Our European Gas Service is based on our unique European Gas Model (EGM) covering the main infrastructure within Europe. EGM has been developed by Energy Markets so that gas sellers, gas buyers, traders and asset owners can come to terms with the strategic implications of a range of issues including liberalisation of the market, increasing demand for gas and growing import dependency. The aim was to develop a tool which, when combined with the knowledge, insight and experience of Energy Markets consultants, can offer unparalleled support to any company seriously interested in the development of the European gas market.

The key outputs of EGM include:

• Wholesale gas contract and spot prices at borders and hubs, for 25 European countries, on a quarterly and annual basis; netback prices to the main producing countries both within and outside Europe and transportation tariffs for all the main pipeline routes. End user prices can also be calculated offline by adding internal transportation tariffs to the wholesale prices.

• On the physical side, gas demand by country and market sector is provided, gas supplies by country of origin, supply / demand matches for twenty five countries individually and Europe in aggregate and gas flows in pipeline and LNG routes to and within Europe .

EGM is based on the main pipeline corridors and storage facilities in Europe . Whereas gas contract prices will continue to be linked to oil prices for some time, gas prices in trading markets will depend increasingly on gas-to-gas competition. The cost of production and transportation through the system will be a key determinant of spot prices. EGM balances supply and demand across the whole of Europe at the lowest cost. It tracks gas flows through the system and estimates costs of production, transportation (by pipe and LNG) and storage.

The unique optimising programme then minimises costs subject to suitable constraints, such as existing gas supply contracts, pipeline capacities and policy criteria (such as diversity of supply). Gas prices at the key nodal points are then calculated to "clear the market".

The range of services offered by Energy Markets which utilise EGM include:

• Scenarios can be developed to reflect the key drivers for change in the gas industry including the pace and form of liberalisation or factors affecting gas demands including technological, economic and policy drivers. As with any model the quality of the output depends crucially on the thinking and business acumen that goes into developing the input assumptions. That is why Energy Market's prefers to work very closely with clients on our modelling projects. We have developed a ten-step process for collaborating with clients which can be downloaded here.

• A newsletter entitled European Gas Price Forecasts, which forecasts wholesale prices for borders and hubs on a quarterly basis, for 5 years and an annual basis for 10 years. The newsletter is issued quarterly with monthly updates of hub prices. An example of a quarterly newsletter can be downloaded here.

• Multi-client reports on topics of specific interest to a number of clients.

• Seminars and workshops, which are provided on a regular basis covering latest developments in liberalisation, security of supply, infrastructure and price developments in the European market. Seminars are run in conjunction with the European Gas Price Forecasting Service or can be customised for clients.

The European Gas Service is being increasingly used by producers who wish to understand the value of their gas reserve portfolio, utilities considering long term planning of their gas grids and a variety of companies and financial institutions looking at new pipeline and storage projects and/or the acquisition of existing assets. Examples of recent projects using the European Gas Model can downloaded by clicking here.

 

 

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