Islamist Terrorism and Energy Sector Security in Algeria

Publication: Terrorism Monitor Volume: 5 Issue: 12

Despite the fact that its oil production is leveling off and serious questions surround projected increases in gas production, exogenous developments and domestic efforts are serving to make Algeria an increasingly important oil and gas supplier to European and U.S. markets. Simultaneously, the risks posed by Islamist terrorism seem to be escalating and reversing the diminishing trend that characterized the last four years. Nevertheless, since the beginning of the resurgence in terrorist activity during the last six months and the growing significance of the Algerian energy sector, there have only been three attacks on the energy sector itself—two on employees of foreign firms and one on a domestic gas pipeline. Considering the thousands of kilometers of pipelines and more than a dozen foreign oil and gas firms operating in the country, it is surprising that Islamist terrorists have not targeted Algeria’s energy sector more aggressively.

For the past six years, it appeared that Algeria’s security situation was improving and that the European Union’s and the United States’ growing reliance on Algerian oil and gas would not be jeopardized by the country’s Islamist insurgency. Building on his passage of the popular Civil Concord general amnesty in 1999, President Abdelaziz Bouteflika had seemingly gained the upper hand by 2002 against the Islamist insurgency that destabilized the country throughout the 1990s, and he had begun to push out of politics the members of the military who were suspected of manipulating Islamist violence. His re-election in 2004 was largely due to the perception that he was personally responsible for bringing an end to the Islamist threat in Algeria. In fact, a member of the Movement for a Peaceful Society, the government-sanctioned Islamist party, said in a private conversation with this author in November 2004, “Thank God, Bouteflika brought peace to Algeria.”

The struggle against Islamist insurgents has continued, but only one group—the former Salafist Group for Preaching and Combat (GSPC), now known as Al-Qaeda in the Islamic Maghreb (AQIM)—remains active, and its numbers are severely depleted, with estimates ranging from 250 to 500 members in contrast with the thousands of fighters distributed across at least three groups during the height of the conflict between 1994-1996. According to a high-ranking police official during an interview with the author on May 20, the police and the military have, in addition to reducing their numbers, confined the terrorists to the mountainous areas in Boumerdes province “where even the French couldn’t go when they were fighting the Algerian mujahideen” during the War of Independence. The official also said that the gendarmerie and the military have currently adopted new counter-terrorism methods, including deploying units to live in the mountains for extended periods in order to combat AQIM rather than trying to launch forays from regional military bases.

Nevertheless, since October 2006, terrorism in Algeria, and around Algiers in particular, has become more prevalent. On October 30, 2006, bombs exploded in front of police stations in the Algiers suburbs. This was followed by a December 2006 attack on a van carrying employees of Brown and Root-Condor—a Kellogg, Brown and Root-Sonatrach joint venture. More bombs exploded in Algeria’s Kabylia region in February this year, followed by coordinated attacks on the Algerian military on February 28. Throughout the winter and spring of 2007, Algerian soldiers clashed with Islamist terrorists, causing the highest number of casualities on both sides in recent years. On April 11, violence reached a new level with the simultaneous attacks on a police station in an Algiers suburb and the prime minister’s office in the center of the city. The last attack received international attention and raised questions about the extent to which the security situation in Algeria is deteriorating. At the same time, Algeria’s increasing centrality as a European and U.S. energy supplier makes the threat of a continued increase in terrorism all the more worrisome.

While global oil markets correctly anticipated that Algerian crude production is not likely to increase significantly in the next three years—with 2010 crude production targets scaled back from two million barrels per day (bpd) to 1.4-1.6 million bpd, or only slightly higher than the current 1.37 million bpd average—the country is unlikely to become any less important to EU oil markets. In fact, supply disruptions in the Niger Delta have actually increased the importance of Algerian production because traders are increasingly turning to Algerian Saharan blend (45° API and 0.1% sulfur) as a more reliable alternative to Nigerian Bonny Light (37º API and less than 0.1% sulfur). Algerian gas is also becoming more important to EU markets as they look to Algeria as an alternative to Russian gas and to British and U.S. markets as they expand the use of LNG in power generation. Algeria-piped gas supplies 30% of the EU’s gas needs, which is only 10% shy of Russian gas and 5% more than Norwegian; however, within certain countries Algerian supply exceeds Russian imports. For example, Italy currently imports 37% of its gas from Algeria and it is expected to import as much as 60% from Algeria by 2010. Algerian LNG supply to the UK’s Isle of Grain began in 2005 and is expected to grow during the next three or four years to meet 20% of the UK’s gas needs. Although Algeria only supplies 3.6% of the U.S. LNG imports, this figure could increase in coming years if the United States moves away from coal-powered electricity generation.

