Regulators Reject France-Spain Gas Interconnect
1/23/2019
PARIS (Reuters) - French energy regulator CRE and its Spanish counterpart CNMC have rejected a project by France and Spain's grid operators to build a gas pipeline across the Pyrenees, CRE said in a statement.
The French regulator said the $502 million (442 million euro) "STEP" interconnector project did not respond to market needs and was not sufficiently mature to get a go-ahead from regulators.
Reuters reported in April that a report prepared for the European Commission had questioned the viability of STEP, which would have been the first part of an EU-backed 3 billion euro Midi-Catalonia (Midcat) pipeline project to more than double gas transport capacity between the two nations.
Gas pipeline operators typically earn a government-set fixed return on their investments, which can only be charged to consumers if regulators consider the investment necessary.
CRE said current gas exchange capacity between Spain and France was 225 gigawatt-hour per day.
In July 2018, French grid operator Terega - owned by Italy's Snam - and Spanish operator Enagas submitted a project to boost that by 180 GWh in the France to Spain direction and by 230 GWh in the Spain to France direction.
The project had strong support from European Union Climate Commissioner Miguel Arias Canete, a Spanish national, who considers the pipeline would reduce Europe's reliance on imported Russian gas.
Enagas operates a large network of LNG regasification plants on the Spanish coast that could help import more gas from other countries such as Algeria, Qatar and the United States.
But the project has faced opposition from French energy regulator CRE, who said shortly after the proposal that Midcat would push up consumer prices without improving security.
Industry experts have questioned the need for another interconnector, arguing that existing cross-Pyrenees pipelines are already underutilized, even during periods of high demand.
Friends of the Earth said in a statement that STEP was a climate-damaging pipeline project and that its rejection by regulators calls into question other EU-supported gas projects.
"Gas is a dangerous fossil fuel which emits significant amounts of greenhouse gases... we can't keep sinking taxpayer billions into more fossil fuels," FEE's Antoine Simon said.
(Reporting by Geert De Clercq Editing by Mathieu Rosemain)
Related News
Related News
Sign up to Receive Our Newsletter

- Army Corps Lists Enbridge’s Line 5 as ‘Emergency’ Project Eligible to Bypass Environmental Review
- Missouri Loses Control Over 1.5 Million-Mile Gas Pipeline Network as Feds Step In
- 1,000-Mile Pipeline Exit Plan by Hope Gas Alarms West Virginia Producers
- Greenpeace Ordered to Pay $667 Million to Energy Transfer Over Dakota Access Pipeline Protests
- Canada’s Canceled Oil Pipelines: The Projects That Didn’t Make It
- Army Corps Lists Enbridge’s Line 5 as ‘Emergency’ Project Eligible to Bypass Environmental Review
- Michigan Court Backs Permits for Enbridge’s Line 5 Pipeline Tunnel Project
- Editor’s Notebook: Fire Fuels Pipeline Concerns
- Missouri Loses Control Over 1.5 Million-Mile Gas Pipeline Network as Feds Step In
- Enbridge Plans $2 Billion Upgrade for North America’s Largest Crude Pipeline
Pipeline Project Spotlight
Owner:
East African Crude Oil Pipeline Company
Project:
East African Crude Oil Pipeline (EACOP)
Type:
TotalEnergies in discussions with a Chinese company after Russian supplier Chelpipe was hit by sanctions.
Length:
902 miles (1,443 km)
Capacity:
200,000 b/d
Start:
2022
Completion:
2025
Comments