Ukraine Crises: Algeria Threatens to Halt Gas Supply to Spain over Morocco

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The Ukraine crises has thrown up the diplomatic row between Algeria and Morocco, as Algeria has sent a warning to Spain to be sure gas deliveries to Madrid does not find its way back to Morocco, insisting that it would b considered a breach of contract.

Algeria and Morocco have been in a lingering diplomatic rift over Western Sahara. Because of the spat, Algeria halted late last year gas supply to Morocco via the Maghreb–Europe Gas Pipeline that runs from Algeria through Morocco onto Andalusia, Spaine, which apparently angered Algeria.

Algerian position was captured in a statement featured by Algeria’s state news agency, APS. The Algerian ministry of energy and mines said in the statement yesterday (Wednesday): “Any conveyance of the Algerian natural gas delivered to Spain, whose destination is other than that specified in the contracts, will be considered as a breach of the contractual commitments, and consequently may lead to the termination of the agreement between Sonatrach and its Spanish customers.”

The AFP said Algeria’s state energy firm Sonatrach delivered more than 40% of Spain’s gas imports last year. OilPrice.com said it was not immediately clear whether Algeria would terminate supply agreements if Spain sends non-Algerian natural gas to Morocco.

The threat of yet another supply disruption in Europe and the Mediterranean region comes amid growing tensions between Russia and the EU over gas supplies and Vladimir Putin’s rubles-for-gas payment scheme.

Decision not to pay in Rubles – a policy adopted by Russia to checkmate US and its Dollar – caused Russia’s state gas major Gazprom to suspended gas deliveries to Poland and Bulgaria yesterday.

There have been reports of EU countries in southern Europe increasingly looking at African gas suppliers, including Nigeria and Algeria, to reduce their exposure to Russian gas.

Italy, for example, which depends for 40% of its gas demand on Russia, signed a deal with Algeria earlier this month to receive 40% more gas from the African gas exporter via the existing pipeline in the Mediterranean.

Italy’s Eni will increase the quantities of gas imported through the TransMed/Enrico Mattei pipeline under the long-term gas supply contract in place with Sonatrach starting from the autumn.

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