The recent breakdown of diplomatic relations between Algeria and Morocco could have very negative consequences for our country, specifically for the security of supply of natural gas at a time when international demand has increased and prices have skyrocketed; specifically, they have multiplied by five in the last twelve months.
Algeria is the main supplier of gas to Spain with 48% of the total (data from last June), raw material that reaches our country mainly through two gas pipelines: Magreb (Algeria-Tarifa) and Medgaz (Algeria-Almería). Only 10% comes in methane tankers (GNL).
The problem lies in the first one, which joins the deposits of Hassi R’Mel (Algeria)
with Tarifa (Cádiz), after traveling 525 kilometers through Moroccan territory to Tangier and another 47 kilometers under the sea in the Strait of Gibraltar. As the Moroccan kingdom charges hefty tolls for the gas that runs through its territory, Algeria threatens to cut or minimize the supply through that pipeline to damage the economy of Morocco.
Security of supply
If this happens, it would seriously damage our country’s security of supply, although it maintains another gas pipeline and six active regasification plants (where the LNG tankers unload).
In addition, the Maghreb gas pipeline turns 25 – it came into operation in 1996 – and society (EMPL) that manages it – whose shareholders are the Spanish Naturgy (77.2%) and the Portuguese Galp (22.8%) – must renew the concession with the Moroccan Government. Negotiations began many months ago, but have suffered several halts due to the various conflicts between Spain and Morocco, such as the recent invasion of Ceuta.
The turn of Mohamed VI
Fortunately, the latest statements from the King of Morocco, Mohamed VI, announcing a new stage in relations with Spain would pave the way to reach an agreement in the two months remaining to complete the current agreement.
Experts point out that this turn of the Alawite Kingdom responds to a strategy of Mohamed VI to win the sympathy of Spain and renew the millionaire agreement with Naturgy and maintain revenue from tolls, at the same time that it would weaken the supply of gas through the other gas pipeline, that of Medgaz.
The Moroccan King is also trying to get closer to the Spanish company after the recent agreements reached between it and the Algerian state gas company Sonatrach. It should not be forgotten that this company is a Naturgy shareholder (4%) and both control the company managed by Medgaz: 51% Sonatrach and 49% Medina (50% Naturgy and 50% BlackRock). This gas pipeline became operational in 2011.
Last October, Naturgy managed, taking advantage of a visit by the Prime Minister, Pedro Sánchez, to Algiers, to improve the conditions of the millionaire contract it has with Sonatrach, obtaining not only a reduction in prices, but also greater flexibility in the conditions of long-term contracts.
And just over a month ago, Naturgy and Sonatrach agreed to increase the capacity of the Medgaz pipeline by 25% (2 bcm) by the end of the year. By then, its capacity will be 10 bcm.
The big difference between the gas pipelines of the Magreb and of Medgaz is that this carries the gas directly from the Algerian fields to Almería and, from here, to the rest of Europe, while the first flows through Moroccan soil.
In the first six months of this year, Spain It has received 43,231 GWh of gas through Medgaz, 21.74% of total imports. Through the Maghreb they arrived 42.591 GWh (21,41%).
It is clear that Algeria’s intention is to increase its gas exports through Medgaz to reach the European market when the demand and, especially the prices, are through the roof.
The last episode in the Algerian-Moroccan conflict, with Spain as an involuntary guest, has been carried out by the Minister of Energy and Mines of Algeria, Mohamed Arkab, who has guaranteed the gas supply to Spain through the Medgaz pipeline.
Algeria ’embraces’ Spain
Arkab received last Thursday at the headquarters of his ministry Spanish ambassador in Algeria, Fernando Morán, with whom he examined the cooperation relations between Algeria and Spain in the field of energy, “rated as excellent, particularly regarding the supply of natural gas to the Spanish market from Algeria”, according to the official statement of the ministry transmitted by the agency official APS.
The minister expressed his satisfaction with the “excellent” state of relations between the two countries in this area and reiterated “the will to Algeria to strengthen these relations and promote the association between the two countries for the benefit of both parties.
Arkab He also highlighted “the efforts made by Algeria to guarantee the security of the supply of natural gas to the Spanish market through the significant investments made to deliver natural gas in the best conditions.”
George is Digismak’s reported cum editor with 13 years of experience in Journalism