Volume 20 / Issue 85 / May 5, 2015

www.platts.com EUROPEAN GAS DAILY[NATURAL GAS ]

Spains April demand up 10% to 23.6 TWh . . . . . . . . . . . . . . . 3Maintenance at Rough rescheduled: operator . . . . . . . . . . . . . 3NBP, TTF ICE volumes down sharply in April . . . . . . . . . . . . . . . 4Fuel Switching Snapshot . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Market CommentaryMarket Highlights

Platts European gas midpoints, May 1, 2015

p/th Eur/MWh $/MMBtu % change D-1

UK NBP

Day ahead 43.50 20.08 6.61 -3.76 June 41.60 19.21 6.32 -5.13

Dutch TTF

Day ahead 43.78 20.20 6.65 -3.12 June 43.34 20.00 6.58 -3.15

Belgian Zeebrugge

Day ahead 43.00 19.85 6.53 -2.38 June 43.10 19.90 6.55 -0.92

French PEG Nord

Day ahead 44.10 20.35 6.70 -2.40 June 43.34 20.00 6.58 -3.15

French PEG Sud/TRS*

Day ahead 44.97 20.75 6.83 -1.89 June 44.97 20.75 6.83 -2.58

German GASPOOL

Day ahead 44.21 20.40 6.71 -3.32 June 43.78 20.20 6.65 -2.65

NetConnect Germany

Day ahead 44.10 20.35 6.70 -2.86 June 43.45 20.05 6.60 -2.91

Austrian CEGH VTP

Day ahead 45.19 20.85 6.86 -0.71 June 45.08 20.80 6.84 -0.48

Italian PSV

Day ahead 46.38 21.40 7.04 -1.83 June 46.60 21.50 7.08 -2.71

*TRS - Trading Region South. All prices assessed at 16:30 London time.

TTF time spreads

Source: Platts(Trade date)

(Eur/MWh)

18

20

22

24

26

Apr-15Mar-15Feb-15Jan-15Dec-14Nov-14

Winter-15Summer-15Day ahead

NCG-TTF location spreads

Source: Platts(Trade date)

(Eur/MWh)

0.0

0.1

0.2

0.3

0.4

0.5

Apr-15Mar-15Feb-15Jan-15Dec-14Nov-14Oct-14Sep-14

Season aheadMonth ahead

Coal Switching Price Indicator vs NBP month ahead(p/th)

Source: Platts (Trade date)

20

30

40

50

60

30-Apr15-Apr27-Mar12-Mar25-Feb10-Feb26-Jan09-Jan22-Dec

NBPUK CSPI 50% (CPS) UK CSPI 45% (CPS)

Reloads slide amid healthy Asia-Pacific inventories Domestic demand rises as renewables output falls Net gas imports from France weaken

Spanish LNG sendout up 31% year to date

(continued on page 2)

Near-term UK wholesale natural gas prices eased Friday afternoon as the system flipped long late as imports from the Netherlands through the BBL pipeline ramped up after the system had been short in the morning, with the prompt and curve posting mild losses on the day, in line with spot and oil prices.

Imports via the BBL pipeline were running at 25 million cu m/d just before the close after having been at zero until about 14:00, flipping the gas system long as physical flows of 240

NBP spot falls late as BBL pipeline ramps up

(continued on page 8)

EuropEan Gas Daily May 5, 2015

2Copyright 2015 McGraw Hill Financial

Platts UK market assessments, May 1, 2015 p/th Change D-1 Eur/MWh $/MMBtu (p/th)UK NBP marketWithin day 44.0544.25 -1.85 20.3320.43 6.696.72DA 11:00 am 44.50 -0.15 20.54 6.76Day ahead 43.4043.60 -1.70 20.0320.13 6.596.62Day ahead+1 43.5543.75 0.15 20.1020.19 6.616.64Weekend 43.4043.60 -0.70 20.0320.13 6.596.62Working week+1 43.6543.85 -0.55 20.1520.24 6.636.66Balance month 43.3043.50 -2.60 19.9920.08 6.576.60June 41.5041.70 -2.25 19.1619.25 6.306.33July 41.9542.15 -0.05 19.3619.46 6.376.40August 42.2042.40 -0.10 19.4819.57 6.416.44September 42.7042.90 0.15 19.7119.80 6.486.51Q3 2015 42.3042.50 -0.25 19.5319.62 6.426.45Q4 2015 47.5047.70 -0.10 21.9322.02 7.217.24Q1 2016 50.5050.70 -0.10 23.3123.40 7.677.70Q2 2016 44.6044.80 -0.10 20.5920.68 6.776.80Winter 15 49.0049.20 -0.10 22.6222.71 7.447.47Summer 16 44.2544.45 -0.10 20.4320.52 6.726.75Winter 16 50.7550.95 -0.15 23.4323.52 7.707.73Summer 17 45.1545.35 -0.05 20.8420.93 6.856.88Winter 17 51.6551.85 0.00 23.8423.93 7.847.87Summer 18 46.2046.40 0.00 21.3321.42 7.017.04Winter 18 52.0552.25 0.00 24.0324.12 7.907.93Summer 19 46.1546.35 0.05 21.3021.39 7.017.04Gas year 2015 46.6546.85 -0.10 21.5321.63 7.087.11Cal 2016 47.0547.25 -0.10 21.7221.81 7.147.17

Platts NBP midpoint indices p/th Change D-1 Eur/MWh (p/th)

Day ahead 43.50 -1.70 20.08Day ahead+1 43.65 +0.15 20.15Month ahead 41.60 -2.25 19.20

Index definitions are published in the Platts methodology guide available on the Platts website.

