29.8 $/MMBtu: at that price, the NIGAL pays back its pipe. The Atlantic, no.
J. Hartley — Londres, Royaume-Uni — 2026-10-18
The NIGAL pays back its pipe. The Atlantic waits for a price that does not exist.
Two gas pipelines, two economies. The NIGAL (Nigeria–Niger–Algeria) and the Atlantic project (Nigeria–13 states–Morocco) cannot be judged with the same calculator: the first has a single toll, the second has thirteen. And the price of gas is no longer that of peacetime.
In 2026, the TTF exceeded €82/MWh in September, then reached €87/MWh — its highest level since late 2022 (Kurier; n-tv). That is about 29.8 $/MMBtu. This is not a market accident: it is the result of an energy war. And it is on that price — not on the 12.4 $/MMBtu of 2025 — that the two projects must be judged.
INTRODUCTION — THE CONTEXT THAT CHANGES EVERYTHING
Four facts that durably support the European gas price:
- The Strait of Hormuz under tension — the LNG route from the Gulf, the tap of part of the world's gas; a shockwave on the energy markets (France Culture, “Ormuz, une onde de choc mondiale sur les marchés de l'énergie”).
- Bab el-Mandeb and the Red Sea — the LNG and oil route; insurers are tightening war-risk premiums and excluded areas are expanding (JCTRANS, August 2026).
- Russia and gas — Europe has turned its back on Russian gas; the European market is structurally tight — and a return of Russian gas remains a distant hypothesis (RTBF, 2026).
- Russian diesel diverted to the United States — a Trump–Putin deal allows Russia to supply diesel to the United States; Europe, for its part, is deprived of these volumes (France Info; ABC News, 10 October 2026). The oil-to-gas substitution is accelerating.
Conclusion of this part: the high price is not an isolated peak — it is the new normal. The central scenario of this dossier is therefore 29.8 $/MMBtu (€87/MWh, October 2026); the price of 12.4 $/MMBtu becomes the fallback scenario (peacetime).
PART 1 — THE TWO PROJECTS, SEPARATED
1. The NIGAL (Nigeria – Niger – Algeria) — the short route
The route: 4,128 km (technical analysis; 4,327 km according to the launch documents), three countries, a single toll: Niger (5% = 1.5 Gm³ out of 30). What remains: 28.5 Gm³ delivered to Europe. Algeria does not take gas in kind; it receives transit royalties in cash — amount not established.
## 🔑 Words to know before reading
CAPEX — capital expenditures: the investment spending — money spent once to build (the pipe, the stations, the terminals).
OPEX — operational expenditures: the operating spending — money spent every year to run (maintenance, staff, energy).
IRR (TRI) — internal rate of return: the average annual return over the project's life. 8% = the project earns 8% per year.
NPV (VAN) — net present value: the value, in today's money, of all future cash flows. Positive = profitable; negative = a loss.
Cash flow — money in minus money out, each year.
Payback period — the number of years to repay the CAPEX.
Discount rate — the rate that converts future money into today's money (€1 today is worth more than €1 in 10 years).
The CAPEX: 10 to 13 billion dollars (Pipeline Technology Journal; MEED; La Tribune) — 2.5 times less than the Atlantic project.
The terminals already exist: Beni Saf (Spain, Medgaz) and El Kala (Italy, TransMed) — the gas can leave for Europe without building export infrastructure.
The OPEX: not established — calculation assumption: 2% of CAPEX per year = $0.26 bn/year.
The pipe's model: its toll is indexed to the gas price (structural assumption: it corresponds to the valuation of the 1.5 Gm³ levy). At 29.8 $/MMBtu, that toll is worth $1.58 bn/year.
2. The Atlantic project (13 states + Western Sahara) — the long route
The route: 6,800 to 6,900 km, 13 official states + a Non-Self-Governing Territory — 14 entities, of which 13 levy. Levy in kind: 5% × 13 = 65% (19.5 Gm³ out of 30). What remains: 10.5 Gm³ in Morocco — 5.25 go to Europe, 0.93 is consumed, 4.32 is resold.
The CAPEX: ~25 billion dollars (Maroc.ma; PGJ/Reuters; CGTN Africa) — and this figure includes neither the upstream, nor the schools, nor the sea equipment, nor maintenance (dossier 055).
The OPEX: not established — assumption: 2% of CAPEX = $0.50 bn/year.
The pipe's model: the investors' toll is a separate cash tariff — not documented (“not established”); calculation assumption: 1.5 $/MMBtu. The high price does not save it: the 65% levies are taken before delivery.
