Amid Algeria’s concerns over Spain’s possible transfer of its gas to Morocco through reversing the Maghreb-Europe pipeline, experts are pointing out the worries as being unfounded.
After accusing Morocco of “hostile acts and positions,” Algeria cut its gas supplies to the Kingdom and renewed its contract with Spain, only after the latter changed its position on Western Sahara. Algeria has been expressing its refusal to allow its gas, shipped to the Iberian peninsula, to be redirected to Morocco.
However, a succession of statements and reports are questioning the reasoning behind such worries.
Secrecy is impossible
Sources told Hespress EN that “it would be impossible for Spain to supply Morocco with Algerian gas secretly,” as the gas facilities allocated for each transfer have been decided, and are “separate and far from each other.”
Spain has one of the “most luxurious gas infrastructures in Europe,” operating at a mere 17% capacity over the seven years from 2011 to 2018, allowing the Iberian Kingdom to take on additional gasification commitments with partner countries, as is the case with Morocco.
According to an investigation published by El Diario, a Spanish news site, Spain’s infrastructure includes more than 50 combined cycle power plants (CCGTs), the highest number in Europe after Britain and Italy.
As of 2019, the Spanish gas plants have been operating at 24.3% capacity, whereas “a €400 million regasification plant at the port of El Musel, in northern Spain, which was given the green light in December 2008, has not been used since.”
Moroccan Minister of Energy Transition Leila Benali had previously announced that the retained offers for Liquified Natural Gas will be announced soon, as the Moroccan government accelerates its entry into the international LNG market.
Spain, having accepted Morocco’s request to gasify its internationally purchased LNG, has overly sufficient infrastructure and capabilities to do so. The Algerian regime’s paranoia about the final destination of its gas also overlooks Spain’s commitment to “meet domestic gas needs through the Algerian supply.”
Up until the crisis, Spain brought in liquefied gas for a total of 63% of imports, compared to 37% of natural gas via pipeline.
Currently, this situation has changed and the main supplier is now the United States with 35% of the total, far surpassing Algeria, which remains at 25%. This trend continues to grow, according to data provided by Spain’s national gas company, which has reaffirmed that the imports are prioritizing domestic use.
Spanish domestic gas demand reached 360 GWh in 2020, 4% higher than the average for the last ten years and the second highest figure since 2012.
In 2020, the national gas demand reached 360 TWh, which is 3.1% more than the figure recorded in 2018.
This spike in demand may be behind Spain’s supplier diversification, but as Algeria continues to “bluff” with its threats to halt supply, Madrid is well on its way to secure different exporters.
Spain turning elsewhere for gas sources
Algeria’s decision to cut its gas tap to Morocco following diplomatic tensions has been largely criticized by experts, economists and officials, calling it “the wrong approach.”
Experts and economists alike have expressed their disapproval of Algeria’s methods, perplexed at its approach to cut gas supplies instead of simply charging exorbitant prices for its gas while contract negotiations were underway.
Instead, excluding Morocco from its gas buyers has the potential of hurting the Algerian economy, as it has now indirectly introduced new suppliers into the North African region, which has been mainly dominated by Algiers up to this point.
In fact, Morocco has now reportedly secured Liquified Natural Gas shipments from the United States, although the offers from Morocco’s public tender have yet to be revealed.
Qatar is yet another potential supplier listed among the favorites, in addition to Nigeria, a country that is closely working with Morocco on a common, transcontinental gas pipeline.
But Algiers’ aggressive, “hard power” strategy with its natural resources and support for separatist movement Polisario is seemingly costing it its relations with its historic partner, Spain.
Diplomatic Relations on the line
Intissar Fakir, a Senior Fellow and Director of Program on North Africa and the Sahel recently published an article on the detrimental effects Algerian fears may have on the relations of both countries.
In her recent contribution to the Middle East Institute, the fellow explained how “it will be difficult, if not impossible,” for Algiers to verify the exact provenance of the natural gas Spain supplies to Morocco, which is likely to “draw the parties into a long dispute.”
According to verifications carried out by ATALAYAR, once the gas has been imported and introduced into the Spanish system of networks and tanks, it is impossible to say which is Algerian gas and which is not.
“While Algeria has stipulated that their current agreement precludes the transfer of Algerian gas to Morocco, and Madrid has reassured Algiers that no such transfers will occur, Algeria is worried that during the reverse-flow process, Algerian gas may be commingled with gas destined for Morocco,” writes Fakir.
In addition, the fellow points out that in the midst of such uncertainty, and the staggering lack of verification methods available to the Algerian regime, Tebboune’s government, and the national energy company Sonatrach “is likely unwilling to break international contracts and jeopardize its relationship with a key client for several reasons.”
This would mean that despite the mystery that will overshadow the Spain-Morocco gas transfers, the North African republic will most likely respect its contractual obligations towards its buyer, but this may translate to diplomatic tensions until the agreement expires in 2023.
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