The Implications of Supervening Events on the Prospects of the Proposed Trans-Saharan Gas Pipeline: Imperatives for Mitigating Cross-Border Risks

(CEPMLP) The proposed Trans-Saharan Gas Pipeline (TSGP) project, which is scheduled to supply natural gas from the gas fields of the Niger Delta Basin in Nigeria to European markets via transit countries to wit, Niger and Algeria through the Mediterranean, measures as one of the latest proposed cross-border gas pipeline projects that would engender contribution to gas utilization beyond regional markets.

The TSGP is uniquely strategic with its agenda mainly driven by geopolitical/security of supply concerns as the EU seeks to mitigate its vulnerability to Russian gas hegemony by diversifying its dependence on Russian gas to Nigerian source, amongst others- without paying attention to the significant distance between Europe and Nigeria. However, like many long distance cross-border pipelines, the TSGP arouses the topical issue of supervening events, i.e., force majeure events along the transit route. Certain challenges such as political and social instability, as well as bargain imbalance with asymmetric fiscal regulatory regimes of the individual transit countries, are areas of concern that could affect the project economics. To this end, the affirmation that parties must put these supervening factors into focus if they must protect their financial and volume interests that the project is poised to offer is quite cogent.

This study seeks to identify the force majeure events that could fetter the success rate of the project, while suggesting that although innovations in the gas transit agreement may be laudable, contracts alone in transit situations cannot proffer water-tight solutions to the problem of force majeure. Rather, a combined effect of policy and party cooperation is key to safeguarding parties' interests