Brussels December 2, 2015 ROMGAZ SNGN ROMGAZ SA, Medias , is the - - PowerPoint PPT Presentation

Brussels – December 2, 2015

EFFECTS OF THE GRADUAL DEREGULATION OF GAS PRICES FOR HOUSEHOLDS ON THE RETAIL MARKET FOR NON-HOUSEHOLDS

• Eng. Ioan IGNAT

SNGN Romgaz SA

ROMGAZ

Task Force meeting on Gas Market Regulation 5th Meeting of the UNECE Gas Centre

ROMGAZ

Brussels – December 2, 2015 SNGN ROMGAZ SA, Medias, is the main Romanian gas producer

 5.663 bln Ncm – in 2014;  50.88% of Romania’s natural gas production;  3240 wells in production;  The entire production is sold on the domestic market;  Households 2014 – 22.53 %  Households 2015 – 38% from the total production allocated to the regulated market – the price is regulated in compliance with the liberalization calendar;  62% - allocated to the free market –– price resulted on the stock market;  Import < 3% - Oct 2015 - March 2016

Brussels – December 2, 2015

ROMGAZ

REGULATED MARKET - HOUSEHOLDS Natural gas price - 60 lei/MWh, set until June 30, 2016; Large variation of the annual consumption - difference 1 : 10 times – summer : winter!!!!! Difference in allocation from the current production - 20% : 52% – summer : winter!!!!! Balancing consumption by using stored gas and imports;  60% taxation of the price difference that exceeds 45.71 lei/MWh; FREE MARKET – NON-HOUSEHOLD Natural gas price - approximately 76 lei/MWh - 90 lei/MWh; Major influence on the budget; Annual consumption - almost constant, 50% increase during winter as compared to summer !!! Difference in allocation from the current production –80% : 48% – summer : winter!!! Balancing consumption by using stored gas and imports; 60% taxation of the price difference that exceeds 45.71 lei/MWh;

MARKET CHARACTERISTICS

Brussels – December 2, 2015

ROMGAZ

Natural gas allocations for the first 10 months of 2015

(published by Transgaz according to Order 161/19.12.2014) MWh

PRODUCTION HOUSEHOLDS NON-HOUSEHOLDS

January 5,084,392.541 2,625,474.562 2,458,917.979 February 4,630,837.153 2,606,524.071 2,024,313.082 March 5,113,733.427 1,909,886.533 3,203,846.894 April 4,677,990.939 1,617,363.866 3,060,627.073 May 4,665,127.254 1,598,412.669 3,066,714.585 June 4,539,154.300 1,621,478.219 2,917,676.081 July 4,739,502.855 1,009,927.408 3,729,575.447 August 4,734,095.454 968,253.989 3,765,841.465 September 4,581,823.216 1,636,105.642 2,945,717.574 October 4,838,229.199 1,858,608.381 2,979,620.818 Total 2015 47,604,886.338 17,452,035.340 30,152,850.998

MWh

MWh

Brussels – December 2, 2015

ROMGAZ

0.000 500,000.000 1,000,000.000 1,500,000.000 2,000,000.000 2,500,000.000 3,000,000.000 Diferente casnici Minim casnici MWh

EVOLUTION OF NATURAL GAS ALLOCATIONS

The current natural gas production is nearly constant, being affected by the natural decline; Allocations from current production are made depending on the consumption of the regulated market, represented by households;  Allocations of natural gas differences for consumption are made from stored gas;

MWh

ROMGAZ

Brussels – December 2, 2015

PRESSURES ON SETTING THE PRICE ON THE FREE MARKET

Flexibility of large non-household consumers by planning consumption; Low consumption level during summer; Possibility for peak shaving by using import gas; Large natural gas suppliers have an extended portfolio of clients; Producers have to trade certain natural gas quantities on the stock market;

MWh

Brussels – December 2, 2015

ROMGAZ

EVOLUTION OF REGULATED TARIFFS FOR SERVICES PROVIDED IN THE NATURAL GAS SECTOR

2.75 3.54 3.83 5.06 5.96 5.58 5.58 5.85 8.21 8.21 0.78 1.01 1.01 1.33 1.81 2.00 2.00 2.00 2.54 3.45 1.28 1.75 1.75 2.18 2.30 2.30 2.30 4.32 4.32 4.48 0.00 1.00 2.00 3.00 4.00 5.00 6.00 7.00 8.00 9.00 Apr. 2005 Apr. 2006 Apr. 2007 1 Ian. 2008 1 Apr. 2009 1 Mai 2009 15 Oct. 2009 1 Iul. 2013 1 Iul. 2014 1 Oct. 2015 DISTRIBUTIE TRANSPORT INMAGAZINARE

$ /MWh

• 3 times increase of the distribution tariff !
• 4.4 times increase of transportation tariff !
• 3.5 times increase of storage tariff !

$/MWh DISTRIBUTION

TRANSPORTATION

STORAGE

• Apr. 2005

2.75 0.78 1.28

• Apr. 2006

3.54 1.01 1.75

• Apr. 2007

3.83 1.01 1.75 1 Jan. 2008 5.06 1.33 2.18 1 Apr. 2009 5.96 1.81 2.30 1 May 2009 5.58 2.00 2.30 15 Oct. 2009 5.58 2.00 2.30 1 Jul. 2013 5.85 2.00 4.32 1 Jul. 2014 8.21 2.54 4.32 1 Oct. 2015 8.21 3.45 4.48

ROMGAZ

Brussels – December 2, 2015

Brussels – December 2, 2015

ROMGAZ

Gas injection/withdrawal profile into/from Romgaz storages

Brussels – December 2, 2015

ROMGAZ

1250 700 200 200 150 50 1250 700 200 200 200 50 1250 700 200 300 200 85 1250 700 200 300 600 85 1250 900 200 300 600 85 1250 1500 200 300 600 85 1250 1500 200 300 600 85

500 1.000 1.500 2.000 2.500 3.000 3.500 4.000

• mil. mc

2007 2008 2009 2010 2011 2012 2013

BILCIURESTI SARMASEL URZICENI CETATE GHERCESTI BALACEANCA

USE OF STORAGE CAPACITIES FOR BALLANCING

Brussels – December 2, 2015

Thank you!

ROMGAZ

www.romgaz.ro