Spanish Compensation For Sonatrach Retroactive To 24 Months

The Spanish energy company “Naturgy” is expected to pay retroactive compensation to the national hydrocarbon company, Sonatrach, for two consecutive years, at the conclusion of negotiations to review gas contract prices, which are nearing their end.
These developments were revealed on Monday by the specialized Spanish newspaper “Expansion”, which indicated that “Sonatrach and Naturgy have buried the hatchet and are moving towards agreeing on new contracts worth 3 billion euros per year, and reviewing prices in a stable manner with a new framework of understanding between the two parties.” Explaining that the Algerian and Spanish parties are about to sign the new contract.
According to the same newspaper, the agreement between the Algerian hydrocarbons company and its Spanish counterpart will retroactively affect the price of supplies for the year 2023, in addition to those for the year 2024, and likewise will begin setting review criteria for the period from 2025 to 2027.
It can be seen from these details that the Spanish party will pay compensation retroactively for two consecutive years, i.e. 2023 and 2024, in favor of Sonatrach, as a result of reviewing the prices of gas supply contracts for the benefit of Naturgy, on the basis that the last agreement between the two parties was related to the prices related to the quantities supplied in 2022.
In the same context, the Spanish commercial bank “Inter Bank”, which is headquartered in the capital, Madrid, issued an analysis regarding these developments regarding the relations between Naturgy and Sonatrach, according to which it welcomed what it described as the progress made in the negotiations between Naturgy and the Algerian national company Sonatrach in order to reach a new agreement to review The prices of its natural gas supply contracts, considering that this agreement is “very important from both economic and political standpoints.”
According to the analysis presented by this commercial bank, “Algeria is the first supplier of gas to Spain. However, the Spanish government went through “critical moments,” when it took a historic diplomatic turn and supported the Moroccan proposal for a solution to the dispute over occupied Western Sahara, especially since the Algerian National Hydrocarbons Company Sonatrach owns a four percent stake in Naturgy and participates in the Medgas gas pipeline, which supplies gas to Spain, with 51 percent and 49 percent for Naturgy.
These developments come at a time when Sonatrach has strengthened its grip on Spanish gas supplies during the current year, as the latest official data of the “Enagas” company, which is responsible for managing the internal gas network in the Kingdom of Spain, indicate that the quantities supplied by Sonatrach in the month of June amounted to 45.2 percent of the total.
This European country’s imports totaled 12,936 gigawatts/hour, ahead of Russia, by 19.9 percent, and the United States of America, by 11.5 percent.
On an annual basis, Algeria has  bolstered its position as the first gas supplier to Spain with a coverage rate of 37.3 percent, compared to 21.9 for Russia, and 18.6 for the United States.