25th IG meeting13th December 2013

Enagás, REN and TIGFIssues to be discussed

2

Index

1. Specific calendar of auctions.2. Definition of large and small price steps for each type of

product.3. Transfer of existing contracts to the VIP4. Capacity to be offered5. Financial guarantees. 6. Contracts: standard and annexes/standard after the auction. 7. Secondary market: when and where trades will take place,

public information. 8. Stakeholders information9. EIC and transfer to affiliates

3

1. Auction calendar

AUCTIONS CALENDAR FOR 2014

Annual yearly

capacity auctions

Annual quarterly capacity auctions

Rolling monthly capacity auctions

SEPTEMBER OCTOBER NOVEMBER DECEMBER

03/03/2014 02/06/2014 15/09/2014 20/10/2014 17/11/2014 15/12/2014

• Since the binding application of the CAM NC, the auction calendar will be determined by ENTSOG

• Until that date, TSOs will follow PRISMA’s auction calendar

4

2. Definition of price steps• Large price steps:

• Rules in other IPs in Europe according to NRAs:

• Yearly auctions: large price step = 10 ct/kWh/h/Runtime, small price step = 2 ct/kWh/h/Runtime

• Quarterly auctions: large price step = 2.5 ct/kWh/h/Runtime, small price step = 0.5 ct/kWh/h/Runtime

• Monthly auctions: large price step = 1 ct/kWh/h/Runtime, small price step = 0.2 ct/kWh/h/Runtime

• To be discussed …

• Small prices steps:

• PRISMA booking platform sets, as a default rule, that small price steps are 20% of the large price steps. In principle, TSOs will follow this default rule for all products (yearly, quarterly and monthly)

5

3. Transfer of existing contracts to the VIP

ENAGAS TIGF Decision requiredYES YES NO

• At the Spanish-French border, Enagás and TIGF agree to transfer existing contracts at physical IPs to VIP. This will imply that as from October 2014 for commercial and operational purposes the physical IPs will no longer exits. This will not imply that existing contracts have to be bundled.

• At the Spanish-Portuguese border, Enagás will also transfer existing contracts at physical IPs to VIP without bundling existing contracts.

• REN will only transfer contracts from physical IPs to the VIP as from October 2014 as long as all unbundled capacity at the IPs is contracted by the same shipper on both sides.

ENAGAS REN Decision requiredYES without changing the conditions in the contracts

YES , but only if existing unbundled capacity is fully contracted

YES

6

4. Capacity to be offered

PENDING ON SEVERAL DECISSIONS DESCRIBED IN THE NEXT SLIDES

7

4. Firm and interruptible capacity

Capacity Opinion on how to offer capacity Decision required

SIDE 1 SIDE 2 REN ENAGAS TIGF

Firm Firm Bundled Bundled Bundled NO

Firm Interruptible Bundled Unbundled Unbundled YES

Interruptible Interruptible Bundled Unbundled Unbundled YES

8

4. Bundled and unbundled products

Where capacity will be offered

REN ENAGAS TIGF Decision required

Bundled capacity VIP VIP VIP NOUnbundled capacity VIP, but… VIP VIP YES

• At the Spanish-French border, Enagás and TIGF will offered all the available capacity (bundled and unbundled) at the VIP.

• At the Spanish-Portuguese border, Enagás and REN will offere all the available capacity (bundled and unbundled) at the VIP, whereby REN considers that the following conditions should be met:

• for the existing unbundled capacity at both IPs, comercial mismatching must be eliminated by contracting the same capacity at both sides of the border by the same shipper;

• if available, unbundled capacity at the VIP shall be only due to mismatch of technical capacity as offered by both TSOs.

9

4. Capacity between Spain and France (2014)SPAIN FRANCE (bundled capacity)

FRANCE SPAIN (bundled capacity)

MWh/d 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028

Capacity offered 19.501 19.501 24.201 24.201 24.201 1.701 1.701 1.701 1.701 117.193 131.113 131.113 177.413 177.413 177.413

Firm annual yearly bundled capacity auctions - VIP

MWh/d 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028Capacity offered 1.980 1.980 1.980 1.980 1.980 - - - - 54.480 54.480 54.480 128.000 128.000 128.000

Firm annual yearly bundled capacity auctions - VIP

MWh/d Q4 Q1 Q2 Q3Capacity offered 16.500 16.500 17.500 17.500

Firm annual quarterly bundled capacity auction VIP(2014 gas year)

MWh/d Q4 Q1 Q2 Q3Capacity offered 17.000 17.000 17.400 17.400

Firm annual quarterly bundled capacity auction VIP(2014 gas year)

Note that the figures are provided at 0ºC

10

4. Capacity between Spain and France (2014)SPAIN FRANCE (unbundled capacity)

FRANCE SPAIN (unbundled capacity)

MWh/d 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028Available unbundled cap FRANCE - - - - - - - - - - - - - - -

Available unbundled cap SPAIN 50.371 50.371 50.371 50.371 50.371 50.371 50.371 50.371 50.371 - - - - - -

