OS 2015: Information Memorandum Draft proposal 12 th SG meeting

1. OS 2015: Information Memorandum Draft proposal 12th SG meeting Madrid 7th May 2010

2. Index Introduction: final documentation and Info Memo contents Capacities Infrastructures Schedule Requirements to participate Contact details Allocation rules

3. 1 Introduction Final documentation and Info Memo contents

4. Final documentation • The information presented here reflects the contents of the draft Information Memorandum as of 5th May 2010. • The conditions under which the Open Season will be developed will be established by the final Information Memorandum. Its publication is expected as from 11th May 2010, once all preliminary arrangements required are completed. • No relevant changes to the current draft Information Memorandum are expected.

5. Info Memo contents STRUCTURE OF THE INFORMATION MEMORANDUM • Introduction. • Market structure. • Marketing of capacities. • Schedule. • Tariff regulation. • Economic Test. • Requirements to participate in the OS. • Joint Allocation Office. • Contact. • Appendices. NRAs

6. Info Memo contents APPENDICES: Available capacities. New investments description. Allocation rules for 2015 capacities. Application form. Letter of Commitment. Non-Disclosure Agreements (Spain). Non-Disclosure Agreements (France).

7. 2 Capacities

8. Market structure • Same market structure as for the 1st Phase, with three balancing zones in France and one in Spain:

9. Physical projects • MidCat: • Biriatou: • GRTgaz North – GRTgaz South link:

10. Interconnection Points (IPs) • For commercial purposes, capacity is offered at 6 Interconnection Points:

11. Commercial capacities Only annual capacities are considered. No seasonal capacities are offered. Commercial capacities (2015 capacities) correspond to: • 3 possible physical development scenarios for MidCat (MC0, MC1 and MC2), • 2 possible physical development scenarios for Biriatou (B0 and B1), • 4 feasible combinations between them (MC2+B1, MC2+B0, MC1+B0, and MC0+B0). In addition, the commercial capacities between GRTgaz North – GRTgaz South correspond to 2 possible physical scenarios (NS0 and NS1) which can be combined with the 9 scenarios above, and which depend on the economic test to be applied to the investment project between GRTgaz North and GRTgaz South. • These total 18 possible commercial scenarios. MC2+B1+NS1 will be the Reference Case for determining the maximum amount of capacity that can be requested by a shipper or group of companies

12. Commercial capacities, assuming NS1

13. Commercial capacities, assuming NS0

14. 3 Infrastructures

15. Infrastructures associated to development scenarios

16. Infrastructures related to the MidCat project France Spain

17. Infrastructures related to the Biriatou project France Spain

18. Infrastructures related to GRTgaz link project France

19. 4 Schedule

20. Schedule

21. Schedule

22. 5 Requirements to participate in the OS

23. Requirements to participate in the OS NON-DISCLOSURE AGREEMENT • Shippers willing to participate in the OS must sign and submit the relevant Non-Disclosure Agreement (NDA): • It is also recommended to sign, in any case, the NDA with Enagás, as Joint Allocation Office. • Shippers having already signed and submitted the corresponding NDA during the 1st phase of the OS do not need to take any further action, since the NDAs remain valid for the Open Season being the second phase. LICENSES • In France, a shipper is required to have a valid license for the gas networks before the signing date of the transmission contract • In Spain, a communication of the starting of activity, and a declaration that all duties are fulfilled, is required to develop the shipping activity for companies based in EU Members.

24. 6 Joint Allocation Office and Contact details

25. Joint Allocation Office • Applications form(s) together with the corresponding letter(s) of commitment (being the latter an integral part the Application Form) should be sent to: • All Application Forms and Letters of Commitment should be received by the Joint Allocation Office by the “Closing date for capacity requests reception”. Joint Allocation Office Enagás, DATR Paseo de los Olmos, 19, 3A 28005 Madrid Spain e-mail: openseason@enagas.es

26. Contact • Any requests for additional information should be sent to: Enagás, S.A. Dirección de Gestión ATR Att. Fernando Impuesto Nogueras Paseo de los Olmos, 19 28005 MADRID Spain e-mail: dgia.gestionatr@enagas.es GRTgaz Direction Commerciale Att. Carole Baron 2 rue Curnonsky 75017 PARISFrance e-mail: acces-reseau-accueil@grtgaz.com TIGF Direction Developpement Commerce Att. Maximiliano Miglio 49, Avenue Dufau – BP 522 64010 Pau Cedex France e-mail: maximiliano.miglio@tigf.fr Naturgás Energía Departamento de Regulación Att. Mauricio Álvarez Pío Baroja Nº 3 48001 Bilbao, e-mail: gestionatr@naturgasenergia.com

27. 7 Application form and Allocation rules

28. Request and booking of capacities • Up to 4 shippers may request capacity through a single Application form, making, under each pricing option, up to six capacity requests in total (one at each IP):

29. Capacity requests: capacity data • Amount of capacity requested (MWh/d): • It will be constant at each Interconnection Point for the whole duration, under each pricing option. • Minimum capacity required to accept the allocation (MWh/d): • If the minimum capacity required to accept the allocation, under a pricing option, is not reached by the shipper through that request at an IP after the 1st Allocation Stage, no capacity will be allocated to the shipper for that capacity request at that point (under that pricing option). In case of coordinated requests, no capacity will be allocated to the shipper for the coordinated capacity requests at the coordinated points. • Requests for capacity at the same IP submitted through different Application Forms will be treated independently in order to apply the “Minimum capacity requirement check”. • Maximum amount of capacity requested at an Interconnection Point: • The aggregation of amounts of capacity requested by a single shipper or by a group or companies (relationship of control as per EC Regulation 139/2004) through more than one Application Form, under each pricing option, must be equal to or lower than 100% of the total amount of capacity offered at that IP in any given month.

