Gas Storage: a Flexibility Instrument supporting Security of Supply

1. Gas Storage: a Flexibility Instrument supporting Security of Supply Lex HuurdemanManager Regulatory Affairs & Commercial Strategy - Europe

2. Current trends in Europe that impact gas storage investments… • Increasing gas import dependence • Liberalising markets • Supply disruptions • Recession

3. Onshore areas with restricted access Waddenzee IJsselmeer & Markerwaard Schagen Biesbosch Indigenous production will continue to play a major role but needs an enabling framework • Access to resources • Competitive fiscal and regulatory regime • Streamlined permitting procedures • Liberalised gas market Source: provincies Groningen, Friesland, Drenthe, Overijssel, Gelderland, Flevoland, Noord-Holland, Zuid-Holland, Utrecht, Zeeland, Noord-Brabant, Limburg; DLG Groningen; Expertise Centrum Ministerie van LNV; Ministerie van Defensie; Rijksdienst voor het Oudheidkundig Bodemonderzoek (ROB); Rijkswaterstaat; International Maritime Organization (IMO); Centraal Bureau voor de Statistiek (CBS). Groningen Compressor Station

4. Import Routes Diversity of supply and supply routes is security of supply Russia Norway 48 Tcm Caspian 9 Tcm Iran Iraq Nigeria LNG 30 Tcm Source: OGP Egypt Algeria Libya Qatar

5. Gas Storage as Flexibility Instrument • Physical flexibility instruments compete with virtual ones • Regulation should be market-driven • Regulatory framework needs to attract investments • Maintain level playing field in a competitive flexibility market

6. A Strategic Role for Gas Storage? • Commercial flexibility services can deal with most disruption scenarios • Public Service Obligations when deemed unavoidable for specific exposures • Impact on commercial playing field should be minimal • PSO holders purchase flexibility services on the open market