PART 2 — THE MASTER TABLE: THE FLOWS OF BOTH PROJECTS
Central scenario: 2026 price = 29.8 $/MMBtu. In brackets: fallback scenario = 12.4 $/MMBtu.
| Item | The NIGAL | The Atlantic project |
|---|---|---|
| CAPEX | $10 to 13 bn (sourced) | ~$25 bn (sourced) |
| Annual OPEX | not established — assumption $0.26 bn/yr (2%) | not established — assumption $0.50 bn/yr (2%) |
| Capacity | 30 Gm³/yr | 30 Gm³/yr |
| Levies in kind (5%/country) | 1 country → 1.5 Gm³ (5%) | 13 entities → 19.5 Gm³ (65%) |
| Value of levies at 29.8 | $1.58 bn/yr (0.66 at 12.4) | $20.51 bn/yr (8.54 at 12.4) |
| Volume delivered to market | 28.5 Gm³ | 5.25 Gm³ (Europe) + 4.32 (resold by Morocco) |
| Cash royalties | Algeria: royalties — amount not established | no documented cash royalty |
| The pipe's receipts | $1.58 bn/yr (0.66 at 12.4) — toll indexed to price | $1.59 bn/yr — hypothetical cash tariff (independent of price) |
| The pipe's outlays | CAPEX $10-13 bn + OPEX 0.26/yr | CAPEX $25 bn + OPEX 0.50/yr |
| Net cash flow | $1.32 bn/yr (0.40 at 12.4) | $1.09 bn/yr |
| Payback | 9.9 years (32.8 at 12.4) | 23.0 years |
| IRR over 25 years | ≈ 8.9% (−2.0% at 12.4) | ≈ 0.7% |
Immediate reading: at the 2026 price, the NIGAL pays back its pipe in ten years; the Atlantic in twenty-three. And if the price falls to 12.4, the NIGAL turns negative — but the Atlantic no longer even depends on the price: it is dragged down by its 65% levies.
PART 3 — WHO ARE “THE INVESTORS”? THREE ACTORS, THREE FLOWS
| Actor | What it puts in | What it receives | What it pays |
|---|---|---|---|
| 1. The pipeline company (the investors) | the CAPEX ($10-13 or $25 bn) | the toll: $1.58 bn/yr (NIGAL) / $1.59 bn/yr (Atlantic) | the OPEX (assumption 2% of CAPEX/yr) |
| 2. The transit states | the passage | 5% in kind (NIGAL: $1.58 bn/yr at 29.8; Atlantic: $20.51 bn/yr) | their own costs — not quantified |
| 3. The producers | the gas | the sale of the remaining volume (NIGAL: $29.98 bn/yr at 29.8; Atlantic: $11.05) | transport + levies in kind; production cost (proxy $2.18/MMBtu) |
The producers' flows, at the two prices:
| Calculation step — the producers | NIGAL — 29.8 | NIGAL — 12.4 | Atlantic — 29.8 | Atlantic — 12.4 |
|---|---|---|---|---|
| ① Starting volume | 30 Gm³ | 30 Gm³ | 30 Gm³ | 30 Gm³ |
| ② − TRANSIT royalty of the States (in gas, ~5%/country, indicative — President A. Tebboune, who knows the gas market) | − 1.5 Gm³ (1 country) | − 1.5 Gm³ | − 19.5 Gm³ (13 entities) | − 19.5 Gm³ |
| ③ = delivered volume | 28.5 Gm³ | 28.5 Gm³ | 10.5 Gm³ | 10.5 Gm³ |
| ④ × conversion (1 Gm³ = 35.3 M MMBtu) | × 35.3 = 1,006 | 1,006 | × 35.3 = 370.7 | 370.7 |
| ⑤ × gas price | × 29.8 $/MMBtu | × 12.4 $/MMBtu | × 29.8 | × 12.4 |
| ⑥ = receipts (sale) | $29.98 bn/yr | 12.48 | 11.05 | 4.60 |
| ⑦ − CAPEX repayment toll (8% IRR over 25 years) | 1.40 $/MMBtu × 1,059 = − 1.48 | − 1.48 | 2.68 $/MMBtu × 1,059 = − 2.84 | − 2.84 |
| ⑧ − production cost (2.18 $/MMBtu × 1,059) | − 2.31 | − 2.31 | − 2.31 | − 2.31 |
| ⑨ = producer cash flow | $26.19 bn | 8.69 | 5.90 | − 0.55 |
🔎 Two distinct flows — do not confuse them. ② the transit royalty (in gas, ~5%/country, indicative — President A. Tebboune, who knows the gas market — unconfirmed) pays the States crossed. ⑦ the toll repays the investors' CAPEX, computed via the IRR: to earn 8% over 25 years, NIGAL must charge $1.40/MMBtu (= 1.40 × 1,059 = $1.48 bn/yr) and the Atlantic $2.68/MMBtu (= 2.68 × 1,059 = $2.84 bn/yr). At the same toll, NIGAL wins; the Atlantic loses.
