Spain, Portugal nearing end of major gas-transmission expansions

IBERIAN AND ITALIAN GAS-1

Warren R. True
Pipeline/Gas Processing Editor

The Palos de la Frontera (Huelva) LNG terminal was commissioned in 1988 and enlarged in 1990-1992. It can handle carriers up to 40,000 cu m. [9,495 bytes]
The Barcelona LNG terminal is located on the Inflammables Wharf, Port of Barcelona, and was commissioned in 1969. [11,721 bytes]

Countries that make up Europe's Iberian and Italian peninsulas have in the past 2 years stepped up their efforts to expand regional transmission systems and diversify natural-gas supplies.

This activity has been in response to projections that their yearly natural-gas demand growth through 2010 will exceed the average annual demand growth for all countries of the European Union.

This is the first of two articles that set out the scope of construction and supply activities that reached a climax last year or will culminate this year.

Part 1 looks at the Iberian Peninsula and the infrastructure results there of completion in late 1996 of Gazoduc Maghreb Europe (GME), the massive 858-mile, 48-in. pipeline from Algeria, across Morocco and the Strait of Gibraltar, to Córdoba, Spain (OGJ, Dec. 2, 1996, p. 50).

The concluding article sets out supply increments and construction under way or slated to supply Italy, whose gas demand-growth projections are among the highest of all European Union (EU) countries.

Supply growth for Italy has occurred from the south in the original transMediterranean pipeline, and expansion is occurring along the Russian pipeline in Austria from the northeast. An expansion and a new pipeline are also slated for gas from the North Sea across France.

By 2000, Spain's gas transporter Enagás expects to have installed nearly 1,200 km (745 miles) of new trunkline split among three regions. This activity is to meet expected nationwide demand shortly after 2000 of more than 1.5 bcfd (42.8 million cu m/day; 15.63 billion cu m/year).

Portugal at yearend 1997 was operating approximately 379 miles of high-pressure natural-gas pipeline installed over the last 3 years as a direct result of construction of GME.

In fact, volumes moving up GME from Algeria have been directly responsible for growth of an interconnecting system of gas pipeline on the Iberian Peninsula that ties the two countries together as never before: gas supplies from Spain move into Portugal from the southeast. Supplies also move through Portugal and re-enter Spain in the northwest to supply Galicia.

Spanish gas growth

Natural-gas use and its share of the primary energy picture in Spain have lagged the rest of Western Europe. But by 2000, the growth of natural-gas use will exceed the average for the rest of the countries in the European Union, according to Enagás.

In Spain, natural-gas imports and transmission are handled by Enagás, formerly state-owned but now privately held (91%) by Gas Natural SDG S.A. whose main shareholders are Repsol S.A. (45%), La Caixa, a savings bank (26%), and public ownership (29%) traded on the Spanish Bolsa de Valores.

Enagás is responsible for negotiating gas-supply contracts, importing the supplies to Spain, and installing, operating, and maintaining gas trunklines and sales to power generators in Spain.

Only one other company, Gas de Euskadi, holds state licenses to transport gas. The remaining 9% of Enagás will likely be sold to Gas Natural when Spain's gas market has been fully liberalized.

Enagás says that total primary energy demand in Spain in 1996, the most recent year for which firm figures are available, was on the order of 102 million metric tons of oil equivalent (Fig. 1 [71,973 bytes]).

Almost 55% of this demand was met by oil and oil derivatives (including LPG). Nuclear (14.7%) and coal (14.7%) made up the second largest portion of primary energy demand. Hydroelectric made up nearly 4%.

Spanish natural-gas demand in 1996 was 8.3% of total primary energy demand, less than half the average (22%) for European Union countries combined. By contrast, in Germany, it was 21.5%; in France, 13.6%.

Spain's National Energy Plan (PEN), however, foresees natural-gas growing by a third to exceed a 12% share of primary energy consumption by 2000. Average EU-country share by the same time will be reach 23%.