Platts UK NBP intra-day gas prices: May 1p/th Within day (A) Next day (B) EFA day ahead

May 1 45.20 44.50 44.70May 2 44.50 44.50 44.50May 3 44.50 44.50 44.50May 4 44.50 44.45 44.46

Prices assessed at 1100 UK time. EFA day ahead is calculated at A*7/24 plus B*17/24. This reflects the difference between the 6am-start gas day and the 11pm-start EFA power day. During Monday-Thursday only the top row contains data, other rows used ahead of weekends and bank holidays.

ICE UK NBP futures, May 1, 2015 (p/th)Month Close Previous Change Low High VolumeJun-15 41.860 41.940 -0.080 41.500 42.180 5720Jul-15 42.240 42.320 -0.080 41.970 42.510 715Aug-15 42.510 42.560 -0.050 42.280 42.800 420Sep-15 43.050 42.930 0.120 42.920 43.300 110Oct-15 44.910 44.830 0.080 45.000 45.050 30Q3 2015 42.595 42.600 -0.005 42.350 42.860 1575Q4 2015 47.734 47.654 0.080 47.450 47.930 140Q1 2016 50.657 50.647 0.010 50.590 50.800 190Q2 2016 44.734 44.704 0.030 Q3 2016 44.195 44.165 0.030 Q4 2016 49.403 49.373 0.030 Q1 2017 52.652 52.622 0.030 Q2 2017 45.678 45.628 0.050 Win 15 49.188 49.142 0.046 48.850 49.440 990Sum 16 44.463 44.433 0.030 44.450 44.680 235Win 16 51.010 50.980 0.030 50.800 51.110 170Sum 17 45.337 45.287 0.050 45.400 45.400 25

Source: ICE Futures Europe

ICE ENDEX UK OCM, April 30, 2015 No. trades SAP (p/th) Energy (therms) Values (GBP)NBP total 159 46.8900 8,671,000 4,065,832OCM On-the-day Commodity Market

Source: ICE ENDEX

ANALYSIS LNG sendout from Spanish terminals January-April rose by 31% on the year-ago period on a combination of boosted domestic gas demand and weak interest for spot reloads from Asian buyers.

Gas Infrastructure Europe data showed sendout totaling 38.1 million cubic meters between January and April 2015, up from 29 million cu m in the year-ago months.

Mild weather has left major Asia-Pacific buyers with comfortable inventories. Spot LNG prices in Asia have tumbled as a result, with Platts data showing the JKM shedding almost $3.00/MMBtu since the start of this year, to $7.175/MMBtu by end-April from $10.025/MMBtu.

This has narrowed the arbitrage between Atlantic Basin and Pacific Basin LNG prices, stranding potential reload volumes in Spain. The SWE-delivered LNG price at the beginning of 2015 was about $7.50/MMBtu, which softened to $6.511/MMBtu by end-April.

The spread between Spain and the Pacific Basin started the year at $2.525 before collapsing to $0.664/MMBtu.

In contrast, 2014s lower LNG sendout from Spains terminals tracked a wider spread between the Atlantic and Pacific basins. The SWE marker at the start of 2014 was $15.27/MMBtu, against the JKM for the same period at $18.60/MMBtu. By end-April, the SWE marker had softened to $11.58/MMBtu, while the JKM has reached $14.25/MMBtu. The spread between the basins narrowed to $2.67/MMBtu from $3.33/MMBtu over the same period.

While weakening demand from the Pacific has kept LNG at Spanish terminals, domestic requirements have also been drawing gas into the grid there on the back of lower renewables output.

Renewables and nuclear weakenHydro generation in Spain dropped by nearly 7.6 TWh January to April compared to the same period last year, when it totaled 18.8 TWh, according to Platts data. The lower hydro generation this year has been linked to a colder-than-usual beginning of spring and a drier season, with rain levels also lower in the first and April. However, while hydro output is lower, reserves are almost as full as last year, which saw particularly high hydro stock levels. At just over 85% full, hydro dam levels are above the 80.2% five-year average and the 74.2% 10-year average, the latest hydro data from Spains environment ministry showed.

This could be an indication that dam operators are expecting a dry period ahead with little rainfall, traders said.

The drop in hydro output comes amid an unusually low nuclear generation level, with three nuclear reactors of the total seven available currently offline for maintenance.

Lower hydro and lower nuclear plant availability have come against the backdrop of a drop in wind output this year as well. Total wind output so far in 2015 has been 21.4 TWh, down 1.8

Spanish LNG sendout up 31% year to date...from page 1

Holiday notice

There will be no publication of European Gas Daily on Monday May 4 owing to a holiday in the UK. Publishing will resume on Tuesday May 5 with the next edition dated Wednesday May 6.

Day ahead as published in the assessment tables in this issue relates to the Monday May 4 gas day. Day ahead +1 is for delivery on Tuesday May 5.

EuropEan Gas Daily May 5, 2015

3Copyright 2015 McGraw Hill Financial

Platts Belgian Zeebrugge assessmentsMay 1, 2015 p/th Change D-1 Eur/MWh $/MMBtu (p/th)

Day ahead 42.9043.10 -1.05 19.8019.89 6.516.54Day ahead +1 43.1543.35 0.25 19.9220.01 6.556.58Weekend 42.9043.10 -0.75 19.8019.89 6.516.54Working week+1 43.2543.45 -0.05 19.9620.06 6.576.60Balance month 42.9043.10 -2.15 19.8019.89 6.516.54June 43.0043.20 -0.40 19.8519.94 6.536.56July 42.3042.50 -1.15 19.5319.62 6.426.45August 42.4542.65 -0.35 19.5919.69 6.456.48Q3 2015 42.5542.75 -0.25 19.6419.73 6.466.49Q4 2015 46.0546.25 -0.05 21.2621.35 6.997.02Q1 2016 48.2548.45 -0.15 22.2722.36 7.337.36Winter 15 47.1547.35 -0.10 21.7621.86 7.167.19Summer 16 44.3044.50 -0.05 20.4520.54 6.736.76Winter 16 48.8049.00 -0.15 22.5322.62 7.417.44Summer 17 45.3045.50 -0.05 20.9121.00 6.886.91Gas year 2015 45.7545.95 -0.05 21.1221.21 6.956.98

