UPDATE 3-Algeria signs deal with Vitol to cut fuel import bill

* Sonatrach signs deal with Vitol to refine crude abroad

* Value of Algeria's fuel imports more than tripled last year

* Agreement to take effect next month, volumes not disclosed (Adds Vitol comment)

TIGUENTOURINE, Algeria, Jan 16 (Reuters) - Algeria's state energy company Sonatrach said it has signed a deal with oil trader Vitol to send crude abroad for refining as the country seeks to reduce a record fuel import bill.

CEO Abdelmoumen Ould Kaddour said Sonatrach would pay processing costs before bringing refined fuel back to Algeria, and said it was also negotiating to buy shares in a foreign refinery, but did not give details.

"Our goal is to reduce our imports of gasoline, they are too high," Ould Kaddour told reporters on Tuesday.

The deal is due to take effect in early February, according to a document seen by Reuters. It was not immediately clear what volumes would be refined.

A spokeswoman for Vitol declined to comment.

Sonatrach is OPEC member Algeria's only domestic oil producer.

The North African country, which needs to meet surging domestic demand, paid $800 million for fuel imports in 2016, but last year the bill more than tripled to a record $2.5 billion because of refining problems, a Sonatrach source said.

Ould Kaddour was speaking during a visit to the southern gas complex of Tiguentourine, operated by Sonatrach, BP and Statoil, where he said production was stable at 8.8 billion cubic metres per year, just below maximum capacity of around 9 billion cubic metres.

Algeria, a key supplier of gas to Europe, exported 55 billion cubic metres (bcm) of gas in 2017, Ould Kaddour said. That was up slightly from the 54 bcm it exported in 2016, according to Sonatrach officials.

Ould Kaddour's visit marked the fifth anniversary of an attack by al Qaeda-linked militants at Tiguentourine that killed 40 mostly foreign contractors.

He also said Sonatrach was improving relations with its foreign partners and had resolved more than 10 out of 15 litigation cases. (Additional reporting by Julia Payne, Writing by Aidan Lewis; Editing by David Evans and Susan Fenton)