UPDATE 1-Algerian students protest against Bouteflika offer to shorten new term in power

Students determined to pursue Algeria's biggest anti-government protests in years boycotted classes on Monday to denounce an offer by President Abdelaziz Bouteflika to run in elections next month but not to serve a full term if re-elected. Hundreds of protesters staged small demonstrations in several cities outside the capital, footage posted online showed, continuing almost two weeks of marches and rallies against the 82-year-old leader's plan to seek a fifth term.

Bouteflika's offer, made on Sunday, appeared aimed at undermining the wave of youthful opposition against his 20-year rule and shore up an establishment dominated by ageing revolutionary stalwarts of the 1954-62 independence war against France. A former Algerian government minister resigned as a lawmaker and member of the ruling FLN party on Monday, a rare sign of discontent within the ruling elite, which is coming under unprecedented pressure.

Sidi Ferroukhi, who has served as agriculture minister, did not address Bouteflika in a statement on Facebook, saying only that Algeria was going through exceptional circumstances and change. Bouteflika's political survival may hinge on how the ruling elite, made up of members of his FLN party, the military and business tycoons react if protests keep growing.

His opponents say he is no longer fit to lead, citing his ill health and what they call chronic corruption and a lack of economic reforms. The president, who has rarely been seen in public since a stroke in 2013, appeared in a wheelchair in Algiers in April last year but is now reported to be in a Swiss hospital. Shops were open in Algiers on Monday but students did not show up for classes at Bab Ezzouar University in Algiers, the biggest in the oil-producing North African country.

Several other university campuses in Algiers were deserted. "We are not going to study, this is a decision we have taken yesterday," Amina, a 21-year-old student, told Reuters.

"Together we are the world and the system is nothing," a said a message posted by activists on social media. Bouteflika's campaign manager said on Sunday that the president would run in the April 18 elections, defying calls for him to quit at the end of his current term.

The announcement, read out by Abdelghani Zaalane on Bouteflika's behalf, said the president pledged that if he won he would organise a national conference to discuss reforms and then call early elections in which he would not run. Ennahar TV said the fresh vote would be held within a year. OPPOSITION FRAGMENTED

Hundreds of students marched in Blida, about 40 km (25 miles) south of Algiers, shouting "no new term, no new term". Security forces have sought to contain protests but there was no sign of the military.

Algiers residents who spoke to Reuters said they were disappointed by Bouteflika's decision. "How come Bouteflika asks for one more year, there is nothing in the constitution that allows this," said Maziane Ali, a 50-year-old owner of a fast food restaurant.

Tens of thousands of protesters rallied on Sunday in cities around Algeria in the largest protests since the 2011 Arab Spring, calling on Bouteflika not to submit election papers. Zaalane filed the papers late on Sunday. Despite the challenge to Bouteflika posed by the generally peaceful unrest, analysts say protesters lack a leader and the opposition is fragmented and disorganised.

Algeria avoided the Arab Spring revolutions that toppled leaders in neighbouring countries largely because officials calmed dissent by increasing spending. Algerians generally tolerated a political system that left little room for dissent as a price to pay for stability after a nearly decade-long civil war in the 1990s that killed an estimated 200,000 people.

Falling global prices for oil and gas have hit Algeria’s economy in recent years: living standards are poor and more than a quarter of people under 30 are unemployed. (Writing by Michael Georgy Editing by William Maclean and Frances Kerry)