Platts NBP-Zeebrugge basis differentials p/th Change (%) Eur/MWh

Day ahead -0.50 -56.52 -0.23Day ahead+1 -0.40 -20.00 NAMonth ahead 1.50 -528.57 0.69

Platts Belgian Zeebrugge day-ahead flow date pricesFlow date p/th Eur/MWh

May 2 43.00 19.85May 3 43.00 19.85May 4 43.00 19.85May 5 43.25 19.97

Platts Dutch TTF assessments (Hi-cal gas)May 1, 2015 p/th Eur/MWh Change D-1 $/MMBtu (Eur/MWh)Day ahead 43.6743.88 20.1520.25 -0.65 6.636.66Day ahead+1 43.4543.67 20.0520.15 -0.10 6.596.63Weekend 43.4543.67 20.0520.15 -0.75 6.596.63Working week+1 43.4543.67 20.0520.15 -0.65 6.596.63June 43.2343.45 19.9520.05 -0.65 6.566.59July 43.0243.23 19.8519.95 -0.55 6.536.56Q3 2015 43.1243.56 19.9020.10 -0.40 6.556.61Q4 2015 45.7246.16 21.1021.30 -0.30 6.947.01Q1 2016 47.2447.68 21.8022.00 -0.30 7.177.24Q2 2016 44.6445.07 20.6020.80 -0.25 6.786.84Q3 2016 43.6744.10 20.1520.35 -0.30 6.636.69Q4 2016 47.0347.46 21.7021.90 -0.30 7.147.20Winter 15 46.4846.92 21.4521.65 -0.30 7.067.12Summer 16 44.1044.53 20.3520.55 -0.25 6.696.76Winter 16 47.7848.22 22.0522.25 -0.25 7.257.32Summer 17 45.0745.51 20.8021.00 -0.15 6.846.91Winter 17 48.3348.76 22.3022.50 -0.35 7.347.40Summer 18 45.7246.16 21.1021.30 -0.20 6.947.01Gas year 2015 45.2945.72 20.9021.10 -0.30 6.876.94Cal 2016 45.7246.16 21.1021.30 -0.25 6.947.01Cal 2017 46.3846.81 21.4021.60 -0.25 7.047.10Cal 2018 47.2447.68 21.8022.00 -0.25 7.177.24

ICE ENDEX Dutch TTF gas futures (Eur/MWh)May 1, 2015 Settle Change VolumeWDNW First month 20.163 -0.315 2450Second month 20.022 -0.353 25Third month 20.057 -0.387 First quarter 20.087 -0.347 280Second quarter 21.181 -0.350 50Third quarter 21.938 -0.288 10Fourth quarter 20.745 -0.232 First season 21.558 -0.319 190Second season 20.447 -0.259 75Third season 22.231 -0.211 5Fourth season 20.929 -0.126 First year 21.163 -0.271 15Second year 21.536 -0.178 10Third year 21.875 -0.238 Total volume 3110.00Source: ICE ENDEX

Spains April demand up 10% to 23.6 TWh Gas-to-power demand up 37% on year Gas-to-power 8% above high-end forecast LNG reloads down 87% at 1.1 TWh

DEMAND Spains gas demand rose 10% year on year to 23.6 TWh in April, marked by a 37% rise in demand from gas-fired electricity generation plants to 4.3 TWh, data from grid operator Enagas showed Friday.

There was also a 6% increase in domestic demand to 19.3 TWh over the same period, the data showed.

Total gas demand was 2% higher than the companys March forecast of 23.2 TWh demand in April, with gas-to-power demand outpacing the companys own high-end forecast of 4 TWh by 8%.

Peak daily demand in the month hit 898 TWh on April 28, with combined cycle gas plants operating at 15%.

The average rate for CCGTs in April was 12%, up from 9% the year before.

Spains gas exports jumped 443% year on year to 3.4 TWh in April due to a reclassification of exports to neighboring Portugal, which were previously classified as transit volumes.

Reloads of LNG for export fell 87% year on year to 1.1 TWh in April. Gianluca Baratti

Maintenance at Rough rescheduled: operator Withdrawal now between May 7-Sep 5 Start pushed back by six days Injections unaffected during outage

STORAGE Maintenance at the Rough reservoir, the UKs largest natural gas storage site, that will limit withdrawal capacity by 50% has been pushed back by six days and is now due to begin May 7, its operator, Centrica Storage Ltd, said Friday.

Withdrawal capacity at the facility, normally about 44 million cu m/day, will be limited to 22 million cu m/day between 7:00 am London time (0600 GMT) May 7 and 06:59 am September 5 the previous schedule was between May 1 and August 31.

Withdrawal maintenance usually occurs during the summer when gas is injected into the reservoir for withdrawal during the winter.

Capacity restrictions at the Rough reservoir remain in place after a routine inspection led to the discovery of issues surrounding well integrity in mid-March.

CSL decided to limit the maximum operating pressure of the wells to 3,000 psi on the back of the findings, which meant that capacity in the reservoir is limited to somewhere between 29 TWh and 32 TWh (between 2.741 Bcm and 3.024 Bcm) for

TWh from the year-ago period, according to PowerVision data.At the same time, demand for power has increased, to 82.3

TWh in January-April from 82.1 TWh for the year-ago period. This, in turn, increased demand for gas-fired generation to 10.33 million cu m in April from 8.09 million cu m in April 2014, according to Platts data.

