Shell has signed a 12-year arrangement to supply Morocco with 0.5 billion cubic meters (bcm) of liquefied natural gas (LNG) per year.
According to a statement from the Energy Ministry, the agreement was signed by the National Electricity and Drinking Water Office (ONEE) and Shell to assist Morocco’s energy needs and diversify its energy sources.
According to the ministry, the gas would initially be transported from Spanish ports via a gas pipeline that connects the two countries until Morocco constructs its own LNG facilities.
The LNG will assist ONEE in operating two power units in northern and eastern Morocco that formerly ran on Algerian gas delivered over the same pipeline, according to reports.
Meanwhile, Algeria unilaterally decided in 2021 to halt gas flows to Spain via Morocco through the pipeline. Rabat said it would reverse the flow in 2021 by importing LNG from Spanish terminals.
ONEE is aiming to increase the share of gas in Morocco’s electricity mix to meet low-carbon goals, the ministry said.
According to official estimates, renewables contributed for 18% of total electricity production in Morocco last year, while gas accounted for 1.6% and coal accounted for 72%.
By March 2023, renewable energy has accounted for 40% of the country’s installed capacity, with Morocco aiming for 52% by 2030.
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