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Thursday, May 30, 2024

LNG: Morocco and Shell sign a 12-year supply contract

Shell International Trading Middle East Limited FZE and ONEE (“Office National de l’Electricité et de l’Eau Potable”) have signed a twelve-year LNG supply agreement for 0.5 billion cubic meters per year. In the first years, LNG will be supplied through Spanish ports and shipped to Morocco via the Maghreb-Europe Gas Pipeline. Then, the gas can be delivered through future Moroccan LNG terminals.

Morocco is committed to the decarbonization of several sectors, including electricity. The increase in the share of renewable energies in the national electricity mix generates a greater need for flexibility and requires access to competitive and low-carbon fuels such as natural gas. ONEE thus has more than 2 GW of gas-fired power plants under development.

“The Kingdom of Morocco entered the international LNG market for the first time in 2022, thanks to exemplary cooperation and a climate of trust with our neighbours. This medium-term supply contract will strengthen our energy security, improve our competitiveness and accelerate our decarbonization strategy,” said Leïla Benali, Minister of Energy Transition and Sustainable Development.

Commenting on this agreement, Mr. Abderrahim El Hafidi, Director General of ONEE said “After having made several purchases of LNG on the spot market in 2022, we are delighted today with the signing of this agreement which is the first contract of medium-term purchase by ONEE on the international LNG market. This agreement will enable us to meet part of our needs and guarantee the supply of natural gas to our power plants. Natural gas is now a major component of our electricity mix because it offers the flexibility needed to compensate for the massive introduction of renewable energies into our electricity system.”

Mehdi Chennoufi, Head of Global Origination, Shell LNG Marketing and Trading, said: “We are delighted to work with ONEE and supply LNG to the Kingdom of Morocco to help meet the country’s gas demand. LNG offers a flexible and reliable source of energy and has a crucial role to play in the energy transition. »

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