Annual report 2007 - Activity Report

A n n u a l
R e p o r t
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1. L
egal and regulatory
framework����������������������������������� 101
2. D
evelopment of
Fluxys' services��������������������������� 106
3. Sustainable development����������� 126
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act i v i t y r e p o r t - L egal and regulator y framework
1.1 Key elements
In the current legal and regulatory framework, a regulated regime applies to the transport, transit and
storage of natural gas and the terminalling of liquefied natural gas (for the transit of natural gas, see
section entitled ‘Regulated regime for transit as well’, p. 104).
Regulated tariffs : costs + fair return. The regulated tariffs are based on the estimated costs that are
allocated through approved distribution keys to the range of services offered by Fluxys and Fluxys LNG.
These costs include operating costs and depreciations on the regulated asset base (RAB) as approved
by the Belgian federal regulator, the Commission for Electricity and Gas Regulation (CREG). CREG also
checks the development in real expenditure in relation to estimated costs.
In addition to costs, the regulated tariffs also include a fair return on invested capital, calculated in
accordance with directives that CREG has drawn up for this purpose. The fair margin corresponds to
the capital costs (WACC – Weighted Average Cost of Capital) multiplied by the capital invested in the
regulated services, also called the regulated asset base.
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Methodology used for regulated tariffs example of transport tariff
Return on invested
capital: WACC x RAB
Depreciation
and amortisation
Operational costs
= 3 x million
Estimation of
booked capacity =
y (m3(n)/hour)/year
Tariff in
3/(m3(n)/hour)/year
Post stamp tariff:
one single entry tariff
and one single exit tariff
per contracted
(m3(n)/hour)/year
The regulated tariffs for natural gas transport services are calculated using the equalisation principle :
each grid user pays the same tariff for a subscribed m3(n)/hour)/year, regardless of the transport
distance. To this end, the sum of the estimated costs and fair margin on capital invested is divided by
the estimated capacity subscribed during the tariff period.
Different tariff systems. For transport, storage and regulated transit, the normal regime applies, with
four-year tariffs in principle to be introduced in 2008 (see p. 104). As regards new transit, storage and
LNG infrastructure, the Gas Act provides for the application of a specific regime of multi-annual tariffs
including a fair margin on the regulated asset base taking account of the competitive context.
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1.2Implementing the Gas Act
The Second European Gas Directive (16 July 2003) was transposed into Belgian national legislation in
2005 via amendments to the existing Gas Act, which were supplemented in 2006 with other provisions.
These amendments expand in several respects the legal and regulatory framework within which Fluxys
and Fluxys LNG operate.
Specific requirements for operators. The amended Gas Act implements the provision in the Second
European Gas Directive to officially appoint one or more system operators. To be eligible for appointment,
operators must meet a number of specific requirements relating to, amongst other things, corporate
governance (see also ‘Corporate governance – developments’, p. 71).
Following implementation of the Gas Act, Fluxys and Fluxys LNG were officially appointed operators
under the non-definitive system in March 2006 : Fluxys LNG was appointed operator for the LNG
terminalling facilities and Fluxys was appointed operator for the natural gas transmission network
and operator for the natural gas storage facilities.
A notice was published in the Belgian Official Gazette on 21 February 2007 inviting applicant operators
to submit an application to be appointed operator under the definitive system. On 21 May 2007, Fluxys
submitted three applications to be appointed under the definitive system as operator of the natural
gas transmission network, operator of the natural gas storage facilities and operator of the LNG
terminalling facilities. The appointment as operator under the definitive system is valid for a renewable
20-year term.
The appointment procedure stipulates that the federal Energy Minister must ask the Banking, Finance
and Insurance Commission (CBFA) and CREG for an opinion on applications. The two bodies submitted
their opinions and the Minister asked Fluxys to take them into account. Although the applications
complied in full with the Gas Act, Fluxys decided to respond to the opinions as far as possible.
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Regulated regime for transit as well. In accordance with the second European Gas Directive, transit
is in Belgium now subject to a regulated regime as well. This regime has yet to be defined further to
take account of the principle of sanctity of contracts for transit contracts concluded under the former
Transit Directive (91/296/EEC).
1.3Topics Fluxys/CREG in 2007
Monitoring of 2006 tariffs. In accordance with applicable regulation, Fluxys submitted its 2006 financial
report to CREG in 2007. When checking the 2006 accounts, CREG decided to revise its interpretation of
fair remuneration of invested capital. This had a negative impact on the results.
