While Morocco is dragging its feet in the procedure for renewing the concession of the Maghreb-Europe gas pipeline which expires in October, Algeria reassures Spain of the continuous supply of gas via the Medgaz gas pipeline.
The president of the Algerian national energy company (Sonatrach), Toufik Hakkar, and the president of the Spanish company Naturgy on Tuesday formalized the agreement for the commissioning of the extension of Medgaz, the submarine gas pipeline between ‘Algeria and Spain. This investment of more than 70 million euros, which induces an extension of 2,000 million cubic meters per year, will increase the supply of gas to Spain by 25%, indicates a joint press release from the two structures.
The Medgaz extension will be operational in the fourth quarter of this year, when the Maghreb-Europe gas pipeline expires, which allows Spain and Portugal to be supplied with gas from Algeria via Morocco. “Negotiations with Morocco for a renewal of the concession are still not progressing”, inform well-informed sources in the newspaper.
The situation does not seem to worry the president of Sonatrach who reassured two weeks ago that they will not give in to any blackmail from Rabat. “We have taken all the necessary measures in the event of non-renewal of the contract … Even if this contract which expires in October is not renewed, Algeria will not only be able to supply Spain, but also satisfy without a problem. any additional demand from the Spanish market,” Hakkar said.
The Medgaz pipeline is currently owned by Sonatrach (51%) and Naturgy (49%). The project was awarded in 2006 by the Algerian State for a period of 35 years (until 2041), renewable for an additional period of 15 years. By not renewing the concession of the Maghreb-Europe gas pipeline, Morocco risks losing two big advantages: the 7% toll which represents around 200 million euros per year, and the quantity of gas from which it benefits from the fact. transit through the pipeline.
