italian iron woman is heading for some sort of confrontation with France.
Apparently, she made it very clear, that during her visits to places that annoy the French officially and effectively through a declared Italian goal boldly titled “Italy as a major center for the delivery of gas supplies from Africa to Europe in the very near future”, which would mean taking Russia’s place in some sort, as supplying almost half of Europe’s natural gas needs, and at the same time pulling the rug from under the French in North, Central and Western Africa.
Evidence of that is that less than a week later, Giorgia Meloni went to another Arab and Northern African country, as she visited Italy’s former colonized country Libya.
These smart, quick, and calculated Italian moves prompting very important questions, such as:
What’s Italy’s plan in order to remain a key player in the global natural gas markets?
How can Algeria mainly, but also other African countries, would help achieving this goal?
Will the Italian infrastructure allow transporting such quantities of natural gas which Europe heavy needs?
What are the details of the so called Mattei plan announced by the Italian Prime Minister in the heart of Algerian Capital?
These are of course, a sample questions that require answers.
In order to understand how Italy is approaching this conquest, fingers are will be pointed out at the energy situation in Italy before the Russian-Ukrainian war.
Before the Russian military operation in Ukraine, Russia was supplying the European Union countries with 40% of their natural gas needs, and Italy was the second largest importer of Russian natural gas behind Germany.
It’s in general one of the largest importers and consumers of Russian natural gas in Europe.
Italy imports 90% of its natural gas supplies, which is approximately 40% of it, or about 29 billion cubic meters, was coming from Russia.
In 2021 the Italian domestic consumption of natural gas reached 75 billion cubic meters.
Natural Gas is fully responsible for generating half of the country’s electricity, and it’s the main energy source for Italian industries and for household heating.
But after the Russian president Vladimir Putin launched the still ongoing war on Ukraine, Italy among other European Union countries found themselves threatened with the cutoff of Russian natural gas supplies, and indeed Russian natural gas supplies began to gradually decrease as the war intensified, and the European Union imposed large piles of sanctions of all kinds on Moscow.
Therefore, the logical step for the Europeans was to discuss alternatives to the Russian natural gas.
During the few months after the war in Ukraine, Italy had two main goals which are a short-term goal, which was to secure its supplies of natural gas after phasing out Russian natural gas, and a middle-term goal, which was to plan to re-export the surplus natural gas it imports from Africa to Europe, and thus be a natural gas hub in the European continent.
Thanks to precise moves made by Eni, the Italian energy giant Company, and the former Italian Prime minister Mario Draghi, Italy has largely succeeded in achieving its short-term goal of securing the country’s natural gas supplies, and weaning it off Russian natural gas.
Italy’s choice to fulfil this goal was Algeria, as it was, at that moment, Italy’s second largest natural gas supplier after Russia, by supplying 29% of Italy’s total natural gas needs, meaning approximately 21.2 billion cubic meters, but the Italians wanted an additional 9 billion cubic meters of Algerian natural gas.
And that’s why the former Italian Prime minister Mario Draghi led a high-class delegation on April 2022, to secure this agreement and convince the Algerians to sign it, and also to secure a foothold for Eni Company there.
Of course, Claudio Descalzi, the CEO of Eni Company, and one of the most important Italian businessmen ever, was in the Italian delegation that visited Algeria.
The visit was so successful that at the end of May, the Algerian President Abdelmadjid Tebboune reciprocated the visit and traveled to Rome, and there he made a logical and understandable request to the Italians.
Tebboune said to his Italian hosts, “You want more gas, then you must help us raise our production capacities”.
And as a result, the two energy giants, the Italian Eni Company and the Algerian state-owned Sonatrach Energy Company, signed an agreement to boost natural gas exploration and accelerate the development of existing fields to develop green hydrogen projects in Algeria, and to lay a submarine cable from Algeria to Italy to transmit electricity.
They also agreed to gradually increase natural gas flows to reach the 9 billion meters cube required by the Italians by 2023-2024.
After this mutual visit, the Italian Prime Minister made frequent visits to Algeria in particular, and to other countries around the world in general to secure Italy’s natural gas supplies away from Russia.
This effort had the greatest impact on Russia’s supplies, which decreased by 40%, reaching only 10% of Italian natural gas imports, starting from late September 2022.
Italy succeeded in drastically reduces most of its need for Russian natural gas, as it compensated by increasing natural gas supplies mainly from Algeria and in a lesser extent from Egypt and Libya, after Mario Draghi’s effective maneuvers with the help of his right-hand in the field of energy, Eni Company CEO, Claudio Descalzi.
This is where Mario’s term ends, and kudos to him, as the post went to the winner of the Italian parliamentary elections, Giorgia Meloni, as her post in power as new MP of Italy begins.
Meloni took office after her conservative right-wing party, Fratelli d’Italia, (FdI) “Brothers of Italy,” won the elections last October, and thus formed the new Italian government, while at the same time terrifying Europe with this victory.
