Page 4 - AfrOil Week 46 2021

AfrOil COMMENTARY AfrOil

(Image: Wikimedia)

Morocco’s gas supply woes

Against the backdrop of high prices and fears of shortages in Europe,

Morocco has lost access to natural gas from Algeria, its main supplier

GLOBAL natural gas markets have become European states, Spain and Portugal, are com-
increasingly tight this year, largely because ing under additional pressure for an unrelated
WHAT: the world economy has started to regain the reason.
Morocco is no longer ground it lost as a consequence of the coronavi- The extra pressure stems from Algeria’s
receiving 6 bcm per rus (COVID-19) pandemic. This tightness has decision to halt shipments through Gas Magh-
year of gas via the GME been evident in Europe, where gas markets have reb-Europe (GME), a 12bn cubic metre per year
pipeline. taken a strongly bullish turn because of concerns pipeline that delivers 6 bcm per year to the Ibe-
about high prices and low supplies. rian Peninsula and 6 bcm per year to Morocco.
WHY: However, Europe is not the only gas market Algiers stopped pumping gas through GME on
Algeria has cut off that has come under pressure within the last few November 1, 2021, following the expiration of
supplies in response weeks. Morocco is also likely to experience sup- its 25-year transit agreement with Rabat.
to ongoing diplomatic
disputes. ply problems this heating season, but for very That agreement had provided for Morocco to
different reasons. receive about 6 bcm per year of gas from Hassi
WHAT NEXT: This essay will seek to explain why Morocco R’Mel, a field in Algeria’s Laghouat Province, in
The country aims to start may be headed for gas shortages and assess the exchange for hosting a 522-km section of GME.
importing LNG and boost- likely impact of recent developments. Once Algeria let the accord lapse with renewal,
ing domestic production, though, gas deliveries stopped.
but these plans will not Algeria, Morocco and Europe
come to fruition any time Europe’s current supply/demand situation stems Rising tensions
soon. in no small part from the fact that Russia, which This halt is unfortunate for Morocco, as GME
is the Continent’s largest external supplier of was supplying gas to power stations that pro-
gas, has been limiting deliveries. However, two duce about 10% of the country’s electricity.

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