Rete Gas PLAN FOR THE IMPLEMENTATION OF NEW CAPACITY AND FOR DEVELOPMENT Document prepared by Snam Rete Gas S.p.A. for compliance with the Delibera 137/02 of the Autorità per l’energia elettrica e il gas. September 1st, 2003 1 Foreword Snam Rete Gas S.p.A. publishes the plan for the implementation of new capacity and the development of its transportation network prepared on the basis of currently available information and on the basis of relationships with its own clients, securing transparency and impartiality among users in conformity with provisions of Directive no. 98/30/EC of the European Parliament and of Law Decree no. 164/2000. The present document has been prepared in compliance with the article 4 subsection 1 letter b, of Delibera no. 137/02 of the Autorità per l’energia elettrica e il gas. The projects that figure in the programme result from studies carried out by Snam Rete Gas on the basis of its own forecasts of capacity requirements. The infrastructure development plans included in this document are not binding for Snam Rete Gas that, therefore, reserves the right to modify them every time that new elements, such as for example evolutions of market requisites different from the current hypotheses, require it, as provided for in article 4 subsection 2 of Delibera no. 120/01 of the Autorità per l’energia elettrica e il gas. 2 Index 1 PLANNED INFRASTRUCTURES 1.1 Complete Programme 1.2 Transportation on the National Network 1.3 Transportation on the Regional Network 1.4 Main projects 2 PLAN OF CAPACITIES 2.1 Entry Points interconnected with foreign pipelines 2.2 Exit Points interconnected with foreign pipelines 2.3 Methodology for calculating capacities 2.4 Operational constraints and boundary conditions used for simulations 2.5 Interruptible capacities 2.6 Simulation Programs 3 ATTACHMENTS 3 1 PLANNED INFRASTRUCTURES 4 1 PLANNED INFRASTRUCTURES 1.1 Complete programme The plan for implementation of new capacity and for development includes projects whose construction is under way and those whose start is scheduled in future years, within the next four-year term. The level of project definition included in the plan changes, downwards, depending on their time collocation. Furthermore Snam Rete Gas has planned to put out some sections of natural gas pipelines and some plants, which, in total, have no impact on the reliability of the network of natural gas pipelines, or on the availability of transportation capacity. The development projects have been evaluated on the basis of transportation scenarios that reflect forecasts of consumptions of natural gas in Italy, relationships with subjects interested in starting-up new off-take points and those with users who use capacity in the inlet and outlet points. These projects represent approximately 80% of the plan and are characterised by the presence of significant works that will make it possible in the near future to inject quantities of gas onto the Italian network from the main pipelines supplying the Country. The remaining 20% of the plan includes different types of interventions including those aimed preserving existing infrastructures. Preservation projects have been identified on the basis of information available on the status of existing pipelines. Works relating to Transportation on the National Network represent approximately 60% of the plan, while those relating to Transportation on the Regional Network represent approximately 40% of the plan. In total the Snam Rete Gas Group plan provides for development of the network of gas pipelines from the 30,160 km forecast for the end of 2003, to the 31,700 km planned for the end of the 2003-2006 four-year term, with a further increase of up to approximately 31,900 km in the following years. 5 Similarly, the increase of installed capacity in the Compressor stations is forecast in the plan from the current 625 MW (37 compressor units in 11 stations), up to approximately 800 MW in the four-year term (seven new units to be installed in existing stations). A further increase of approximately 50 MW (one new station with three units) is planned in the following years. 6 1.2 Transportation on the National Network 86% of the National Network Development Plan is composed of projects already being implemented or that will be started during 2003, while the remaining 14% are planned to start in the following years. These infrastructures are destined mainly to reinforce the importation system, and will include the completion of works dedicated to importation from Russia and those for connection from the LNG terminal of Panigaglia, carrying on with activities related to the new Gela – Enna gas pipeline and works for development of the pipelines system from the South. These works will be presented in detail in paragraph 1.4. Furthermore, phases of design and permits related to possible further developments of the Transmed backbone have started. The remaining development projects are aimed at reinforcing other main national transportation pipelines, mainly located in the areas of Apulia, Southern Piedmont