⚠️ THE AMBIGUITY OF THE 5% — AND WHY THE “5% = TOLL” MODEL IS NOT REALISTIC: if the 5% in kind were the investors' toll, the Atlantic would show a “tariff” of 65% of the gas — 18.3 $/MMBtu at 29.8 — and an IRR of 75%. No investor would confuse a state tax with its revenue, and no state would take 65% of the gas to finance a private pipe: this model is presented as a variant, not as the reference scenario. The realistic model — the one in the master table — is: the states take their tax in kind; the investors receive a separate toll. It is in this model that the NIGAL wins.
PART 4 — THE ASSUMPTIONS, EXPLICIT
| Assumption | Value | Status | |
|---|---|---|---|
| Base price — 2026 | 29.8 $/MMBtu (€87/MWh ≈ 29.8 $/MMBtu) | sourced (Kurier; n-tv — highest since late 2022) | |
| Fallback scenario | 12.4 $/MMBtu ≈ $0.44/m³ | sourced (TTF 2025 — GME) | |
| NIGAL CAPEX | $10 to 13 bn | sourced (PTJ, MEED, La Tribune) | |
| Atlantic CAPEX | ~$25 bn | sourced (Maroc.ma, PGJ, CGTN) | |
| Capacity | 30 Gm³/yr | ||
| States' transit draw (5%/entity) | 5% per entity crossed | indicative — President A. Tebboune, 4 Oct 2026 (Attaqa) | sourced (NNPC, Maroc.ma) |
| Conversion | 1 Gm³ ≈ 35.3 M MMBtu | sourced (dossier 053) | |
| NIGAL toll | indexed to price (valuation of 1.5 Gm³) | STRUCTURAL ASSUMPTION | |
| Atlantic toll | $1.5/MMBtu (sweep 1 to 3) | CALCULATION ASSUMPTION — no public tariff | |
| OPEX | 2% of CAPEX/yr (sweep 2 to 4%) | CALCULATION ASSUMPTION — not established | |
| Asset life | 25 years (sweep 20 to 40) | assumption | |
| Discount rate | 8% (sweep 8 / 12 / 15%) | assumption — a high political-risk project (13 countries, Sahara, security) requires 12 to 15% | |
| Tax, debt, construction delay | not modelled | simplifying assumption |
PART 5 — PRICE SENSITIVITY
Central model — 2026 scenario as base (line in bold):
| Gas price ($/MMBtu) | NIGAL — IRR | Atlantic — IRR |
|---|---|---|
| 12.4 (peacetime) | −2.0% | 0.7% |
| 20 | 3.6% | 0.7% |
| 28.1 (September 2026) | 8.1% | 0.7% |
| ⭐ 29.8 (October 2026 — base) | ⭐ 8.9% | ⭐ 0.7% |
| 35 | 11.4% | 0.7% |
| 40 | 13.7% | 0.7% |
The NIGAL becomes profitable as soon as the price exceeds ~$28/MMBtu; at $40, it reaches 13.7%. The Atlantic remains at 0.7% whatever the price: its IRR does not depend on gas, it depends on its 65% levies.
Sweeps (base price 29.8):
| Parameter | NIGAL — IRR | Atlantic — IRR |
|---|---|---|
| OPEX 2% | 8.9% | 0.7% |
| OPEX 3% | 7.7% | −1.3% |
| OPEX 4% | 6.4% | −3.7% |
| Life 20 years | 7.9% | −1.3% |
| Life 25 years | 8.9% | 0.7% |
| Life 40 years | 9.9% | 3.0% |
| Discount 8% — NPV | +$1.07 bn | −$13.38 bn |
| Discount 12% — NPV | −$2.66 bn | −$16.46 bn |
| Discount 15% — NPV | −$4.48 bn | −$17.96 bn |
And the point that changes everything: at a 12% discount rate — the rate required by a high political-risk project — the NIGAL reaches break-even only at ~$36.2/MMBtu, and the Atlantic is negative at all prices. The NIGAL is the more profitable of the two — but it is not a “risk-free” project either.
PART 6 — CONCLUSION
The most profitable project is the NIGAL.
