BRIDGING THE GAS MARKETS IN EUROPE
CONTENTS
Fluxys in a nutshell
4
Vision
6
Mission
7
Strategy
8
Industrial partner
2
9
Shareholders with a long-term outlook
10
Motivated and committed professionals
12
Company values
13
Sound finances
14
Climate challenge
16
Advantages of natural gas and gas infrastructure
18
Ideal complement to renewable for power generation
20
Significant potential as a transport fuel
22
100% carbon-neutral gas supply by 2050
25
Transmission
26
Pipelines in Germany
28
Pipeline in Switzerland
30
Pipelines in the North Sea
31
Pipelines in Sweden
32
Trans Adriatic Pipeline (TAP)
33
Belgian grid: crossroads for international gas flows
34
Key role of the Zeebrugge area
38
FLUXYS 2015
FLUXYS 2015
Trading places: Zeebrugge Beach and ZTP
40
GMSL: operational support services and software
42
PRISMA: cross-border capacity booking platform for Europe
44
Integrated gas market for Luxembourg and Belgium
45
Storage
46
Underground storage in Belgium
48
Underground storage in Sweden
49
LNG terminalling
50
Zeebrugge LNG terminal
52
Dunkirk LNG terminal
60
Investments 2015-2024
62
In Belgium
64
In Europe
66
Commercial contacts
69
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FLUXYS IN A NUTSHELL • • • • •
Gas infrastructure company Present in 9 European countries 3 main activities: transmission, storage and LNG terminalling Major operator in the international transmission of natural gas Independent from any producer or supplier of gas or electricity
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FLUXYS 2015
FLUXYS 2015
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VISION EUROPE NEEDS NATURAL GAS AND FLUXYS BRIDGES THE MARKETS Natural gas will remain a core component of the energy mix in tomorrow’s low-carbon economy. Fluxys as gas infrastructure owner and operator aims to bridge the markets in Europe so that suppliers can move natural gas flexibly to their customers and between trading places.
BBL
INTERCONNECTOR
DUNKIRK LNG TERMINAL TRANSITGAS
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MISSION SWEDEGAS
NEL
• •
TENP
•
Connect liquid trading places and contribute to security of supply. Invest in infrastructure necessary for the market and operate infrastructure safely, efficiently and sustainably. Provide at competitive prices quality services tailored to market expectations.
TAP
Infrastructure in which Fluxys holds an interest.
FLUXYS 2015
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STRATEGY In a consolidating European market, Fluxys aims to strengthen its position as a crossroads of natural gas flows by pursuing the following objectives: Remain active in three activities. Fluxys is active in three core activities, namely transmission, storage and LNG terminalling. This diversified knowhow is a major asset in the European market to ensure profitable growth.
TRANSMISSION
Provide competitive and quality services to our clients. Fluxys is committed to competitive tariffs and services and investments that contribute to both security of supply and well-functioning markets. Further expand towards a broad asset base of gas infrastructure alongside future gas corridors. Starting from its central position in Belgium, Fluxys seeks to extend at a European level its role as a crossroads for international gas flows through long-term profitable investments in new infrastructure and existing assets.
STORAGE
Strengthen our expertise and partnerships. To implement its strategy, Fluxys values the development of its employees’ know-how and builds strong alliances with solid partners. LNG TERMINALLING
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FLUXYS 2015
INDUSTRIAL PARTNER • • • •
FLUXYS 2015
Long-term investor Focus on the development of infrastructure with a market bridging potential Responsible owner and operator of gas infrastructure Group with sound expertise in acquiring, developing and operating infrastructure
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SHAREHOLDERS
WITH A LONG-TERM OUTLOOK
Fluxys’ shareholders, both public and private, share the same vision of the company’s future: a long-term investment outlook and profitable business development. Over the past few years, shareholders have increased Fluxys capital by € 600 million.
SOLID PARTNERSHIPS To implement its strategy, Fluxys relies on alliances with solid partners, among which: • investment fund Global Infrastructure Partners (GIP) and the Swiss natural gas company Swissgas in FluxSwiss; • Italian gas infrastructure company Snam in the sub-sea pipeline Interconnector between United Kingdom and Continental Europe; • Spanish TSO Enagás in the Trans Adriatic Pipeline (TAP) and the Swedish gas grid; • French energy company EDF in the Dunkirk LNG terminal.
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> Publigas manages the shareholding of Belgian municipalities in Fluxys. > Caisse de dépôt et placement du Québec is a financial institution that manages funds primarily for public and private pension and insurance plans in Canada (Québec). Caisse has significant expertise in the infrastructure and gas transmission sector, particularly through its stakes in natural gas transmission and distribution companies in the United States, Canada and Europe. > Société Fédérale de Participations et d’Investissement is a Belgian federal holding set up to acquire on behalf of the Belgian State shareholdings in public and private companies of strategic economic importance to Belgium. > Employees and management had the opportunity to become Fluxys shareholders in 2012 and 2013.
FLUXYS 2015
Shares listed on NYSE Euronext Brussels
Publigas
77.7% Caisse de dépôt et placement du Québec
20% Société Fédérale de Participations et d’Investissement
2.1% Employees and management
0.2% FLUXYS 2015
10.03%
Golden Share held by the Belgian State
FLUXYS BELGIUM Regulated activities in Belgium
89.97% FLUXYS FINANCE Centralised management of cash funds and financing
100% FLUXYS EUROPE Non-regulated activities in Belgium and activities outside Belgium
100% 11
MOTIVATED AND COMMITTED PROFESSIONALS Fluxys can count on the expertise, commitment and motivation of over 1,100 staff in Belgium, France, Germany, Switzerland, the United Kingdom and Sweden. Around a fifth of these employees have been taken on in the past five years. With a view to implementing its strategy, Fluxys prioritises the development of its employees’ know-how and expertise and promotes professional growth through integration, training and competence management programmes.