PEN also calls for a natural-gas energy customer base of 3,000 industrial clients and 3 million homes-an increase of almost 10% and more than 25%, respectively.

Target: electricity generation

Fig. 2 [91,937 bytes] shows Enagás' historical and projected natural-gas demand for the current decade for all sectors. Residential-commercial, industrial, and industrial demands have grown slowly but steadily and are expected to continue that pace through 2000.

Growth in natural-gas demand for cogeneration, however, has leaped since 1994, almost doubling in 1995 (17.1% of demand) and will more than double by 2000 when it will make up nearly 21% of demand.

More importantly, natural-gas demand by electric-power generation, virtually nonexistent in 1993-95, multiplied tenfold in 1996 (from 0.2 bcm to 2.0 bcm) and by 2000 will double to 4.0 bcm (approximately 141 bcf/year).

In 1996, power generation made up only 3.7% of gas demand; by 2000, it is expected to comprise slightly more than 25%.

PEN stipulates that more than 7,300 mw of fuel-fired electricity generating assets-or close to 16.5% of the nation's total installed power base-be converted to natural gas by 2000.

Traditionally, the volume of gas used in Spanish electricity generation has been minimal. In 1994, for example, Enagás sold 66.8 million cu m of gas to the country's power utilities, which represented less than 1% of its total gas sales for the year.

Conversion of the country's power plants is already well under way; however, approximately sixteen fuel-oil-fired generating groups at eleven Spanish power stations had begun running on natural gas by yearend 1997.

One other, the 1,050-mw Andorra facility (near Teruel in central Spain) which belongs to the state-controlled electric utility Endesa (Empresa Nacional de Electricidad S.A.), has begun using natural gas as a support fuel.

By 1999, a further nine groups will be converted at five more power stations, representing a total installed potential of 7,312 mw, some 16.42% of the total in Spain, and only 78 mw short of the country's total nuclear generating base.

The converted power plants will consume 14.67 billion cu m of natural gas to fire electricity over the period 1996-2000, as stipulated by an agreement between Gas Natural and the utilities group Unesa, which represents fourteen Spanish electricity companies.

Moreover, the volume stated in the protocol will be increased to 4.19 billion cu m/year (from about 3.7 billion cu m/year) from 2000 onward, eventually to account for about 20% of total national power production.

Gas movements

Security of supply constitutes the chief priority of the Gas Natural Group's supply policy, says Enagás: increasing the proportion of natural gas received directly by gas pipeline and depending less on imports of LNG.

Currently, natural gas enters Spain from three directions (Fig. 3 [237,040 bytes]):

North: Through the 145-km, 26-in. Lacq-Calahorra gas pipeline from France across the Pyrennes. The line operates at 80 bar (1,160 psi) and current daily throughput of 10 million cu m/day (353 MMcfd).
West: Through two LNG-receiving terminals at Cartagena in the southwest and at Barcelona in the northwest, both on the Mediterranean Sea
South: Through an LNG receiving and regasification plant at Huelva in the Gulf of Cadiz on the Atlantic Ocean and through the recently completed GME.

Also, some supply in the south continues from production from the Marismas-Palancares fields in the Guadalquivir Valley north of Huelva and from the Gulf of Cadiz. These volumes are negligible and declining, however, says Enagás.

Supply sources in 1996 and 1997 have been Algeria and Middle East countries via LNG and the GME pipeline, Libya and others via LNG, and Norway via the LACQ pipeline from France.

With the GME pipeline, Algeria in 1996 supplied 55% of Spain's gas. Enagás' goal is to allow Algerian gas to comprise as much as 60% of Spanish supply and says, given the historical absence of any problems with Algerian supply, it anticipates none in the future.

Additionally, Enagás has negotiated short-term LNG supply contracts with Australia, Nigeria, Qatar, and Abu Dhabi.

Table 1[25,162 bytes] shows the historical and projected evolution of natural-gas supply in this decade.

By far the biggest boost in Spanish, indeed Iberian supply-and the most critical factor in the growth of natural-gas use on the Iberian Peninsula-has been the completion in November 1996 of GME.