Available firm yearly unbundled capacity - VIP

Note that the figures are provided at 0ºC

MWh/d 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028Available unbundled cap FRANCE - - - - - - - - - - - - 4.000 4.000 4.000

Available unbundled cap SPAIN 251 251 251 251 251 251 251 251 251 73.520 73.520 73.520 - - -

Available firm yearly unbundled capacity - VIP

11

4. Enagas-REN Technical capacitiesBadajoz/Campo Maior: Spain Portugal

GWh/dayYear New Infraestructures Exit ENAGÁS Entry REN

2013 134 GWh at 76 bar 141 GWh at 76 bar

2014 CS Carregado 134 GWh at 76 bar (*) 141 GWh at 76 bar/ 80 bar

Spain -> PortugalActual capacities

(*) When the delivery pressure at the border is 80 bar the maximum physical capacity is 128 GWh

Capacities are calculated at 25ºC

GWh/day

2014

-202

0

Current status

2021

-202

4

W: Jan, Feb, Mar; Nov, DecS: Apr, May, Jun, Jul, Ago, Sep, Oct

Spain Portugal

W: 134S: 134

W: 134S: 134

W: 140S: 135

W: 115S: 110

W: 25 S: 25

Firm capacity at 76 bar and normal network average

pressure.

Interruptible capacity at 80 bar or low network average

pressure.

All the capacity is firm

Firm Interruptible

Spanish side

Firm Interruptible

Portuguese side CommentsREN

Totalvalue

at 76 bar

New InfraestructureYear

CommentsEnagas

Totalvalue

at 76 bar

12

4. Enagas-REN Technical capacitiesBadajoz/Campo Maior: Portugal Spain Actual capacities

GWh/dayYear New Infraestructures Exit REN Entry ENAGÁS

2013 W: 35 GWh at 55 barS: 70 GWh at 55 bar 105 GWh at 55 bar

2014 CS Carregado W: 70 GWh at 55 barS: 105 GWh at 55 bar 105 GWh at 55 bar

Portugal -> Spain

Capacities are calculated at 25ºC

GWh/day

2014

-202

0

Current status W: 85 S: 105

W: 35S: 55

W: 50S: 50

2021

-202

4

W: 40S: 75

W: 0S: 25

W: 40S: 50

CS Carregado W: 125S: 120

W: 70S: 95

W: 55S: 25

Firm capacity is available through the Carriço UGS withdrawal to cover the

CCGT's demand.

Additional interruptible capacity is available with

Carriço UGS withdrawal and depending on CCGT's

demand.

W: 105S: 105

W: 105S: 105

All the capacity is firm

W: Jan, Feb, Mar; Nov, DecS: Apr, May, Jun, Jul, Ago, Sep, Oct

Portugal Spain

Firm Interruptible

Spanish sideFirm Interruptible

Portuguese side CommentsREN

Totalvalue

New InfraestructureYear

CommentsEnagas

Totalvalue C

at 55 bar

at 55 bar

at 55 bar

at 55 bar

13

4. Enagas-REN Technical capacitiesValença do Minho/Tuy: Spain Portugal

GWh/dayYear New Infraestructures Exit ENAGÁS Entry REN

2013 W: 30 GWh at 60 barS: 42 GWh at 60 bar 40 GWh at 60 bar

2014 CS Carregado W: 30 GWh at 60 barS: 42 GWh at 60 bar 40 GWh at 60 bar

Spain -> PortugalActual capacities

GWh/day

2014

-202

0

Current status W: 30S: 42

W: 30S: 42

Interruptible capacity is available depending on:

1) Minimum production of Mugardos LNG terminal

2021

-202

4

W: 30S: 42

W: 30S: 42

Interruptible capacity is available depending on:

1) CCGT demand on Spanish side

2) Minimum production of Mugardos LNG terminal

LNG Terminal MuselCS Carregado

W: 40S: 42

W: 40S: 42

Interruptible capacity is available depending on:

1) Minimum production of Mugardos LNG terminal

W: 10S: 10

Interruptible capacity is available at low network

average pressure and high NG demand (mainly from the

CCGT's demand).

Spain Portugal

W: 35S: 25

W: 25S: 15

W: Jan, Feb, Mar; Nov, DecS: Apr, May, Jun, Jul, Ago, Sep, Oct

Firm Interruptible

Spanish sideFirm Interruptible

Portuguese side CommentsREN

Totalvalue

New InfraestructureYear

CommentsEnagas

Totalvalue

at 60 bar

at 60 bar

at 60 bar

at 60 bar

Capacities are calculated at 25ºC

14

4. Enagas-REN Technical capacitiesValença do Minho/Tuy: Portugal Spain Actual capacities

GWh/dayYear New Infraestructures Exit REN Entry ENAGÁS

2013 28 GWh at 60 bar 25 GWh at 60 bar

2014 CS Carregado 31 GWh at 60 bar 25 GWh at 60 bar

Portugal -> Spain

Capacities are calculated at 25ºC

GWh/day

2014

-202

0

Current status W: 25S: 15

W: 25S: 15

W: 35S: 40

W: 25S: 30

W: 10S: 10

2021

-202

4

W: 0S: 10

W: 0S: 0

W: 0S: 10

CS Carregado W: 45S: 50

W: 35S: 40

W: 10S: 10

Firm capacity is available through the Carriço UGS withdrawal to cover the

CCGT's demand.