NUMBER OF EMPLOYEES PER ACTIVITY
180 Support services
NUMBER OF EMPLOYEES PER COUNTRY Belgium: 998 France: 3 Germany: 16 Switzerland: 7 Great Britain: 79
SENIORITY 29 Community relations 81 Commercial
38% More than 15 years
19% Less than 5 years
37 Gas flow management
153 ICT
43% 5 – 15 years
507 Infrastructure operations BREAKDOWN MEN – WOMEN
114 Infrastructure: planning, projects and engineering 12
19%
81% FLUXYS 2015
COMPANY VALUES 1
CUSTOMER FOCUS We listen to our customers to provide competitive services tailored to their expectations.
2
COHESION We strive for cooperation and team spirit to jointly achieve our objectives.
PROFESSIONALISM & COMMITMENT We are committed to achieving our results by adopting an efficient approach and ensuring we are guided by best practices in everything we do. We systematically develop our expertise and continually seek innovative solutions at a reasonable cost.
RESPECT FOR SAFETY AND THE ENVIRONMENT We jointly give priority to the safety of our facilities because we are responsible for the transmission of an energy that entails risks. In the same spirit of sustainability, we strive to minimise the environmental impact of our operations whilst keeping a close eye on wellbeing at work.
4
GOOD NEIGHBOURLY RELATIONS We provide services of general economic interest and have to ensure our activities are properly integrated in society. Through open dialogue, we want to establish good relations and cooperate with all those affected by the construction and operation of our facilities. FLUXYS 2015
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5 13
SOUND FINANCES Fluxys has the financial resources to build and operate natural gas transmission infrastructure. To prepare itself for the investments needed to pursue its international strategy, Fluxys has a balanced financing structure with sound financial ratios. External financing products and terms are also diversified. In its financing, Fluxys always takes care to strike a right balance between the cost, duration, liquidity and diversification of financing sources. Moreover, Fluxys has undrawn credit facilities totalling €600 million, which allow the group to respond quickly to investment and acquisition opportunities. Fluxys’ shareholders are also willing to provide the equity needed for the group’s profitable industrial development.
FINANCIAL KEY FIGURES 2014 (in € millions)
FLUXYS Revenue: 940.8 EBITDA: 555.3 Net profit: *129.2 Equity: *1,879.4 Net debt: 2 ,131.4 Interest coverage ratio (FFO divided by net debt): 18% Debt coverage ratio (FFO + interest divided by interest): 5.1 Ratio of equity to debt (equity divided by equity + debt): 51% *group share
FLUXYS BELGIUM Regulated activities in Belgium Revenue: 613.2 EBITDA: 278.6 Net profit: 65.9 Net debt: 1,412.4 14
FLUXYS EUROPE Non-regulated activities in Belgium and activities outside Belgium
FLUXYS FINANCE Centralised management of cash funds and financing
Revenue: 332.4 EBITDA: 280.1 Net profit: 99.4 Net debt: 967.8 FLUXYS 2015
BORROWED FUNDS (in € millions) Retail Bond Bond issued for public investors in 2009: €350 million (2009-2015) 2500
Retail Bond Bond issued for public investors in 2012: €350 million (2012-2018)
Ba
Private Placement Bond issued for institutional investors: €300 million (2011-2017) 2000
Pla
Private Placement Placement for public investors amounting to €350 million: €250 million (2014-2029), €100 million (2014-2034)
Re
European Investment Bank: €85 million (2007-2017)
1500
European Investment Bank €400 million loan: €280 million (2008-2033), €120 million (2009-2034)
Ou
Project Financing: loan as part of the acquisition of a 46% stake in Swiss TSO: CHF 375 million (€305.5 million at 22/11/2011)
1000
500
0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034
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CLIMATE CHALLENGE To combat global warming, the European Union has set three targets by 2030: reducing greenhouse gas emissions by at least 40% below the 1990 level, increasing the share of renewable energy in the energy mix to at least 27% and increasing energy efficiency by at least 27%. To meet these targets, natural gas and natural gas infrastructure will have to continue to play a key role thanks to their numerous benefits in heating, power generation and as a fuel in the transport sector.
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ADVANTAGES
OF NATURAL GAS AND GAS INFRASTRUCTURE
IMPACT ON AIR QUALITY AND HEALTH
LOW CARBON FOOTPRINT
Natural gas has the lowest carbon footprint of all fossil fuels. Switching from petrol, diesel or heavy fuel oil to natural gas has an immediate impact on CO2 emissions as well as on air quality and health. • Up to 25% less CO2. • Up to 90% less nitrogen oxides. • The amounts of sulphur and particulate matters are negligible.
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MOST SUSTAINABLE AND COST-EFFECTIVE FORM OF TRANSMISSION
91
0
56 NATURAL GAS
20
COAL
40
73
GASOIL
60
HEAVY FUEL OIL
78
80
kg CO2/GJ
Intergovernmental Panel on Climate Change (IPCC)
Natural gas transmission infrastructure has a minimal impact on the environment compared with other forms of transmission. Moreover, natural gas infrastructure is a highly cost-effective technology for transmitting and storing energy. Compared with high-voltage installations, for example, natural gas infrastructure is up to 15 times cheaper at transmitting energy. In the future new power-to-gas technologies will make wind and photovoltaic power generation more efficient: it will be possible to convert the excess electricity generated by renewables into hydrogen or synthetic natural gas and feed it into gas networks. Eventually, natural gas flowing through transmission networks will also be made greener by injection of biogas (a gas produced from waste and mainly composed of methane) as is already the case in Scandinavia.
