UPDATE 3-French PM hails "transformation" in Algeria ties

(Adds Fillon speech)

By Sophie Louet

ALGIERS, June 21 (Reuters) - France and Algeria signed defence and civil nuclear power accords on Saturday in what Paris called a sign of transformation in sometimes stormy relations with its former north African colony.

Making the first visit by a French premier in 22 years, Prime Minister Francois Fillon declared French firms would not be driven out of the north African country by armed groups, following the death of a Frenchman in a bombing this month.

"We will not give in to threats," El Watan newspaper quoted him as saying in an interview marking his two-day visit to France's largest trading partner in Africa, which still suffers sporadic attacks by rebels fighting for purist Islamic rule.

Al Qaeda's north Africa wing said it was behind twin bombings that killed a French engineer in Algeria on June 8 east of Algiers and vowed more attacks against "crusaders".

The engineer was the first French citizen killed in political violence in Algeria since the 1990s when the country plunged into a civil conflict that killed up to 200,000 people.

Fillon and Algerian Prime Minister Abdelaziz Belkhadem attended the signing of an accord on the peaceful use of nuclear energy.

It provides for cooperation in research, training, technology transfer and the exploration and production of uranium, sectors of interest to French nuclear plant builder Areva.

"This is a historic moment that is representative of the transformation in our relations," Fillon said, accompanied by six ministers including Defence Minister Herve Morin and Economic Strategy Minister Christine Lagarde.

'CLEAR SIGNAL'

"There is no clearer signal of France's intention to establish an exceptional partnership with Algeria."

Algerian commentators say sometimes prickly political ties remain hostage to the past. Many of Algeria's leaders took part in an eight-year guerrilla struggle against France that ended with independence in 1962.

Fillon, in a speech to students at a business school, said Algeria and France should not think of their common past "as a burden" but work together to rise above resentment.

His was the latest in a string of statements by French officials seeking to address Algerian anger over colonial misdeeds during France's 132-year rule.