Algeria anticipates Morocco and revives the trans-Saharan gas pipeline with Nigeria.

After a 20-year delay, why did Nigeria revive this project that will transport its gas to Europe via Algeria? Expressionism/ Istock

Algeria recently started working with Nigeria to revive several old agreements to activate cooperation regarding the export of fuel to Europe. In this context, the Director-General of the Algerian Oil and Gas Company ” Sonatrach “, Taoufik Hakkar, revealed, at the end of September 2021, the completion of studies on the Algerian-Nigerian gas pipeline project to supply natural gas to Europe. What is this project and why is it being revived now.

What is the Trans-Saharan gas pipeline project between Nigeria and Algeria?

The Trans-Saharan Gas Pipeline is an old project to construct a pipeline to transport natural gas from Nigeria to Europe via Niger and Algeria. To move forward with the implementation of the project, following a prior memorandum of understanding between the two governments in addition to Niger.

The Trans-Saharan gas pipeline extends from Nigeria to Niger and then Algeria, to export gas to the European market. The pipeline is about 4,128 kilometers long and aims to transport 30 billion cubic meters of Nigerian gas annually to Europe.

But the huge project was repeatedly postponed until it was forgotten due to several obstacles, and in 2007, when the Algerian Energy Minister at the time, Chakib Khelil, was asked about the reason for delaying the completion of the Trans-Saharan gas pipeline project between Nigeria and Algeria, he denied that this was related to its high financial cost, but rather the lack of buyers.

A preliminary map of the Trans-Saharan Gas

Chakib Khelil was confident at the time that the banks in Algeria, Nigeria, and even the African Development Bank would be able to finance the Trans-Saharan gas pipeline, which cost about $13 billion at the time before rising to about $20 billion, but the biggest obstacle facing the project was the absence of markets to accommodate 30 billion meters. A cube of Nigerian gas.

Why did Nigeria embark on the completion of the Trans-Saharan gas pipeline after a 20-year delay? 

One of the proposals put forward by Chakib Khelil at the time was Algeria buying Nigerian gas and reselling it to its network of customers in Europe and the world. But 14 years after that date, things became more difficult, with new competitors entering the gas market, led by the United States, which turned from an importer to an exporter thanks to shale gas.

Gas was also discovered in the eastern Mediterranean in a significant quantity, and Russia launched gas pipelines towards Europe at competitive prices, and in the face of the intensification of competition for the European market, a fundamental revolution occurred in the global gas market contracts in 2019, with the end of the period of long-term gas contracts (20 years at least), and the price change. Fixed prices are subject to sharp market fluctuations.

One of the victims of these fluctuations was the Trans-Saharan gas pipeline, whose cost has risen to $20 billion, and requires long contracts (between 20 and 30 years) to supply gas and ensure profits.

The Trans-Saharan Gas Pipeline also entered into competition with an alternative project linking the gas fields in the Niger Delta with West African countries. However, the biggest challenge the Trans-Saharan gas pipeline faced was the emergence of Boko Haram in northeastern Nigeria in 2002 and its expansion in the region, then its allegiance to the organization. ISIS terrorist organization in 2015, and ISIS expanded the Greater Sahara in western Niger, through which the gas pipeline crosses not far from.

All events went against the sails of the Trans-Saharan gas pipeline, and postponed its completion several times, despite the signing of an agreement by Nigeria, Algeria, and Niger in 2009 to complete the project, and four years later, former Nigerian President Jonathan Goodluck announced that the project was about to start.

Nigerian Trans-Saharan Gas Pipeline..implementation kicks off

Nigeria’s announcement of the start of the implementation of a trans-Saharan gas pipeline that will reach the Algerian gas pipeline network for export to Europe, last September, raises more than one question about the reasons that prompted Abuja to embark on this huge project despite all the security, financial, economic and even political challenges that hindered its completion For about 20 years.

On September 21, the Nigerian Energy Minister, Tembri Silva, revealed, in an interview with CNBC Arabia, that his country’s government “has started implementing the construction of a gas pipeline to transport gas to Algeria, which will in turn, at a later stage, transfer it to other countries.” African (maybe he means European countries) other.

This statement coincided with the announcement by the Director-General of the Algerian Sonatrach Group, on September 13, that the technical studies of the trans-Saharan gas pipeline had been completed, and the area for crossing the line “remained economic feasibility related to the demand, supply, and prices.”

Sahara gas pipeline project at the heart of the conflict between Algeria and Morocco

The Algerian moves come in conjunction with Morocco’s efforts to rely on Nigeria through the African gas pipeline, to meet the domestic demand for gas, with the possibility of exporting the surplus to Europe through the Maghreb pipeline, through which Algeria exports gas to Europe.

Algeria plans to stop exporting gas to Europe via Morocco after severing their diplomatic relationship and to use the “Medgaz” pipeline, which crosses the Mediterranean and connects Algeria with Spain directly, and raises its export capabilities.

Morocco had started talks with Nigeria to build a gas pipeline linking Abuja with Rabat, and a joint plant for fertilizer production in Nigeria.
During the past years, there was talk about the trans-Saharan gas pipeline, after Morocco and Nigeria launched the project to complete the regional gas pipeline, in December 2016.