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NATURAL GAS CONVENTIONAL RESERVES IN BILLIONS M³
Other CIS countries
15,767
Russia
49,541
Europe
4,666
North America
11,545
34,020 24,681
Natural gas consumption within the 28 EU Member States amounts to approximately 410 billion m³ per year.
South America
14,386
Saudi Arabia + UAE
14,407
7,618
Asia – Oceania Source : Cedigaz Natural Gas In The World 2014 Edition
16,966
ABUNDANT RESERVES Proven conventional reserves of natural gas are large enough to cover global consumption at current levels for 60 years. If reserve estimates for unconventional sources are added to this, current global gas production could be sustained for almost 250 years. FLUXYS 2015
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IDEAL COMPLEMENT TO RENEWABLE
FOR POWER GENERATION
Natural gas-fired power stations are the ideal back-up solution to offset intermittent generation by renewable energy sources. They are more efficient in terms of atmospheric emissions, are more energy-efficient than their oil and coal counterparts, have the lowest investment costs, the shortest construction times and the highest operational flexibility. However, power generation using natural gas is currently undergoing a difficult time in Europe. Natural gas is being squeezed out of the energy mix by low coal prices, price floors for CO2 emission rights and a market model for electricity which doesn’t adequately integrate the growing proportion of renewable power generation.
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FLUXYS 2015
ENERGY EFFICIENCY 3 MWh of thermal energy
0.7 tonnes CO2
EFFICIENCY 32-34%
OIL 1 MWh 2.5 MWh of thermal energy
0.9 tonnes CO2
EFFICIENCY 34-35%
COAL
PRIMARY ENERGY USE IN THE EU IN 2013
1 MWh 2 MWh of thermal energy
0.4 tonnes CO2
NATURAL GAS
0.8% 12.4% EFFICIENCY 48-58%
23.1%
17.2%
1 MWh
13.4%
The current situation, in which renewable generation is supplemented by electricity from coal-fired power stations, is also at odds with climate targets: combining wind and solar with coal-fired power plants generates far higher CO2 emissions than combining renewables with natural gas-fired power plants. In its energy policy, the European Union should revise the model for electricity so that natural gas-fired power stations can provide a back-up for renewable generation at satisfactory levels of profitability. FLUXYS 2015
Natural gas Nuclear Oil products Solid fossil fuels Renewables Other
Source : Eurogas, Statistical Report 2014
33.1%
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SIGNIFICANT POTENTIAL AS A TRANSPORT FUEL Within the 28 Member States of the European Union, 25% of CO2 emissions linked to energy combustion are transport-related. With an emission profile that outperforms other fossil fuels in all areas, natural gas has a very promising future as a transport fuel. The challenge is to develop the infrastructure needed to allow cars, trucks and ships to fill up easily with natural gas, as promoted in the European directive on the deployment of alternative fuels infrastructure.
SHIPPING More stringent standards came into effect on 1 January 2015, creating Sulphur Emission Control Areas (SECAs) for shipping in the English Channel, North Sea and Baltic Sea, among others. Thanks to its low emission values, liquefied natural gas (LNG) is a particularly good alternative fuel for ships and Fluxys continues to work with the various port authorities in Belgium and Germany to examine what investments are needed in the relevant ports to further develop LNG as a shipping fuel. Fluxys is pulling out all the stops to develop the Zeebrugge LNG terminal into a hub for small-scale LNG. When the second jetty currently being built comes into service, the Zeebrugge LNG terminal will accommodate all kinds of ships and will be an essential link in the logistical chain for the supply of LNG as a fuel for shipping, inland waterways and road transport.
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CO2 EMISSIONS FROM FUEL COMBUSTION IN THE EU28 IN 2012
11.7%
2.1% 0.9%
5%
25.2%
40%
15.1%
Source: European Environment Agency
Energy industry Manufacturing industries and construction Transport Commercial / Institutional activities Residential Agriculture / forestry / fishing Other fugitive emissions and emissions from fuel combustion
FLUXYS 2015
LONG-DISTANCE HAULAGE LNG is also an ideal alternative to traditional fuels for long-distance haulage trucks. In 2014, the first LNG filling station in which Fluxys invested was opened in Furnes on the premises of haulage operator Eric Mattheeuws. The station is supplied by tanker trucks coming from the Zeebrugge LNG terminal. Fluxys is also involved in Blue Corridor, a European project that aims to install LNG filling stations on major motorways for use by haulage trucks.
FLUXYS 2015
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CARS, VANS AND BUSES Compressed natural gas (CNG) is a tried-and-tested technology that can be used in cars, vans and buses. Currently, over a million vehicles run on CNG in Europe, mainly in Germany and Italy, and automotive manufacturers offer a wide range of models. In Belgium, Fluxys is active within the Belgian Natural Gas Vehicle Association (NGVA.be), which is involved in promoting natural gas as a fuel and the provision of suitable supply infrastructure for vehicles. The number of natural gas-powered vehicles in Belgium has risen from 700 in 2013 to around 2,000 in early 2015, and the network of CNG filling stations continues to expand. Fluxys is also examining the possibility to convert to CNG captive fleets in Belgium, such as public transport and waste collection companies.
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FLUXYS 2015
100% CARBON-NEUTRAL GAS SUPPLY BY 2050 Fluxys Belgium and gas infrastructure companies Energinet.dk (Denmark), Gasunie (the Netherlands), GRTgaz (France), Swedegas (Sweden), Gaznat (Switzerland) and Ontras (Germany) made a joint commitment to play an active part in tackling climate change by transporting 100% carbon-neutral gas in their infrastructure by 2050. To achieve their common objective, the seven companies are cooperating closely and exchanging expertise in order to implement the various options and examine how they can be combined to meet the specific energy needs of each country. Key areas of cooperation: • CNG and LNG as fuel for road and maritime transport • Green gas (on the basis of biogas and gasification of biomass) and development of green certificates • Power-to-gas technologies and the injection of hydrogen or synthetic methane into natural gas transmission networks.
