1. EG pfa-sb Athen_November2005.ppt GIE Annual Conference The View of the Users of Gas Infrastructures Presented by Dieter Pfaff E.ON Ruhrgas AG Chairman of the Eurogas Network Users Group (NUG) and Acting Chairman of the System Users Committee (STUC) Athens, 03-04 November 2005

2. EG pfa-sb Athen_November2005.ppt New Eurogas Organisation System Users Committee (STUC)

3. EG pfa-sb Athen_November2005.ppt The work programme of the Network Users Group (NUG) will be maintained in the new System Users Committee (STUC) with a new and expanded remit (i.e. user issues on networks, storage facilities and LNG plants). The scope of the STUC´s work will typically encompass the following activities: - Input on system use issues to the Madrid Forum, -Responses to GIE´s work, -Dialogue with the EU Comm ission, the CEER and ERGEG and representatives of other internation al public Organisations on issues related to system use. -Securiy of Supply issues Network Users Group (NUG) and New System Users Committee (STUC)

4. EG pfa-sb Athen_November2005.ppt Eurogas System Users Still ongoing Follow-up work to the 8 th Madrid Forum In the Conclusions of the Forum it was mentioned that the shortcomings of the entry/exit systems identified at the 7 th Madrid Forum, especially the issue of transit and multiple TSO, still exists and have not been solved. The NUG had discussions with ERGEG/CEER representatives on their planned report on transit and cross-border issues. ERGEG’s approach to transit issue is still not yet published. The NUG has prepared a report on transit with national approaches, to reflect the different national systems. It is planned to publish the NUG Report to the transit issue short term.

5. EG pfa-sb Athen_November2005.ppt Follow-up work to the 8 th Madrid Forum GTE Report on TPA Services and Market Needs In the Conclusions of the Forum -It was suggested to deal with the issue of TPA services/ transparency requirements, which are really used and how the services offered by TSOs would match market needs in more detail. Eurogas discussed in several meetings with GTE their report on TPA Services and suggested that -Users need appropriate services compatible with their needs and should be informed on cost-implications of services. -Users ’ needs can be expected to vary in different countries and at different stages of market development. -Potentially some services in practice could be left to the market. Eurogas is still looking for more transparency and information on which companies offer which services.

6. EG pfa-sb Athen_November2005.ppt Follow-up work to the 8 th Madrid Forum CEER discussion Paper on Calculation of Available Capacities The Conclusions of the 8 th Madrid Forum: -With reference to the need for transparency in respect of calculation of available capacities and to ensure that maximum capacity is made available to the market, it was proposed that the principles governing UIOLI should be discussed more in detail and to carry out a study on UIOLI principles and -GTE was invited to present a study taking into account previous work carried out by Eurogas and other interested parties and elaborated in close co-operation i. a. with Eurogas to the next Forum.

7. EG pfa-sb Athen_November2005.ppt CEER discussion Paper on Calculation of Available Capacities In several meetings with CEER, GTE and EFET representatives discussions took place on the CEER discussion Paper on Calculation of Available Capacities. CEER came back to the idea first mentioned some years ago of grading firm capacity. Eurogas expressed strong concern at this approach, and explained that firm capacity had to be firm for suppliers to be confident of meeting their commitments. The only exception was in the case of Force Majeure. Interuptible capacity could be graded at different levels, but not firm. Force Majeure is an unforeseen event, which happens beyond the control of a “reasonable and prudent operator”. It can not be part of a risk control and management procedure.

8. EG pfa-sb Athen_November2005.ppt The Network Users Group commented on GIE´s Report and expressed concerns about different opinions: - The Responsibility for Securiy of Supply belongs to commodity suppliers -Securiy of Supply must be based on entrepreneurial responsibility -The Role and Responsibilities of different market players have to be clearly defined -New Gas Infrastructures should be determined through market signals, underpinned by binding financial commitments Eurogas refers to its Position Papers on TSO Function and Responsibilities and Capacity Allocation Procedures Ivestment in New Gas Infrastructures For Securiy of Supply

9. EG pfa-sb Athen_November2005.ppt Eurogas discussed with GTE representatives the -ERGEG Discussion Paper on Gas Balancing and commented the ERGEG Report recently in detail i. e.: -Sources of flexibility to be available for TSOs and for users -Number of balancing zones preferable small -Small imbalances and incentives to avoid bigger imbalances -Linepack either to be available on a non-discriminatory basis or part of the TSO´s flexibility service Follow-up work to the 8 th Madrid Forum CEER Discussion Paper on Gas Balancing

10. EG pfa-sb Athen_November2005.ppt Discussion with ERGEG/CEER representatives and letter exchange with ERGEG/CEER and EASEE-gas on the implementation of Common Business Practices (CBPs) and the nature of voluntary agreements. Eurogas considers that if a bilateral agreement offering an alternative approach led to the same results, then it should be allowed alongside the voluntary agreement approach, providing it involved no discriminatory treatment. In other words, voluntary agreements like EASEE-gas CBPs, should not be exclusive and other solutions in bilateral agreements should also be possible - as long they are non-discriminatory to others. In the Madrid Forum Joint Working Group Eurogas requested that there should be a statement in every CBP to the effect that bilateral agreements should be possible. EASEE-gas is making important contributions to the development of proper instruments, which have to be developed further, in order to find solutions concerning specific gas quality issues (in the UK and LNG). EASEE-gas Common Business Practices and bilateral agreements

11. EG pfa-sb Athen_November2005.ppt