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North West Europe Gas System Performance Report

April 2018

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1. Gas prices: A warmer April than in 2017 in most of NW Europe caused consumption to decline

year-on-year and prices to retreat from the record highs of March. See slides 3 and 4.

2. Consumption: A year-on-year increase in consumption in GB mitigated declines elsewhere due to

warmer than seasonal normal temperatures, preventing total NW Europe consumption from

falling below the min-max envelope. See slides 5 and 6.

3. Supply: Russian pipeline gas imports increased by 2 bcm year-on-year, at the expense of LNG and

storage which saw share declines of 1-2% points each. See slides 7 – 11.

• Pipeline imports: Imports from Norway remained unchanged year-on-year, with the 12%

increase in pipeline imports to Europe being primarily through Russia’s Nord Stream.

• LNG: LNG imports declined by 21% year-on-year, causing regasification terminal utilisation to

decline by almost half in GB as pipeline gas dominated storage replenishment.

4. Storage: Storage levels remained below the 5 year minimum, despite a 68% increase in injections

year-on-year, primarily into German storages. See slides 12-13.

Executive Summary

• Indigenous production: Dutch production declined by over a quarter, as the Groningen

production cap meant reduced output flexibility.

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1. Gas prices

North West European gas price development

Sources: Thomson Reuters, Aurora Energy Research EOS

Notes: Monthly prices are the averages prices of each month’s daily prices. Prices are converted in € using the monthly averages of the daily exchange rates.

0

4

8

12

16

20

24

28

32

36

Sep-17Jul-17May-17 Nov-17 Jan-18 Mar-18

Belgium (ZEE)

Germany (NGC)Netherlands (TTF)

France (PEG Nord)

France (TRS)

Great Britain (NBP) Germany (Gaspool)

Gas price,€/MWh

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1. Gas prices

% Price spreads against NBP

Sources: Thomson Reuters, Aurora Energy Research EOS

Notes: Using the monthly averages prices of daily prices and the monthly averages of daily exchange rates.

-20-15-10

-505

1015202530354045505560

Dec-17Apr-17 Jun-17 Aug-17 Oct-17 Apr-18

Belgium (ZEE)

Netherlands (TTF)

France (PEG Nord) Great Britain (NBP)

France (TRS) Germany (NGC)

Germany (Gaspool)

Price spread against NBP,%

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2. Consumption

North West Europe monthly consumption1

Sources: Aurora Energy Research EOS

Notes: 1. Consumption excludes demand from interconnectors.

20

15

10

35

25

30

0

5 11

13

2

10

5

Nov-17

2

5

1

1

7

33

3

3

Apr-18

2

5

2

8

Apr-17

2

1

Oct-17

21

2

4

May-17

1

2

3

5

Jun-17

2

6

2

64

3

10

Jul-17

1

2

Aug-17

5

4

Sep-17

13

5

7

2

4

6

9

Dec-17

2

4

9

10

Jan-18

2

5

9

2

Feb-18

2

4

5

11

Mar-18

1

3

6

7

20

16

11

1415

19

28

32 3231

32

195

6

13

-7%

Belgium FranceNetherlands Great Britain Germany

Consumption,bcm

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Sep-17May-17

25

Jul-17

30

Nov-17 Jan-18 Mar-18

0

5

10

15

20

35

40

2. Consumption

North West Europe consumption in min-max envelope

Sources: IEA, Aurora Energy Research EOS

Notes: 1. Envelopes are calculated by taking the maximum and minimum monthly values since October 2013.

Min-max envelope (Oct 13 – March 17)1Total Consumption

NW Europe consumption,bcm

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3. Supply

North West Europe annual gas supply

Sources: Aurora Energy Research EOS, IEA

Notes: 1. Previous years are calendar years. 2. LNG reflects regasification send-out to the high pressure network. 3. Russia pipeline supply includes pipe imports via Poland, Czech Republic, and Austria. 4. Other pipeline supply includes Denmark, Spain and Switzerland.

250

0

200

350

100

300

50

150

16

43

80

1164

103

14

110

212

2000

53

67

16

192

2005

38

46

90

2010 Last 12 months1

47

86

95

2015

102

21

315328

338

305 308

LNG2

Russia Pipeline Supply3

Norway Pipeline Supply Local Production

Other Pipeline Supply4

NW Europe supply,bcm

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3. Supply

North West Europe monthly gross gas supply

Sources: Aurora Energy Research EOS

Notes: 1. LNG reflects regasification send-out to the high pressure network. 2. Pipeline supply is from Russia (including via Poland, Czech Republic, and Austria), Norway, Denmark, Spain and Switzerland

0

20

25

55

30

5

45

10

50

60

15

35

40

8

5

Apr-17

23

14

1

Apr-18

17

1

5

11

6

2

7

17

Jul-17

1

16

2

1619

May-17

2116

Jun-17 Oct-17

00

6

19

1

16

Aug-17

1

6

15

Sep-17 Nov-17

9

37

1

8

20

Dec-17

8

8

20

1

11

21

7

18

Feb-18

7

2

8

20

Mar-18

1

Jan-18

6

19

2725

2224 23

28

38 3836

27

33

Pipeline Supply2Storage Withdrawal LNG1 Local Production

NW Europe supply,bcm

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3. Supply

Monthly gross gas supply by country

Sources: Aurora Energy Research EOS

Notes: 1. LNG reflects regasification send-out to the high pressure network. 2. Pipeline supply is from Russia (including via Poland, Czech Republic, and Austria), Norway, Denmark, Spain and Switzerland

