HomeEconomyNaturgy maintains the hope of opening the GME floodgates, not us!

Naturgy maintains the hope of opening the GME floodgates, not us!

The Spanish gas and electricity group Naturgy, which does not enter into its calculations, revised its profit forecast for 2021 downwards on Wednesday. Indeed, its core profits fell by 1% to 2.56 billion euros ($ 2.96 billion) for the first nine months of the year. This is because the rebound in demand for electricity and rising prices for gas sales around the world have been offset by lower margins on electricity in Spain, Reuters explains.

In any case, this was immediately reflected in the group’s shares on the Madrid stock exchange, which in the momentum, took note of a slight drop of 0.2%. From there, to converting to a negotiator, there is only one step that cannot be taken. The story of Naturgy, which nevertheless owns 49% of the Medgaz gas pipeline and which directly links Algeria to Spain, is; so to speak, singular. Indeed and despite the official announcement on October 31 of the closing of the valves of the Maghreb-Europe (GME) gas pipeline “ordered” with beating drum, by the Algerian president and especially the non-renewal of the contract, Naturgy maintains a strong hope of reopening the valves.

This is in any case, what its global planning director, Jon Ganuzo, said yesterday Wednesday. The latter having, it seems, taken his pilgrim’s staff and is preparing, according to his words and to do this, to conduct discussions with Morocco and Algeria in order to obtain an extension of the contract as to the GME transit agreement. ‘If we come to an agreement with Algeria it would be very positive it would mean the most reasonable path for everyone‘, he said. On this side of the shore, the GME and the agreements with the khaki regime, we have mourned it in view of the daily hostilities that we endure by the gas neighbor. The reconversion is therefore acted and it is not a vacuum. Also, we gladly praise the enthusiasm of this manager of Naturgy, without however bathing in euphoria or even in the slightest optimism and we keep, for as much avowed will, a cool head, knowing in this that ‘in the East of Eden, the version is quite different when it is not the most absurd obstinacy if not the most absolute intransigence which dominates.

Indeed Algiers, is hardly willing in its way of conducting the country’s affairs to agree to a return to what was done before the end of last October. Algeria is too busy looking for lice to go to this version wanted by Jon Ganuzo. If the latter seeks his small part lost in the exchange, it is quite legitimate. Algeria has repeatedly stated that it can meet Spain’s gas demand using only the Medgaz pipeline and direct LNG deliveries. Sonatrach, repeats to whoever wants to hear it that there is no reason to worry about this, especially since Algeria is currently working to extend the capacity of the Medgaz gas pipeline to 8 Gm3 / year at 10.7 bcm / year – against 13 bcm / year for the GME -, the work to be completed by the end of the year. In addition, Sonatrach had declared that Naturgy had been aware since July 2018 that the GME concession would probably not be renewed. However, despite assurances from Algeria, the non-renewal of GME’s transit contract has raised some concerns in Europe given the current tight gas market and high prices. The GME pipeline during the year 2021 was sufficient to meet around 25% of the Spanish gas demand.




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