According to Moroccan media, the Moroccan gas pipeline extends at a length of 5,660 kilometers, and it is expected to be built in several phases to meet the growing need of the countries through which it will cross and Europe, over the next 25 years.

Map of the pipeline project, which is supposed to extend between Morocco and Nigeria for a length of 5,660 km, passing through 11 countries / DW

The pipeline is supposed to pass through Benin, Togo, Ghana, Côte d’Ivoire, Liberia, Sierra Leone, Guinea, Guinea-Bissau, Gambia, Senegal, and Mauritania. The cost of the project exceeds $25 billion, and the new pipeline is expected to transport between 30 and 40 billion cubic meters annually.

Why did Nigeria choose Algeria for this project, and did it strike the Moroccan ambition?

Reports indicate that the pipeline that will pass from Nigeria to Algeria through Niger aims to transport 30 billion meters of Nigerian gas to Europe, while the pipeline that extends between Morocco and Nigeria with a length of 5660 km, passing through 11 countries, will be technically and economically more difficult than the Nigerian project. -The Algerian.
What prompted Nigeria to choose the trans-Saharan route, was that it did not pay transit fees to only two countries (Niger and Algeria), and Algeria does not need Nigeria’s gas, which increases the quantity exported.

In addition to Algeria owning a network of gas pipelines to Europe, which will reduce the cost and duration of completion, not to mention the infrastructure owned by Algeria, whether in terms of gas pumping stations, liquefaction plants, and export ports, as well as marine gas tankers that can transport Nigerian gas to the markets Far in Asia after its liquefaction.

Recently, meetings and visits between Algerian and Nigerian officials have intensified, the latest of which was the meeting of Algerian Foreign Minister Ramtane Lamamra with his Nigerian counterpart, Jeffrey Onyeama, in New York, on the sidelines of the United Nations General Assembly meetings.

A delegation from Nigeria’s National Institute for Political and Strategic Studies (governmental), comprising 17 senior officials specialized in political, economic, and military affairs, visited Algeria at the end of last August to learn about the Algerian experience in various fields.

These visits and meetings reflect the desire of both countries to strengthen the partnership, not only in the economic aspect but also in the political and military aspects.

But can Algeria and Nigeria secure this pipeline?

If the economic obstacles are overcome, on top of which is the guarantee of a buyer of Nigerian gas for a long time, at a price that covers the cost and achieves profits, the biggest obstacle will be security.

The path of the gas pipeline crosses from several security hotspots, starting with the Niger River Delta in southern Nigeria, where several armed groups are active, including the “Niger Delta Avengers”, which target gas and oil pipelines in the region.

The repair of pipelines (gas and oil) cost 143.6 million dollars between January 2020 and January 2021, according to data from the Nigerian National Oil Corporation (NNPC).

In the north of the country, Nigeria is fighting a difficult war against the Boko Haram group and ISIS in West Africa and has not yet been able to resolve it despite its alliance with several countries (Niger, Cameroon, Benin, and Chad).

As for Niger, it faces a double challenge from Boko Haram in the southeast, and ISIS the Greater Sahara in the west, but the gas pipeline passes between them through Zinder state, which is safer.

Only Algeria is living in a stable atmosphere, but it is still under the security threat close to its borders. If this project is accomplished, the three countries will be obliged to secure it against any sabotage operations targeting it, which makes it likely the possibility of forming a tripartite security alliance on the “Abuja – Niamey – Algeria” axis.

Security alliance and greater Algerian involvement in the war against armed groups.

If Algeria prefers that each country secure the pipeline within its borders while coordinating security and intelligence work, Nigeria and Niger both want the presence of Algerian forces side by side to fight “Boko Haram” and “ISIS.”

The possibility of the presence of elements of the Russian Wagner Company in Mali near the Niger border may threaten the completion of this gas pipeline, which may reduce Europe’s dependence on Russian gas.
In this regard, it is not excluded that the talks that the Russian company, Gazprom, held with Algeria on September 24, discussed the impact of the Trans-Saharan gas pipeline on its strategic interests in the European market.

The construction of this project faces many security, political, economic, and international obstacles, but Nigeria has no choice but to complete it before the last mile of the fossil fuel era ends.

Will Algeria dispense with Morocco in exporting gas to Europe? For these reasons, the current situation remains in the interest of both parties.

Algeria’s inauguration of a new pipeline to export natural gas directly to Spain raised questions about whether this pipeline would be an alternative to the other gas pipeline passing on Moroccan territory, whose contract term expires this year.

Media and activists on social media from the two countries put forward the hypothesis of not renewing the contract for the pipeline that transports Algerian gas from the Hassi Ramel fields in the state of Laghouat (central) to cross the Strait of Gibraltar through Moroccan territory towards the Spanish city of Cordoba.

Political tension does not cancel economic cooperation

However, the political and media tension between the two countries on several issues, foremost of which is the issue of “Western Sahara” and “normalization with Israel”, does not reflect the fact that both countries have a common interest in renewing the contract on the export of Algerian gas to Spain through the pipeline passing through Morocco.

Nigerian Energy Minister: The gas pipeline will pass through Morocco and be exported to Europe

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