No multi-year tariffs yet. Pursuant to the Gas Act, on 29 June 2007 the Belgian Official Gazette
published the Royal Decree setting out the method for calculating the multi-year tariffs 2008-2011
(Royal Decree on tariffs, dated 8 June 2007). In accordance with the new Royal Decree on tariffs, Fluxys
submitted its proposals for four-year tariffs 2008-2011 to the Belgian federal regulator CREG.
In response to CREG’s request on 25 October 2007 to revise those proposals, Fluxys submitted on
26 November 2007 new tariff proposals for approval. On 19 December 2007 CREG decided to reject
those proposals and impose provisional tariffs at the level of 2007 tariffs. These provisional tariffs will
apply until CREG and Fluxys agree on the tariffs for 2008-2011.
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1.4Europe - the European Commission’s third package of measures
On 19 September 2007, the European Commission presented a third package of measures aimed at
further liberalising the European energy market.
To improve non-discriminatory access to markets, the Commission proposes to decouple more
clearly production and supply from transmission activities, either via ownership unbundling, or via a
system whereby an independent body within integrated operators takes responsibility for managing
the grid. In addition to the Commission’s proposals, several countries have already proposed a third
solution. Fluxys believes that the Belgian legal and regulatory framework already comprises ample
provisions so as to ensure open access to infrastructure.
The Commission also proposes creating an Agency for the cooperation of National Energy Regulators
which would be able to issue decisions that – amongst other things – would make it possible to deal
with cross-border projects in a suitable manner.
In addition, the Commission plans to formalise cooperation between national natural gas and electricity
transmission system operators by creating a European network of transmission system operators.
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2.1Transmission services
2.1.1 Transport
Transport tariffs among the lowest in Europe. Fluxys' 2007 transport tariffs were among the lowest
in Western Europe, as revealed by a comparison of natural gas transmission tariffs published by
Arthur D. Little in July 2007.
18 entry points
Fluxys grid: 3800 km
Number of grid users on the increase: between the end of December
2006 and 1 January 2008, five new grid users signed transport
contracts with Fluxys, bringing the total number of grid users for
Fluxys’ transport services to 9.
Major
industrial
end users
106
Power
stations
Grids of 18
distribution system
operators
Domestic
end users
Small and
medium-sized
industrial end users
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act i v i t y r e p o r t - D evelopment of F lu x y s ' services
New transport services. In 2007, Fluxys optimised its range of transport services in several areas.
One of the most important improvements is found in the offer of interruptible entry capacity.
By extending and enhancing the offer, customers can change their entry points to the grid more flexibly,
enabling them to better optimise their supply portfolio. In addition, short-term capacity can be booked
from a minimum duration of 1 day (instead of a minimum duration of 7 consecutive days).
As for transport services from 2008, Fluxys has refined its services further. These developments
primarily include new services that will make it even easier to change entry points and which will
extend the options for making maximum use of capacity available in the network.
Developments in the industrial segment. At the end of 2007, there were 259 direct connections between
the Fluxys grid and industrial customers, power stations and cogeneration facilities. During the year,
17 of these customers changed supplier with a further 26 changing supplier on 1 January 2008.
Developments in the distribution system operators segment. Amendments to the Flemish Decree
on natural gas in March 2007 impose targets on distribution system operators for connectability to
their grids. At least 95% by 2015 and 99% by 2020 of areas destined for habitation in accordance with
the sector plan or spatial implementation plan will have to be able to be connected to a distribution
system. This will entail significant extensions to distribution systems and, consequently, additional
investment in the Fluxys grid.
Reinforcement of supply capacity for transport. In 2007 Fluxys commissioned the ZandhovenHerentals pipeline to bolster supply capacity to the Antwerp region. Five new connections with
industrial customers were commissioned as well. Fluxys carried out upgrades at a number of pressurereducing stations on behalf of public distribution operators, and a new pressure-reducing station was
commissioned in Herentals.
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Compressor station under construction in Zelzate and additional regulation stations in the Zeebrugge
area. Two regulation stations were built in the Zeebrugge area in 2007 and construction began on a new
compressor station in Zelzate, which is due to come on stream in 2008. The facility will boost capacity
in the Fluxys grid so as to match the expected growth of natural gas consumption in Belgium. The
compressor station will also optimise flows to the natural gas storage facility in Loenhout. As of 2010,
the facilities will also be used for additional natural gas flows from the Dutch grid, both international
transit flows to Zeebrugge and supply flows for the Belgian market.
