The bomb exploded at around lunch time in a hotel car park in Draa Ben Khedda some 90 kilometers east of Algiers, an official security statement said, carried by the Algerian state news agency APS. "The hotel has sustained significant damages," it said.
Algerian Interior Ministry Mustapha Ben Mensour rushed to the scene, it added.
There was no word on who had carried out the attack.
Moslem militants in Algeria are fighting to overthrow the government since the army intervened to cancel an election in 1992 in which the Islamic Salvation Front had taken a commanding lead. Over 40,000 people have been killed in the conflict.
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