Energy Pipelines Largely Secure

Despite the increase in terrorist activity, however, Algeria’s energy sector is largely secure. The state has long recognized that the sector is the country’s economic lifeline and has taken steps to protect it. Pipelines are regularly monitored and key hydrocarbons and petrochemical facilities are heavily policed. Algeria’s geography further mitigates the likelihood of an attack on wellheads. Unlike southern Iraq or Nigeria’s delta states where insurgents attack those countries’ important oil sectors in order to call attention to their grievances and advance their political agenda, the key oil and gas producing areas in Algeria are in the south of the country and are far from population centers. The Interior Ministry requires a special permit to travel throughout oil and gas producing areas. Furthermore, any effort to carry out an attack on oil and gas producing facilities would likely result in the deaths of the assailants. Most facilities are in remote areas and any attack would prompt an immediate government riposte that would likely kill the attackers before they were able to retreat to safe territory. According to an employee of a privately-owned aviation company that runs charter flights from Algiers to Hassi Messaoud (Algeria’s southern energy hub), the Algerian military would likely launch helicopter gun ships within half an hour of an attack, and they would likely be able to track down invaders in Algeria’s southern deserts before they could escape.

In addition, foreign energy firms operating in Algeria have instituted rigorous security protocols in order to reduce exposure to a possible attack. An employee of an independent international oil, gas and mining company with assets in Algeria, who asked to remain anonymous because he is not permitted to speak with outside analysts, remarked that although Algeria has lost “five years of security improvements” in recent months, he did not see the deterioration of security as curtailing his company’s activities. Instead, his and other foreign firms have minimized their staff and prohibited non-essential personnel from residing in-country. Many foreign firms are taking the additional precaution of minimizing travel to Algiers and are flying directly to the southern energy hub of Hassi Messaoud. The head of a Canadian oil firm recently flew directly from London to Hassi Messaoud in order to evaluate the status of his company’s assets and bypassed Algiers entirely. When foreign firm employees are required to travel to Algiers to meet with the Energy Ministry or Sonatrach, they stay in fortified compounds and travel through the city in two-car convoys.

Vulnerabilities Remain

Despite these precautions, Algeria’s energy sector is still vulnerable. In particular, oil and LNG must eventually be lifted at Algeria’s ports. Algeria has plans to rehabilitate and upgrade its ports, but with the exception of Bejaia, most Algerian ports are still closely linked to their surrounding urban environments, which make securing their perimeters difficult. This is particularly true in Algiers, Oran, Arzew and Skikda. Complicating port security is the fact that Algiers and Skikda are notoriously home to supporters of Islamist terrorists, and the current head of the ex-GSPC, Abdelmalek Droudkal, has historic ties to Skikda—where Algeria’s main gas liquefaction installation is located.

The previously mentioned police official acknowledged that he does not understand why the Islamists have not tried more rigorously to target energy sector installations. He surmised that his forces’ efforts to disrupt the Islamists’ bomb-making capabilities have limited attacks in general, but admitted that he did not entirely comprehend the Islamists’ rationale for staying away from coastal energy installations. According to the official, police operations have undermined bomb-making capabilities, both through seizing bomb materials and killing or arresting technicians. The official asserted that the Islamists are able to make numerous small bombs but have limited “large” bomb resources. In his estimation, the Islamists are likely trying to conserve their resources for sensational operations similar to the April 11 attack on the prime minister’s office.

A possible split within the former GSPC between members who want to bring the group’s objectives into line with the broader global al-Qaeda movement and those who want to retain the group’s “Algerianist” orientation may also be complicating the Islamists’ planning capabilities. The previously mentioned police official suggested that the GSPC’s January 28 announcement that it was to be called AQIM reflected a schism within the group. Apparently, Droudkal is pushing for a closer alliance with al-Qaeda and an expansion of the group’s activities beyond Algeria. Other members, however, are insisting that the organization continue its struggle specifically against the Algerian government in response to the government’s cancellation of the 1991 legislative elections that the Islamic Salvation Front was slated to win. While the al-Qaeda elements within the organization would likely prefer to attack energy installations and foreigners, the “Algerianist” elements likely prioritize targeting government institutions. To the degree that the different factions within the group cooperate, they likely focus their limited resources on targets that will satisfy the demands of each faction, which more often than not means government personnel and institutions.

Nevertheless, an Algerian reporter employed by an international news agency in Algiers said in a discussion on May 22 that he believes that Islamists unquestionably intend to target the energy sector and that it is only a matter of time before they do so. If the Islamists are able to reconstitute their bomb-making capabilities to the point where they can satisfy both the interests of the al-Qaeda supporters and the “Algerianist” fighters, then both the government and the energy sector will be at risk. For the moment, however, the police and military efforts to counter terrorist activity seem likely to succeed in limiting the Islamists’ ability to attack the energy sector. This, in conjunction with strict energy company security protocols, ensures Algeria’s ongoing ability to be a key energy supplier and minimizes the likelihood of supply disruption.