Full ZEE Platform Service. In December 2006, Fluxys launched the ZEE Platform service, a new
service allowing open transfers of natural gas between three entry points in the Zeebrugge area.
The overall available transfer capacity was limited to 400,000 cubic metres per hour and was offered
through a capacity allocation procedure. On 1 February 2008 Fluxys switched over to the full ZEE
Platform Service.
ZEE Platform Service: transfer of natural gas without capacity limitations
between all four entry points in the Zeebrugge area
LNG
TERMINAL
HUB
INTERCONNECTOR
TERMINALS - IZT
ZEEBRUGGE HUB
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ZEEPIPE
TERMINAL
ZPT
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Users of the ZEE Platform Service can now transfer natural gas without any capacity restrictions
between the four entry points in the Zeebrugge area :
the Zeebrugge hub ;
the Interconnector Zeebrugge Terminal, feeding either UK gas into the continent or continental gas
into the UK ;
the Zeepipe Terminal, feeding Norwegian gas into Belgium and France ;
and the LNG Terminal.
Switching over to the full ZEE Platform Service marks another step in the further development of the
Zeebrugge area : it will enhance the role of the Zeebrugge area as a crossroads for international gas flows
in Northwest Europe while competition possibilities increase for suppliers on the Belgian market.
Possible changeover from low calorific gas to high calorific gas in the long term. The Fluxys network
consists of two separate networks : a network for transmission of low calorific natural gas from the
Groningen field in the Netherlands, and a network for the transmission of high calorific natural gas
from Norway, Russia, the United Kingdom and LNG sources.
High calorific
natural gas
Low calorific
natural gas
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The future supplies of low calorific natural gas to Belgium depend on developments in supplier purchase
contracts and the remaining period left for exploitation of the Groningen field in the Netherlands. It
is in this context that the Federal Public Service Economy was given the task of setting the schedule,
mode of financing and actions that will make it possible to adapt, either partially or in full, the Fluxys
network and the distribution system operators’ networks currently used to supply low calorific gas to
the supply of high calorific gas. This conversion will require a series of investments and actions that
will involve not only Fluxys, but also the distribution system operators, suppliers, grid users, regulators
and neighbouring countries.
2.1.2 Transit
In addition to its transport services, Fluxys also offers transit services in Belgium. These cover borderto-border transmission of natural gas without delivery or supply in Belgium.
Fluxys is the single point of contact for transit in Belgium. Distrigas temporarily commissioned
Fluxys in December 2006 to handle the commercialisation of the transit capacities held by Distrigas
& C°, a Distrigas subsidiary, from 1 January 2007. This involves transit capacity in the ZeebruggeBlaregnies and Zeebrugge-Zelzate/Eynatten (RTR1) pipelines. According to the terms and conditions
of this mandate, Fluxys – in the name and on behalf of Distrigas – manages existing transit contracts
between Distrigas & C° and its customers for the two pipelines, and concludes new transit contracts
as well. This mandate simplifies the situation significantly : Fluxys is now the single point of contact
for all current and potential natural gas transit shippers in Belgium.
Preparation of permit applications for new east/west transit capacity. In June 2005 Fluxys launched
a market survey to assess the level of interest in new east/west transit capacity on the ZeebruggeZelzate/Eynatten (RTR) transmission route. The market survey led to contracts with 14 grid users for
new transit flows in both directions on the route in question. The contracts were concluded subject to
various conditions such as tariff approval by CREG and provide the foundation for the feasibility of the
project to lay a second pipeline between Eynatten and Opwijk (RTR2) along the existing RTR route.
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UNITED KINGDOM
SOURCES FROM THE
NORTH AND EAST
Zeebrugge
Zomergem
Opwijk
Haccourt
Eynatten
SOURCES FROM
THE EAST
Fluxys is seizing upon the interest in transit through the RTR2 pipeline to enhance entry and supply
capacity for the Belgian market.
In 2007, Fluxys continued to prepare the files connected with various permit procedures required to
lay a pipeline. The RTR2 pipeline will be laid in two stages :
the Eynatten-Haccourt section in 2009/2010 (exclusively for entry and supply capacity for the
Belgian market) ;
the Haccourt-Opwijk section in 2010.
In addition, in 2007 Fluxys decided to lay a second pipeline along the east/west transmission route
between Opwijk and Zomergem.
Market consultation on new transit capacity between Belgium and France. In April 2007, Fluxys
launched a market consultation to assess the level of interest in booking additional long-term natural
gas transit capacity between Belgium and France.
