Spain has “potential,” said Federal Finance Minister Christian Lindner in Madrid on Thursday. Lindner traveled to the meeting with the Spanish Economics Minister, Nadia Calviño, to explore this potential. The question was also: To what extent can Spain help Germany to free itself from dependence on Russian gas? Or as Calviño put it: from Putin’s “blackmail”.
Since the beginning of the war in Ukraine, Spanish newspapers have been asking whether their country has the key to replacing Russian gas in Europe. There is some evidence that Spain could become an important transport hub for gas to Central Europe in the future – provided the EU finances the necessary conversion. But money is not the only thing missing so far. In recent years, there has also obviously been a lack of political will to connect the Iberian Peninsula to the European gas and electricity grid at all. In terms of energy policy, Spain is like an island, says Teresa Ribera, Minister for Ecological Change in the cabinet of socialist Pedro Sánchez. The bottleneck for a gas pipeline from Spain to Central Europe is in the Pyrenees.
In recent years, Spain has made a virtue of its location and used its coasts. Gas now makes up a good 20 percent of the Spanish energy mix, in Germany it is only about ten percent. But unlike Germany, Spain only gets eight percent of it from Russia. Algeria was the main supplier for a long time, but the USA has recently entered the Spanish gas market with increasing self-confidence. If they had their way, gas from the USA would arrive in Spain and be distributed from there to other European countries. Spain as Europe’s gas port? Commentators in Spanish newspapers are already shouting that this opportunity for geostrategic revaluation should not be missed.
Today, the country only gets part of its natural gas from pipelines; the rest is brought in by tankers in the form of liquefied natural gas (LNG), cooled to minus 160 degrees and thus liquefied. LNG is complex, expensive and has an even worse environmental balance than conventional natural gas from the pipeline due to the high energy consumption for cooling and transport.
Algeria also knows how to use gas as a means of pressure
Gas used to come from Algeria to Spain mainly through two pipelines: the Medgaz pipeline comes out of the ground in Almería and has a capacity of 10.7 billion cubic meters per year, of which only eight billion cubic meters are currently being used. The second connection, the Maghreb-Europe Gas Pipeline (MEG), which runs through Morocco, could transport twelve billion cubic meters per year. But it has been lying idle since Algeria broke off diplomatic relations with Morocco last summer and let the supply contract, which had granted Morocco ten percent of the gas as a right of passage, expire.
Algeria also knows how to use gas exports as a diplomatic means of exerting pressure. It is no coincidence that this behavior is reminiscent of Russia: Algiers has close ties to Moscow, has been buying three quarters of its weapons there for decades and recently abstained from voting in the UN General Assembly condemning Russia’s attack on Ukraine. Despite its gas reserves, Algeria is also dependent on Russia: the state-owned company Gazprom is involved in the development of Algerian gas fields in the desert.
Nevertheless, a few days ago, Sánchez asked Algeria if it could increase deliveries. The willingness to do so is there, but experts are skeptical as to whether it can step in for Russia in the short term. “Algeria has hardly invested in its gas infrastructure for 20 years, many things are outdated and need to be renewed before deliveries can be increased,” says Isabelle Werenfels, North Africa expert at the German Institute for International and Security Affairs (SWP).
There is also a lot of protest against the possible extraction of shale gas in the structurally disadvantaged south of the country. The population, already shaken by global warming, fears the extensive water consumption and pollution that fracking is likely to bring with it. For the time being, Algeria is dependent on the existing capacities – and must primarily use them to supply its own population. Domestic demand has risen sharply over the past ten years.
Spain will soon have seven liquid gas terminals, Germany none
Where Algeria falters, the USA steps in: In January of this year, the USA already covered 35 percent of Spain’s gas requirements. Ascending trend. From the USA’s point of view, the Spanish and Portuguese coasts are the ideal landing places, with almost half of all European liquid gas terminals located here, where the cargo is converted back into its gaseous state and transported onward. There are six terminals in Spain and a seventh is under construction. Portugal has a terminal – which now takes over the entire gas supply of the ten million inhabitant state. Germany does not have a single LNG terminal. In Spain, on the other hand, 30 tankers can land a month, with more gas than the country needs. So it would only make sense to send parts of the raw material further north.
But according to the current status, it would be over at the Pyrenees at the latest. To date, there is no significant connection across the Franco-Spanish border. The economist Natalia Fabra from the Universidad Carlos III in Madrid speaks of a “historic strategic omission”. Only two smaller lines connect northern Spain with southern France, their capacity is just seven billion cubic meters per year. For comparison: Nord Stream 1 transports 55 billion cubic meters annually, Nord Stream 2 would have doubled this capacity again.
Spain is currently campaigning powerfully in the EU to resume the construction project for a third Pyrenees pipeline, which has been shut down for three years: Midcat, as it is called, had previously failed primarily due to resistance from France, and the pipeline ends in nowhere in Girona in northern Spain. But even Midcat would only have a capacity of nine billion cubic meters per year.
So does a more powerful pipeline across the Pyrenees need to be built to alleviate Europe’s dependence on Russian gas? The energy expert Natalia Fabra believes that such a rethinking of European energy policy would have long-term advantages: If the EU gets rid of natural gas in 2050 as planned, the new Pyrenees pipeline can be used to transport green hydrogen. Sánchez recently announced that he wants to become the European leader in the production of hydrogen using sun and wind. Both are found in abundance on the Iberian Peninsula – thanks to its island location.