The story of the future of energy in Algeria

 By Ian Martin

In Algeria, there is an ancient tradition of oral storytelling from the past, a tradition which is currently undergoing something of a revival…

One of the stories told to children and adults alike is of an authentic national hero, Emir Abdelkader. His resistance to French colonialism and his regard for what we today would be called human rights unite all Algerians today. An Algerian friend told me that Emir Abdelkader was “a unifier inside and outside the country, a fighter but not a divider. No matter his incredible difficulties, his imprisonment and exile, he never allowed hatred or revenge to trump his compassion”. One of his most famous quotes which Algerians love to cite is, “Don’t ask about a man’s genealogy, but about his character, his life and his deeds”, and it is this spirit of compassion and understanding that is so pervasive in the country today.

A strategic supplier

However, even if this link to the historic past is somehow very typically Algerian, the country’s more recent past is marked with political and social upheaval. And one must realise, this is a vast country. It measures some 2.4 million square kilometres, making it the biggest country in Africa and the tenth biggest in the world. History, oral and otherwise, tell of how the country has been home to so many empires and dynasties, and the countless invasions and occupations have left their mark on this country’s soul, as evinced by the story of the life and times of Emir Abdelkader. During the period when the Roman Empire had annexed the territory in the first century of the Common Era, the area was known as the “Breadbasket of Europe” due to that amount of wheat it provided to feed the countries on the other side of the Med. And now, once more, Algeria is a strategic supplier of another vital commodity that makes its way across the Mediterranean Sea – energy.

From wheat to the Sun

Algeria’s current production is 1.5 million barrels a day of oil and 96 billion cubic metres of gas per year, with the majority this being earmarked for export. If once the area provided wheat and grain to its European neighbours, now the commodities of choice are hydrocarbons. However, the heavy reliance on these oil and gas exports is not lost on the country – there is also a strong awareness that a world which is looking to decarbonise requires alternatives to ‘traditional’ energy practices. Maybe a little surprising is the growth renewables seen in the recent past: in 2017 solar voltaic power (SVP) capacity rose by 83% to 400 MW and SVP generation increased by 50% to 87GWh. Connected to this, in late November 2018 Algeria’s national oil and gas company Sonatrach, in partnership with Eni, inaugurated a 10 MW solar power plant (the first Eni has been involved in outside of Italy) in the Bir Rebaa North oil production facility. This initiative sees an off-grid PV system supplying electricity to the treatment facilities, thus reducing the amount of power purchased from the national grid. Further reinforcing this move to tackle emissions, the two companies committed to a new joint venture which targets the development of renewable energy in both brownfield and greenfield projects at the same time as agreeing on the construction of a state of the art research and development laboratory on the Bir Rebaa North site that will test solar and hybrid technologies in a desert environment with such evident photovoltaic potential.

The Bir Rebaa North Photovoltaic Plant - Eni and Sonatrach

Eni’s low carbon future

The pledges from these two such historically rooted energy organisations demonstrate an almost surprising commitment to real, work-a-day initiatives aimed at addressing GHG emissions. Eni’s own presence as an energy producer in Algeria dates back to 1981, although the connection actually stretches back to the 1950s and to the procurement of natural gas and the construction of the Transmed gas pipeline across the Mediterranean. Today’s Eni views the main challenge as being one which aims to strike a balance between maximising energy access whilst fighting climate change through changing the energy mix and reducing the overall carbon footprint. One of the company’s pillars in this fight against emissions is the Energy Solutions (DES) business unit, which was formed in 2015 with the express remit of promoting sustainable energy to engender a low-carbon future.
Head of DES Luca Cosentino comments by stating: “In DES, we have a distinctive business model, which is based on the synergy with the other business of Eni. In a low-return world like the renewable energy market, this is what generates extra value to our projects, and eventually makes the difference”. It is for this that Cosentino has designed his unit around a specific remit of developing renewable energy projects in and around existent brownfield projects as well as looking for ways to capture upsides in contractual, logistic and industrial synergies. One of the immediate applications being rolled out by DES is the use renewable energy for electricity generation within existing facilities to provide power for operations, as is the case in DES’s first international foray in Bir Rebaa North.

The plant will provide green energy to the oil field, contributing to the progressive decarbonization of the local energy system

Tangible results

An energy company which makes such unequivocal statements within its strategy is not exactly a rare commodity, just as there is no shortage of those who might question how much of these recent pronouncements are posturing over substance. Yet Eni’s studied reiterations do actually seem to be bearing fruit. The DES strategy is to both develop renewable energy’s scope and reach inside Eni’s portfolio as well as making real moves to reduce the carbon footprint of the company’s current activities. The aim is to leverage geographical and technological reach by pairing existing upstream, downstream and generation facilities with technological solutions that have originated in the labs and test-beds of places of academic notoriety such as Massachusetts Institute of Technology and the Polytechnics of Milan and Turin. Fiscal commitment to the DES unit’s activities was doubled to €1.2 billion in Eni’s 2018 – 21 strategy, and the start-up of 3 Italian sites in addition to the Bir Rebaa North initiative might go some way to convincing to the sceptical that actions do indeed speak louder than words. Beyond the plan, by 2025 DES targets a CAPEX of some €4 billion as it seeks to grow capacity to the region of 5 GW, with something like 60% of this investment to be carried out in Africa. For Eni and Sonatrach, Algeria will continue growing as a strategic country in the fight against climate change, just as the greater continent of Africa will be where a great many will gain access to energy that does not compromise the planet’s wellbeing over the coming decades. One would hope that Emir Abdelkader would approve.

READ MORE: Off to the beach! by Simonetta Sandri

about the author
Ian Martin
Internal Communications Manager, Eni International Resources Limited, Story teller from the Eniverse