4

18

0

2

6

12

14

16

10

8

Oct-17

Aug-17

Nov-17

Jan-18

Su

pp

ly, b

cm

Feb-18

Dec-17

Apr-17

Jul-17

May-17

Jun-17

Sep-17

Mar-18

Apr-18

Storage Withdrawal Local ProductionLNG1 Pipeline Supply2

14

0

4

16

8

10

12

6

18

20

2

Su

pp

ly, b

cm

Apr-17

May-17

Jun-17

Jul-17

Aug-17

Sep-17

Oct-17

Nov-17

Dec-17

Feb-18

Jan-18

Mar-18

Apr-18

4

0

2

8

6

12

16

18

10

14

May-17

Jan-18

Nov-17

Apr-18

Jun-17

Su

pp

ly, b

cm

Apr-17

Jul-17

Aug-17

Sep-17

Oct-17

Dec-17

Feb-18

Mar-18

4

2

0

6

14

8

10

12

16

18

Su

pp

ly, b

cm

Apr-17

May-17

Jun-17

Jul-17

Feb-18

Aug-17

Sep-17

Oct-17

Nov-17

Jan-18

Mar-18

Apr-18

Dec-17

Great Britain Germany

France Belgium and the Netherlands

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3. Supply

North West Europe share of monthly gas supply

Sources: Aurora Energy Research EOS

Notes: 1. LNG reflects regasification send-out to the high pressure network. 2. Russia pipeline supply includes pipe imports via Poland, Czech Republic, and Austria. 3. Other pipeline supply includes supply from Denmark, Spain and Switzerland.

33% 33% 35% 38% 38% 38% 34% 30% 26% 27% 24% 27%33%

29% 31%30%

30% 31%27% 34%

28%26% 27%

24%28%

36%

26% 25% 25% 23% 23%26%

25%

23%

20%22%

19%

21%

21%

8% 9% 6% 7% 6%4%

4%

6%4%

3% 2% 2%

5%

3%

15%25% 22%

30%20%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Jun-17

2%

3%

Apr-17 May-17 Apr-18Feb-18Jul-17 Sep-17Aug-17

3%

Jan-18Oct-17

4%

Nov-17 Dec-17

2%

3%

Mar-18

3%

Share of gas supply,%

Storage Withdrawal

LNG

Production Norway Pipeline Supply

Russia Pipeline Supply Other Pipeline Supply

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3. Supply

North West Europe share of monthly gas supply –excluding storage withdrawal

Sources: Aurora Energy Research EOS

Notes: 1. LNG reflects regasification send-out to the high pressure network. 2. Russia pipeline supply includes pipe imports via Poland, Czech Republic, and Austria. 3. Other pipeline supply includes supply from Denmark, Spain and Switzerland.

35% 34% 37% 38% 39% 40% 35% 35% 35% 35% 34% 33% 34%

30% 31%31% 31% 32% 29% 35% 33% 34% 34% 34% 35% 37%

27% 26%26% 24% 23% 27% 26% 27% 27% 28% 28% 26% 22%

9% 9% 6% 7% 6% 5% 5% 7%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

May-17 Oct-17Apr-17 Sep-17Aug-17Jun-17 Jul-17

4% 4%

Nov-17

4%

Dec-17

3%

Jan-18

4%

Feb-18 Mar-18 Apr-18

LNG1 Production Russia Pipeline Supply2 Norway Pipeline Supply Other Pipeline Supply3

Share of gas supply- exc. Storage withdrawal,%

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May-17

50

Jul-17

15

Nov-17

20

60

Sep-17 Jan-18

30

35

40

45

0

25

55

Mar-18

5

10

4. Storage

North West European storage inventory

Sources: IEA, Aurora Energy Research EOS, AGSI

Notes: Storage data is based on net daily flows. 1. Envelopes are calculated by taking the maximum and minimum monthly values since October 2013.

Total inventory Min-max envelope (October 13 – March 17)1

NW Europe storage inventory,bcm

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4. Storage

Storage margin (days of demand in store)1

Sources: Aurora Energy Research EOS

Notes: 1. Days of Demand in store is defined as the number of days that the storage inventory could potentially solely satisfy, all contractual constraints left aside. Future demand is defined as today’s demand adjusted with last year’s profile. The analysis shown is our most up-to-date estimate but may be subject to revision as historical data gets confirmed. The values shown indicate the storage margin at the ned of each month.

0

20

40

60

80

100

120

Jun-17Apr-17 Feb-18Aug-17 Oct-17 Dec-17

Belgium Netherlands Great BritainFrance Germany

Storage margin,days

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European Gas Market ServiceMarket analysis and forecasts for all participants in the European gas market

• European gas market development until 2040 including hub prices, seasonal

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