Groningen, 19/04/23

Natural gas infrastructure in EuropeExperiences of an independent system operator

Helmer Horlings

Groningen, 19/04/23

Who we are…

Infrastructure

Trade

25%

25%50%

ShareholdersPrior to 1 July 2005Integrated company

Gasunie

ShareholdersFrom 1 July 2005Two companies

100%

Ministry ofFinance

50%25%

25%

N.V. Nederlandse Gasunie

GasTerra

Ministry of Economic Affairs

N.V. Nederlandse GasunieFrom an integrated natural gas company to infrastructure provider

Gasunie’s natural gas transport gridFrom 1 July 2008

Total length 15,000 km Gas qualities: H-, L- and G-gas Transported volumes: 125 BCM in 2007 18 compressor stations 1 LNG peak shaver

Groningen, 19/04/23

Natural gas in the European Union…

Annual volumes in BCM Indigenous production Imports from outside EU

Natural gas supply situation in 2020Projected imports amount more than 530 BCM

110

30

155

120

20

210

200

50

120

30

90

Natural gas supply situation in 2007Imports amounted some 290 BCM

Natural gas imports of EU-27 to grow substantially 240 BCM on imported gas to be added in the period 2007-2020

Securing natural gas deliveries also under more extreme than average conditions

Colder and longer than average winters

Technical failure

Terrorism

Commercial disputes

Political tensions

Natural disasters

Questions

1-in-10, 1-in-20 or 1-in-50 winter?

30, 60 or 90 days with interruption of largest supply?

National measures or a European solution?

Who is responsible for deliveries at extreme conditions?

…

Policy choices

Broad discussion

Gas supply security Markets’ preparedness for extreme conditions

Relative comparison of gas securityImportant gas markets of EU-27

High

Plentiful

A large spread on a national level

Nati

on

al m

ean

s t

o

deal w

ith

gas c

risis

Exposure to natural gas supply shocks

LowAbsent

Anno 2007

With an increased interconnectivity EU member states could all approach this level

Investment requirement€ 20 to 30 billion

MODEL INPUT• Energy supply mix• Natural gas diversity• Natural gas storage

Gas security of the EUMaintaining current gas security level requires investments in new storages

High

Plentiful

Nati

on

al m

ean

s t

o

deal w

ith

gas c

risis

Exposure to natural gas supply shocks

LowAbsent

Anno 2020

If no additional large-scale storage constructed

+70 BCM of storage above current level

+120 BCM of storage above current level

2007Investment requirement

€ 35 to 50 billion

Investment requirement€ 60 to 90 billion

How to tackle extreme conditions?To what extent are market players willing to invest? Should the governments intervene or participate in projects?

By 2020, some € 120 billion need to be invested in EU infrastructure to assure gas

security close to its current level

Measures assuring gas security

Long distance pipelines

LNG receiving terminals

Interconnection pipelines

Storages for normal conditions

Demand side management

Storages for extreme conditions

Both supply & demand

Market

Let market players take all responsibility

Government to set proper boundary conditions

Governments & market

Let governments take a large share of responsibility through direct participation in strategic projects

?

?

How to assure adequate investments, including extreme conditions?

Groningen, 19/04/23

Gasunie’s new activities…

Gasunie’s business philosophyIndependent gas infrastructure business creates a platform for market openness

Open access philosophyAggregation role

LNG re-gasificationGas transport

Gas storage

Gas storage Zuidwending

LNG Gate

BBL

North-South expansion

Nord Stream

Gasunie Deutschland

Gasunie invests intensely into infrastructure in Northwest-EuropeProgress between 2005 and present

Integrated Open Season