Spain Pays Algeria’s Gas 3 Times More Expensive Than In 2021

Algeria’s closure of the Maghreb-European gas pipeline, which previously connected it to Spain via the Kingdom of Morocco, and the Russian-Ukrainian war have led Madrid to pay a price for Algerian gas three times higher than in 2021.
The latest data on the prices of Spanish gas purchases from Algeria, published by the Spanish Channel of the South “Canal Sur” website, indicate that Madrid is paying double prices for Algerian gas that enters the country through the Medgas pipeline, confirming that the price of a ton in 2023 has become three times more expensive than the previous year 2021, a situation that has affected the prices of products that use gas in the production process.
The same figures show that in the last five years, 21 million tons of natural and liquefied gas have entered Almeria through the pipeline and the port, with a value of 9 billion euros, which indicates that the cost of imports from Algeria through the Medgas gas pipeline is currently estimated at 650 euros per ton, which is the same price. In 2022, but it is almost three times more expensive than in 2021.
According to the same source, Spain will pay Algeria a value of 3 billion euros for gas imports in 2022, while the cost in 2021 was between 1 billion and 174 million euros.
With regard to 2023, according to the same data, until the end of August, Spain has paid Algeria a value of 1.8 billion euros, in exchange for 2 million and 700 thousand tons of gas. What explains this upward trend in the cost of Algerian gas is due to the Russian-Ukrainian war and the closure by Algeria of the pipeline that passes through Morocco.
As for liquefied natural gas, the data showed that the quantities that entered through the Port of Almeria in 2023 amounted to 378 million euros, compared to 475 thousand tons. These figures represent an increase of about 90 million euros, compared to 90 thousand tons less compared to 2022, and that the reason is due to the cost of liquefied natural gas. A ton of LNG arriving by tanker is estimated at 800 euros in 2023, compared to 380 euros in 2022.
These statements come at a time when the CEO of the Spanish company Naturgy, Francisco Reinas, visited Algeria a few days ago and met with the President and General Manager of Sonatrach, Rachid Hachichi.
The Algerian and Spanish parties are negotiating to review and increase gas prices, as there is a clause that provides for their review in the event of an increase in the international market or an increase in production costs.
Algerian gas exports to Spain reached their highest level in three years last September, accounting for about 42 percent of Spain’s gas imports.
In addition, there is a new Algerian slap dealt by the Spanish government, which has turned against its country’s historical position regarding the conflict in Western Sahara, and this time from the energy gate, through the clarification of the features of the second southern corridor project for hydrogen, in which Algeria has clearly chosen its partners, namely Italy, all the way to Germany, via Austria, far from any Spanish participation.