Net imports from France decreaseThe increased input of LNG into the grid in Spain has also affected gas imports from France, which have declined on a month-on-month basis in 2015. Platts data showed that net flows from France to Spain in April were 4 million cu m/d, down from 10 million cu m/d in March. The net decrease also includes an increase of exports from Spain to France, which hit a high of 2 million cu m/d in April. Desmond Wong, Ana-Maria Tolbaru, Lucie Roux

EuropEan Gas Daily May 5, 2015

4Copyright 2015 McGraw Hill Financial

Platts European assessments, May 1, 2015 p/th Eur/MWh Change D-1 $/MMBtu (Eur/MWh)French PEG NordDay ahead 43.8844.32 20.2520.45 -0.50 6.666.73Day ahead+1 43.7744.21 20.2020.40 -0.05 6.646.71Weekend 43.9944.42 20.3020.50 -0.90 6.686.74June 43.1243.56 19.9020.10 -0.65 6.556.61Q3 2015 43.3443.77 20.0020.20 -0.40 6.586.64Winter 15 47.3547.78 21.8522.05 -0.30 7.197.25Cal 2016 46.4846.92 21.4521.65 -0.25 7.067.12

French PEG Sud/TRS*Day ahead 44.7545.18 20.6520.85 -0.40 6.796.86Day ahead+1 44.2144.64 20.4020.60 -0.25 6.716.78Weekend 45.1845.62 20.8521.05 -0.40 6.866.92June 44.7545.18 20.6520.85 -0.55 6.796.86

German GASPOOLDay ahead 43.9944.42 20.3020.50 -0.70 6.686.74Day ahead+1 43.6744.10 20.1520.35 -0.15 6.636.69Weekend 44.3244.75 20.4520.45 -0.65 6.736.79June 43.5643.99 20.1020.30 -0.55 6.616.68Q3 2015 43.1243.56 19.9020.10 -0.40 6.556.61Winter 15 46.3846.81 21.4021.60 -0.30 7.047.10Cal 2016 45.7246.16 21.1021.30 -0.25 7.067.01

NetConnect GermanyDay ahead 43.8844.32 20.2520.45 -0.60 6.666.73Day ahead+1 43.5643.99 20.1020.30 -0.15 6.616.68Weekend 44.1044.53 20.3520.55 -0.75 6.696.76June 43.2343.67 19.9520.15 -0.60 6.566.63Q3 2015 43.4543.88 20.0520.25 -0.40 6.596.66Winter 15 47.0347.46 21.7021.90 -0.30 7.147.20Cal 2016 46.2746.70 21.3521.55 -0.25 7.027.09

Austrian CEGH VTPDay ahead 44.9745.40 20.7520.95 -0.15 6.836.89Day ahead+1 44.9745.40 20.7520.95 0.00 6.836.89Weekend 44.9745.40 20.7520.95 -0.90 6.836.89June 44.8645.29 20.7020.90 -0.10 6.816.87

Italian PSVDay ahead 45.9446.81 21.2021.60 -0.40 6.977.10Day ahead+1 46.3847.24 21.4021.80 0.20 7.047.17Weekend 45.9446.81 21.2021.60 -1.35 6.977.10June 46.1647.03 21.3021.70 -0.60 7.017.14Q3 2015 46.4847.35 21.4521.85 -0.35 7.067.19Winter 15 49.6350.49 22.9023.30 -0.30 7.537.66*TRS Trading Region South.

EEX German NetConnect gas prices, May 1, 2015

EEX gas spot price Settlement price Change (Eur/MWh) (Eur/MWh)NCG day ahead 10 MW NA NA

EEX gas futures Settlement price Change Total volume (Eur/MWh) (Eur/MWh) (MWh)NCG month ahead NA NA NANCG month ahead+1 NA NA NANCG quarter ahead NA NA NANCG quarter ahead+1 NA NA NANCG year ahead NA NA NANCG year ahead+1 NA NA NA

Source: EEX

an expected period of six months compared with the previous 3.805 Bcm capacity.

National Grid figures put Rough gas stocks at 500 million cu m at the end of Wednesdays gas day, 1.026 Bcm down on the five-year average and 1.654 Bcm lower than at the same time last year. Gary Hornby

NBP, TTF ICE volumes down sharply in April Total down 46.5% on the month to 697 TWh Easter Weekend, Summer 15 expiry cuts trade Jan-April trade still 36.5% up on year

THE MARKET Natural gas futures traded volumes on the IntercontinentalExchange for the UK NBP and Dutch TTF hubs dropped sharply in April as fewer trading days and the expiry of the Summer 15 contract led to lower liquidity on Europes two largest gas hubs, ICE data showed Friday.

Total traded volumes on ICE, a network of regulated exchanges and clearing houses for financial and commodity markets, for the NBP and TTF combined fell almost 50% to 697 TWh from the March total of 1,302 TWh and 12.0% down on the 792 TWh in April 2014.

Moreover, Aprils total was the lowest since the 612 TWh in May last year.

There were two fewer trading days available in April due to the four-day Easter Weekend at the beginning of the month.

In addition, trading on seasonal contracts plummeted with the expiry of the Summer 15 contract, falling from 690 TWh in March to 212 TWh in April.

Despite the low traded volumes last month, the first four months of the year saw 4,465 TWh traded compared to the 3,272 TWh for the January-April period in 2014.

On the NBP, traded volumes dropped 47.1% on the month and 23.3% on the year to 522 TWh in April, a 16-month low, however total traded volumes for January-April remained 20.9% higher on the year at 3,448 TWh.

