Madrid, May 21 st th SG Meeting South Gas Regional Initiative Working Group 4B: Open Seasons

2 Objective An European will: One European Gas market. Development interconnections between France and Spain in order to bring significant market places closer to each other. Favour transits North to South and South to North, connecting different gas sources by pipelines and by ships.

3 Open Seasons: Why? Open Seasons: assessment and contracting of market needs, leading to investment decisions Required in France for decision. Not required in Spain for decision, but jointly conducted by Enagás and Naturgás for coordination. Developments based on binding requests by market participants. Process allowing: Capacity development at existing entry/exit points (Larrau/Biriatou). Creation of new entry / exit point (Midcat).

4 Development of interconnections implies reinforcement of internal transmissions networks in each of the market zones concerned. Difficult exercise: find the best combination with numerous interconnection development projects. Market Structure 4 markets zones. Full entry-exit zones.

5 Projects Different developments are envisaged between Spain and France: Western corridor: increasing existing interconnections (2013). Eastern corridor: building a new interconnection (2015). Additionally, a need of new capacity in the GRTgazNorth GRTgazSouth link. Coordination should be pursued between Open Season Procedures and marketing of existing capacities.

6 Projects: Technical Capacity (I) Note: Incremental capacities in Biriatou, and the infrastructures associated to those incremental capacities, are currently under review. (*) Infrastructures increasing capacity between GRTgaz NORTH and GRTgaz SOUTH are not detailed.

7 Projects: Technical Capacity (II) Note: Incremental capacities in Biriatou, and the infrastructures associated to those incremental capacities, are currently under review. (*) Infrastructures increasing capacity between GRTgaz NORTH and GRTgaz SOUTH are not detailed.

8 Capacities to be marketed Note: Incremental capacities in Biriatou, and the infrastructures associated to those incremental capacities, are currently under review.

9 Notes (1)Currently, from 1st April 2013, the total technical capacity (230GWh/d) is not booked but dedicated to be marketed by short (1 year) to medium (2, 3 or 4 years) term OSP procedures, fixed by CRE. According to these rules, capacities will be marketed 6 months before the beginning of the period in question. The figures here suppose that CRE would adapt this rule in order to allow marketing of a part of existing capacity in coordination with OS. (2)Currently, from 1st April 2013, 142GWh/d is not booked but dedicated to be marketed by short (1year) to medium (2, 3, or 4 years) term OSP procedures, fixed by CRE. According to these rules, capacities will be marketed 6 months before the beginning of the period in question. The figure here supposes that CRE maintains these rules because of congestion North >South. (3)Depending on level of short term capacity decided by CRE, capacity proposed to the market would vary between 210 and 380GWh/d. (4)Capacity at the GRTgazNorth-GRTgazSouth link might be impacted by other entry points to the GRTgazSouth zone, in particular Fos. A detailed description of the different development options should be presented in the Info Memo. No capacity at the GRTgazNorth-GRTgazSouth link should be dedicated to any entry or exit point. Every procedure, OS or OSP, will be open for every shipper and every need.

10 1 process, 1 or 2 phases Information Memorandum in October 2008 will describe the whole process (all proposed capacities). 1 st phase following a provisional 12 month planning. Binding applications for Western corridor & also applications for Eastern corridor (to be defined whether applications will be binding or non-binding). If necessary, 2 nd phase following a provisional 10 to 12 month planning: applicable if applications for Eastern corridor in the 1st phase are non-binding. Binding applications for Eastern corridor.

11 Development Planning Western Corridor (2013). Capacity from/to Spain to/from GRTgaz South. Capacity between GRTgazSouth and GRTgazNorth to be defined by CRE (part of existing capacity). Eastern Corridor & GRTgaz North- South (2015). Development of new interconnection capacity between GRTgazNorth and GRTgazSouth X X

12 Investment Decisions in France Once the capacity has been allocated and the contracts have been signed, global investments (related or not to the OS) will be approved by the French TSO’s boards and the CRE, around December.

13 Provisional timetable of the OS process D Publication of the Information Memorandum: D (2008, October 1 st ). D Publication of the Confidentiality Agreement: D. D Publication of a project of priority and allocation rules: D. D Publication of a project of clauses of the transmission contract relative to the developed capacities: D. Presentation and information meeting with shippers about this consultation. D + 2 months Publication of priority and allocation rules (one document): D + 2 months. D + 2 months Publication of clauses of the transmission contract relative to the developed capacities (four documents): D + 2 months.

14 Provisional timetable from D to D+4 months Individual discussion following signature of a confidentiality agreement with shippers: from D to D+4 months. D+4 months Deadline to receipt : D+4 months. binding applications for the Western corridor binding or non-binding applications for the Eastern corridor binding or non-binding application for GRTgaz North-South link D+5 months TSO’s response on capacity allocations: D+5 months. from D+5 months to D+6 months Deadline for signature of contracts: from D+5 months to D+6 months. D+6 to D+9 2 nd phase (if applicable): to be launched once information from the market has been processed and contracts have been signed: from D+6 to D+9 D+12 months French TSO’s boards approve their global investments programs: D+12 months.

15 Allocation Procedures TSOs are committed to develop transparent allocation procedures. Capacity will be allocated fostering the creation of energy corridors. Consumers’ interest will be protected in each market area.

16 Information Memorandum The main contents of the Information Memorandum will be: Objectives of the OS. Existing and new capacities to be offered under the OS. Marketing of capacities / OS phases. Calendar of the OS. Coordination with other OSs/OSPs in France and Spain. Allocation procedures. Infrastructures associated to incremental capacities. Binding / non-binding application sheet.

Thank you for your attention