Algeria-Morocco standoff threatens Spain’s gas supplies

Algeria pumps huge volumes of gas through Morocco into Europe, but with Algiers and Rabat at loggerheads as a pipeline agreement nears expiry, experts say the taps could soon be turned off.

Amenas gas plant, 1,300 kilometres (800 miles) southeast of Algiers, shows workers riding bikes
For a quarter of a century, gas from Algeria's vast southern desert has been transported to Spain and Portugal through Morocco but a deepening rift between the North African neighbours means the taps could soon be turned off. Photo: RYAD KRAMDI / AFP

That would hit Spain’s gas supplies just as prices soar across Europe and with winter approaching, and Foreign Minister Jose Manuel Albares was due in Algeria on Thursday to discuss the issue, his office told AFP.

Algeria, Africa’s biggest natural gas exporter, has been using the Gaz-Maghreb-Europe (GME) pipeline since 1996 to deliver several billion cubic metres (bcm) per year to Spain and Portugal.

But the GME contract is due to expire at the end of October — just over two months after Algiers severed diplomatic ties with Rabat over “hostile actions”.

And in August, Energy Minister Mohamed Arkab told Spanish ambassador Fernando Moran that Algeria was ready to deliver all its Spain-bound gas exports via an alternative undersea pipeline, bypassing Morocco.

“A deal to continue the GME agreement before October 31 is very unlikely,” Maghreb geopolitics expert Geoff Porter told AFP.

“In light of the lack of diplomatic channels between Rabat and Algiers, it’s difficult to see any pathway for negotiations.”

Unlike their border, closed since 1994, the GME pipeline has stayed open for a quarter of a century, despite repeated crises.

Both sides benefit. Morocco receives around one bcm of gas per year, half of which it buys and the other half of which it receives as transit fees in kind — worth some $50 million per year, according to a Moroccan energy expert who asked to remain anonymous.

In return, Algeria gets a cost-effective route for around half of its piped gas exports to Spanish and Portugese markets.

Yet with another diplomatic spat flaring just as the contract expires, a new deal is far from certain.

Economic weapon

The latest crisis followed months of tensions, partly over Morocco’s normalisation of ties with Israel in exchange for Washington recognising Rabat’s sovereignty over Western Sahara.

Algiers, which has hosted the Polisario independence movement and supported the Palestinian cause, in August accused its neighbour of “hostile actions”, including complicity in deadly forest fires, backing separatists in the Kabylie region and using Pegasus spyware against Algerian officials.

Morocco called the Algerian move “completely unjustified”, but experts say Algeria is keen to hit its rival where it hurts — in the pocket.

“Algeria could deprive Morocco of transit fees, which are a major and stable source of revenue, but also of gas supplies at a good price,” said North Africa energy expert Roger Carvalho.

But, he added: “Algeria has obligations (towards Spain and Portugal) and can’t deprive itself of international revenues from these contracts. So it has to find another delivery route.”

People walk with grocery bags under Christmas lights in the centre of Madrid.

Experts believe the diplomatic rift could cause some daily costs to rise significantly for Spain’s population. Photo: OSCAR DEL POZO/ AFP

International revenues

Algeria does have two alternatives to the GME, but both have shortcomings.

The Medgaz undersea pipeline, which transports Algerian gas directly to Spanish shores, is already operating near its full capacity of 8 bcm per year — around half total Algerian gas exports to Spain.

“If the Algerians manage to deliver enough gas via Medgaz, they probably will,” Carvalho said.

But while Algeria’s state energy firm Sonatrach and its Spanish partner Naturgy have vowed to boost Medgaz’s capacity to 10 bcm per year in the coming months, that still falls far short of the total needed at current levels.

The second option is liquefying the gas and sending it to Spain by ship.

But Porter says the short distance means this option “does not make financial sense”.

As a result, “Algeria is potentially going to lose some gas export sales revenue in order to deprive Morocco of its primary (97 percent) source of natural gas,” he told AFP.

The Moroccan energy expert told AFP that closing the pipeline would hurt Algeria but have only “marginal” impact on Morocco.

“The GME is an opportunity for the Algerians. If they passed it up, it would be an irrational decision and they would be the biggest losers,” he said.

Porter says that could force Morocco, which uses GME gas to generate around 10 percent of its electricity, to boost coal imports to cover the shortfall.

‘Costs will rise’

Rabat has said it wants to keep the GME open. But notwithstanding a deal directly between the firms managing the contract, many analysts are betting the taps will be turned off.

Matthew Cunningham, an economist at Barcelona-based consultancy FocusEconomics, said that would cause considerable supply disruptions for Spain, which has already been pushed to lower electricity taxes and impose price caps as gas bills soar across Europe.

“Despite this, Spain should be able to satisfy its energy needs by obtaining natural gas from different places or by using other energy sources, even though costs will rise significantly,” he said.

Spain’s environment ministry told AFP this week that Algeria had given it “the necessary guarantees that gas imports from Algeria will not be jeopardised despite the current crisis”.

But Carvalho warned that long term, closing the GME could push Spain and Portugal to diversify their supplies away from Algeria.

