Report on Security
of Natural Gas Supply in the European Part of the Unece Area
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| V. CONCLUSIONS
AND RECOMMENDATIONS |
A t the moment there is no significant
threat that the gas industries in the UNECE area might not
be able to maintain the extremely high level of security of
supply displayed by them in the past. However, some new regulations
could threaten this favourable future, even in the short run.
A clear example is the impossibility in some countries of
matching long term supply contracts with long term transit/transportation
contracts. Such anomalies should be removed as soon as possible.
They cause unnecessary additional costs and supply risks to
the market.
Long term contracts with take-or-pay obligations and huge
upfront investments in market development production and transportation
have been instrumental in providing for security of supply
and stable market development. Such contracts also provide
for a basis for contractual portfolios. Their continuing existence
is a key element in maintaining security of supply, facilitating
large new investments in production, infrastructure and market
development.
With regard to the long term, sufficient gas reserves are
available in and near the UNECE area to meet future gas demand.
As described in this report, certain conditions are essential
for the gas industries.
The most important conditions are:
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A stable and predictable regulatory and
political framework;
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Clear roles and responsibilities and a
level playing field for all market participants;
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A positive investment climate;
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Supply security is primarily seen as the responsibility of the
companies. The cooperation between gas industries and governments
is also essential.
Based on an optimal division of responsibilities, governments
are recommended to give top priority to:
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Stable international relations;
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Consistent energy policies, including a favourable
fiscal regime;
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Predictable, but limited number of new laws
and regulations (including fair, non-discriminatory transit
tariffs, as well as the principle of “right of first
refusal” where companies have priority in getting access
to the pipeline when their existing transit contract is expiring).
Meeting those circumstances is essential to facilitate the necessary
level of investments in the gas market. Although the market
has developed favourably during the past decade, perceived overregulation
and lack of confidence in further market development may lead
to inefficiency and to the postponement of new investment projects.
It is of the utmost importance to restore confidence and to
provide stable conditions to safeguard future supply security.
Constant high investments in the whole gas chain, including
maintenance and improvement of the existing infrastructure,
are the core indicator of a successful future gas market. Together
with the underpinning of demand/supply by long term contracts,
a solid backbone is available for steady growth and a secured
supply of natural gas.
The European gas industry has always succeeded in taking adequate
measures for safeguarding gas supplies. This has been confirmed
more than once by the IEA and theEU Commission or the EU Council
of Ministers. An indispensable constituent element of security
of supply is long-term contracts between exporters and importers
with their specific fundamental principles.
A high degree of supply security will remain contingent on the
viability of long-term supply contracts. Without them it is
not possible to achieve adequate security of supply. Security
of gas supplies can continue to be ensured if they remain diversified
by supply sources, a balance of interests is maintained between
producers and importer countries, and a generally reliable political
framework is preserved. The further liberalisation of European
gas markets should therefore be geared towards the optimum pursuit
of the goals of energy policy, such as security of supply, instead
of jeopardising those goals.
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