Because it has the shortest route: 4,128 km against 6,800.
Because it costs the least: 10 to 13 billion against 25.
Because it has the terminals: Beni Saf and El Kala already exist.
Because it has only one toll: Niger.
And because at a high price, its tariff — 1.5 Gm³ — is worth much more.
The Atlantic, for its part, crosses thirteen entities, pays 65% in levies, and must finance a $25 billion pipe. Expensive gas does not save a project that takes 65% of the volume before delivering it.
📚 FULL BIBLIOGRAPHY (rule 19)
1. Kurier, “Gaspreis klettert auf höchsten Stand seit Ende 2022 — 87 Euro/Megawattstunde” (TTF at €87/MWh ≈ $29.8/MMBtu) — https://kurier.at/wirtschaft/gaspreis-87-euro-megawattstunde-energie-krise-ttf/403197941
2. n-tv, “Europäischer Gaspreis erreicht höchsten Stand seit Ende 2022” — https://www.n-tv.de/ticker/Europaeischer-Gaspreis-erreicht-hoechsten-Stand-seit-Ende-2022-id31413264.html
3. France Culture, “Ormuz, une onde de choc mondiale sur les marchés de l'énergie” — the Strait of Hormuz and LNG — https://www.radiofrance.fr/franceculture/podcasts/le-journal-de-l-eco/ormuz-une-onde-de-choc-mondiale-sur-les-marches-de-l-energie-2532544
4. JCTRANS, “P&I Clubs Tighten Red Sea War-Risk Cover Again as Excluded Areas Expand from August 16”, August 2026 — Bab el-Mandeb, Red Sea, war-risk premiums — https://m.jctrans.com/en/news-knowledge/14019/
5. RTBF, “Crise énergétique : un retour du gaz russe est-il possible ?”, 2026 — Europe and Russian gas — https://www.rtbf.be/article/qr-crise-energetique-un-retour-du-gaz-russe-est-il-possible-11716960
6. France Info, “Des millions de barils, un effet incertain sur les prix, l'Ukraine en colère… Quatre questions sur l'accord sur le diesel russe entre Donald Trump et Vladimir Poutine”, October 2026 — https://www.franceinfo.fr/monde/europe/manifestations-en-ukraine/des-millions-de-barils-un-effet-incertain-sur-les-prix-l-ukraine-en-colere-quatre-questions-sur-l-accord-sur-le-diesel-russe-entre-donald-trump-et-vladimir-poutine_8231458.html
7. ABC News, “Trump strikes deal with Putin for Russia to supply diesel to US”, 10 October 2026 — https://newsapp.abc.net.au/news/2026-10-10/trump-strikes-deal-with-putin-for-russia-to-supply-diesel-to-us/107250922
8. Maroc.ma (official portal of the Moroccan government), “Freetown: ECOWAS Member States Endorse Nigeria-Morocco African Atlantic Gas Pipeline Initiative”, 19 July 2026 — ~$25 bn; 30 Gm³/yr; nearly 6,800 km — https://maroc.ma/en/news/freetown-ecowas-member-states-endorse-nigeria-morocco-african-atlantic-gas-pipeline-initiative
9. Pipeline & Gas Journal / Reuters, “30-Bcm Nigeria-Morocco Gas Pipeline Wins ECOWAS Backing”, July 2026 — 6,900 km; ~$25 bn — https://www.pgjonline.com/news/2026/july/30-bcm-nigeria-morocco-gas-pipeline-wins-ecowas-backing
10. CGTN Africa, “International backers line up to finance $25 billion Nigeria-Morocco gas pipeline project”, 16 January 2026 — $25 bn; FID not taken; UAE, OPEC Fund, EIB signalled; Afreximbank/AFC/AfDB expected; commissioning 2046 — https://newsaf.cgtn.com/news/2026-01-16/Proposed-Nigeria-Morocco-pipeline-has-25-billion-price-tag-1JZ704gZ2EM/p.html
11. Senego, “Gazoduc Nigeria-Maroc : 25 milliards de dollars, l'enjeu financier après le soutien de la CEDEAO”, July 2026 — https://senego.com/gazoduc-nigeria-maroc-25-milliards-de-dollars-lenjeu-financier-apres-le-soutien-de-la-cedeao_1988367.html
12. Pipeline Technology Journal, “Trans-Saharan Gas Pipeline: How 4,128 km of New Steel Could Reshape Europe's Energy Map”, 2026 — 4,128 km; cost $10 to 13 bn — https://www.pipeline-journal.net/news/analysis-trans-saharan-gas-pipeline-how-4128-km-new-steel-could-reshape-europes-energy-map
13. MEED, “Construction of $13bn Trans-Sahara gas pipeline starts in Algeria”, 2026 — cost $13 to 25 bn — https://guest.meed.com/construction-of-13bn-trans-sahara-gas-pipeline-starts-in-algeria/
