Spain faces another record year as a gas resale center thanks to ports like El Musel and international gas pipelines

2023-08-22 04:00:32

The European energy system has suffered a historic shock fueled by the geopolitical earthquake caused by Russia’s invasion of Ukraine. With all of Europe maneuvering to reduce its dependence on Russian gas as much as possible, Spain has become a key player in guaranteeing continental supply and has established itself as the great European center for gas re-exports.

Spain is squeezing its network of regasification plants – those that receive and send gas by ship – and also its gas pipeline connections with Europe to trigger resale to other countries. Asturias already participates in said infrastructure with the El Musel terminal, which opened in June with the unloading of the methane tanker “MV Energy Universe”. At the moment, the plant in Gijón does not operate as a liquefied natural gas regasification plant –for which it was conceived–, but only as a logistics warehouse, with a capacity of 300,000 cubic metres.

Last year the Spanish gas system already managed to lead gas re-exports to the EU and now it is accelerating towards another record year with new increases. Forwarding has skyrocketed another 49.7% between January and June of this year, to close to 45,000 equivalent gigawatt hours (GWh), and that was already off the record levels of last year, according to the records of the Corporation of Strategic Reserves (Cores). Shipments grew both through gas pipelines with France, Portugal and now also Morocco (with an increase of 53%, up to 33,100 GWh, three quarters of the total) and from regasification plants using methane tankers (with an increase of 40 %, up to almost 11,900 GWh).

Spain has re-exported 22% of all the gas that arrived in the country this year (imports up to June reached 204,700 GWh, with a decrease of 9.7% year-on-year). European countries are the main destination by far, concentrating 85% of sales so far this year (in line with the 86% that the flow to Europe represented last year, and well above the weight of 65% registered in 2021, before the worst of the energy crisis).

Already last year, Spain managed to almost double the resale of gas to other countries, with a growth of 91%, to exceed 68,200 GWh and mark an all-time high. The persistent market turmoil due to the need to guarantee supply in the midst of geopolitical tension anticipates that the Spanish gas system will set a new record in 2023.

With the Kremlin cutting off piped gas shipments to Europe as part of the crusading retaliation game for the war, European countries have begun looking around the world for other suppliers. And for this, it is necessary to transport it by ship in the form of liquefied natural gas (LNG), which is transported in a liquid and frozen state. Spain is taking full advantage of its network of six regasification plants, which concentrate 33% of the regasification capacity of the entire European Union and 44% of the continent’s LNG storage, to become a major European “hub” for the arrival and the re-export of gas.