Starting again from Mattei
Prime Minister Giorgia Meloni's visit last January to Algeria, Italy's natural extension on the African continent, during which she also paid homage to Enrico Mattei's monument, opened what may be a new chapter. Confronted with predatory impulses, new and old, towards Africa, Meloni chose a hero, which has never been over-valued, from the republican pantheon who built an alternative model to neo-colonialism, based on cooperation in the enlarged Mediterranean. A model capable of fuelling a season of peace and stability, in the context of the Cold War.
The stability of energy supplies, daughter of the long vision of Mattei and the Italian ruling classes of the post-war period, allowed the full industrialisation of Italy, a country still rural and devastated by the lost war (the GDP per capita had fallen below pre-unification levels), and the spread of prosperity. Not only that, from the perspective of mutuality, the purchase of gas from the coastal countries led to the stabilisation of those ruling classes that had won the struggle for independence. Pontecorvo's film 'The Battle of Algiers', which won the Golden Lion, dates from 1966. Meloni's was a first political step to relaunch Italian diplomatic action, which could produce many positive effects, but there are points to be clarified. The context has changed profoundly. Italy, which used to be an emerging power, must now maintain the degree of development and prosperity it has acquired while giving up its main partner, Russia.
Consequently, the 'Mattei Plan', still not fully clarified, starts from the involvement and synergy of companies such as ENI, ENEL, Snam and Terna and aims at certain objectives: the transformation of the country into a hub for oil and gas by means of infrastructure, the complete abandonment of Russian gas and, therefore, its replacement with both LNG and natural gas from Africa.
Managing scarcity: infrastructure deployment
Natural gas from Russia will be phased out: 100 per cent by 2024-2025, at least 80 per cent by 2023, warns ENI's CEO Claudio Descalzi, predicting the most complex period in the winter of 2023-2024.
Following the Russian invasion, a new stage opened for Europe and Italy in particular, which had to increase its imports of liquefied natural gas by over 60% in just one year, according to the International Energy Agency. Also because of this, LNG has reached high price peaks, which are set to remain steadily elevated in the coming years also due to the fact that supply will stay weak and demand strong.
In order to process the new LNG, two new regasifiers are planned, in addition to those already present (Panigaglia, Leghorn, Rovigo), namely the one in Piombino, which has a total processing capacity of 5 billion cubic metres per year (equal to 7% of Italian requirements), built by Snam - which aims to become the European leader in LNG - and Ravenna (third quarter of 2024), possibly also Gioia Tauro. The Italian strategy is certainly on track and the two regasifiers will increase the country's flexibility, boosting LNG imports to around 40% in 2026 when it was just 20% in 2021.
After the cut in Russian supplies of natural gas, however, Italy can count on supplies from Azerbaijan via Turkey thanks to the vituperate TAP (worth around 10% per year) and the Transmed, better known as the 'Mattei pipeline', which connects Algeria to Italy via Cape Bon in Tunisia and has a capacity of around 32 billion cubic metres of gas.
ENI and ENEL in Africa
Now it is still to be understood where Italy can get new gas from. ENI and ENEL have always guaranteed strategic continuity in relations with Africa and are the key to giving substance to the 'Mattei Plan'. ENI has been present in Africa since the mid-1950s and has projects in as many as 14 countries. It is a major player in the diversification of gas supplies, first and foremost thanks to its historic relationship with Algeria's Sonatrach. Since the first half of 2022, Algeria has become the first gas supplier, ousting Russia, and already in July of that year it provided a further 4 billion gas. ENI is the most important company in the country: in 2021 it produced around 20 million barrels of oil and condensate as well as 1.7 billion cubic metres of natural gas. Proof of ENI's dynamic commitment in Algeria is the start-up in October 2022 of two new fields in the Berkine South basin.
There is not only Algeria. Another country with which ENI has an established relationship is Egypt, where it has been present since 1954 through its subsidiary IEOC. In 2022, ENI produced almost 60% of the gas produced in Egypt. A central infrastructure is the Damietta plant (in operation since 2005), which, after resuming production in 2021, reached its 500th LNG cargo, touching approximately 4 billion € liquefied gas exported in 2022, largely to Europe. Also in Egypt, thanks to the agreements with Egas, ENI will finalise exploration campaigns together with those in newly acquired areas such as the Nile Delta.
ENI has also promoted new investments and projects with a view to diversifying gas source countries. A significant case in point is 'Coral South', a floating natural gas liquefaction plant with a capacity of 3.4 million tonnes of LNG, fed by 6 subsea wells, in the Rovuma field in Mozambique, from which the first LNG cargoes left as early as November 2022. The project is a source of new jobs, estimated at around 800 during the operational period.
In Africa, ENEL's commitment, via 'ENEL Green Power', focuses on renewable energy sources. There are already active plants such as those in Morocco (three for a capacity of 210 MG) or those in South Africa where there is both wind and solar power; in other countries, such as Ethiopia, ENEL has presented projects, for example the photovoltaic plant in Metehara.
The need for stabilisation and Italy's role
The Mediterranean framework was irrevocably disrupted in 2011, the year of the 'Arab springs' that liquidated the ruling classes, children of Arab nationalism, with which Mattei himself had built his policy. After more than 10 years, a new phase can open and the relaunch of Italian action is a positive step. Indeed, there are also pitfalls that have to be considered.
There are new players: China, which intends to invest in Algeria (for the production of phosphates), and Russia itself is firmly established in Syria, with its bases in Tartus and Khmeimim; Erdoğan's Turkey - his imperial vision triumphed in the ballot - is a reality in the Levant Mediterranean and has become increasingly central in energy flows, just think of the aforementioned TAP. Nevertheless, a reorganisation is underway that follows a need for stabilisation.
In recent months, Syria has returned to the Arab League, while Tunisia - notable for its 110 million in funding from Italy - has embarked on a path of complex stabilization with Kaïs Saïed's neo-presidential reforms, certainly not painless. Likewise, recent agreements brokered by China have ushered in a new chapter in Middle East relations, with Iran firmly stretching its limes right up to Lebanon. Faced with the difficulties of a France driven out of Africa, the culture of Italian cooperation may be a reservoir that can still be drawn upon.