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TRANSMISSION Thanks to its shareholdings in key European transmission infrastructure, the position of its Belgian grid as a natural gas crossroads and the major role of the Zeebrugge area, Fluxys provides access to a wide range of natural gas sources and occupies a central position on the east-west and north-south transmission axes supplying Europe.
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Pipe gas LNG Future flows
SWEDEGAS
GTF
NEL BBL NBP
TTF
INTERCONNECTOR
GASPOOL
DUNKIRK LNG TERMINAL ZTP
TENP
NCG
PEG N
CEGH TRANSITGAS PEG S
PSV PEG TIGF
CDG TAP
Infrastructure in which Fluxys holds an interest Trading place
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PIPELINES IN GERMANY NEL PIPELINE (NORTH EUROPEAN GAS PIPELINE) •
•
The NEL pipeline in Germany accommodates flows from the Nord Stream pipeline, which brings Russian natural gas to Europe. The NEL moves these flows inland Germany from where they can be brought to other countries, in particular to Belgium, the Netherlands, France and the United Kingdom. Fluxys Deutschland markets some 24% of the capacity in the NEL pipeline
NEL (440 KM)
20 billion m³/year
NEL
TENP INFRASTRUCTURE (TRANS EUROPA NATURGAS PIPELINE) TENP
• •
The TENP infrastructure links the Belgian and Dutch markets to the German market and the Swiss grid. Fluxys TENP markets some 64% of the capacity in the TENP pipeline, is a 10%-partner in NetConnectGermany (NCG) and intensively cooperates with a view to developing this market area.
PARTNERS: • NEL: Wingas (51%), Gasunie (25.13%), Fluxys (23.87%). • TENP: Open Grid Europe (51%), Fluxys (49%).
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TENP (1,000 KM)
23 billion m³/year
FLUXYS 2015
FLUXYS INFRASTRUCTURE: A SOLUTION OF CHOICE FOR THE GERMAN GAS MARKET The Dutch and German production of low-calorific gas will decline from 2020 onwards and has to be substituted with additional natural gas imports for a total of 50 billion m³. Germany alone accounts for 30 billion m³ and the country actively seeks to diversify its supply. Fluxys infrastructure can largely contribute to the diversification of sources for the German market. Today, the NEL pipeline already transmits Russian gas flows to Germany, whilst the Zeebrugge LNG terminal and the Belgian grid of Fluxys are a gateway of choice for LNG sources into the European gas markets, and especially into the German market. When the Dunkirk LNG terminal will be commissioned at the end of 2015, Fluxys will offer a second entry point for additional LNG flows to Germany. Moreover, the investments decided by Fluxys to make the TENP (Germany) and Transitgas (Switzerland) infrastructure work in both directions will make it possible for gas to flow from Italy to Northern Europe. This will open countries like Switzerland, France and Germany to sources available in Italy and coming from Russia, the Caspian Sea, Africa and the Near East region. Besides, Fluxys has decided to connect the NEL pipeline to the NETRA (Norddeutsche Erdgas Transversale) pipeline, opening up the German market of NetConnectGermany (NCG) to Russian gas flows from the Nord Stream infrastructure.
FLUXYS 2015
NEL
TENP DUNKIRK LNG TERMINAL
TRANSITGAS
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PIPELINE IN SWITZERLAND • •
Transitgas is a pipeline linking the German market to the Swiss market as well as to the French and Italian grids. FluxSwiss markets 90% of the capacity in the Transitgas pipeline.
PARTNERS: Swissgas (51%), FluxSwiss (46%), E.ON Ruhrgas (3%).
TRANSITGAS (300 KM)
26 billion m³/year
TRANSITGAS
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PIPELINES IN THE NORTH SEA •
•
The Interconnector and BBL pipelines are the two physical links for natural gas flows between the United Kingdom and continental Europe. The Interconnector pipeline moves natural gas in both directions between Zeebrugge and Bacton. The BBL pipeline moves natural gas between Balgzand (The Netherlands) and Bacton (United Kingdom). Interconnector and BBL users can reach the natural gas markets of continental Europe and the United Kingdom by transporting natural gas through these pipelines or trading it between the gas trading places connected through the pipelines: > Interconnector: the trading points in Belgium and the National Balancing Point (NBP) in the United Kingdom > BBL: TTF in the Netherlands and NBP in the United Kingdom.
INTERCONNECTOR (235 KM)
Zeebrugge – Bacton: 25 billion m³/year Bacton – Zeebrugge: 20 billion m³/year
BBL
INTERCONNECTOR
PARTNERS: • Interconnector: Caisse de dépôt et placement du Québec (33.5%), Gasbridge 1 (partnership Snam/Fluxys: 15.75%), Gasbridge 2 (partnership Snam/Fluxys: 15.75%), Fluxys (25%), Gazprom (10%). • BBL: Gasunie (60%), E.ON Ruhrgas (20%), Fluxys (20%). PIPELINE BALGZANDBACTON (230 KM)
Balgzand – Bacton: 15 billion m³/year Bacton – Balgzand: non-physical flows possible since 2010
FLUXYS 2015
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PIPELINES IN SWEDEN The Swedegas network is comprised of 600 km pipelines as well as the underground storage facility of Skallen near Halmstad. Swedegas is also developing a terminal in Gothenburg (participation Swedegas of 40%) for bunkering and small scale LNG. PARTNERS: Fluxys (50%), Enagás (50%).
