‘It’s not like that!’ Spain warned against re-exporting oil from Algeria

Algeria warned on Wednesday that it would terminate gas supplies to Spain if Madrid sold any Algerian gas to other countries, citing what it said was a Spanish decision to supply gas to Morocco via a pipeline.

Algeria has previously said it will stick to its contract with Spain despite withdrawing its ambassador over a dispute between the two countries relating to the Moroccan-held territory of Western Sahara.

Spain’s energy ministry confirmed it planned to ship gas to Morocco but stressed that none of that gas would be of Algerian origin.

North African gas supplies to Europe have grown increasingly important this year as the Ukraine crisis has cast doubt on Russian energy exports, and Algeria has agreed to raise its supply to Italy.

Algeria wants to take advantage of higher demand for its gas after years of declining energy sales that have eaten into its foreign currency reserves.

Meanwhile, ties between old rivals Algeria and Morocco have worsened over the past two years and last year Algeria broke off diplomatic ties with its neighbour.

Algeria supports the Polisario Front movement that is seeking independence for Western Sahara, a territory seen by Morocco as its own. Spain last month said it backed Rabat’s plans to offer the territory autonomy.

Algeria also decided last year not to extend a deal to export gas through a pipeline running through Morocco to Spain that made up nearly all Morocco’s gas supply. It is supplying Spain through a direct subsea pipeline and by vessel.

Morocco now wants to import liquefied natural gas (LNG) from Spain by reversing the flow of the pipeline while it moves to develop its own longer-term LNG import terminals, as Reuters first reported last year.

Algerian television, reporting the warning, said that Energy Minister Mohamed Arkab had received an email from his Spanish counterpart notifying him of Spain’s decision to allow a reverse flow of the pipeline.

However, Spain’s energy ministry said that in no case would gas acquired by Morocco come from Algeria and that it had discussed the plan with Algiers in recent months.

“Morocco will be able to purchase LNG on the international markets, unload it at a regasification plant on the Spanish mainland and use the Maghreb gas pipeline to bring it to its territory,” the ministry said on Wednesday.

Last week Algerian President Abdulmadjid Tebboune said “We assure the Spanish friends, the Spanish people that Algeria will never abandon its commitment to supply Spain with gas under any circumstances.”

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