German FNB Releases Winter Outlook

Less Dutch gas and an ongoing south Germany pipe constraint are concerns noted in the third annual winter outlook, published by German gas transmission system operators’ association FNB October 24, but it is confident that any demand spikes in the coming months will be managed.

The 2018/19 winter outlook is characterised by further reduced low-calorific (L-gas) production in the Netherlands and the continued limited availability of the TENP pipeline in southern Germany that transmits gas to/from Italy and Netherlands.

Technically available storage volume in the German gas storage facilities is the same as in the previous year, but the aggregated level of storage facilities in Germany is lower than the average of the last five years, said FNB.

FNB judges the further reduction of Dutch L-gas production from the Groningen field as “not critical,” although it reduces overall supply flexibility. The changeover in market areas from L- to H-gas is on schedule, a process it says will make managing supplies easier. By end-2018, around 270,000 units will be converted to H-gas, it adds.

Very cold weather at the end of February/early March 2018 caused brief price spikes reaching as high as euros 285/MWh-gas (euros 83.45/mn Btu), when gas inventories fell to 30%-full. FNB said it is confident that this situation will not recur in winter 2018/19 “due to the current market signals - as well as additional measures taken in comparison with the previous year”.

The full report (German only) can be accessed at https://www.fnb-gas.de/files/fnb_gas_winterausblick_2018_2019.pdf