Additional interruptible capacity is available with

Carriço UGS withdrawal and depending on CCGT's

demand.

W: Jan, Feb, Mar; Nov, DecS: Apr, May, Jun, Jul, Ago, Sep, Oct

W: 30S: 15

W: 30S: 15

All the capacity is firm

Portugal Spain

Firm Interruptible

Spanish sideFirm Interruptible

Portuguese side CommentsREN

Totalvalue

New InfraestructureYear

CommentsEnagas

Totalvalue

at 60 bar

at 60 bar

at 60 bar

at 60 bar

at 60 bar

15

5. Financial guarantees• Each TSO will establish its own financial guarantees. There is no need for

alignment or decision as regards this point.

• Neither Enagás nor TIGF, nor REN will use PRISMA functionality for managing financial guarantees.

• On the Spanish side and on the French side as well on Portuguese side, there will not be any need to establish additional financial guarantees for participating in the auctions.

• Each TSO will require the financial guarantees establish in their national regulation.

16

6. Standard contracts (I)• TSOs fully agrees that an standard capacity contracts should be signed with

each TSO.

• ENAGAS

• The Standard Contract with Enagas will have to be singed in advance, as a prerequisite to participate in auctions. The Standard Contract will only be signed once during the registration process. This contract will be valid to both concluding bookings and to participate in auctions with Enagás at PRISMA booking platform.

• Capacity allocated to a Shipper at PRISMA booking platform will be automatically introduce at the SL-ATR, thus this allocation will be binding for shippers and it will not be necessary to sign any additional document.

• Once the shipper has been informed of the allocation of capacities, it will be informed of the financial guarantees associated to the contracted capacity he has to put in place in favour of Enagás. These financial guarantees are detailed in Royal Decree 949/2001.

17

6. Standard contracts (II)• REN• In order to be able to participate in auctions Shippers must be registered as

licensed shippers in the Portuguese system. The requirements and procedure to get the license are detailed by the DGEG at http://www.dgeg.pt/

• Shippers have to have signed the Transport Contract with REN Gasodutos in order to participate in the auctions.

• Capacity allocated to a Shipper at PRISMA booking platform will be automatically introduced in REN’s Third Party Access Platform (ATR), thus this allocation will be binding for shippers and it will not be necessary to sign any additional document.

• Once the shipper has been informed of the allocation of capacities, it will also be informed of the financial guarantees associated to the contracted capacity he has to put in place in favor of REN. These financial guarantees are detailed in Contrato de Uso da Rede Nacional de Transporte de Gás Natural, wich general terms & conditions are available at https://www.ign.ren.pt/

• No specific financial guarantees to participate in the auctions will be required.

18

6. Standard contracts (III)• TIGF• In order to be able to participate in auctions Shippers must be registered as

licensed Shippers in the French system. The requirements and procedure to get the license are detailed by the DGEC at the following link:

http://www.developpement-durable.gouv.fr/Liste-des-fournisseurs-autorises.html

• Then, Shippers will have to sign the Transport Contract with TIGF in advance in order to participate to the auctions.

• Capacity allocated to a Shipper at PRISMA booking platform will be automatically introduced in the Transport Contract (Bordereau de Capacités), thus this allocation will be binding for shippers and it will not be necessary to sign any additional document.

• Once the shipper has been informed of the allocation of capacities, it will be informed of the financial guarantees associated to the contracted capacity he has to put in place in favor of TIGF. These financial guarantees are detailed in Article 8 Guarantee of Transport Contract General Terms available on TIGF web site.

• No financial guarantees to participate in the auctions will be required.

19

7. Secondary market• For the year 2014, TSOs will put in place a coordinated procedure to allow

shippers to trade their bundled capacity in the secondary market.

• Once there is a secondary booking platform, TSOs will have the opportunity to use this functionality.

• During 2014, Enagas and REN are working on a Pilot project with PRISMA, which doesn’t include a secondary market facility.

20

8. Stakeholders informationProposed calendar• January: publication of the relevant documentation by TSOs for shippers

• February: publication of the relevant regulation by NRAs

Documentation• Description of capacity products

• Capacities offered

• Auction process

• Link to PRISMA on TSO’s websites

• Creation of the VIP

• 2014 calendar for yearly, quarterly, monthly auctions

21

9. EIC code & transfer to affiliates• Situation: the company that has been allocated capacity at PRISMA should

be the same as the one signing the contracts with the TSOs. Thus, there is no possibility to transfer the capacity to an affiliate at IPs; instead, gas transactions will take place within each system (PEG, AOC, VTP)

• Enagás agrees with this provision.

• TIGF, at this point of progress, would agree with this provision.

• REN has no objection to this provision, as it is imposed by NRAs

REN ENAGAS TIGF Decision requiredTransfer to affiliates

NO NO NO NO

Thank you for your attention!