PIPELINES IN SWEDEN (600 KM)
1.2 billion m³/year
SWEDEGAS
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FLUXYS 2015
TRANS ADRIATIC PIPELINE (TAP) TAP is a pipeline project, which is part of the infrastructure that will open up the so-called Southern Gas Corridor and will accommodate the supply of natural gas from Azerbaijan to a wide array of markets in Europe. TAP will connect with the Trans Anatolian Pipeline (TANAP) near the Turkish-Greek border at Kipoi and will transport natural gas from Azerbaijan through Greece, Albania and the Adriatic Sea to Southern Italy.
TAP (880 KM)
10 billion m³/year with a possible extension to 20 billion m³/year
PARTNERS: BP (20%), SOCAR (20%), Statoil (20%), Fluxys (19%), Enagás (16%), Axpo (5%). TAP
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BELGIAN GRID:
CROSSROADS FOR INTERNATIONAL GAS FLOWS As Belgium does not produce natural gas, Fluxys’ strategy has always been to anchor the country’s security of supply on cross-border flows to other countries. As a result, Fluxys has developed its Belgian grid into a crossroads for natural gas flows in North-Western Europe. Today, the benefits of Fluxys’ crossroads strategy for the Belgian market are: • a very high level of security of supply at competitive transmission tariffs; • a broad diversification of sources; • an excellent interconnectivity with grids in neighbouring countries; • the good functioning of the Belgian market. Cross-border natural gas flows attract many players to the Belgian market and thus promote circulation of large volumes of natural gas, which, in turn, prompts greater competition and impacts positively on natural gas prices in Belgium.
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BELGIAN GRID (4,100 KM)
Entry capacity at the borders: 113 billion m³/year Exit capacity at the borders: 80 billion m³/year
FLUXYS 2015
LNG
NETHERLANDS
NORWAY
ZELZATE
UNITED KINGDOM
NETHERLANDS ZANDVLIET POPPEL
Loenhout ZEEBRUGGE
Antwerpen
Brugge
Sint-Niklaas
Kortrijk
NORWAY / GERMANY
Mechelen
Gent Aalst
DILSEN
Winksele
Genk ‘S-GRAVENVOEREN
Brussels
NORWAY / GERMANY
Berne eau
RUSSIA / GERMANY
Liège
Tournai
V rv Ve r iers
EYNATTEN
Namur Cha Ch arleroi Mons Mo
BLAREGNIES
BRAS FRANCE SPAIN ITALY
Basto ogne Libramont
4,100 KM PIPELINES
Arlon
LUXEMBOURG
PÉTANGE
LUXEMBOURG
Interconnection points LNG Terminal Compressor stations Storage Blending stations
FLUXYS 2015
High calorific gas Low calorific gas 35
UPSTREAM: EXCELLENT INTERCONNECTION With 18 interconnection points, the Belgian grid of Fluxys is connected to all available natural gas sources for the European market: • natural gas supply by pipeline from Norway, the United Kingdom, the Netherlands, Germany and Russia; • LNG supply from producing countries through the Zeebrugge LNG terminal.
DOWNSTREAM: OPTIMUM FLEXIBILITY The Belgian grid gives users optimum destination flexibility for their gas flows. Any LNG or pipe gas brought into Belgium can be transmitted through the Fluxys network: • for consumption on the Belgian market; • for trading on the Belgian gas trading places: Zeebrugge Beach and Zeebrugge Trading Point (ZTP); • for redelivery at the borders and trading on other gas trading places or consumption on end user markets throughout Europe: the United Kingdom, the Netherlands, Germany, the Grand Duchy of Luxembourg, France and Southern Europe.
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197 large industrial end users 17 combined heat and power units FLUXYS GRID High pressure
18
interconnection points Entry capacity: 113 billion m³/year
4,100 km
17
~ 60 active grid users
Networks of distribution system operators
70,000 km
Transmission for consumption on the Belgian market
17 billion m³/year
Low pressure
2.9 million households
100,000 SME’s
19 power stations
Border-to-border transmission to neighbouring grids Exit capacity:
80 billion m³/year
Interconnection points LNG Terminal Trading place Storage
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KEY ROLE OF THE ZEEBRUGGE AREA Over the years, Fluxys has developed the Zeebrugge area as a cornerstone of security of supply in North-Western Europe. The infrastructure in the Zeebrugge area has a combined landing capacity of about 50 billion cubic metres per year, corresponding today to more than 10% of the border capacity needed for supplying the entire European Union.
Interconnector pipeline from and to United Kingdom
INTERCONNECTOR TERMINAL 1998 To Zeebrugge: 20 billion m³/year To United Kingdom: 25 billion m³/year LNG TERMINAL: liquefied natural gas arrives at the Fluxys LNG terminal onboard LNG carriers coming from gas-producing countries. Zeepipe terminal: Gassco’s Zeepipe terminal connects Fluxys’ Belgian grid to the subsea Zeepipe pipeline, which transmits natural gas from the Norwegian Troll and Sleipner gas fields. Between the Zeepipe terminal and Blaregnies on the French border, Fluxys laid two Troll pipelines to transit Norwegian natural gas to France and southern Europe.
