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"Gas OPEC" worth consideration: Algerian president
AFP
MADRID
Petroleumworld.com 03 14 07" An OPEC-style cartel of gas producing countries should not be "rejected out of hand", Algerian President Abdelaziz Bouteflika said in an interview in the Spanish newspaper El Pais on Tuesday.
His remarks contrasted with recent comments against the idea by his energy minister.
"The idea should not be rejected out of hand. It is worth examining by all interested parties," Bouteflika told El Pais in an interview.
Along with Russia, Algeria is the main supplier of gas to Europe which accounts for 90 percent of Algerian gas exports.
A recent Iranian proposal to form a gas producers' cartel along the lines of the Organization of the Petroleum Exporting Countries (OPEC) is "in line with trends which have surfaced through globalisation which are pushing producers to come together to defend their interests," Bouteflika said.
Last month, Russian President Vladimir Putin described the idea of a gas cartel as "interesting" although sector experts believe it could never come to fruition given the specific nature of the gas market.
Asked if Spain might end up being "exclusively dependent" on Algerian gas supplies when it already depends on its southern neighbour for some two-thirds of supplies, Bouteflika said Madrid "has not entered lightly into this energy cooperation."
That cooperation "will allow (Spain) to supply gas to the rest of Europe. I need not underline the advantages that situation represents for Spain," Bouteflika said.
Bouteflika's comments came a month ahead of a gas producers forum in Doha which follows on from an August accord between Algerian public producer Sonatrach and Russian behemoth Gazprom which led to uproar among European clients, led by France and Italy.They are concerned that a future cartel would set price and supply levels.
Bouteflika's energy minister, Chakib Khelil, took a different view on a visit to Madrid on February 7 when he said that a gas "OPEC" was not possible as "all sales take place in the framework of long-term contracts."
Khelil added on Monday: "Gas prices are indexed on oil prices, which already respond to OPEC policy and strategy."
"What would be the point of a gas OPEC when we already have an oil OPEC which directly sets the price of gas?"
On Monday, Khelil said Algiers was negotiating to increase the price of its gas exports to Spain to reflect higher prices in international market.
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).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.
AFP 13 1144 GMT 03 07
Copyright© 2007 AFP. All Rights Reserved.
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