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Algeria presses Spain for higher gas revenues
AFP
ALGIERS
Petroleumworld.com 03 13 07Algeria is negotiating to increase the price of its gas exports to Spain to reflect higher prices in international markets, Algerian Energy Minister Chakib Khelil said Monday.
In Madrid a spokesman for Gas Natural, Spain's largest gas provider, told AFP the company was negotiating a revision in its contract with Algerian gas giant Sonatrach.Spain relies on Algeria for 60 percent of its gas supplies and is linked to the North African country via the Europe-Maghreb pipeline (MEG).
"Algeria is negotiating a revision of the gas price to bring it into line with current prices," Khelil said on public radio.
"There will probably be one dollar per million BTU (British thermal unit) more than what is billed at the moment," he added, saying the increase would generate an additional 150 million dollars (114 million euros) for Algeria.
The minister declined to name the current price of gas sales to Spain.
"The gas supplies delivered through the MEG are through old contracts in which the sales price is lower that the price obtained from other clients in the Iberian peninsula," Khelil said.
"We want to bring these prices to reasonable levels that take into account increases in the price of gas on international markets while also taking into account the impact on Spanish consumers."
In Madrid the Gas Natural spokesman said "the only thing we can say on this matter is that we are in the process of negotiating a revision of (a gas importing) contract with Sonatrach."
"But we have nothing to add because of a confidentiality clause."
The Maghreb-Europe pipeline links the Hassi R'mel gas field in the Sahara desert in Algeria with Cordoba in southern Spain, where it is connected with the Spanish and Portugese gas grids.
Algeria exported 12 billion cubic metres of gas through the pipeline in 2006, generating revenues of 650 million dollars.
Ninety percent of Algerian gas is sold in Europe.
AFP 121534 GMT 03 07
Copyright© 2007 AFP. All Rights Reserved.
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