ZEEBRUGGE BEACH 1998 Traded volumes: 66 billion m³/year
Interconnector terminal: the Interconnector terminal connects Fluxys’ Belgian grid to the Interconnector subsea pipeline that can transmit natural gas in both directions between Zeebrugge and Bacton in the United Kingdom. As an extension to the Interconnector, Fluxys has a bidirectional infrastructure that connects Zeebrugge to the Netherlands and Germany, enabling it to transmit natural gas in both directions between the continental European gas markets and the United Kingdom. Zeebrugge Beach: Zeebrugge Beach was the first natural gas trading place on the European continent and today remains one of the largest spot markets for natural gas entering the Zeebrugge area. 38
FLUXYS 2015
LNG TERMINAL 1987 9 billion m³/year
Zeepipe pipeline from Norwegian natural gas fields
ZEEPIPE TERMINAL 1993 15 billion m³/year
FLUXYS’ BELGIAN GRID
FLUXYS 2015
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TRADING PLACES:
ZEEBRUGGE BEACH AND ZTP
Natural gas trading places are proving increasingly popular in Europe. Thanks to the Zeebrugge Beach and ZTP trading places, the Belgian grid offers market participants a wide range of trading opportunities. As such, it reflects the European Union’s vision of an integrated European gas market: a unified system of optimally interconnected transmission grids that suppliers and producers can access through flexible entry/exit systems, plus trading places where they can buy and sell natural gas.
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FLUXYS 2015
ZEEBRUGGE BEACH AND ZTP > Zeebrugge Beach: bilateral trading of natural gas in the Zeebrugge area.
TTF
NBP
GASPOOL ZEE BEACH / ZTP
> Zeebrugge Trading Point (ZTP): every cubic metre of natural gas entering Fluxys’ Belgian grid is automatically available at the virtual trading point ZTP, where suppliers and traders can buy and sell natural gas easily using bilateral contracts or via the ICE-Endex and Pegas exchange platforms. ZTP also allows companies connected to Fluxys’ Belgian grid to buy natural gas directly on the trading place.
NCG PEG NORD
ZEEBRUGGE BEACH : 50 active companies Total traded volume in 2014: 747.1 TWh
PEG L
PSV
FLUXYS 2015
ZEEBRUGGE TRADING POINT: 27 active companies Total traded volume in 2014: 96.4 TWh
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GMSL :
OPERATIONAL SUPPORT SERVICES AND SOFTWARE All players throughout the natural gas chain from producers, LNG importers, traders, suppliers to major consumers can call in the operational support services of GMSL (24 hours a day, seven days a week) to outsource their nominations and allocations of natural gas between sources and end users. These operational support services are offered on the major European grids (the Netherlands, France, Germany, Austria, Italy, Switzerland, Belgium, the United Kingdom and Ireland) as well as for the subsea pipelines and the natural gas production fields in the North Sea.
42
FLUXYS 2015
GMSL deploys its operational expertise and experience to develop software for monitoring gas movements and transfers. This specialist software is sold to market players wishing to manage their gas flows through the European grids themselves.
Geographical scope of operational services FLUXYS 2015
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PRISMA :
CROSS-BORDER CAPACITY BOOKING PLATFORM FOR EUROPE Fluxys Belgium, Fluxys TENP and 20 other transmission system operators have set up the European Capacity Platform PRISMA. The joint platform is used to auction cross-border capacity at the interconnection points in the Netherlands, Austria, Belgium, Denmark, Germany, France, Italy and the United Kingdom. PRISMA is a major step towards an integrated European gas market: the platform brings together the gas markets of eight countries in the heart of Europe and works according to the capacity allocation mechanisms set forward in the corresponding European network code.
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INTEGRATED MARKET
FOR LUXEMBOURG AND BELGIUM
Fluxys Belgium, Luxembourg TSO Creos Luxembourg and their respective regulators are cooperating closely to integrate the Belgian and Luxembourg national markets by the end of 2015. This initiative, reflecting the European Union’s ambition to create a borderless European gas market, will be the first market integration between two EU Member States. It will also provide a useful experience for further integration with other operators in neighbouring countries.
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STORAGE In Belgium, Fluxys has been operating a storage facility at Loenhout near Antwerp for more than 25 years. Fluxys together with Spanish TSO Enagás also owns the underground storage facility of Skallen in Sweden.
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UNDERGROUND STORAGE IN BELGIUM On Fluxys’ storage facility at Loenhout, natural gas is stored underground at a depth of over one kilometre. The workable volume of 700 million m³ as well as the injection and emission capacities are made available to customers as a flexibility means to secure continuity of their supply by peak demand or their activity on the natural gas trading places.
SERVICE OFFERING TAILORED TO THE NEEDS OF EACH CUSTOMER Market players wishing to book storage capacity at Loenhout can choose between annual contracts and long-term contracts (from 2 to 10 years). Faced with a growing flexibility offer in Europe, Fluxys is making every effort to develop products and services that meet changing market needs. This creative approach lead the company to be awarded Gas Storage Operator of the Year at the 2015 European Gas Conference in Vienna.
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UNDERGROUND STORAGE IN SWEDEN In the underground storage of Skallen in the southwest of Sweden, natural gas is stored in a rock cavern at a depth of over 100 metres. The workable storage volume of the site amounts to 8.6 million m³.
Fluxys’ underground storage site in Loenhout near Antwerp.
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LNG TERMINALLING As natural gas production in the European Union declines, LNG has an increasingly important role to play in safeguarding Europe’s long-term security of supply. Through its activities at the Zeebrugge terminal and the terminal under construction at Dunkirk, Fluxys has built up a strong position on the LNG terminalling market.
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ZEEBRUGGE LNG TERMINAL LNG GATEWAY TO NORTH-WESTERN EUROPE Fluxys’ Zeebrugge LNG terminal offers its users maximum flexibility. Not only is it one of the few terminals in the world that can accommodate all types of LNG ships in circulation, from the smallest (7,500 m³) to the biggest (266,000 m³), but it also opens up a whole range of possible destinations for its users’ natural gas. Any LNG unloaded at the Zeebrugge LNG terminal can be: • traded at Belgian trading places; • moved via Fluxys’ Belgian grid to supply the Belgian market or other end-user markets in Europe: the United Kingdom, the Netherlands, Germany, Luxembourg and France; • loaded onto LNG ships or trucks and transported to other markets.
