Morocco and Spain Seek Gas Supply Solutions as Algeria Pipeline Contract Nears Expiration

25 October 2021 – byPrince@Bladi · 2 min read

Morocco and Spain are continuing negotiations to ensure the gas supply of the two countries in the event that Algeria does not renew the concession contract for the Maghreb-Europe Gas Pipeline (GME) which expires on October 31.

In a week, the concession contract for the Maghreb-Europe gas pipeline connecting Algeria to Spain via Morocco will expire. Algeria had announced that it would not renew the contract, after breaking off its diplomatic relations with Morocco in August. Since then, Morocco and Spain, the main beneficiaries of this gas pipeline, have started looking for alternative solutions.

To read: Algeria Poised to Cut Gas Supply to Morocco, Impacting Spain’s Energy Imports

It was in this context that a technical meeting was held on Wednesday, October 20, between Moroccan experts from the National Office of Hydrocarbons and Mines (ONHYM) and representatives of the Spanish Ministry of Energy as well as those of the Enagás and Naturgy groups. For the moment, several scenarios are being studied, but nothing has yet been decided, confides a source close to the file to Le360, specifying that a second technical meeting is scheduled for this week.

To read: Spain Awaits Decision on Crucial Algeria-Europe Gas Pipeline as Deadline Looms

In the event of non-renewal of the GME contract, Spain will be able to count on the Medgaz, a gas pipeline directly connecting it to Algeria, the Algerian authorities have assured them. But with a limited capacity of 8 billion cubic meters per year, this gas pipeline will not be able to meet the strong Spanish demand. Fearing a disruption in gas supply, Spain is leaning more towards a renewal of the GME which has a capacity of more than 13.5 billion cubic meters per year.

To read: Morocco Explores Spanish LNG Option as Algeria Pipeline Deal Nears Expiry

For its part, Morocco reiterates its willingness to maintain the GME, "a clearly stated willingness in a constant manner, at all levels, for more than three years," Amina Benkhadra, the general manager of ONHYM, said in a statement to MAP on August 18. In the event of non-renewal of the GME, Morocco is considering the solution of importing gas from Spain via this same gas pipeline.

Category: Spain

Keywords:

Spain Algeria Gas