Monthly contracts accounted for just over half of all traded volumes in April, with quarterly, seasonal and annual contracts accounting for 17.7%, 31.9% and 0.2% respectively.

For the TTF hub, traded volumes at 175 TWh in April were 44.5% down on the month but remained well above the 111 TWh in the same month last year, with traded volumes for the first four months of 2015 142.3% higher on the year at 1,018 TWh.

Trading was more evenly spilt than on the NBP, as monthly contracts accounted for 34.5% of the April total, quarterly contracts 30.2%, seasonal contracts 25.8%, and annual contracts 9.5%. Gary Hornby

(TWh)

0

500

1000

1500

Apr-15Feb-15Dec-14Oct-14Aug-14Jun-14Apr-14

Source: IntercontinentalExchange

ICE futures traded volumes

NBP TTF

Powernext French PEG Nord gas prices, May 1, 2015Spot daily average price Daily average price Change Total volume (Eur/MWh) (Eur/MWh) (MWh)PEG Nord day ahead NA NA NA

Powernext gas futures Settlement price Change Total volume (Eur/MWh) (Eur/MWh) (MWh)PEG Nord month ahead NA NA NAPEG Nord month ahead+1 NA NA NAPEG Nord quarter ahead NA NA NAPEG Nord quarter ahead+1 NA NA NAPEG Nord season ahead NA NA NAPEG Nord season ahead+1 NA NA NAPEG Nord season ahead+2 NA NA NA

Source: Powernext

EuropEan Gas Daily May 5, 2015

5Copyright 2015 McGraw Hill Financial

Platts cross fuel comparisons, May 1, 2015 p/th Eur/MWh Eur/GJCoal CIF ARAMonth ahead 43.1666 19.9203 5.533490 Days 42.7047 19.7071 5.4742

UK gas prices at NBPBalance month 86.8000 40.0560 11.1267June 83.2000 38.3947 10.6652July 84.1000 38.8100 10.7806Q3 2015 84.8000 39.1330 10.8703

Dutch gas at TTFJune 86.6800 40.0006 11.1113July 86.2500 39.8021 11.0562Q3 2015 86.6800 40.0006 11.1113

Fuel oil 1% (NW Europe cargoes)June 180.5749 83.3306 23.1474July 181.3617 83.6937 23.2483Q3 2015 182.1485 84.0568 23.3491

Electricity (UK baseload)June 120.5988 55.6532 15.4592July 121.4780 56.0590 15.5719Q3 2015 121.3314 55.9913 15.5532

Electricity (German baseload)June 65.9842 30.4500 8.4583July 65.0090 30.0000 8.3333Q3 2015 66.0925 30.5000 8.4722Prices in this table show the cost of electricity generated from each fuel, taking into account the following plant efficiencies: CCGT gas plant 50% HHV, coal 35%, fuel oil 32%. Assumed calorific value: fuel oil 17,800 Btu/lb, Coal 6,000 kcal/ton. HHV high heating value.

Platts Coal Switching Price Indicator (CSPI) UK UK NetherlandsMay 1, 2015 (p/th) (Eur/MWh) (Eur/MWh)

Month ahead 44.38 20.48 13.88Quarter ahead 44.01 20.31 13.73Year ahead 44.14 20.37 13.80Efficiency used is 50% for Gas plants, 35% for UK Coal plants and 40% for Dutch Coal plants. Platts CSPI is the theoretical threshold at which gas is more competitive than coal in power generation. When the gas price is higher than the CSPI, CCGTs are more expensive to run than coal-fired plants.

UK clean spark vs clean dark spreads season ahead(Eur/MWh)

Source: Platts (Trade date)

3

6

9

12

15

Apr-15Mar-15Feb-15Jan-15Dec-14Nov-14Oct-14Sep-14

CDS (CPS) Sum-15CDS (CPS) Win-15/16CSS 50% HHV (CPS) Win-15/16

CSS 50% HHV (CPS) Sum-15

(Eur/MWh)

Source: Platts

Clean spark spread, May 1, 2015 (50% efficient)

-25-20-15-10

-505

101520

QA+1QAMA+1MADA

BelgianDutchGermanUK

EC Gazprom statement indicates settlement Tone less hostile than expected Many of the issues already resolved

POLICY & REGULATION Russian gas analyst Katja Yafimava said Friday that the recent statement of objections that the European Commission filed against Gazprom allows the possibility of a settlement, based on what has been made public.

The EC has taken a more conciliatory tone than expected, and many of the issues that the statement identified, such as destination clauses, have been or will be removed where they persist, she said.

The EC is charging Gazprom with abusing its market position to set unfairly high prices and limiting natural gas market growth in eight Eastern European countries through contract clauses that ban customers for reselling gas, among other allegations.

The EC is acting on claims that were made against Gazprom some years ago, and since then, the markets affected have begun to diversify their sources of gas, in the process lowering their gas price.

Yafimava said it was a very important point that the statement of objections had said explicitly that oil price linkage is not per se uncompetitive, nor is charging different prices in different countries, because market fundamentals differ.

As for allegedly linking price discounts with infrastructure investment, she said the main case in point has been South Stream, which is now canceled and therefore irrelevant.

In short, although the statement of objections is not going to improve the EU-Russia gas relationship, its substance and wording are such as to allow enough room for Gazprom/Russia and the commission to settle, she said.

Platts has previously reported the wide range in prices among Gazproms captive customers, such as the Baltic States, which claim to pay the most for their gas. But now Lithuania has built an expensive import terminal, allowing it to import gas from elsewhere and negotiate more effectively with Gazprom.

Poland has nearly completed its LNG terminal, and gas flows in that northeast corner of Europe will respond to prices as more transport capacity is built between markets.

