Algeria’s state-owned oil company Sonatrach has become a majority shareholder in the offshore 210Km long Medgaz gas pipeline, with a 51% stake, with Spanish gas and power utility Naturgy holding the remaining 49%.
The transaction consolidates Sonatrach’s position as a major and reliable supplier of Algerian gas to importing customers in Europe, especially in the Iberian Peninsula via the Medgaz gas pipeline. Sonatrach also holds a stake of 4% in Naturgy.
“With this acquisition, Sonatrach becomes a 51% shareholder in the new shareholding of Medgaz SA with its historic partner Naturgy at 49% and thus strengthens its position as a major and reliable supplier of Algerian Gas to importing customers to Europe, in particular the Iberian Peninsula through the Medgaz gas pipeline,” Sonatrach said in a statement.
The Medgaz gas pipeline has been in operation since 2010 and transports natural gas sourced from Beni Saf on the Algerian coast to Almeria in Andalusia.
The pipeline has a capacity of 8 billion cubic meters (bcm) of natural gas per year. Capacity of the pipeline is expected to be increased to 10.2bcm during the first quarter of 2021 through the addition of a fourth turbo-compressor at the Beni-Saf compression station.