Morocco Courts US Exim Bank, World Bank for $26 Billion Pipeline
(Bloomberg) -- Morocco is courting the Export-Import Bank of the United States and the World Bank to help finance a proposed $26 billion gas pipeline along the coast of Africa, Rabat’s top diplomat in the US said.
The Iran conflict’s disruption of Middle East energy flows has strengthened the case for the conduit that would ferry African gas to Europe, Moroccan Ambassador Youssef Amrani said in an interview Wednesday in Washington. He declined to provide further details on discussions about funding for the project.
The US Exim Bank has had early stage talks about the African Atlantic Gas Pipeline, a spokesperson said. The World Bank declined to comment.
Leaders of the Economic Community of West African States, a 12-nation economic bloc, signed an inter-government agreement on July 19 formally backing the proposed 6,800-kilometer (4,230-mile) pipeline. The conduit will link gas deposits in countries including Nigeria, Senegal and Mauritania, before connecting to the existing Maghreb-Europe Gas Pipeline that joins Morocco to Spain.
The pipeline is “one of the most ambitious infrastructure projects under development today in Africa,” Amrani said.
It joins a slate of giant energy projects on the continent including Algeria’s proposed Trans-Sahara gas pipeline, an oil refinery that billionaire Nigerian investor Aliko Dangote plans to build in Kenya, and multibillion-dollar gas developments in Mozambique.
Morocco is pushing to get the decade-old plan for the pipeline into development as Europe looks to diversify gas supply. The US-Israeli war on Iran has pushed European prices for the fuel to their longest streak of daily gains in eight years, raising concerns around filling stocks ahead of the European winter.
The large number of countries participating in the AAGP project would make it difficult to execute, said Anne-Sophie Corbeau, a global research scholar at Columbia University’s Center on Global Energy Policy. She cited persistent operational and supply disruptions on the smaller West African Gas Pipeline that connects Nigeria, Benin, Togo and Ghana.
Corbeau also questioned the need to extend the project into Europe, at a time when the continent wants to reduce its dependency on fossil fuels.
The proposed AAGP pipeline’s capacity is expected to be 30 billion cubic meters, half of which will be destined for Morocco and the rest to Europe, according to Moroccan state energy company ONHYM, which together with the Nigerian National Petroleum Co. is leading the project.
The pipeline is slated to start construction in 2028 and produce first gas by 2031, pending financing commitments.
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