Operating context

In 2017, Enagás was operating in a context of relatively stagnant energy demand, in which growth in gas had accelerated in the previous two years, mainly displacing coal and being overtaken by renewables, which have seen more rapid growth.

By regions, non-OECD Asia (especially China) and Europe led growth in demand in 2016 (70% of gross growth) due to environmental policies and the favourable evolution of the prices of gas / coal and temperatures in the second half of the year. Iran (Nuclear Agreement) and Australia (wave of liquefaction) led growth in supply (50% of gross growth). In 2017, demand for gas maintained solid growth in many of the main markets (China, South Korea, Europe, etc.).

LNG is the clear leader in the gas sector with growth in the last two years way above demand for gas. Strong import growth, firstly in China and the Middle East and then in Europe is helping to absorb the start of the liquefaction wave better than expected.

All of this renewed demand for gas is being driven partly by the sharp fall in the price between 2014 and 2016. In2017, gas prices increased due to higher demand, but market fundamentals are keeping them at low average annual levels and with favourable evolution compared to coal.

In the medium term, 2020, the abundance of supplies of gas and LNG at competitive costs, will mean a continuation of a relative price scenario that is favourable to gas, consolidating robust growth (1.5- 2%, CAGR) in global demand for gas, particularly in non-OECD Asia, the MiddleEast and Europe. Latin America, despite its lower volume, also expects significant growth rates, with improved short-term prospects in countries like Brazil and Argentina and consolidation of the medium- and long-term fundamentals of countries like Mexico, Peru and Chile.

In this context, the company defines its growth priorities in three areas:

  • First, Enagás will be operating in the main gas infrastructure developments in Europe, contributing to market integration, ensuring security of supply and, therefore, playing a significant role in the transition to a low-carbon energy model.
  • Secondly, Enagás is positioned in growth markets with solid fundamentals and the company’s priority is to continue growing in countries where it is already present and in their neighbours, thus exploiting the major potential of these markets based on its experience of the Spanish system.
  • Finally, trade in LNG is growing, driven by the new liquefaction capacity in the USA and Australia, the increase of regasification in new non-OECD market sand the greater proportions of floating solutions. Investments to date in LNG and those planned for 2017-2020 will consolidate our leadership in the sector, with a focus on established markets.
Growth drivers

Participation in the integration of the European natural gas market

Consolidated EU markets
Enagás seeks to become a key European player with increasing importance in the Internal Energy Market

Develop natural gas infrastructures in growth markets

Growth markets
Lay the foundations for rolling out Enagás' business model as an independent TSO in countries with high growth potential

Strengthen Enagás' position as global LNG (regasification and liquefaction) expert

Global market- LNG
Leverage opportunities to interconnect markets worldwide, with Enagás maintaining its position as leader in LNG