and the North-East. These include works related to the Bernalda – Palagiano natural gas pipeline which are under completion and the recently started works to develop the connection to the storage of Collato and of the Verona - Trento (section Bosentino-Aldeno) natural gas pipeline. Planned works for reinforcing the Alessandria – Oviglio, and Verona-Trento (section Vigasio-Sona) natural gas pipelines have not yet started. In total the plan will develop the National Network from approximately 8,000 km, planned for the end of 2003, to approximately 8,600 km, at completion of plan. The compression system will be developed from the current 625 MW, distributed over 37 compressor units, to approximately 850 MW at completion of plan, resulting from the installation of 10 new compressor units, for a total of approximately 220 MW of new compression capacity. 7 1.3 Transportation on the Regional Network 44% of the National Network Development Plan is composed of projects already being implemented or that will be started during the current year, while the remaining 56% are planned to start in the following years. These infrastructures are aimed at extending and reinforcing of the regional transportation network, for which completion of the following natural gas pipelines is planned: Valtellina, Bolzano – Bressanone – Brunico and Contursi – Battipaglia. Work for the Giarratana – Solarino natural gas pipeline, to develop supply to the industrial centre of Brindisi and to develop the connection to Abbadia Lariana have started. In addition, reinforcements are planned in the area of Southern Piedmont (Oviglio - Ponti and Cherasco – Cuneo gas natural pipelines), in Lombardy (Casaletto – Chiuduno, Mornico al Serio – Zanica and Mornico al Serio – Ospitaletto natural gas pipelines), in Apulia (Triggiano – Locorotondo natural gas pipeline), as well as reinforcement of the network of Umbria (Pietrafitta – Perugia natural gas pipeline), the Forlì - Faenza natural gas pipeline loop and the Palaia – Livorno natural gas pipeline. Furthermore, on the basis of relationships developed with the subjects interested in connecting their own sites to the transportation network and of feasibility studies carried out, many connections of new thermoelectric power plants, of industrial plants and of distribution networks scattered in the eight territorial districts, have been identified. Some of these works have already started. Meanwhile for the remaining ones, for which to date no defined contractual agreements exist, actual planning and implementation is subject to confirmation of interest by the requesting subjects and to the subsequent conclusion of agreements for connection. Started initiatives concern 7 new thermoelectric plants with capacity of approximately 4,000 MW; meanwhile implementation of approximately 100 connections in total per year is planned for the remaining types. At the same time, implementation of connections included in the plan of Methanization of the South goes ahead. In total the plan will develop the Regional Network of Snam Rete Gas from 22,160 Km, in the year 2003 to approximately 23,100 km, at the end of 2006, and an increase of approximately 200 km in the following years, with a total increase of approximately 1,200 Km. 8 1.4 Main projects To complete the description of the plan, hereinafter the most significant infrastructures are indicated in terms of their impact on effectiveness of the transportation system. These projects represent approximately 50% of the total and they are related to the implementation of works substantially distributed all along the Snam Rete Gas transportation network. 9 1.4.1 Additional Importation from Russia The project consists in laying approximately 190 Km of 48” pipeline and 43 km of 56" pipeline (section Camisano-Zimella), parallel to existing 36” and 42” lines between Tarvisio (province of Udine) and Zimella (province of Verona). The above-mentioned works, 97 km of which are operating (sections Flaibano-Oderzo and Malborghetto-Bordano), will be completed within the year 2006, thus allowing for an increase in importation capacity from Russia, at the entry point of Tarvisio, up to 103 Mm3/day. 1.4.2 Importation from Northern Europe The project consists in replacing 42 Km of 34” pipeline with a new 48” pipeline (section Gries Pass-Masera), laying 134 Km of 48” pipeline alongside the existing 34” one in the Masera-Mortara section (sections already completed) and in implementing a new compressor station provided with three units of approximately 12 MW each one. The above-mentioned works, completed in the year 2002, have increased imported volumes at the entry point of Masera to approximately 60 Mm3/day. Additional works and restorations are under way. 10 1.4.3 Gela – Enna natural gas pipeline This project meets the requirement to enable connection of the importation line coming from Libya. Furthermore, connected to implementation of the Giarratana-Solarino natural gas pipeline, it allows for closure of network ring operating for supply of the area of South-Eastern Sicily.