As Russia closes its gas taps, Algeria’s leading role in the market is once again emerging. EastMed revival scenarios.
“Our governments have signed a declaration of intent for energy co-operation, while EMI and Sonatrach have agreed to increase gas exports to Italy.” With these words, during a lightning visit to Algeria in early April, Italian Prime Minister Mario Draghi had announced the revival of energy cooperation with Algeria. By 2024, the North African country is expected to supply Italy with nine billion cubic meters of natural gas via the Transmed pipeline, which also runs through Tunisia.
In this way, Algeria becomes again the largest supplier of gas to Italy, instead of Russia. Trade links have always existed. In 1983, the Transmed pipeline with a capacity of up to 30 billion cubic meters was launched. This is a huge amount, which is considered necessary for the first time after the geopolitical upheavals of recent months, says Davide Tabarelli, director of the independent energy rating agency Nomisma Energia, based in Bologna. “In the early 1980s, no one imagined that we would reach such a quantity,” he says characteristically. “And yet, we need it so much today …”
Political instability in Libya
Italy also maintains traditional ties with Libya. In 2004, the Greenstream pipeline was inaugurated there, in which the Italian energy giant EMI also participates. Libya has significant gas reserves, but so far political liquidity has made it very difficult to exploit them. “The capacity reaches ten billion cubic meters, but so far not even 50% is being used,” says Tabarelli. “State structures have collapsed, there is no competent service that can give permission for new gas extractions.”
From 2020, Italy is also connected to the deposits of Eastern Europe through the TAP pipeline, which transports natural gas from Azerbaijan to the Italian South via Greece and Albania. Its construction had provoked strong protests, especially in the area of Puglia, but today the pipeline is proving valuable. TAP’s share of total Italian gas imports has reached 10% and is expected to double soon. “Italy needs to invest in energy networks, it needs to strengthen and expand them,” said Davide Tabarelli.
Hydrogen, “21st Century Oil”
In the near future, the existing network can be used for hydrogen, which experts consider “21st century oil”. However, it is not yet clear how mature the conditions are for its utilization. Marco Alevra, head of the Italian gas group SNAM, is very optimistic. “99% of the SNAM network, which connects North Africa with Central Europe, can be used to transport hydrogen without the need for any conversion,” he said.
At the same time, Italy is completing the construction of the necessary infrastructure for the storage of liquefied natural gas (LNG). The country already has three LNG terminals, and is currently installing two more floating terminals. A bilateral agreement on liquefied natural gas was signed with Egypt in April, a similar agreement was recently signed with Qatar, while the Italian government plans to increase its imports from Congo, Angola, Mozambique and Nigeria.
A few days ago, Mario Draghi also visited Israel, in search of other alternatives. Plans for the EastMed pipeline, which will supply gas from Israel to Central Europe, already exist, but only on paper. Time will tell if the geopolitical turmoil of recent months will revive plans for its construction.
DW: Elizabeth Pongrats / Giannis Papadimitriou
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