Berthing capacity: 110 LNG carriers/year
Cycling storage: 380,000 m³ of LNG
Belgian gas trading places Belgian market Neighbouring countries
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THE ZEEBRUGGE LNG TERMINAL IN FIGURES > Capacity of 9 billion m³ natural gas per year. > Around 1,500 LNG carriers berthed to date, carrying a total of 78 million tonnes of LNG. > 4 tanks offering cycling storage capacity of 380,000 m³ of LNG. > Send-out capacity into Fluxys’ Belgian grid: 1,700,000 m³(n)/h.
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WIDE RANGE OF SERVICES FOR LARGE- AND SMALL-SCALE LNG For over 25 years, Fluxys has continuously developed its service offering and increased the terminal’s capacity in line with market needs and expectations. Today, the Zeebrugge LNG terminal has become a veritable LNG crossroads, playing a leading role in the supply of natural gas to North-Western Europe, serving many users and offering a whole package of services for large- and small-scale LNG use.
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SHIP UNLOADING AND LOADING SERVICES Today, the Zeebrugge LNG terminal can accommodate 110 LNG carriers per year. When it was commissioned in 1987, it was intended as a ship unloading facility. In 2008, Fluxys proactively developed vessel loading services in response to demand from users wanting to capitalise on the commercial opportunities available on the LNG market. To date, some 1,500 LNG carriers have berthed at Zeebrugge: a hundred of them have used the terminal’s loading services, bound for a variety of destinations in Europe, South America, Asia and the Middle East. FLUXYS 2015
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TRUCK LOADING SERVICES The Zeebrugge LNG terminal can load 4,000 tanker trucks per year. Transporting LNG by road supports the use of natural gas in a broader range of applications: • supply of European industrial sites not connected to a pipeline network; • supply of ships using LNG as a fuel; • supply of filling stations for long-distance haulage trucks using LNG as a fuel. The truck loading service is proving extremely popular. Once loaded, the trucks mostly head to Belgium, the UK, the Netherlands, Germany, France, Switzerland, Sweden, Norway and Poland.
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LNG TRANSSHIPMENT SERVICES As from 2018, Fluxys will offer LNG transhipment services to Yamal LNG which is currently constructing an LNG production facility in North-East Siberia. Icebreaker LNG tankers will be able to berth at the terminal and transfer their LNG cargo to conventional LNG vessels that will make final delivery to the target markets. The transshipment services require the construction of a fifth LNG storage tank to serve as a buffer between unloading and loading operations.
LNG TRANSSHIPMENT SERVICES > 214 transshipment operations per year > Storage capacity needed: 180,000 m³ LNG. FLUXYS 2015
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SECOND JETTY UNDER CONSTRUCTION A second jetty is currently under construction at the LNG terminal. When it will enter into service, the second jetty will be able to accommodate both small and large LNG carriers, with capacities of between 2,000 m³ and 217,000 m³ of LNG. Small bunker vessels will be able to fill up with LNG in order to refuel other LNG-powered ships. Over 200 small-carrier loadings already have been reserved by new users at the second jetty. With this new facility, the Zeebrugge LNG terminal continues to evolve towards a hub for small-scale LNG, i.e. as a fuel for ships and long-distance haulage trucks. Under the TransEuropean Transport Network (TEN-T) policy, the European Commission has decided to award Fluxys a grant to build the facilities enabling small-scale LNG development at the Zeebrugge LNG terminal.
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SUPPLY CHAIN FOR LNG AS A FUEL IN TRANSPORT Seagoing ships Maritime bunker ship AS FROM END 2015
Bunker vessel LNG bunker terminal for seagoing ships
Zeebrugge LNG terminal
Inland ships LNG bunker terminal for inland ships
SINCE 2010 LNG tanker truck Industry
LNG refuelling station FLUXYS 2015
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DUNKIRK LNG TERMINAL Fluxys is a 25% partner in the LNG terminal being built at Dunkirk, alongside EDF (65%) and Total (10%). Fluxys also has a 49% stake in GazOpale, the joint venture established with the owner of the terminal Dunkerque LNG (51%) to operate the future facility. The terminal is due to be operational by the end of 2015 and will have a capacity of 13 billion m³ of natural gas per year. Thanks to new interconnections with the Fluxys grid, this new capacity can also be made available to the market in North-Western Europe, which will contribute significantly to strengthening security of supply and to the effective functioning of the market in this area.
The Dunkirk LNG terminal will have a jetty, three cycling storage tanks for LNG with a capacity of 190,000 m³ of natural gas each and a regasification facility with an annual capacity of 13 billion m³ of natural gas. Cooling water from the nearby Gravelines nuclear power station will be reused to regasify the LNG. 60
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INTERCONNECTION TO THE FRENCH AND BELGIAN NETWORKS: THE DUNKIRK – ZEEBRUGGE LINK Alongside construction of the LNG terminal in Dunkirk, Fluxys and French transmission system operator GRTgaz are currently building a pipeline between Dunkirk and Zeebrugge to link the Dunkirk LNG terminal as a new gas entry point for Europe to the French and Belgian transmission networks. This will allow up to an additional 8 billion m³ of natural gas to be transmitted to Belgium and Europe from the Dunkirk LNG terminal.
ZEEBRUGGE DUNKIRK
The Dunkirk-Zeebrugge pipeline project is a first in Europe. Fluxys Belgium will be the first TSO in Europe to offer cross-border capacity through one single contract. To this end, Fluxys Belgium has booked long-term capacity with GRTgaz from Dunkirk to the French-Belgian border.
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INVESTMENTS 2015-2024 Taking into account the evolution of the market, Fluxys updates annually the investments needed over the next ten years in its three core activities: transmission and storage of natural gas and terminalling of liquefied natural gas (LNG). Over the period 2015-2024, the investments planned in infrastructure in Belgium and Europe exceed €2 billion.