Gazprom says that the claims are unfounded and what it does is consistent with normal business practice. The business practices of the Gazprom Group in the EU market, including the principles of gas pricing, are in full conformity with the standards observed by other producers and exporters of natural gas, it said in response to the EC statement.

It also pointed out that under Russian laws it has to fulfill certain socially important functions as a strategic, government-controlled business entity.

Gazprom added that it expected the case to be resolved by an agreement between the EC and the Russian government.

Yafimava is the author of, or contributor to, a number of books on Russian and former Soviet Union gas markets published by the Oxford Institute of Energy Studies. William Powell

Turkey wants to transit Turkmen gas to Europe Turkey remains fully committed to transit: Yildiz EU interest in Turkmen gas continues

POLICY & REGULATION Turkey wants to transit natural gas from Turkmenistan to Europe, Turkish energy minister Taner Yildiz said Friday following a meeting with the Azerbaijani energy minister, Natiq Aliyev, Turkmen Deputy Prime Minister Baymurat Hocamuhammedov and European Commission Vice President Maros Sefcovic in the Turkmen capital Ashgabat.

FUEL SWITCHING SNAPSHOT

EuropEan Gas Daily May 5, 2015

6Copyright 2015 McGraw Hill Financial

Platts daily spot vs NWE oil-indexed gas indicator

May 1, 2015 Eur/MWh p/th $/MMBtuNBP day ahead current month -5.20 -10.50 -1.69NBP month ahead month ahead -4.44 -8.90 -1.45NBP month ahead+1 month ahead+1 -3.30 -6.47 -1.07

Eur/MWh p/th $/MMBtuTTF day ahead current month -5.08 -10.23 -1.65TTF month ahead month ahead -3.64 -7.16 -1.19TTF month ahead+1 month ahead+1 -2.81 -5.40 -0.91

The differential table shows the difference between the spot gas price and the indicator.

Platts May 2015 NWE oil-indexed gas indicator

Eur/MWh Change M-1 p/th $/MMBtu

Current month 25.28 -1.71 54.00 8.29Month ahead 23.64 -1.64 50.50 7.76Month ahead+1 22.71 -1.53 48.52 7.45

The Monthly NWE oil-indexed gas contract indicator is a modeled price reflecting the cost of gas sold in NW Europe under a traditional long-term sales contract indexed against fuel oil and gasoil. The model does not include any adjustment for discounts from contract renegotiations. Prices are originally calculated in Euro per MWh, then converted to p/th and $/MMBtu using current exchange rate.

N2EX UK power auction, spark spread: May 1

Delivery date: May 2

N2EX day ahead power auction 39.85 GBP/MWhPlatts EFA day ahead gas* 44.70 p/thNASDAQ OMX UK day ahead spark spread 8.81 GBP/MWh

*Reflects 11pm start electricity day

Forex indicators, May 1, 2015

NOK SKr DKr SFr GBP US $ Zloty TRYEuro 8.5055 9.3892 7.4655 1.0455 0.7394 1.1223 4.0746 3.0270US $ 7.5796 8.3665 6.6526 0.9316 0.6587 1.0000 2.6972

Source: Tullett Prebon, spot FX at 16:00 London time

Weather summary, May 1, 2015Week normal high/low temps (C) and projected deviations from normal

Celsius Normal 01 02 03 04 05 06 07

Central Europe

Berlin 18/7 -3 -3 -2 +3 +3 +1 -1Frankfurt-Am-Main 19/9 -5 -4 0 +2 +3 -1 -3Prague 18/7 -3 -1 0 +5 +5 +5 0Vienna 20/9 -3 -2 -1 +3 +5 +2 0Warsaw 18/7 -2 -2 -2 +2 +2 +4 0

Northwest Europe

Amsterdam 17/7 -3 -3 +1 +1 +1 -1 -1Brussels 17/8 -3 -2 +3 +3 +2 0 0London 17/8 -5 -5 0 +1 -1 -3 -4Paris 18/9 -3 -3 +1 -1 +1 -3 -3

Scandinavia

Copenhagen 15/6 -2 -1 -2 +1 +1 +2 +1Helsinki 12/4 0 -3 -2 -2 -3 -2 0Oslo 14/3 -1 -2 0 -1 -2 -1 +3Stockholm 14/5 -2 -2 -2 -2 -2 0 -1

Southern Europe

Lisbon 21/13 +1 +1 0 +1 -1 -1 -1Madrid 21/8 +3 +7 +5 +4 +2 +3 +5Milan 20/10 -4 +1 0 +1 +3 +3 +2

Source: CustomWeather, 01May15/06:54 AM EDT/1054 GMT

Turkeys semi-official news agency Anatolia Friday quoted Yildiz as saying that Turkey had been supporting the idea of exporting Turkmen gas to Europe via Turkey since the 1990s and remained fully politically and technically committed to achieving the transit. Yildiz said that the four-way meeting held Friday was an important step toward realizing the goal of exporting Turkmen gas via Turkey but made no comment on how the transit could be implemented.

In the late 1990s Turkey supported the development by Shell, Bechtel and GE of the 31 Bcm a year capacity Trans Caspian Gas Pipeline and signed a purchase agreement with Turkmenistan for 15.6 Bcm/year of gas.

The gas purchase agreement remains valid although the pipeline project was shelved by the developers following the discovery of gas in the Azerbaijani sector of the Caspian. Subsequently Turkey has discussed various options for transiting Turkmen gas to Turkey including via Iran and Azerbaijan.

In 2012 Turkey and Azerbaijan signed the host government agreement for the 31 Bcm/year TANAP gas line which allows for the transit of both Azerbaijani and Turkmen gas.

