Duran Farell and the gas idyll between Spain, Algeria and Morocco

“I have come to the conclusion that Algeria is one of those countries that, judged strictly by political stability or instability, have significant risks, as is evident, but even when they decide to wage their civil war, they need to sell gas, which has no important transformation in their country, to be able to finance whatever they want in it.

Thomas Osborne
Thomas Osborne
10 June 2022 Friday 00:31
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Duran Farell and the gas idyll between Spain, Algeria and Morocco

“I have come to the conclusion that Algeria is one of those countries that, judged strictly by political stability or instability, have significant risks, as is evident, but even when they decide to wage their civil war, they need to sell gas, which has no important transformation in their country, to be able to finance whatever they want in it. I know that this does not justify anything, because the risk for Algeria is politically evident, but practice shows that nothing is happening, that nothing has happened so far”.

Pere Duran Farell, then president of Enagás, addressed the Industry, Commerce and Tourism Committee of the Congress on May 16, 1994, to report on the energy connection project with Algeria and Morocco through the gas pipeline of the Maghreb, then under construction.

With pragmatism as his flag, endorsed by the Libyan experience, where the change of regime two decades earlier had not altered the energy contracts one iota, this civil engineer culminated the project of gasification of the Spanish economy, following the European energy model. The path had begun in 1961, when a Duran Farell who was barely 40 years old was entrusted with the reconversion of Catalana de Gas.

Challenging the monopoly of Campsa and Butano, Catalana de Gas opened the first liquefied gas regasification plant in the port of Barcelona in 1969, which began to arrive in a methane tanker. A new and original line of business that left the generation of gas through coal and naphtha in oblivion and that did not alter the coup d'état that Muammar Gaddafi carried out that same year.

The new era of natural gas was extended with contracts with Algeria and led to the creation of the public company Enagás in the throes of Francoism, to whom Catalana de Gas had to sell its contracts and its regasification plant to focus on the distribution business and marketing. Although the growth of the market and the project to build a gas pipeline between Algeria, Morocco and Spain, with an extension to Portugal, would eventually lead to the privatization of the company and its acquisition by Gas Natural, as a result of the merger of Catalana de Gas and Gas Madrid. A process at all times led by Duran Farell, who also assumed the presidency of the new Enagás

The gas pipeline, which today bears the name of Duran Farell, was inaugurated in Córdoba – as far as it went – ​​in December 1996 by the King and Queen and the president of Enagás himself, whose speech we offer in excerpt. It was the culmination of a business model devised and led by the Catalan manager that made possible not only the arrival of natural gas in Spanish homes, but also the electricity generation model through combined cycle plants. In short, the current Spanish energy model.

Twenty-five years later, at the end of the supply contract through the gas pipeline, on October 31, 2021, the Algerian public company Sonatrach decided to suspend supply to prevent Morocco, which charged the toll for passage through its territory and remained part of the gas, benefit from the infrastructure. Algeria, however, continues to supply gas to Spain and Portugal through the second gas pipeline that it built in 2011 between Beni Saf and Almería, the Medgaz.

In all these years, gas has not stopped flowing between Algeria and Spain, reaching 29% of the gas consumed in 2020 (in the first quarter of this year it represents just over 26%). These days, without revolutions in between, Duran Farell's dream is more threatened than ever.

“Your Majesties, Your Excellency President of the Andalusian Community, Your Excellency Vice President of the European Commission, Your Excellencies, Ministers, Honorable Authorities, Ladies, Gentlemen, Dear Friends:

”The truth is that this gas pipeline, the Maghreb-Europe Gas Pipeline, is off to a good start. And it is evident that it could not be otherwise, being inaugurated by Their Majesties the King and Queen of Spain, who have done us the honor, who have honored us dearly, by presiding over this act.

”It is a happy reality, Your Majesties, that in the presence of the Vice President of the European Commission and the Foreign and Energy Ministers of the four countries participating in the gas pipeline, that is, Algeria, Morocco, Portugal and Spain, your august presidency symbolizes, exactly, the historical importance of this act and emits, by itself, an emotional intangible message of deference and encouragement that we warmly appreciate.

”The Maghreb-Europe Gas Pipeline is important and in my words I am going to especially underline its strategic importance and its socio-political and human potential, beyond its considerable economic, industrial and technical magnitude.

”The Maghreb-Europe Gas Pipeline, Your Majesties, is a project initially promoted by Spain, to which Algeria and Morocco and later Portugal adhered from the outset, with the aim of connecting the important Algerian natural gas fields of Hassi R'Mel with the European network of gas pipelines through Morocco, the Strait of Gibraltar and the Iberian Peninsula.

”The gas pipeline, in this its first phase, the one that ends here in Córdoba, constitutes a very important contribution to satisfying, in quantity and quality, the gas demand of Spain and Portugal in the coming years. It undoubtedly facilitates the interrelation of the Maghreb countries with each other and with Europe and obviously contributes to a positive evolution of its GDP, as well as its production processes and the environment.

"In addition, this first phase constitutes a fundamental and necessary step so that, in its second phase of development, the gas pipeline is integrated into the planned connection scheme of the three main non-EU production centers: Algeria, North Sea-Norway and Russia. and, with this, can contribute decisively to the supply of the large European gas markets.

”As is known, the external dependence of the European Union on the supply of natural gas is high. Currently, almost 40% of the gas consumed in the Union markets is non-community and it is expected that in 2020 the deficit will be of the order of 80%. For this reason and in this context, the contribution of Algerian natural gas to Europe's future supply can and must be very important. Hence, Your Majesties, the strategic importance of this gas pipeline.

”The Maghreb-Europe Gas Pipeline, properly speaking, reaches Córdoba in its first phase after a route of about 1,400 km from Hassi R’Mel, in Algeria. Of these, 520 km from Hassi R'Mel to the Moroccan border, 540 km in Morocco to Tangier, 47 km from the crossing of the Strait of Gibraltar between Tangier and Tarifa and 275 km from the Tarifa-Córdoba section.

”Your Majesties, the first conception and subsequent construction of this great gas pipeline has allowed us to have sincere contact with North African civil and political society, mainly, as is logical, with that of Algeria and Morocco. Contact through which we have intuited and known better and better its admirable potential and reality of cultural, personal and social values.

”Admirable reality that has led us to the conviction of the interest of considering in the civil environment of our gas pipeline initiatives of an economic, sociological and human nature that, debated and expressed in common, will configure a broad process of convergence of attitudes and mutual understanding .

”Thus, for example and within the framework of this conviction, we are organizing in Algiers, Rabat and Tunis, UNESCO/Natural Gas chairs, with the aim of deepening our knowledge of the conditions that can lead to sustainable human development of the Maghreb societies themselves and in their interrelation with the other Mediterranean societies.

”And allow me, Your Majesties, to integrate these considerations, recall now, albeit very briefly, the overcoming of the North-South Mediterranean imbalance that occurred in the second half of the first millennium of our era and that from that overcoming the foundations of the Western world of ours arose. days.

”Spain, or more exactly, the Iberian Peninsula, was at that juncture, as now, in the geographical center, but culturally and politically part of the Islamic south, while now we are integrated into the Christian north. And Spain was in that circumstance the great Mediterranean protagonist of the Islamic-Christian osmosis that harmonized, recovering it, the natural balance of the western Mediterranean human ecosystem.

”I think that we are now experiencing an equivalent circumstance after a thousand years of history, in which Spain could again fulfill that transmitting and lubricating function of a process of the same type. And I also think that, in this sense and in the present circumstance, our gas pipeline could help this process as the backbone of sociological and human initiatives that promote it.”