The Brothers of Italy party (Fratelli d’Italia, (FdI)), led by Giorgia Meloni, is the main heir to the so-called “neo-fascism”, and the party’s members are Italy’s most far right people who sanctify nationalism, and hold great skepticism about the European Union and the usefulness of its existence, and want to renegotiate the European Union treaties.
Meloni’s motto in her election campaign was a populist slogan of Prima l’Italia e gli italiani! “Italy and the Italian people first”, and most of her government is formed by members of her right-wing party, and from other right-wing and conservative parties such as the Lega Nord party, and the former Italian Prime Minister Silvio Berlusconi’s party, Forza Italia party.
In short, Meloni sees and prioritizes the nationalism of her country only, and the first goal she started working on immediately after taking office is placing Italy in a major strategic position on the global natural gas map, while also planning to make it the next major European natural gas hub.
As been mentioned, Italy choose Algeria to be the spearhead in order to achieve the objectives.
Algeria is the largest exporter of Natural gas in Africa, as it produces 100 billion cubic meters of natural gas each year, consuming half of it domestically and exporting the rest, and possesses one of the largest oil and natural gas reserves in Africa, which however is a largely untapped resource due to a combination of mismanagement and lack of investment.
Thus, Algeria’s capabilities make gave it the position to be the main cornerstone of Giorgia Meloni’s ambitious conquest, which is why her first visit to an African country was to Algeria.
This was encouraged by the fact that the Italian operator Eni Company, the world’s largest in the field of energy, and is considered the main foreign energy company operating on Algerian territory since 1981.
That’s why Giorgia Meloni’s chose Algeria to announce her grand plan, through which Italy will become a huge global natural gas hub.
The Italian plan was given the name of “Mattei plan”, referring to the founder of Eni Company, Enrico Mattei, because it simply aims to repeat what Mattei did in the 50s and 60s, which was the core of Italy’s foreign policy at the time.
During this period, he supported Algeria’s independence from France and confronted the major Anglo-American oil companies because of their exploitation of African resources.
He defended the continent’s utilization of its natural resources and tried to help them maximize their economic growth, without of course forgetting his main priority, which was to strengthen the independence of his own country, Italy in the field of energy by using some of Africa’s resources.
Eni Company was at the time offering mutual energy deals to the African countries with actually fair and mutually beneficial policies, something that was never provided by any other international parties.
For example, Eni Company offered countries such as Tunisia and Algeria an equal partnership to extract their oil in exchange for profit margins much lower than those offered by the major international oil companies to African countries.
And this can clearly explain why this man (Enrico Mattei) was obviously assassinated.
The Italian Prime Minister currently wants to implement Mattei’s strategy once again, and turn Italy into an energy bridge connecting Africa to Europe by investing in African countries with fair bilateral energy deals for all sides.
Meloni described this investment approach as “non-predatory and cooperative”, especially with Algeria which has now replaced Russia as the largest supplier of natural gas to Italy.
But does Italy have the proper natural gas infrastructure that would enable transporting billions of cubic meters of excess from its domestic consumption natural gas from the south to the north?
At meantime, Italy has 3 pipelines transporting natural gas.
- The first pipeline is the Enrico Mattei gas pipeline, also known by the TransMed Pipeline.
This line starts from the municipality of Hassi R’Mel in the Algerian state of Laghouat, passes through Tunisia, then goes under the strait of Sicily, reaches Sicily itself in southern Italy, and then onto the Italian mainland.
- The second line is the Greenstream pipeline.
This pipeline belongs to the Libyan West Gas Project, and starts from the Wafaa field in the Libyan city of Mellitah, passing through the Libyan northwest, then under the Mediterranean Sea, reaching Sicily in southern Italy.
- The third line is the Trans Adriatic Pipeline, known as TAP, which is part of the western European Natural gas Corridor project.
This pipeline consists of 3 lines that complement each other.
- The first line, which is called South Caucasus Pipeline, aka SCP, starts from the Shah Deniz field in the south of the Caspian Sea, the largest natural gas field in Azerbaijan, and ends on the Georgian-Turkish border.
- The second line is the Trans-Anatolia natural gas pipeline known as TANAP, which is a Turkish pipeline that starts from the Georgian town of Akhalkalaki and crosses all of Türkiye.
- The third is the Trans Adriatic Pipeline (TAP), which goes from Greece to Albania, and then under the Adriatic Sea until it reaches the San Foca region in eastern Italy.
These are the 3 pipelines that currently supply Italy with natural gas, but if Giorgia Meloni wants to lead Italy to become the first natural gas hub for Europe, then these pipelines won’t be enough.
That’s why the Italians are taking two paths:
- The first is expanding these pipelines.
- The second is laying new pipelines.
In this issue, Italy has started working on doubling the capacity of the TAP pipeline, so that it can deliver 20 billion cubic meters of natural gas by the year 2027.