“Using gas deliveries as an economic weapon isn’t a good calculation in the long term for Algeria,” Carvalho said.

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EXPLAINED: What is Spain’s anti-trafficking law?

The Spanish government has passed a draft bill that seeks to beef up the fight against human trafficking and exploitation, addressing everything from prostitution to arranged marriages and organ trafficking.

EXPLAINED: What is Spain’s anti-trafficking law?

On November 29th, Spain’s Council of Ministers approved a draft law aimed at tackling human trafficking.

The law, known as la ley de trata (or anti-trafficking law) will bolster measures against sexual exploitation, forced and arranged marriages, slavery, forced labour, organ and tissue removal, and situations where vulnerable people are forced to engage in criminal activity.

Spain’s Justice Minister, Pilar Llop, said that the law will protect “people who suffer a lot in our country and also in other countries around the world,” strengthening the fight against trafficking mafias and organised crime groups to “break the business chain that is generated using human beings as commodities.”

The law will, among other things, create a national plan for the prevention of trafficking, protection and privacy protocols, a compensation fund for victims, social, health and financial support, and increase awareness of the problem at the educational level.

A particular focus of the legislation will be on minors, migrants, asylum seekers and refugees – groups thought to be most vulnerable to exploitation and trafficking.

Prostitution in Spain

Many cases of human trafficking in Spain result in sexual exploitation, but there exists no single law that deals directly with prostitution in Spain. Prostitution was decriminalised in 1995, though its related activities, such as pimping, trafficking, and sexual exploitation are still illegal.

READ ALSO: What’s the law on prostitution in Spain?

Although the clandestine nature of the sex work makes accurate data hard to find, according to a 2011 UN report, Spain is the third biggest centre for prostitution in the world, behind only Thailand and Puerto Rico.

In 2016, UNAIDS estimated that over 70,000 prostitutes were working in Spain, but some estimates put that number as high 350,000.

It is believed that 80 percent of them are foreigners, with many reportedly coming from Colombia, the Dominican Republic, Morocco and eastern Europe.

If the draft law is finally approved, its sexual exploitation clauses would include prison sentences of up to eight years for procurers such as pimps or madams.

Customers of prostitutes that have been forced to be sexual workers could also face fines and prison sentences of between six months and four years.

The Spanish government wants prostitution banned in its current form in Spain.

Forced labour

Clearly, the ley de trata will hope to combat some of the sexual exploitation of women in Spain, but the anti-trafficking legislation is more far-reaching than that and is also intended to tackle forced labour and slavery – two big but underreported problems in Spain.

According to the U.S State Department’s 2022 report on human trafficking in Spain, “labour trafficking is under-identified in Spain. Authorities report the pandemic increased worker vulnerabilities and contributed to the rise in labour trafficking in 2020 and 2021, especially in agriculture, domestic work, and cannabis cultivation in Catalonia.”

“In 2022, Ukrainian refugees, predominantly women and children fleeing Russia’s war against Ukraine, are vulnerable to trafficking. Labour traffickers continue to exploit men and women from Eastern Europe and South and East Asia, particularly Pakistan, in the textile, construction, industrial, beauty, elder care facilities, and retail sectors.”

It should be said, however, that the report also notes that “the government of Spain fully meets the minimum standards for the elimination of trafficking” and kept it in its Tier 1 of nations.

What does Spain’s anti-trafficking law include?

  • National Trafficking Plan

The law will create a protocol to coordinate the immediate referral of trafficked persons to specialised services, which will be overseen by a National Rapporteur on Trafficking and Exploitation of Human Beings run through Spain’s Interior Ministry, according to the Spanish government website.

The rapporteur will oversee anti-trafficking policy and represent Spain in the international arena, a role considered crucial as human trafficking is often a cross border, international problem.

  • Education

According to Article 7 of the law, efforts will also be made to improve educational awareness of the problems of trafficking and exploitation with a focus on human rights, sexual education, and democratic values.

  • Social, labour, and health support

A ‘Social and Labour Insertion Plan’ will be created for victims of trafficking and exploitation that provides social, health and employment support for victims.

This could include housing access, physical, psychological and sexual health support, employment opportunities, and financial assistance for victims and their family members.

  • Tightening labour market regulation

As trafficked and exploited people are so often brought in from abroad (and often dependent on the traffickers themselves for housing, food, money and so on) the regulation of migrant worker recruitment will be tightened through beefed up surveillance and labour standards.

  • Compensation fund

A compensation fund – the Fund for the Compensation of Victims of Trafficking and Exploitation (FIVTE) – will also be created, and will be taken from state budgets, as well as money or goods confiscated from convicted traffickers.

  • Protection and privacy

The anti-trafficking law will also provide protection services and maintain the victim’s right to privacy, protect their identity, access to free legal advice and even offer a living income.

According to Article 36 of the bill, victims trafficked from abroad will have the right to voluntary and assisted return to their country of origin. If they were brought illegally into Spain and don’t have official documentation, the Spanish government will issue them with the appropriate papers needed for travel as well as provide them with the option of residency.