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At the same time, the French system operator GRTgaz surveyed the market to assess the level of
interest in complementary additional capacity in the French grid. The market consultations held by
Fluxys and GRTgaz are being coordinated with the energy regulators in both countries. Besides, Fluxys
consults with the Dutch system operator GTS, who is currently also surveying the market for interest
in additional capacity.
The Fluxys and GRTgaz market consultations have revealed keen interest from the market : 40 shippers
have confirmed non-binding interest for an overall long-term capacity to be qualified as important and
requiring significant investments in the infrastructure of both Fluxys and GRTgaz.
Following this market consultation, Fluxys and GRTgaz signed a Memorandum of Understanding
in December 2007 on the development and sale of new cross-border capacity. Under the terms of
this Memorandum, GRTgaz and Fluxys agree to consult each other in each stage of the process to
implement the necessary investments on both sides of the border : binding agreements with shippers,
investment decisions, approval by regulation authorities and progress of respective projects. This close
cooperation aims at offering the new capacity through a set of services which is consistent between
Fluxys and GRTgaz. Considering permitting procedures and the investments required, commissioning
of the new capacity is planned for the end of 2012 at the earliest.
Blaregnies
New North/South
transit capacity
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New transit services. In addition to projects for new transit capacity, Fluxys is also developing new
services to allow the market to use existing transit capacity more efficiently. Since early 2007, Fluxys
further promoted the possibility for shippers to book conditional transit capacity from the Interconnector
Zeebrugge terminal and the Zeebrugge Hub to France. This service led to a noticeable increase in the
number of grid users and volumes nominated at the entry point towards France. The conditionality of
the service relates a.o. to the flow direction in the Zeebrugge-Zelzate/Eynatten pipeline.
In 2008, interruptible transit capacity will be offered on different routes :
from the Zeepipe Terminal or the LNG Terminal in Zeebrugge towards France ;
from ’s-Gravenvoeren towards France ;
from Eynatten towards the Interconnector Zeebrugge Terminal ;
from the Interconnector Zeebrugge Terminal towards Zelzate or Eynatten.
The available interruptible capacity will be determined in accordance with historical capacity use in
the pipelines concerned.
In 2008, Fluxys also plans to launch an Internet application which will facilitate trading of transit
capacity on the secondary market in the Zeebrugge/Zelzate-Eynatten and Zeebrugge-Blaregnies
pipelines.
Zeebrugge
Zelzate
‘s-Gravenvoeren
Eynatten
Blaregnies
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Market consultation in 2008 : new transit capacity towards Luxembourg. In 2008, Fluxys will launch a
market consultation to assess the level of interest in booking additional long-term natural gas transit
capacity towards Luxembourg.
Improved cooperation between transmission system operators in the spirit of the European
Commission’s third package of measures. The European Commission’s third package of measures
stresses the importance of cooperation between system operators to facilitate free movement and
trade of natural gas. As a leading transit operator, Fluxys has always found it important to work closely
with other operators in the interests of grid users. This cross-border coordination intensified in 2007
with the signature, in December, of the Memorandum of Understanding between Fluxys and GRTgaz
on the development and sale of cross-border capacity between Belgium and France (see p.112).
In the same spirit, Fluxys and GRTgaz concluded in November 2007 an interconnection agreement.
Such an agreement allows shippers to fully concentrate on their commercial dealings as they do not
have to bother about day-to-day natural gas transfer issues at the border. In the past, Fluxys already
signed similar agreements with four other operators : Gassco (Norway), Zebra (Netherlands), E.ON
Gastransport (Germany) and Interconnector UK.
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2.2 Storage services
Fluxys offers storage services from its underground natural gas storage facility in Loenhout and the
LNG storage at the peak shaving facility in Zeebrugge. Existing storage capacity has to be allocated in
priority to grid users supplying distribution system operators. There were four active users of Fluxys
storage services in 2007.
Increase in underground storage capacity at Loenhout. In 2007, Fluxys started work on increasing
capacity at the Loenhout underground storage facility. The aim, over a period of four years (2008-2011),
is to gradually increase the workable storage capacity by 15% from 600 to 700 million cubic metres.
In addition, the flexibility in operating the storage facility will be boosted by increasing send-out capacity
from 500,000 to 625,000 cubic metres per hour and injection capacity from 250,000 to 325,000 cubic
metres per hour.