However to date no indication has been given as to how the gas could be brought to Turkey to feed into TANAP. Azerbaijan and Turkmenistan are in dispute over the delineation of their respective areas of the Caspian Sea, primarily over the ownership of the Omar and Osman oil and gas fields and without a resolution, the development of a new Trans Caspian pipeline is seen as unlikely.

Turkish officials said the dispute would be addressed at Fridays talks, but Anatolia made no reference to what had been discussed.

The presence of Sefcovic at Fridays talks suggests continuing hopes on the part of the EU that Turkmen gas can be transited to Europe via the TANAP line construction of which started in February. Although construction has started the line currently only has commitments of 16 Bcm/year of gas from Azerbaijans Shah Deniz gas field of which 6 Bcm/year will be supplied to Turkey and 10 Bcm/year transited to European markets with the remaining 15 Bcm/year of capacity still available.

The purchase last year by Malaysias Petronas of a 15.5% stake in the Shah Deniz field sparked speculation both that the company could take a stake in the TANAP pipeline consortium and that that Turkmen gas could be used to fill some of the lines spare capacity. Petronas holds a production sharing agreement with the Turkmen government for Block 1 in the Turkmen sector of the Caspian which covers the Magtymguly, Ovez and Diyarbekir gas fields which together have proven reserves of around 245 Bcm and have developed an onshore gas processing plant.

To date Petronas officials have declined to say whether the company is interested in joining the TANAP consortium or what plans it has for its Caspian holdings. David OByrne

MARKET COMMENTARy

ZEE spot discount narrows to 0.40 p/thSpot gas on Belgiums Zeebrugge hub against the UKs NBP market for the coming days was valued narrower on Friday than it had been throughout week 18.

Gas for delivery during the three-day bank holiday was assessed at a discount of 0.50 pence/therm to the NBP, at 43 p/th for both the weekend and Monday, and gas for delivery on Tuesday was at a discount of 0.40 p/th at 43.25 p/th.

During the previous week, the day-ahead contract was at a

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EUROPEAN GAS DAILY

discount of 0.85-1.40 p/th.Flows from the UK to Belgium across the Interconnector

pipeline were expected to be 23 million cubic meters for the day Friday after dipping to 14 million-15 million cu m/d Wednesday and Thursday, according to data from Eclipse Energy, an analytics unit of Platts.

Norwegian flows into Belgium were at a rate of 29 million cu m/d during the afternoon, operator Gassco said, up slightly from Thursdays 27 million cu m but down from Wednesdays 33 million cu m.

Norwegian production was hampered during the week by a string of unplanned outages, but they had ended by Friday.

Eclipse data estimated total gas demand for Belgium on Friday at 41 million cu m, fairly well in line with recent days. Demand was expected to ease to as low as 31 million cu m on Sunday and to 37 million cu m/d for Monday and Tuesday.

The expected drop in demand coincides with forecasts of warmer temperatures.

Brussels was forecast to be 3 degrees Celsius below the norm of 17/8 C Friday, CustomWeather data showed. Temperatures were forecast to climb to 3 C above average Sunday-Monday.

The new front-month June contract was valued at 43.10 p/th, a 1.50 p/th premium to the UK.

Winter 15 lost 0.10 p/th day on day to close at 47.25 p/th, with its discount unchanged at 1.85 p/th.

TTF extends losses as Norway ramps upDutch prices pushed lower again Friday, gaining momentum from an end to the recent spate of unplanned outages on the Norwegian continental shelf.

By the close, the contracts for Monday and Tuesday delivery were assessed at Eur20.20/MWh and Eur20.10/MWh, compared with Eur20.85/MWh on the corresponding contract for Friday delivery. The contract for Monday delivery last Friday had been assessed at Eur21.80/MWh.

Real-time flow rates at Emden/Dornum on the Dutch-German border were seen around 145 million cubic meter/day during the session, according to network operator Gassco, around 15 million cu m above flow rates Thursday.

Norways 120 million cu m/day Troll field had no unplanned

maintenance Friday after a 24 million cu m/day volume reduction Thursday.

Gassco reported one planned outage on the Continental shelf at an unnamed field, with a volume reduction of 45 million cu m/day.

End-of-day Norwegian imports into the Netherlands were nominated at 56.6 million cu m/d compared with a 58.8 million cu m/d allocation Thursday, according to Eclipse Energy, an analytical unit of Platts.

Dutch gas production was nominated at 103.2 million cu m/day compared with 89.8 million cu m Thursday, Eclipse Energy said.

Robust Dutch supply meant the system was able to restart exports to the UK through the BBL pipeline from mid-afternoon. The pipe was nominated to deliver nearly 15 million cu m into the UK Friday, Eclipse Energy said.

Meanwhile, Russian supply into Europe was expected at 293.5 million cu m/day Friday compared with a 320.1 million cu m/day allocation Thursday, Eclipse said.

CustomWeather forecast Amsterdam temperatures for Friday 3 degrees Celsius below the normal seasonal high and low of 17/7 C and at 1 C above norms Monday.

By the close, weekend and working-days-next-week contracts were assessed 75 and 65 euro cent lower day on day at Eur20.10/MWh parity.

On the curve, the new front-month June contract ended 45 euro cent lower day on day at Eur20/MWh, while Winter 15 was pegged 30 euro cent down on the day at Eur21.55/MWh.

Bears get firm grip on German spotThe German wholesale gas market continued to fall Friday, thanks to a downward revision of a demand forecast, healthy supply and pressure from the Dutch TTF equivalent.

The NetConnect day-ahead for Tuesdays delivery closed at Eur20.20/MWh, falling 75 euro cent day and day. GASPOOL equivalent plunged 85 euro cent to Eur20.25/MWh. The sharper fall at GASPOOL failed to reverse the price profile between the two hubs and GASPOOL remained the most expensive contract.

