with France, Portugal and an underwater tunnel with Italy

In the midst of an energy storm and before the fear that Russia will close the gas tap to the European Union after its invasion of Ukraine, Enagás, the manager of the gas network, dresses up as a key player to guarantee security of supply. The company has presented this Tuesday its strategic plan for the coming years, until 2030, including the investments it has planned. And the message is clear: "Supply security is under the spotlight", has recognized its CEO, Arturo Gonzalo Aizpiri.

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The CEO, appointed last February, assumes that this role of gas guarantor is an "opportunity" for the company and, at the same time, "a responsibility", as he acknowledged in the presentation to analysts. In this role, the key that will determine how much Enagás invests and what it does lies in the new gas interconnections within the European Union, which has become the area of ​​growth for the group, which in recent years had looked to America when designing the markets in which to grow.

Now, instead, the priority is Europe and the focus is on creating three new gas pipelines to improve European interconnection. One with France, another with Portugal (in both cases, it would be the third gas pipeline) and a new one, submarine, with Italy; the first to that country, which would take a large part of the investments planned for the entire period.

In total, for the remainder of the decade, Enagás has planned to invest more than 4,700 million euros. Of that figure, 1,980 million would be for the three new gas pipelines and only 1,500 million, to create this new infrastructure towards Italy. Three projections that are not definitive. “These projects are in the proposal and approval phase by European regulators. When the process concludes, the company will incorporate them into its projections”, it indicates in its presentation to investments.

From gas to hydrogen

That is to say, those are their plans, but they have to receive the approval of the administrations. “They are awaiting the analyzes that are carried out and the decisions that the Member States and the European authorities make,” the CEO indicated. “They can have subsidies of between 30% and 40%”, because, after 2030, they would no longer be used only to transport gas, but also hydrogen, considered a green alternative for decarbonization and, therefore, likely to receive community aid.

“We have presented three proposals, a third gas interconnection with France that would operate from 2025 and that can become a hydrogen interconnection from 2030”, he pointed out. “The one in Italy could begin to be operational in 2028 and operate as a gas transmission route until 2039 and, from that date, for hydrogen. With France and Portugal there is a very advanced preliminary work, it is a very mature project”.

When will it be known if these projects start? In principle, at the beginning of next year. “The expectation is that the list of projects will be published in February 2023, what aid they can access and how the REPowerEW financing instruments are specified. [el proyecto comunitario para dejar de depender del gas ruso], which until now is known to be financed with the transformation and resilience programs; and there may be an additional financing of 75,000 million, through the funds of the CO2 auctions, or with other instruments, which are yet to be defined”, Arturo Gonzalo Aizpiri has listed.

Underground storage at 73%

The clear background of this new plan for the future of Enagás is the supply problems, especially next winter, if Russia closes the tap and after it has interrupted the gas interconnection with Germany, in principle, due to review of the infrastructure. “Europe wonders if Nord Stream 1 will resume”, acknowledged the CEO of Enagás. “REPowerEU is a strategic autonomy project. We believe that Europe is serious about this project, with the support of the States, on a map where infrastructures appear and for Enagás it is not optional how to deal with them, it is an obligation to see what the best way is, seeing the capabilities of the system. It's what we've done."

In Spain, he sees no problems. "Spain is solid in terms of the guarantee of supply," he stressed. “For Enagás it is a responsibility to say how it can make what the European Commission has communicated a reality. REPowerEU are going to be carried out because the EU needs it”.

“Today Europe feels great uncertainty about how the next winter season is going to be tackled. For this year, in October there must be an 80% filling of the storages. Spain is complying with this filling schedule. This morning, the figure was 73% filled in underground storage when the goal for August is 71%”, the CEO has broken down. “Liquefied natural gas (LNG) tanks, where Spain has 44% of all LNG storage capacity in the EU, we are at 84%. It is the highest level in the last 5 years and we expect the arrival of 26 more ships this July. It does not mean that we monitor day by day”. "Storage is key so that we can approach these times that Europe has ahead of us in the coming months with great serenity." he has summed it up.

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