(MWh)
Energy transported daily for supply and consumption in Belgium –
comparison between July and December 2007
Highest daily offtake in 2007:
957,429 MWh
1.000.000
900.000
800.000
700.000
Fluxys stores
natural gas so that
suppliers have a
buffer they can use
to meet their
heating customers'
needs when
demand peaks
during cold periods.
600.000
500.000
Lowest daily offtake
in 2007: 262,493 MWh
400.000
300.000
200.000
1
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3
4
5
6
7
8
9
10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31
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Study concerning a new underground storage facility at Poederlee. Fluxys conducted a seismic study
in May 2007 to assess the feasibility of a new underground natural gas storage facility at Poederlee,
with a partnership being set up with Gazprom Export and Gazprom Marketing & Trading Ltd for these
explorations. In February 2008 the project partners jointly decided to discontinue further exploration
of the site. As for Fluxys the decision to discontinue the Poederlee project was made because it turned
out not to meet the economic criteria envisaged : the seismic study showed the Poederlee underground
to have too small a workable storage capacity.
Research into possible underground storage in the Limburg Campines region. In collaboration with
the Flemish Institute for Technological Research (VITO) and the Limburg Investment Company (LRM),
Fluxys is currently looking into potential underground storage sites in the Campines region of the
Limburg province. Seismic research was carried out in November 2007 in Bree, Bocholt, Maaseik and
Kinrooi to map out the deep subsoil. Sometime in the first half of 2008 the research should reveal the
presence – or not – of any structures that could be used as a reservoir.
2007 Seismic study of the
underground in Bree,
Bocholt, Maaseik
and Kinrooi
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2.3LNG terminalling
1000th cargo unloaded. In 2007 the Zeebrugge LNG Terminal passed several milestones in its history
as a cornerstone for security of supply. Not only did the terminal mark its 20th year in operation, it also
unloaded its 1000th cargo. Between commissioning of the facility in 1987 and the end of 2007, a total
of 1,012 LNG ships were unloaded, delivering 56.6 million tonnes of LNG or 73.3 billion cubic metres
of natural gas.
Five ships docked at the LNG Terminal for the first time in 2007 : Al Jassasiya, Maersk Qatar, Lusail,
Ejnan and Al Thakhira. As from 1 April 2007, LNG ships have been received under the terms of new
long-term agreements that Fluxys LNG signed in 2004 with Qatar Petroleum/ExxonMobil and Distrigas.
In 2004 a long-term agreement was signed with SUEZ LNG Trading as well. The first cargoes under
this contract are expected in 2008.
On 27 June 2007 Qatar Petroleum and ExxonMobil announced that they had assigned their terminalling
contract with Fluxys LNG to EDF Trading for four and a half years. In February 2008 SUEZ LNG Trading
made known that it had sublet some of its terminalling capacity to ConocoPhillips.
New mechanism for the secondary market. In spring 2007 Fluxys LNG launched a new mechanism to
facilitate the exchange of booked but unused capacity at the LNG Terminal. The new secondary market
mechanism was necessary in view of the switch to a multishipper environment from April 2007. Under
the new system, terminal users notify Fluxys LNG of booked slots they do not intend to use. Any such
slot is automatically made available on the secondary market at the regulated tariff through publication
on the Fluxys LNG website.
Completion of capacity enhancement in April 2008. Following the new LNG terminalling agreements
signed in 2004, the terminal's capacity is being doubled. The capacity enhancement will be completed in
April 2008, representing an investment of 2165 million. The enhancement works include the construction
of a fourth LNG storage tank and regasification facilities nearly doubling send-out capacity.
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The doubling of capacity develops the Zeebrugge terminal into an LNG gateway to neighbouring
markets on the continent and in the UK. The capacity enhancement will also have a positive impact
on the Belgian market as it increases security of supply and supports the development of more
competition : more LNG can trigger greater liquidity on the Zeebrugge Hub, with in turn a positive
impact on the market operation.
Market consultation for possible second capacity enhancement project. A pre-feasibility study has
shown that, in line with the strategic plan for the port of Zeebrugge, the LNG Terminal's capacity can be
increased even further after the current capacity enhancement. Considering the rising importance of
LNG in Europe’s security of supply, Fluxys LNG launched in late 2007 a worldwide market consultation
to assess the level of demand for additional capacity at the Zeebrugge LNG Terminal. By mid-February
2008, 15 parties had expressed interest in the project. In the next stage Fluxys LNG is to consult with
the interested parties to define the various needs.