This line runs from Algeria's Hassi R'Mel field across Morocco and the Strait of Gibraltar to deliver to Córdoba slightly more than 1 bcfd.

Around 720 MMcfd are earmarked for the Spanish market; the remainder is traveling through a newly built pipeline to the Portuguese city of Campo Maior for expanding natural-gas markets in that country.

Enagás has said that GME permits pipeline-supplied natural gas to account in 1996 for 28% of all gas supplied to Spain. By 2000, that portion will grow to 50%, backing out more expensive LNG.

Expected nationwide demand shortly after 2000 will exceed 1.5 bcfd (42.8 million cu m/day; 15.63 billion cu m/year). To meet the demand, Enagás expects to have installed 745 miles of new trunkline. No new or additional compression is anticipated through 2000.

In addition, Enagás has revamped two-Cartagena and Huelva-of the country's three LNG receiving terminals to increase import capacities.

Spanish infrastructure

The basic transportation infrastructure in the Iberian Peninsula consists of the following (Fig. 3):

Barcelona, Huelva, and Cartagena LNG terminals and regasification plants.
Underground storage in depleted gas fields near Gaviota (Vizcaya Province) and Serralbo (Huesca Province). Table 2 [68,883 bytes] presents details on these fields.

Enagás says other geological structures, aquifers, and salt mines are being studied for possible conversion to underground natural-gas storage.

Pipelines that form the following axes for gas transportation:
-The central axis: Huelva-Córdoba-Madrid-Cantabria-the Basque Country
-The eastern axis: Barcelona-Valencia-Murcia-Cartagena
-The western axis Ruta de la Plata: Almendralejo-C ceres-Salamanca-Zamora-León-Oviedo
-The Spanish-Portuguese western axis: Córdoba-Badajoz-Portugal (Campo Maior-Leiria-Braga)-Tuy-Pontevedra-La Coruna-Asturias (the latter in Galicia).
-The Ebro connection in the northwest: Burgos-Calahorra-Zaragoza-Tivissa

Compressor stations that Enagás operates at six locations:
-The oldest are at Tivisa, built in 1990, and at Bañeras and Haro, each in 1991.

At Tivisa, southeast of Barcelona in Catalunya, two 3,800-hp Solar Centaur T4002 turbines drive two Solar C304 compressors capable of moving 159,000 cu m/hr of gas (approximately 134.7 MMcfd).

At Bañeras, nearer Barcelona, two 6,400-hp Nuovo Pignone Frame 1002 turbines drive a Nuovo Pignone PCL503 compressor capable of moving 251,000 cu m/hr (212.6 MMcfd).

In the north near Bilbao, at the Haro station, three Solar Centaur T-4500 turbine units of 4,400 hp each drive three Solar C304 compressors capable of moving 135,000 cu m/hr (114.4 MMcfd).

-Another station was installed in 1994, this time in the south at Seville.

There, three 4,200-hp Solar Centaur T4500 turbines drive three C304 compressors capable of transporting 125,000 cu m/hr (105.9 MMcfd).

-Later, in May 1995, a third unit was installed at Tivisa: a 4,700-hp Centaur T4700 and another C304 bringing the three turbines there to 12,300 hp and full station flow capacity to 229,000 cu m/hr (194 MMcfd).

-In 1996, two stations were opened as a direct consequence of construction of GME.

At Algete, near Madrid, two 5,000-hp Centaur 50-5702 turbines drive three C304 compressors. Flow capacity is 130,000 cu m/hr (110 MMcfd).

And in December 1996, the Almodovar station near Puertollano in the south, was completed. It contains three 4,700-hp Centaur 40-4702 turbines driving two C304 compressors. Flow capacity headed north is 200,000 cu m/hr (169.4 MMcfd).

Further compression will be required in the form of four new turbocompressors at Almendralejo where the pipeline will be fed from the Córdoba-Camp Maior link. The new compressor plant will be used to push gas both to northern Spain and on to Portugal.