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IN BELGIUM Almost €1 billion was invested in infrastructure in Belgium between 2010 and 2014, bringing the Belgian grid to full maturity as an appropriately-sized network, with significant entry capacity, bidirectional, free from congestion and well interconnected with other gas transmission systems in North-Western Europe. Over the period 2015-2024, Fluxys’ indicative investment programme in Belgium amounts to €949 million and the key objectives are: • reinforcing the role of the Belgian grid as a natural gas crossroads for North-Western Europe; • opening up the grid to as many sources as possible to reinforce the security of supply of Belgium and a good market functioning; • making new capacity available to cover the expected evolution in domestic consumption; • maintaining the security, integrity and reliability of the infrastructure; • systematically reducing the environmental impact of the company’s activities.
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Weelde
ZEEBRUGGE
Oud-Turnhout
Maldegem
Tessenderlo Gent WESTHOEK Alveringem
Haren
Winksele
Diest ‘S-GRAVEN A AVEN VOEREN
Poelkapelle
Kraainem Jesus-Eik
Overijse Berneau
EYNATTEN A ATTEN
Burgo Virton
Over 40% of Fluxys’ indicative investment programme in Belgium is earmarked for three major projects: > laying of the Alveringem – Maldegem pipeline, the Belgian part of the Dunkirk-Zeebrugge link which will connect the future Dunkirk LNG terminal to the Zeebrugge area (see page 61); > construction of a second jetty at the Zeebrugge LNG terminal (see page 58); > construction of a fifth tank at the Zeebrugge LNG terminal for LNG transshipment services (see page 57). FLUXYS 2015
Interconnection point LNG terminal New compression capacity Under construction Confirmed Under study 65
IN EUROPE Fluxys plans to invest over €1 billion in its infrastructure in Europe over the period 2015-2024. Its priority investment areas in Europe are: • strengthening security of supply and source diversification for the European market (thanks to participations in projects such as the TAP pipeline and the Dunkirk LNG terminal); • facilitating the circulation of gas flows; • boosting liquidity at trading places (particularly through the reverse flow project from Italy to the North of Europe).
SWEDEGAS
BBL
NEL
INTERCONNECTOR
REVERSE FLOW DUNKIRK LNG TERMINAL
TENP
TRANSITGAS
TAP
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REVERSE FLOW: BRIDGING THE SOUTH AND NORTH OF EUROPE On the route between the United Kingdom and Italy, the Interconnector pipeline linking the UK to Belgium and Fluxys’ Belgian grid are the only two pieces of infrastructure capable of moving natural gas in both directions. The TENP and Transitgas networks in Germany and Switzerland and the Italian grid are only designed for north-south flows. Fluxys has decided to invest in making the TENP and Transitgas pipelines bidirectional. These investments are aligned with the reverse flow project of Italian operator Snam. From summer 2018, physical gas flows will be able to move north from Italy through Switzerland and Germany. The development of south-north capacity will boost security of supply for North-Western Europe and offer additional supply opportunities from Italy where gas is landing from Africa and Russia and will soon provide access to further sources from Azerbaijan once the Southern Gas Corridor is operational. The development of south-north capacity will also enhance market liquidity by connecting the Italian PSV, German NCG, Belgian ZTP and UK NBP trading points.
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NORTH EUROPEAN GAS PIPELINE (NEL): INTERCONNECTION WITH THE GERMAN NCG MARKET Fluxys took the decision to invest in a physical connection between the NEL pipeline and the NETRA (Norddeutsche Erdgas Transversale) pipeline. This connection will create a second exit point on the NEL pipeline, which transports Russian gas flows from the Nord Stream pipeline, and is to link the NEL pipeline to the German market of NetConnectGermany (NCG). More information about the NEL pipeline can be found on page 28.
TRANS ADRIATIC PIPELINE (TAP) Fluxys has a 19% investment in the laying of the Trans Adriatic Pipeline (TAP), part of the Southern Gas Corridor that will move natural gas from Azerbaijan to European markets. See page 33 for more details.
DUNKIRK LNG TERMINAL Fluxys holds a 25% stake in the construction of the Dunkirk LNG terminal as a new entry point for natural gas into Europe. See page 60 for more details.
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COMMERCIAL CONTACTS
Acquisitions & Business Development
Fluxys Deutschland
Ben De Waele
Friedrich Rosenstock
+32 2 282 74 40
+49 211 230 94 502
[email protected]
[email protected]
Fluxys Belgium
LNG activities
Huberte Bettonville
Pieterjan Renier
+32 2 282 76 96
+32 2 282 62 07
[email protected]
[email protected]
Fluxys TENP
Trading services on ZTP and Zeebrugge Beach
Dirk Goebels
+32 2 282 77 77
+49 211 420 90 924
[email protected]
[email protected] GMSL FluxSwiss
John Fitzpatrick
Raphaël De Winter
+44 1223 446 160
+41 91 910 93 01
[email protected]
[email protected]
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Unless indicated otherwise, the figures and numbers in this publication reflect the situation as at 31 December 2014. When referring to capacities or volumes in cubic metres, it is understood that these are normal cubic metres (a cubic metre of natural gas at a temperature of 0°C and a pressure of 101,325 Pa). 70
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Fluxys – Registered office Avenue des Arts 31 – B-1040 Brussels www.fluxys.com VAT BE 0827.783.746 RLP Brussels – D/2015/12.604/3 May 2015 Responsible publisher: Rudy Van Beurden Design: www.spade.be Copyright photos: Fluxys, P. Henderyckx, M. Provost, photo libraries Transitgas and Dunkerque LNG, R. Baes, E. Manderlier.