30. Capacity requests: pricing levels • The pricing level is the relevant price for the entry tariff in France for which the capacity request is made. The price is expressed as the “premium over the equalised entry tariff into France at PIRs • Shippers must indicate the capacity they would like to request at each Interconnection Point, and the minimum capacity required to accept the allocation, for each of the possible pricing level at IP1.

31. Capacity requests: starting date and duration • Starting date (date from which the shipper requests the commencement of the service.): • The starting date will be the 1st day of the referred month. • Duration (period covered by the capacity request): • Minimum duration of 13 consecutive months and maximum duration of 240 consecutive months. • The period covered by the capacity request (“Duration”) must start not earlier than 1st December 2015 and must end not later than 30th November 2035.

32. Capacity requests in the Application form • As described before, the following information shall be indicated for each IP where capacity is requested:

33. Allocation options Independent and Coordinated allocation options. Independent Allocation per Point (OPTION A): Each capacity request will be treated independently during the allocation process. Coordinated Allocation (OPTION B): A coordinated allocation of capacity between two or more IPs is accepted. Capacity requests at the coordinated points will be referred to as the “coordinated requests”. Coordinated request is defined as a capacity request whose capacity allocation is only accepted by the shipper(s) if the “minimum capacity required to accept the allocation” is reached at other Interconnection Points. All possible combinations of Interconnection Points will be accepted. Types of coordination under OPTION B: Option B.I. Non-flat Capacity Allocation: The allocation of different amounts of capacity at each coordinated point is accepted Option B.II. Flat Capacity Allocation: The same amount of capacity will be allocated at the coordinated points at the end of the Allocation Round. Note that under this option both the amount of capacity requested and the minimum capacity required to accept the allocation must be equal at all coordinated points.

34. Priority rules FIRST PRIORITY: EARLIER DATE OF “STARTING DATE OF THE SERVICE”. Capacity requests will be first ranked granting higher priority to capacity requests with an earlier date of ”starting date of the service”, being 1st December 2015 the earliest possible date. SECOND PRIORITY: LONGER DURATION. Capacity requests with the same starting date will be ranked granting higher priority to capacity requests of longer duration. Capacity requests with a duration equal to or higher than 120 months will be granted the highest priority between capacity requests with the same starting date. PRO RATA ALLOCATION Allocation of capacities between capacity requests with the same level of priority will be made on a pro-rata basis taking into account the amount of capacity requested.

35. Allocation Round and allocation stages

36. Allocation Round • The allocation process, under each pricing option, will be first performed for the Reference Case (MC2+B1+NS1), of the Allocation Round. • An Allocation Round, following the 3 allocation stages established, will be first performed for the Reference Case, at each of the 6 pricing levels (from α to ζ), resulting, for each given pricing level, on a set of 6 aggregated capacity allocations, i.e. one allocation for each of the 6 IPs offered. • Thus, 6 sets of 6 aggregated capacity allocations for the Reference Case will result (“First provisional allocation”). This will be sent to regulators for validation. If validated, they will be announced as the Final Allocation. • If not validated a subsequent(s) Allocation Round(s) will be performed by TSOs for a different capacity scenario, at each of the 6 pricing levels, at the regulators’ request, according to the methodology described in the Economic Tests. • Subsequent allocations resulting from new Allocation Rounds will be referred to as “Second provisional allocation”, “Third provisional allocation”, and so forth.

37. Allocation Stages 1st Allocation Stage: Initial Allocation Capacity requests will be treated independently at each Interconnection Point The amount of capacity allocated to each shipper for each capacity request, at each IP, will be constant for whole period covered by the request.

38. Allocation Stages 2nd Allocation Stage: Step 1: minimum capacity requirement check. If the minimum amount is not reached at an IP after the 1st Allocation Stage, the request will be withdrawn from the process and the capacity will be freed up. In case of OPTION B (Coordinated Points) all coordinated requests will be withdrawn from the process. Step 2: coordinated request check. In the case of Flat Capacity Allocation (Option B.II.) if the minimum amount of capacity specified at each Coordinated Point has not been reached, the provisional capacity allocation after the 1st Allocation Stage at each point might be reduced to ensure that the maximum flat capacity is achieved between all Coordinated Points. Part of the capacities provisionally allocated after the 1st Allocation Stage might be freed up

39. Allocation Stages 3rd Allocation Stage: A 3rd Allocation Stage will be performed to re-allocate capacity freed up during the 2nd Allocation Stage. The following requests will be considered during the 3rd Allocation Stage for the allocation of freed-up capacity: Independent requests qualified during the 2nd Allocation Stage to participate in the 3rd Allocation Stage. Coordinated requests under Option B.I. qualified during the 2nd Allocation Stage to participate in the 3rd Allocation Stage.

40. Thank you for your attention!