Spanish development

In mid-1997, Gas Natural and Enagás announced they intended to spend approximately 450 billion Pta. (about $3 billion U.S.) between 1996 and 2000 on pipelines and industrial networks. Enagás alone had earmarked more than $1.3 billion.

The first step came in late October 1996 with completion of the final leg of GME: the Tarifa-Córdoba pipeline that cost about $244 million.

Closer to Tarifa, Enagás completed an 80-km link to the Algeciras power station at a cost of about $14.9 million.

Moreover, using gas to promote regional development in the poor southern Spanish province of Andalucia has been a key part of the Spanish government's plans in recent years. Enagás signed a contract with the regional Andalucian government to build a gas pipeline linking Córdoba, Jaén, and Granada.

All this work had been completed by yearend 1997.

As 1998 began, Spain was deeply into pipeline construction that will by yearend 1998 add 818 km of 10, 12, 20, 26, and 30-in. line in three geographic clusters.

By yearend 1999, another 360 km of 24 and 26 in. are planned.

By 2000, then, Enagás' trunkline system will be able to deliver the needed 1.5 bcfd to local distributors and power generators. This will be a 36% increase over its delivery capacity on Jan. 1, 1997, of slightly more than 1.1 bcfd.

As a result of completion of the GME line, Enagás has already laid and begun operating connections on its soil. In November 1996, the company began operating the first leg, from Tarifa to Córdoba, 255 km of 48 in. and 19 km of 36 in.

Shortly afterward, in January 1997, operations began on the leg that carries supplies east to Portugal: 251 km of 32 and 28-in. pipeline from Córdoba to Campo Maior.

And in February 1997, Enagás started operating the 177 km, 10, 12, and 16-in. line supplying the Ja?n-Granada corridor, east of Córdoba. Costs for the main line and smaller lines approached $47.5 million.

The three geographic areas of construction are as follows:

In the northwest, Galicia. The Portuguese system has been extended from the border near Tuy northward to near La Coruña. This expansion is being carried out in place of a planned LNG terminal at Ferrol. In November 1997, 48 km of lateral work of 4, 6, and 8 in. were completed in the corridor between Villalba and Lugo. Early in 1998, installation of approximately 207 km of 20-in. line will have been completed between Tuy and Villalba (82 km) and Valga and Villalba (125 km). In March 1998, related 52 km of 10-in. lateral pipeline will be installed between Pontevedra and Orense.
In the southeast, between Cartagena and Valencia. Last month, Enagás was scheduled to have completed construction on 71 km of 30-in. main line between Cartagena and Orihuela, east of Murcia, and by July will finish a 26 km, 12-in. lateral from this new line west to Murcia.

Capacity on this new system will near 600,000 cu m/year (approximately 58 MMcfd). As a result, natural gas send-out capacity at the Cartegena LNG plant has been increased.

Although storage at the plant remains limited to a single tank, throughput at Cartagena has been trebled. A second phase calls for construction of two more 103,000-cu m tanks and a terminal capable of taking the new generation of 145,000-cu m LNG carriers.

Work on this phase may be completed this year. By 2000, throughput capacity will be further doubled. In all, more than $74.6 million is being spent on this project, with Foster Wheeler in charge of the detailed engineering.

In the west: Ruta de la Platta, between Oviedo in the north and Almendralejo in the south.
Enagás will complete construction in April 1998 on 164 km of 20-in. line from Aranda de Duero westward to Zamora and at nearly the same time begin to purchase materials for continuing with 26-in. pipe 66 km south to Salamanca.

Additionally, by November 1998, the company expects to complete 250 km of 20-in. north from Zamora to the León-Oviedo area.

Finally, engineering is under way for construction on the south leg of this project, from Almendralejo northward to Salamanca; completion is set for sometime in 1999.

Under study is a dedicated line from near the GME connection at Córdoba northeast to France. LACQ is running full, at 2 bcm/year. And there is the possibility of installing compression to move Norwegian gas across France and the Pyrennes.

