Gulf and European Energy Supply Security - Feem-project.net

Energy Security: Potential for EU-GCC Cooperation
Figure 1. Actual and Future Maghreb Export Capacity to Europe
Source: OME Encouraged Del. 6 (2006)
On the overall energy security picture, therefore,
Libya represents a limited risk and an important
opportunity.
It must also be noticed that Libya’s export
capacity is small and consists of one gasification
facility and one undersea pipeline (Greenstream).
Libya also has a long experience with LNG
technology as it historically was the second largest
exporter after Algeria. All these factors allow us to
conclude that Libya possesses a large potential that
could certainly benefit EU’s energy security. The
government has shown clear interest in increasing
gas production, especially for supplying the domestic
market since much of the power generation is gasfired,
alongside developing an export strategy.
Libya’s population, at 6 million, is much smaller
than Algeria’s; consequently, even if the domestic
consumption increases by 2030 – from 6 bcm/yr now
to 12 bcm/yr then – the impact on export capacities
will remain minor.
On the political side, the international situation
of Libya has drastically improved since the lifting
of EU and US sanctions in 2004. The largest risk
comes from more internal factors and concerns the
underdevelopment of government institutions and
the total absence of an institutional framework for
the succession to the colonel.
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2.4.3 egypt
Egypt is, for the moment, a very
small supplier of gas (5.7bcm in 2007
to the EU out of a production of
58bcm), but its geopolitical interest
is great. It possesses around 2.13tcm
of proved reserves, and there could
be some 3.3tcm still to be found. This
would position Egypt as an even
larger potential supplier than Libya.
Conversely, Egypt’s population is
much larger than Libya’s and when the
OME predicts that Egypt’s domestic
gas consumption will reach 70bcm/yr
in 2030, it leaves a much smaller share
available for export. It is hoped that
new fields coming on-stream will allow
surplus volumes to grow in parallel
with the domestic appetite. It must be
noted that regulations require that a
significant share of the reserves be left untouched. If
production grows sufficiently to reach 120bcm/yr by
2030 (OME’s projections), around 50bcm/yr would be
available for exports. The short-term problem is that
Egypt lacks the infrastructure for large-scale exports.
Only two solutions are available: LNG or the Arab
Gas Pipeline, which bypasses Israel. This pipeline
could potentially fill up Nabucco, but the realization
of such a scenario is still very vague, and Egypt alone
could not sustain Nabucco.
2.5 The Fourth Corridor - Central Asia and the
Gulf Region
The so-called fourth corridor could potentially
pool the resources from several areas: the Caucasus
(Azerbaijan), the Caspian basin countries (Central
Asia and Iran), and the Middle East countries (Iraq,
Egypt, and potentially, Qatar), thus acting as an
alternative route allowing Europe to diversify away
from Russia, Norway and the Maghreb.
The primary means of attracting those
resources has materialized as the Nabucco
pipeline. The pipeline, favored by the EU and the
United States would rely, as of today, on Azeri
production. Azerbaijan possesses the giant Shah
Deniz field that could produce between 30 and