14. La Tribune (fr), “Gazoduc transsaharien : l'Algérie et le Niger relancent un projet de corridor visant le marché européen”, 2026 — budget $13 bn; NIGAL — https://www.latribune.fr/article/afrique/1769097988685214/gazoduc-transsaharien-l-algerie-et-le-niger-relancent-un-projet-de-corridor-visant-le-marche-europeen
15. GMK Center, “European gas prices exceeded €80/MWh in September”, 2026 — TTF: €82/MWh on 10 September 2026 — https://gmk.center/en/news/european-gas-prices-exceeded-e80-mwh-in-september/
16. GME (Gestore dei Mercati Energetici, Italy), 2025 report — TTF 2025: €36.2/MWh (+5.5%) — https://gme.mercatoelettrico.org/Portals/0/Documents/en-US/20260511BilancioGME2025.pdf
17. Nairametrics, “NMDPRA raises gas price to $2.18/MMBTU, effective April 2026”, 1 April 2026 — Nigerian domestic base gas price: $2.18/MMBtu (proxy) — https://nairametrics.com/2026/04/01/nmdpra-raises-gas-price-to-2-18-mmbtu-effective-april-2026/
18. DZWatch, “American Expert Validates Tebboune's Morocco Pipeline Assessment”, 2026 — Porter: 11 countries; TransMed/Tunisia: $0.85/MMBtu per transit entity — https://dzwatch.dz/american-expert-validates-tebbounes-morocco-pipeline-assessment/
19. Western Sahara Resource Watch, “Gas pipeline planned to cross occupied land” — feasibility and engineering financed by the Islamic Development Bank and the OPEC Fund, carried out by Worley — https://wsrw.org/en/news/gas-pipeline-planned-to-cross-occupied-land
20. Algeria Vanguard dossier AV-R-20261016-053, “Perfidy, parody: the mirage of the 15 billion m³ — but the real SWINDLE is the profits pocketed” — volumes, conversion 1 Gm³ ≈ 35.3 M MMBtu, levies — [link](/en/article/le-maroc-ne-consomme-pas-le-gaz-il-le-revend)
21. Algeria Vanguard dossier AV-R-20261018-055, “The pipeline does not cost 25 billion dollars: it costs men” — costs not included in CAPEX — [link](/en/article/le-gazoduc-ne-coute-pas-25-milliards-il-coute-des-hommes)
⚠️ Published reservations.
(1) The 2026 base price ($29.8/MMBtu) is a market price observed, not a guarantee over 25 years. The 12.4 $/MMBtu of 2025 is kept as the fallback scenario.
(2) The nature of the 5% in kind is not established: state tax or toll? The reference model is the tax (states take their share, investors receive a separate toll); the “5% = toll” model is presented as a variant — and it is not realistic (65% of the gas, $18.3/MMBtu of “tariff” for the Atlantic).
(3) The NIGAL toll (indexed to price) is a structural assumption: no public contract confirms it; the valuation of 1.5 Gm³ at $29.8/MMBtu gives $1.58 bn/yr.
(4) The Atlantic toll is a calculation assumption ($1.5/MMBtu, swept 1 to 3): no public tariff.
(5) OPEX is an assumption (2% of CAPEX/yr, swept 2 to 4%): no public figure.
(6) The asset life retained is 25 years (swept 20 to 40); the model ignores tax, debt and construction delay — commissioning is projected for 2046, which would degrade the actual IRR.
(7) The gas purchase price ($2.18/MMBtu) is a Nigerian domestic proxy; the actual export price is not published.
(8) At a 12% discount rate — the rate required by a high political-risk project — the NIGAL reaches break-even only at ~$36.2/MMBtu: it is not “risk-free”, it is simply the more profitable of the two.
(9) The CAPEX are announced figures; sources diverge (MEED: 13-25 bn; PTJ: 10-13; CGTN: 25; 6,800-6,900 km against “nearly 6,000 km” in CGTN) — the gaps are reported, not smoothed.
(10) No invented figure: each datum has its source; each assumption is flagged; what is missing is written “not established”.
(11) The geopolitical context is documented by press sources (France Culture, JCTRANS, RTBF, France Info, ABC, Kurier, n-tv); price projections over 25 years remain projections.
(12) No accusation: the article sets out flows and calculations. The reader concludes.