During Meloni’s visit to Algeria, she made an agreement with the Algerian officials to resume work on the Algeria-Sardinia-Italy pipeline project known as Galsi.
The construction of this pipeline was supposed to start in 2012 in order be operative in 2014.
However, and here another irony involving France, the project was halted due to the discovery of a large warship wreck belongs to France, the “Danton battleship” that goes back to the 1st World War, which sank between the Italian island of Sardinia and northern Algeria.
Therefore, the project was put on hold.
Nowadays, Rome and Algeria have begun rebuilding the pipeline that will extend from the Algerian field of Hassi R’Mel to the north of the country, then to the island of Sardinia, reaching the Italian city of Piombino.
Additionally, Italy has 3 regasification plants to import liquefied gas and convert it into natural gas.
One in the Veneto region, and the second in the Liguria region, the third plant in the Tuscany region.
Italy’s 3 plants have a combined capacity to re-convert liquefied gas into natural gas of 15.25 billion cubic meters.
Moreover, a few months ago the operator of the Italian gas network, the state-run Snam Company, bought a ship, which serves as a floating gas storage and regasification unit (FSRU) and is called Golar Tundra, for $350 million.
A month later, Snam bought another FSRU ship called BW Singapore for $400 million.
Both ships have a capacity of 5 billion cubic meters of natural gas each.
FSRU vessels generally refer to a type of enormous ship that stores natural gas and has the ability to convert it from liquefied gas to natural gas, which renders them highly important units.
That’s why Stefano Venier, CEO of the Snam Company, said that the two ships will provide 13% of the Italian domestic consumption needs for natural gas.
The Italian domestic consumption is expected to decrease by 7% by next month, because at the beginning of last August the EU countries approved a voluntary reduction in gas demand by 15%, with the possibility of exceptions according to each country’s circumstances.
Italy said that it will aim to reduce demand by only 7% and obtained an exemption from the European Council based on its ability to store natural gas.
By next month, Italian domestic consumption is expected to drop to 65.7 billion cubic meters per year.
Since Italy’s main goal for taking all these steps is to become the first natural gas corridor for Europe, it must take care of the infrastructure that will transport the excess quantities of imported gas coming from the entry points that we mentioned a while ago to its strong industrial center located in the north of the country, as well as to the export channels that used to transport natural gas from Russia, passing it through some European countries before it reached Italy.
That’s not the case now, as the Italians will create a reverse flow of natural gas from their country to other European countries through the Trans Austria Gas pipeline (TAG), which passes through Austria, and through the Transitgas pipeline that goes through Switzerland, which will in turn transport Italian natural gas to high-demand markets in Central and Western Europe.
For that reason, Italy started investing $2.7 billion in an additional land pipeline that will run through the heart of Italy, called the Adriatic pipeline.
The Adriatic pipeline will increase the transportation capacity between the south and the north by about 10 billion cubic meters.
However, it seems that Giorgia Meloni’s ambition has no limits and won’t be satisfied with all of this, as she’s trying to take advantage of the critical situation the European Union is going through in the field of energy, in order to gain its financial and political support to achieve the Italian ambition in the region.
This will be done by a project called “REPowerEU plan”.
This plan is a very huge developed by the European Commission in May 2022 to make the European Union independent of Russian fossil fuels by 2027, and of course with huge sums allocated to accelerating the European Union’s diversification of natural gas supply sources.
The plan will be supported by $263.5 billion in loans and grants.
Of course, the European Union is now excited about any projects that will make it dispense with anything coming from Russia.
That’s why, on February 6, Giorgia Meloni along with some of her government’s ministers met with the heads of major Italian energy companies, such as the CEOs of energy giant Eni Company, Enel Company, the Italian distributor of electricity and gas, of the Italian gas network operator Snam, and of the Italian transmission system operator Terna.
After the meeting, she explicitly stated that she would use the EU funds of the “REPowerEU plan” to completely wean Italy from Russian natural gas and turn the country into an energy hub for the EU.
Therefore, considering the amount of domestic consumption after the expected decrease, the solid infrastructure that Italy owns and has begun to expand and develop, the additional quantities that Eni contracted with the Algerian Sonatrach Company, the increase in imports of natural gas from Azerbaijan and liquefied gas from Egypt, Angola, the Congo Republic, Nigeria and Mozambique, not to mention Eni’s new investments in Libya and other countries, which will likely bear fruit within the next 3 years, Italy will become a major exporter of natural gas to northern European countries.
Thus, Italy’s strategy has succeeded, and it achieved its ambitions to become the main natural gas corridor for Europe, which will help it in the future to increase its weight within the European Union, and will enhance its influence in the Mediterranean region, because the country will play a major role in the energy security of the European Union on one hand and will serve as the largest natural gas customer for the Mediterranean countries and Africa.
