Algeria wants to double its gas exports, after a record year 2022.
©MYCHELE DANIAU / AFP
With the conflict in Ukraine and the consequences this has on gas supply, Europe is seeking to enter into agreements with Qatar and Algeria.
Atlantico: Faced with our gas needs, the Europeans are seeking to enter into agreements with Qatar. To what extent do we plan to increase our Qatari exports?
Jean-Pierre Favennec: Until 2020, Russia supplied 40% of European gas consumption, i.e. 200 billion cubic meters imported for 500 billion consumed.
The gradual cessation of exports decided by Russia is forcing Europe to find alternative solutions. First of all, it should be noted that European production of natural gas is very low and tends to decrease. Besides Russia, Norway and Algeria have long been important suppliers of natural gas to Europe. More recently, Europe also imports natural gas from Nigeria, Qatar and the United States.
Replacing 200 billion cubic meters of gas (Russian imports now stopped) by other sources of gas on the international market is impossible. European countries are led to turn to traditional suppliers – other than Russia – to ask them to increase their exports.
Norway and Algeria, traditional suppliers, can only increase their exports to a limited extent. It is therefore necessary to turn to other suppliers
The additional supplies, which cannot immediately compensate for the missing Russian exports, will mainly be made by LNG (Liquefied Natural Gas) coming primarily from the United States, Qatar, or even new African producers (in particular Senegal and Mauritania)
Qatar already supplies LNG to Europe. With huge gas reserves, the emirate recently decided to increase from 80 to 110 and then 127 million tonnes of LNG before the end of the decade, its production capacity. But Asia remains a preferred destination and additional quantities will only be available in a few years. It is likely that a large fraction of Europe’s new natural gas imports will have to come from the United States.
War in Ukraine: Vladimir Putin arrived in Belarus for talks with his ally Lukashenko
Algeria wants to double its gas exports, after a record year 2022. Europe is already Algeria’s leading customer. Is it wise to increase our dependence on a country with which our relations, in particular the French, are sometimes difficult?
Algeria was the first country to export natural gas to Europe (starting with France), from the beginning of the 1960s (exports by LNG from Arzew). For more than 60 years, Algeria has therefore been an important supplier to France and Europe. Recent visits by the French President and Prime Minister have heightened the importance of the relationship between France and Algeria.
However, Algeria’s natural gas reserves are only progressing slightly and domestic consumption, largely subsidized to help Algerian households, is constantly increasing. The possibilities of increasing Algerian exports to France and to Europe remain limited and disproportionate to the quantities that would in principle be necessary to replace Russian exports.
What is the state of our current dependence on these two countries? How much could this increase?
European dependence on Qatar and Algeria will not increase significantly simply because of the limited capacities of these two countries to very significantly increase their exports to Europe. German initiatives to increase Germany’s imports from Qatar or Italian initiatives to increase Italy’s imports from Algeria will no doubt enable these European countries to improve their situation. They will not replace Russian imports.
Still no agreement within the European Union on the gas price cap
To what extent do economic, energy and moral issues intertwine in the choices? With what consequences?
The priority for European countries is to cope with the cessation of Russian gas exports, which represented a significant fraction of energy consumption in Europe and which cannot be replaced quickly. The European Commission has taken a number of measures to deal with the situation arising from the invasion of Ukraine by Russia. Energy sobriety, energy efficiency, acceleration of the development of renewable energies, research of new gas suppliers are part of these measures.
HAS to what extent are we replacing a dependency on Russia with dependencies with countries that also raise ethical questions?
The priority for Europe is to deal with a shortage of gas which resulted, from 2021, before the invasion of Ukraine by Russia, in an explosion in the price of gas, and more recently in the price of electricity. This crisis could ultimately benefit European countries by accelerating the energy transition. . In the immediate future, this crisis is heavily penalizing European consumers, individuals or small, medium or even large companies, with very serious economic and social consequences. For gas, it is likely that the United States will eventually become Europe’s main suppliers. Market mechanisms will make the fortune of American exporters who have been benefiting from very high natural gas prices for a year.
Completely in gas: after European dependence on Russia, that of Qatar or Algeria?