• The pipeline would connect to existing pipelines that run under the Mediterranean Sea and have the capacity to send up to 30 billion cubic metres of natural gas to Europe each year.
• For context, the now-cancelled-but-forever-in-German-hearts Nord Stream 2 pipeline was designed to carry around 55 billion cubic metres of gas each year.

The idea of connecting West African gas supplies to European markets via pipeline was first floated in the 1970s, but ultimately went nowhere.

• It turns out it just takes a global energy crisis sparked by Russia’s invasion of Ukraine to get nations to focus on diversifying their energy supply.

First things first: who will fund it?

The proposed pipeline will traverse more than 4,000 km of the Sahara Desert as it makes its way from Nigeria to Algeria, and that type of infrastructure doesn’t come cheap. Analysts put the cost of construction between US$13-15B.

Europe?

Perhaps the most obvious partner for the project would be a European energy giant like Italy’s ENI or France’s TotalEnergies.

• Both companies have well-established operations in Nigeria and a track record of delivering complex infrastructure projects.

Given the gas is ultimately destined for European markets, it’s possible that any regulatory approval would be easier to come by as well.

China?

But it looks like Algeria might have other plans. According to analyst Francesco Sassi, Algerian officials are planning a trip to China to secure funding:

• “Apparently, the [Algerian] diplomats are presenting the pipeline as the new big thing in African energy and they are targeting the China-African Development Fund (CADFund)”.

While the CAD Fund has invested in energy infrastructure on the African continent before, it has never taken on a project of this size.

An emerging rival

Whoever is ultimately chosen to finance the pipeline, they must be chosen soon because talk of a rival Nigeria-Morocco pipeline has resurfaced in recent weeks.

Like the TSP, this project would send Nigerian gas northwards, connecting it to the Moroccan and European markets.

• Both pipelines require investors to stump up billions of dollars, so analysts think that the first pipeline to secure funding and break ground on construction will likely put the other out of business.

Why this matters

As always, there’s more to this than simply securing energy supplies. Algeria and Morocco have been locked in a bitter rivalry over the contested Western Sahara region. Morocco claims the Western Sahara is theirs, while Algeria backs a secessionist group in the region.

• Both countries understand that making Europe reliant on their gas will give them considerable leverage to ‘convince’ European countries to see things their way in the Western Sahara.

A long-range guessing game: While Europe is hungry for natural gas right now, the long-term viability of the TSP ultimately rests on European demand for gas in five, ten, or even twenty years from now.

Given the cost of the TSP, and the level of geopolitical volatility in the world right now, we’re just glad we’re not the analysts tasked with predicting that demand.