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GIE Annual Conference Bratislava, 28-29 September 2006

GIE Annual Conference Bratislava, 28-29 September 2006. Ensuring Secure and Competitive European Gas Supplies. Johannes ENZMANN European Commission DG Energy and Transport Unit Electricity and Gas. EU25 - Demand and Supply. Growth of demand: 37% Growth of imports: 135%.

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GIE Annual Conference Bratislava, 28-29 September 2006

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  1. GIE Annual ConferenceBratislava, 28-29 September 2006 Ensuring Secure and Competitive European Gas Supplies Johannes ENZMANN European CommissionDG Energy and TransportUnit Electricity and Gas

  2. EU25 - Demand and Supply Growth of demand: 37% Growth of imports: 135%

  3. The growing role of LNG • World LNG trade: • mid 1970s 10 bcm at a global scale • Mid 1990s 80 bcm • Since then more than doubled to 180 bcm in 2004 • Further growth is expected, some analysts forecast another 180 bcm by 2010 • LNG in the EU: • In 2004, EU LNG imports accounted for 12% of imports (34 bcm) and 7% of total consumption • Unevenly distributed, some Member States import around 60% of their needs in form of LNG • Underlying reasons: techology & economies of scale; market opening and market opportunities

  4. From regional to global markets • Growing demand for gas is a global tendency • Growing role for LNG not only in Europe, but also other regions (US, India, China etc) • Contractual developments of LNG contracts allow better exploiting market opportunities • Competition between gas consuming regions likely • ...but also a more diversified supply portfolio and thus enhanced security of supply

  5. Investments in an attractive market • Supply and demand developments clearly point to the need for new investments in gas infrastructure as well as E&P • IEA figures suggest infrastructure investments in the order of € 200 bn by 2030 • An attractive market: • No operational barriers to enter the market • No barriers to market the gas • Free flow of gas allowing exploiting buisness opportunities • Competitive prices

  6. Some Preconditions to Be Met • Unbundling • TSOs geared to market capacity • Entirely independent of supply interests • Clear rules for investments • Providing a stable, clear and reliable framework • Taking into account the regulatory environment • In line with non-discrimination and transparency • Non-discriminatory and transparent capacity allocation mechanisms including effective congestion management • Sufficient level of transparency etc

  7. Investments in existing and new infrastructure • Non-discriminatory and transparent capacity allocation mechanism • Overall transparency on available capacity • Open season, open subscription period • Lead time corresponding to duration of the contract • Clear rules concerning tariffs • Economically viable investments including cross border • Coordination among and between relevant authorities and TSOs • Obligation to respond to market demand

  8. Conclusions • Obvious need for investments • Need to define clear rules in line with the requirements of a competitive market • Main elements are available, but may turn out not to be sufficient • Further efforts are necessary…

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