Fluxys: Dunkirk-Zeebrugge Pipeline Attracts Interest (Belgium)

The joint offer by Belgian and French transmission system operators Fluxys and GRTgaz to make available firm gas transmission capacity from France to Belgium has triggered keen interest from the market.

Binding commitments totaling more than 219 GWh/day (807,522 cubic metres/hour) have been made by shippers for a 20-year period.

Walter Peeraer, Chairman of the Executive Board and CEO of Fluxys: “The Dunkirk – Zeebrugge pipeline will connect three infrastructures: the Dunkirk LNG terminal as new gas entry point for Europe, the GRTgaz system and the Fluxys system. Through this combination, gas from the Dunkirk terminal will be deliverable anywhere throughout Europe, strengthening security and diversity of supply. The set-up is an example of how the European gas system should operate in the spirit of the Third Energy Package.”

Philippe Boucly, CEO of GRTgaz: “The Gas Trading Points in France (PEG), Belgium, the UK and Germany will be connected through firm capacity in all directions. This will allow shippers to perform exchanges between the main North European gas trading points more easily. I am quite sure that these new possibilities will benefit consumers and all shippers, producers or traders active in these markets. With this new interconnection, the Belgian and the French show their involvement in the construction of the European gas market.”

Investment decisions before May 2012

Both the level and duration of committed capacity bookings provide Fluxys and GRTgaz with a sound business case to go ahead with the planned pipeline between Dunkirk and the Zeebrugge area. Fluxys and GRTgaz will make their final investment decisions before May 2012.

Shippers have committed to a total of 266 GWh/day (982,376 cubic metres/hour) during the first two years following commissioning. For the next 18 years, 219 GWh/day (807,522 cubic metres/hour) is booked, with 51 GWh/day (188,053 cubic metres/hour) on top being available to the market.

Strengthening security of supply, market liquidity and market integration

The new pipeline between France and Belgium is to connect both markets more closely as the infrastructure will offer the community of shippers firm transmission capacity from France into Belgium which currently cannot be offered. The infrastructure will enable the market to move an additional 8 billion cubic metres of natural gas from France into the Belgian system, strengthening security of supply and supporting gas trading and further build-up of liquidity.

A simple and innovative set of capacity products

The Dunkirk – Zeebrugge project also introduces a novelty for Europe in commercializing gas transmission capacity. Through close cooperation between TSOs and the Belgian and French regulatory bodies, arrangements have been pioneered so as to offer a simple and innovative set of capacity products:

• One single Fluxys contract for cross-border capacity between Dunkirk and the Belgian system: a first in Europe,
• A joint GRTgaz/Fluxys capacity offer for capacity from PEG Nord to the Belgian trading point,
• The GRTgaz transmission contract for entry capacity from Dunkirk to PEG Nord.

100 km pipeline and new interconnection point in Alveringem near Veurne

In order to make the proposed capacity available GRTgaz plans to lay a 26 km pipeline from the Pitgam compressor station to the French-Belgian border. Fluxys, in turn, envisages to build a new interconnection point in Alveringem near Veurne and a 72 km pipeline from Alveringem to Maldegem. Both TSOs aim to commission the new capacity in line with the commissioning date of the Dunkirk LNG terminal in late 2015.

[mappress]

LNG World News Staff, March 21, 2012