MS-ATR SECONDARY MARKET FOR GAS EXCHANGES I N SPAI N Madrid, 2 3 th - PowerPoint PPT Presentation

MS-ATR SECONDARY MARKET FOR GAS EXCHANGES I N SPAI N Madrid, 2 3 th July 2 0 0 8 FRANCISCO P. DE LA FLOR

1 . The Context 3 . The Results 2 . The I T Tool 2 Index

THE CONTEXT 3

The Spanish Gas Industry 1 . A peripheral country in the European landscape. 2 . Lack of cross-border capacity w ith continental Europe. 3 . Very high natural gas dem and grow th. 4 . Strong need to develop new infrastructures. 5 . Alm ost com plete dependency on im ports. 6 . Special im portance of LNG ( 7 0 % total gas im ports) . 7 . Different dem and pattern com pared to the other MS, w ith higher proportion of industrial and electrical dem and ( CCGTs) and low er seasonal variation. 8 . r-TPA to all basic gas infrastructures ( HP pipelines + LNG + UGS) 9 . I nfrastructure Code & SL-ATR. 1 0 . Liberalisation & No barriers to new entrants. 4

THE CONTEXT THE CONTEXT ANNEX 5

Cross-border Interconections with EU countries 6

Natural Gas Demand & Forecast to 2016 TWh 700 600 500 x 10,2 400 300 200 100 9 1 3 5 7 9 1 3 5 7 9 1 3 5 8 9 9 9 9 9 0 0 0 0 0 1 1 1 9 9 9 9 9 9 0 0 0 0 0 0 0 0 1 1 1 1 1 1 2 2 2 2 2 2 2 2 Residential + Industrial current CCGT current Residential + Industrial CCGT 2006-2016: System Technical Manager Scenario ( 5% CAGR) 7

Mandatory Planning to 2016 8

Supply Diversification 2 0 0 7 Oman Otros 2 0 0 7 Nigeria Algeria LNG 1% 1% 24% Supplies 12% 4 1 0 TW h Domestic Production Algeria NG < 1% 25% Norway 6% Libya T&T 2% Qatar 6% Egypt 12% 11% NG LNG 3 1 % 6 9 % 9

74% 26% 2 0 0 8 ( e) 72% 28% 2 0 0 7 2 0 0 6 LNG supplies to the LNG Market 2 0 0 5 New entrants 2 0 0 4 10 2 0 0 3 Incumbent 2 0 0 2 2 0 0 1 2 0 0 0 1 9 9 9 TWh 250 300 200 150 100 0 50

CCGTS IN SPAIN I nstalled Capacity Current 21.000 MW Future (2016) * 34.000 MW CCGT in testing phase CCGT (400 MW unit or equivalent) Conventional Power Station 11 ( * ) I ncluding 3 0 0 0 MW e of Open Gas Turbines

NGTS & SL - ATR � NGTS: I nfrastructure Code ( Netw ork + UGS + LNG term inal code) � SL-ATR: I T logystic system for I nfrastructure users 12

Active Shippers in Spain 13

THE I T TOOL 14

Main features � MS-ATR w as im plem ented at late 2 0 0 5 in order to organize the huge num ber of gas exchanges. � Developed on a w eb system basis as a part of the TPA I T System ( SL-ATR) . � Transactions could be m anaged w ithin gas day m arket, ensuring transparency, security and confidentiality. � Several activities and functions: � Bilateral exchanges � I m balance m anagem ent � Trading ( bids & offers) � Bids and offers should be order in term s of volum e and price for every infrastructure. 15

MS-ATR � Shippers having access to MS-ATR trading platform are able to choose the infrastructure w here they w ant to trade gas and to accept or refuse offers from other users. 16

MS-ATR: > 30 USERS 17

MS-ATR: BILATERAL EXCHANGES � MS-ATR allow s to organize the OTC bilateral exchanges 18

MS-ATR: IMBALANCES MANAGEMENT � MS-ATR allow s GTS to receive offers to m anage the im balances. 19

MS-ATR: TRADING � MS-ATR allow s the negotiation of gas prices betw een users, on anonym ous basis. 20

21 MS-ATR: VESSELS

THE RESULTS 22

EVOLUTION VS. MONTHLY DEMAND 10.000 20.000 30.000 40.000 50.000 60.000 GWh a g o Gas exchanges - 0 0 2 n o v - 0 2 f e b - 0 3 m a y - 0 3 a g o - 0 Difference monthly demand - Gas exchanges 3 n o v - 0 3 f e b - 0 4 m a y - 0 4 a g o - 0 4 n o v - 0 4 f e b - 0 5 m a y - 0 5 a 23 g o - 0 5 n o v - 0 5 f e b - 0 6 m a Difference Gas exchanges - monthly demand y - 0 6 a g o - 0 6 n o v - 0 6 MS- ATR f e b - 0 7 m a y - 0 7 a g o - 0 7 n o v - 0 7 f e b - 0 8 m a y - 0 8

GAS EXCHANGES PER INFRAESTRUCTURE Underground Transm ission storages ( GW h) netw ork ( GW h) 7 % 2 % Gas exchanges per infrastructure LNG Term inals ( GW h) 9 1 % Underground storages 2 % Num ber of transactions Transm ission LNG Term inals netw ork 5 5 % 4 3 % 24

Number of exchanges NON-DOMINANT PLAYER Volume of gas exchanges 25 100% 80% 60% 40% 20% 0%

Disclaimer This document may contain market assumptions. different sourced information and forward-looking statements with respect to the financial condition. results of operations. business. strategy and the plans of Enagas SA. Such statements are based on a number of assumptions that could ultimately prove inaccurate. and are subject to a number of risk factors. including the ability to realize cost reductions and operating efficiencies without unduly disrupting business operations. environmental. regulatory considerations and general economic and business conditions. Enagas does not assume any obligation to update publicly any forward- looking statements. whether as a result of new information. future events or otherwise. Further information on factors which could affect the company's financial results is provided in documents filed by the company with the CNMV. Any data contained herein for periods 2000 and earlier was prepared by using historical proforma results. Proforma financial data is unaudited and calculated applying company's accounting principles. 26

ENAGÁS, S.A. Director of Regulation fpflor@enagas.es Tel: +34 91 709 93 10 www.enagas.es 27