Gas arrives in Portugal

Portugal is Europe's last country to introduce natural gas and in 1997 was working at breakneck speed to make up the gap.

Combined with plans to install by 2000 a new combined-cycle power plant at Tapada de Outeiro in northern Portugal, the frenetic pace of gas-pipeline construction since 1994 represents Portugal's biggest industrial project.

The aim is to make gas supplies available to up to 75% of the population and to businesses which account for 85% of gross domestic product.

The country's gas operator, Transgás (Sociedad Portuguesa de G s Natural S.A.) estimates that by the turn of the century, natural gas will account for 8-10% of the country's primary energy needs. Gas has already been commercially available since Jan. 1, 1997, on a limited scale.

The contract signed between Trang s and Sonatrach calls for an increasing volume of gas of up to 2.5 billion cu m/year (241.7 MMcfd) of gas until 2002. Under a second phase starting in 2002, volumes could rise to 4 billion cu m/year (386.8 MMcfd).

Portuguese construction

Last year, the Portuguese gas company Transgás began moving gas through the first high-pressure natural gas pipeline in Portugal (Fig. 4 [93,118 bytes]). As in Spain, much of the new gas supply is for electric-power generation. The 220 km, 28-in. line runs from Campo Maior, on the Spanish border near Badajoz, to Monte Redondo. Its delivery capacity is nearly 13 million cu m/day (457 MMcfd).

Spurring construction of the Campo Maior-to-Monte Redondo line was the line opened in 1997 between Córdoba and Campo Maior connecting the Portuguese system with the GME via Spain.

More recent Portuguese construction developed this route along the Atlantic spine of the country and consisted of two main sections:

170-km segment south from Monte Redondo to Setúbal. A joint venture of Mannesmann Demag/Süd rohrbau built this segment.
220 km north from Monte Redondo to Braga. This segment consists of 163 km of 28 in. to Porto and 43 km of 20 in. to Braga. Spie-Capag-Entrepose was in charge of construction.

In addition, approximately 200 km of branchlines in two sections were laid to move gas to cities and power stations.

The first section consisted of four segments: 16 in., 21 km to Almada; 28 in., 32-km to Lisbon; 20 in., 1 km line to Carregado power station; and an 8 in., 24 km line to Torres Vedras and Caldas da Rainha.

The second segment of branchlines consisted of 8 in., 8-km line to Aver; 16 in., 9-km line to Vila Nova de GAO; 24 in., 7-km line to Tapada power station; and a 6 in., 13-km line to Monomer.

Also recently completed is a 75 km, 20-in. line connecting Braga to Tuy, Spain, finally linking gas systems twice in the two countries. This connection, at Tuy, has prompted Enagás to shelve plans for a fourth LNG terminal at El Ferrol near La Cornea in the northwest.

Transgás says that much of the recent construction encountered numerous obstacles such as rocky ground, water, steep slopes, rice fields, and river crossings.

In areas where traditional installation would be difficult or which were environmentally sensitive, the line was installed by directionally drilling. Eighteen such crossings were successfully performed, says the company.

Terminals, storage

Another aspect of the Portuguese gas-development program had been an LNG terminal at Setúbal, to be built and operated with Gaz de France and including a pipeline. From the Portuguese government's point of view, diversifying gas supply away from a dependency on Spain was desirable.

But reports from Lisbon in mid-1997 indicated negotiations with Gaz de France had broken down when GdF, having won the contract to build and operate the LNG and pipeline project, tried to renegotiate terms. The LNG project is now regarded as a likely second phase in the country's gas plans once demand reaches such a level to warrant extra volumes.

Another aspect of the project delayed pending studies by Transgás is underground LNG storage planned to hold the statutory 20 days of reserves. This part was only given final approval in late October 1996.

Three underground storage tanks are planned, each of 50-m diameter and capable of storing up to 300 million cu m of gas. Construction is scheduled to last at least 6 or 7 years which means that until then, Portugal will have little or no strategic stocks of its own and must rely on Spain.