Nominated imports from Poland and from Russia remained high at about 176 million cu m. Exports allocated to the Netherlands increased about 21 million cu m since Monday to 41.3 million cu m, according to Eclipse Energy, an analytics unit of Platts.

EuropEan Gas Daily May 5, 2015

8Copyright 2015 McGraw Hill Financial

Stocks were seen at 28% full Friday at the opening, which was 35 percentage points less than last year at the same date, according to Gas Storage Europe data. Shippers boosted withdrawals as the week moved along, moving from a 2 million cu m withdrawal on Monday to a 23.40 million cu m drawdown on Thursday. Withdrawals then ratcheted back on Friday, to 7.8 million cu m.

Demand remained steady at about 200 million cu m Friday compared with Thursday, but was expected to tick down slightly over the weekend and the next week, to 170 million cu m.

At the end of the day, the forecast for German demand for May 4 and 5 was revised down according to GFS, which added to the bearishness.

CustomWeather forecast Munich temperatures for Monday 1 degree Celsius above seasonal norms and 5 C above normal on Tuesday, while Berlin was forecast 2 C below the seasonal norm for Monday and 3 degree above average Tuesday.

Healthy supply sends PEG prices downThe French wholesale gas market was pressured Friday by low demand on a bank holiday, the end of the firm capacity restriction at Taisnieres and the arrival of LNG cargoes in Spain.

The PEG Nord day-ahead for Tuesday delivery closed at Eur20.30/MWh, down 55 euro cent day on day. The TRS counterpart was assessed at Eur20.50/MWh, losing 65 euro cent day on day.

The Taisnieres interconnection point linking Belgium to France showed 43.51% restriction Thursday, but the outage ended Friday, operator GRTGaz showed. This in turn pushed down the TRS spot as the capacity between PEG Nord and TRS continued to be fully available.

Two LNG cargoes were expected in Spain on Friday and added to the sentiment of oversupply as Spain was expected to import less gas from France.

Temperatures in France were seen broadly in line with the seasonal average at the start of the week ahead. CustomWeather forecast temperatures in Paris to be 1 degree Celsius above seasonal norms Monday but about 1 C below norms Tuesday.

New front-month June closed at Eur20/MWh on the PEG Nord and at Eur20.75/MWh on TRS, with both contracts falling more than half a euro below May expiry.

PSV prompt, curve move lower in thin tradeItalian prompt gas on the PSV hub came down Friday in a generally quiet holiday session.

Weekend and Monday contracts were assessed at Eur21.40/MWh Friday, down from a level of Eur22.05/MWh seen Thursday for weekend delivery, while Tuesday was assessed at Eur21.60/MWh.

According to Snam nominations, demand for Saturday will fall to 116 million cubic meters from 118 million cu m Friday, while imports were expected to increase by 3 million cu m to 156 million cu m and storage injections to rise by 5 million cu m to 58 million cu m.

According to weather forecaster ilmeteo.it, temperatures in Milan were seen rising across the long weekend, from 13/14 degrees Celsius Friday to 17/25 C by Tuesday, while in Rome they would increase from 12/22 C Friday to 15/31 C by Tuesday.

On the curve, Winter 15 and Q3 followed the TTF lower, dropping 30 and 35 euro cent respectively to Eur23.10/MWh and Eur21.65/MWh. New front-month June was assessed at Eur21.50/MWh, having been seen Thursday at Eur22.10/MWh.

million cu m/d were higher than demand forecasts at 16:00 London time (1500 GMT) from National Grid of 225 million cu m.

The BBL flows have come out of the blue, accelerating the late selloff, one UK-based gas trader said. Although, Europe has been taking a lot of Norwegian gas, up by about 80 million cu m/d [since maintenance at Troll ended].

The within-day NBP contract was assessed at 44.15 pence/therm at the 16:30 London market close, 1.85 p/th lower than Thursdays close and down on the intraday high of 45.20 p/th from late morning trade.

The day-ahead and weekend contracts also came under pressure late, with day-ahead for Tuesday delivery closing at 43.65 p/th and weekend for Saturday, Sunday and Monday delivery assessed at 43.50 p/th, down 1.55 p/th and 0.70 p/th, respectively.

Early pressure on spot prices came from higher Norwegian gas flows through the Langeled pipeline, with total Norwegian gas flows into the UK rising from 60 million cu m/d Thursday afternoon to 82 million cu m/d Friday afternoon.

UK gas production was again robust and nudged close to the 100 million cu m mark Friday.

LNG supply remained healthy despite the fact that the Dragon LNG terminal ceased sendout overnight, with only South Hook flowing gas out at rates of 38 million cu m/d.

The Qatari Shagra LNG tanker remains on course to berth at South Hook on Tuesday; however, no tankers are due at either Dragon or Isle of Grain in the short term.

Storage withdrawals were seen from the Holford medium-range facility early Friday at rates of 4 million cu m/d; however, flows ceased early afternoon.

Nominations for exports to Belgium were higher, with IUK 16:00 nominations at 24 million cu m against the 15 million cu m from Thursday.

Prompt and curve NBP contracts also came under pressure toward the close, with further bearish influence from intraday losses in oil prices.

Front-month June was assessed at 41.60 p/th, down from the Thursday close of 42.10 p/th, with Q3 15 dropping 0.25 p/th to close at 42.40 p/th with mild losses on the near curve as Winter 15 and Summer 16 both fell 0.10 p/th to be assessed at 49.10 p/th and 44.35 p/th, respectively.

NBP spot falls late as BBL pipeline ramps up...from page 1

Spains April demand up 10% to 23.6 TWhMaintenance at Rough rescheduled: operatorNBP, TTF ICE volumes down sharply in AprilFuel Switching SnapshotMarket Commentary