German Chancellor Olaf Scholz poses next to a turbine of the Nord Stream gas pipeline during a visit in the town of Mülheim an der Ruhr. /
The chancellor, Olaf Scholz, regrets that the connections with the Iberian Peninsula had not been strengthened before
«In the first year of the Economics degree, one learns that no import and export strategy can be successful if all the eggs are put in the same basket». The German Chancellor, the Social Democrat Olaf Scholz, yesterday launched this poisoned dart at her predecessor in office, Angela Merkel, for betting throughout her 16 years at the head of the country for Russia as the main gas supplier. It is not a unique German problem. At the beginning of the year, Moscow produced 40% of the gas consumed by the European Union, which in the context of the war in Ukraine has become a powerful weapon in the hands of the Kremlin to pressure the West.
To reverse the situation, Scholz proposed this Thursday to promote the construction of a new gas pipeline from Spain and Portugal to the countries of central Europe. If the connections with the Iberian Peninsula had been strengthened sooner, Scholz said, it would have been “a massive contribution to alleviate and lighten the situation” today.
The initiative was very well received in Madrid. “We positively value the foreign minister’s message,” the third vice president and minister for the Ecological Transition and Demographic Challenge, Teresa Ribera, congratulated herself on Thursday. “Spain has always shown its availability and claimed greater interconnection,” she added. Scholz announced that he will meet with the leaders of Spain, Portugal and France, as well as with the president of the European Commission, Ursula von der Leyen, to discuss the project.
Spain and Portugal have seven regasification plants, more than anyone else in Europe. To get an idea, Italy barely has three and Germany, none. It’s building three offshore plants in the North Sea, but they won’t be finished until mid-2023. Too late.
Madrid and Lisbon have seven regasification plants, more than anyone else in Europe
The strategic position of the Iberian Peninsula would allow them to import liquefied gas from the United States -which has already become the main supplier to our country, ahead of Algeria-, Nigeria or Qatar, among other nations, in order to reconvert it into gas and pump it up Pyrenees. Spain could also send part of the supply it receives from Algeria through the Medgaz gas pipeline, which reaches Almería. Until February, it was also supplied by a second conduit, the Maghreb Europa, which previously crossed Morocco and crossed the Strait of Gibraltar, but tensions between Algiers and Rabat led the Algerian government to close this route.
‘energy island’
What is the problem? That, although the Iberian Peninsula is a privileged actor to receive gas -it can regasify 60,000 million cubic meters (60 bcm) per year-, the truth is that it barely has the capacity to send it to Europe. Why? Basically, because there is no connection. It is an ‘energy island’. There are currently only two gas pipelines that cross the border with France. One is in Irun and the other is in the Navarrese Pyrenees. Between the two of them they pump 8 bcm a year. It is about 5% of what Moscow exported to the EU before the war.
It can only pump Pyrenees gas up through two pipes with little capacity
The question is not trivial. At the beginning of the year, Germany received 55% of the gas it consumed from Russia (now it has reduced it to 26%), through the gigantic Nordstream 1 submarine gas pipeline, with the capacity to transport up to 55 bcm per year. The problem is that now the installation works at 20% of its capacity. Moscow alleges technical problems; Berlin denounces a blackmail. The second part of the project, Nordstream 2, was paralyzed by pressure from the allies, especially the United States, which viewed with suspicion that Germany would further increase its dependence on Russia.
In any case, the delicate situation has led the German Foreign Ministry -and the rest of the countries highly dependent on Moscow- to seek alternatives. For example, it has reopened coal mines and is considering delaying the closure of its nuclear plants. But there is another possibility: replace Russian gas with another from a different source. And there would come the key role of the Iberian Peninsula.
On the other hand, Scholz appealed this Thursday again to “European solidarity in times of difficulty.” A request that is not new. Germany was the main promoter of the energy saving plan promoted by Brussels for the Twenty-seven to reduce their gas consumption by 15%, regardless of their dependence on Moscow. The proposal was opposed by several governments, including those of Spain and Portugal, which finally managed to adapt it to the reality of each country. The Minister of Foreign Affairs, José Manuel Albares, admitted this Thursday that he does not rule out a complete closure of the gas supply to Germany by Moscow. “It is a scenario that must be considered,” he warned.
The 226 kilometers remaining to complete the MidCat pipeline
When Olaf Scholz put on the table this Thursday the need to reinforce the gas connection of the Iberian Peninsula with the rest of Europe, all eyes turned to Hostalric, in Girona. That is where the MidCat gas pipeline ends, a project with a budget of 440 million euros that would double Spain’s capacity to pump gas across the border. It has been paralyzed since 2019, when the Spanish and French regulators decided to stop the project against the criteria of their Portuguese counterpart. The reason given was the high cost of infrastructure and the belief that gas was a declining energy source, in favor of renewables. Since the outbreak of the war with Ukraine, Madrid and Paris have intensified contacts to resume the project. The Spanish government wants the EU to help finance the construction of the 226 kilometers that remain between Hostalric and the French town of Barbaira.