Cycling storage: fourth tank
brings total workable
volume to 380,000 m3 of
LNG (equivalent to about
three LNG cargoes)
Extra regasification facilities
increase send-out capacity
to 1.7 million m3(n)/h (1 LNG
cargo in about two days)
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2.4Hub services
Zeebrugge Hub 2007: Breakdown of net traded volumes among members
(%)
10 %
100 %
9 %
90 %
8 %
80 %
7 %
70 %
6 %
Cumulative percentage
5 %
60 %
50 %
Percentage per member
4 %
40 %
3 %
30 %
2 %
20 %
1 %
10 %
0 %
0 %
1
2
3
4
5
6
7
8
9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35
Eighteen new members. Huberator, the Fluxys subsidiary operating the Zeebrugge Hub, had 70
members by the end of 2007. Eighteen new members joined during the year. There was a continuing
trend towards more and more financial traders wishing to trade on the Zeebrugge Hub, and the number
of new members operating from the United States and Southern Europe also shows growing interest
outside the northwest European market. Net traded volumes at the hub remained relatively stable.
Increase in activities on APX Gas ZEE natural gas exchange. In 2005, Huberator joined forces with
APX to launch APX Gas ZEE exchange for the Zeebrugge Hub, an electronic platform offering traders
the opportunity to conclude short-term deals anonymously and without any counterparty risk. Screen
trading as an alternative to trading using bilateral contracts picked up significantly in 2007 : annual
traded volume rose from 20.4 GWh (1.75 million cubic metres) in 2006 to 339.7 GWh (29.2 million cubic
metres) in 2007.
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Huberator has been active on APX Gas ZEE since 2007 as part of its automatic back up services to
balance its customers' shortfalls and exceedings. Fluxys also joined APX Gas ZEE at the start of 2007 :
screen trading offers the company an additional tool for balancing possible shortages and surpluses
in its operational natural gas reserves.
2.5Operational support services
The operational support services provided by Fluxys’ subsidiary Gas Management Services Limited
(GMSL) enable all players in the natural gas chain from producers, LNG importers, traders and
suppliers to large industrial end users to outsource the monitoring of nominations for their natural
gas movements and transfers. In 2007, GMSL provided operational services to grid users in Belgium,
the Netherlands, France, Germany, Austria, Switzerland, Italy, the United Kingdom and Ireland and
users of the subsea pipelines in the North Sea. The number of customers using GMSL’s operational
support services increased sharply in 2007.
GMSL also uses its operational knowledge and experience to develop software for shippers active
on both the UK market and grids in continental Europe. In 2007 the company developed additional
functionalities within ENOM, a communication software package that, amongst other things, enables
grid users to exchange nomination data with operators. There was a substantial rise in the number of
licences for operational software in 2007 as well.
GMSL also acts as Claims Validation Agent for the grid users of National Grid Gas (GB), checking
delivery claims at grid entry points in order to validate the data on volumes of natural gas entering
the grid.
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2.6 Balgzand-Bacton Pipeline
Following the Interconnector (Zeebrugge-Bacton), the Balgzand-Bacton pipeline (BBL) is the second
subsea pipeline between the European continent and the United Kingdom. BBL Company - a joint
venture between Gasunie (Netherlands), Fluxys and E.ON Ruhrgas (Germany) - is responsible for
building, operating and marketing the pipeline. The pipeline, which was commissioned on 1 December
2006, has been offering interruptible capacity since December 2007.
In May 2007, a market consultation was launched to assess the interest from shippers to conclude
agreements for additional capacity in the BBL pipeline. More than 15 companies showed interest and
Fluxys decided to co-invest – in proportion to its stake in BBL Company (20%) – in the new compressor
facilities needed to offer the requested additional capacity.
2.7Indicative investment programme for 2007-2016 : 41.7 billion
2.7.1 General approach to investment planning
The Fluxys Group pursues an active investment policy and underpins this policy with an indicative 10-year
investment programme. The programme is based on CREG's Indicative Natural Gas Supply Programme
2004-2014 and is regularly updated to bring it in line with new signals from the market. These updates
take account of changing needs in terms of security of supply, new connection requests for industrial
customers and additional requirements from grid users identified a.o. through market consultations.
When updating its investment programme, Fluxys takes the data showing how demand for transmission
capacity is expected to develop and the forecasted use of entry zones to carry out simulations on the
grid as it currently stands. A number of scenarios are considered : a scenario primarily showing east/
west flows, a scenario primarily showing west/east flows, and a number of other sub-scenarios.
For each scenario Fluxys examines what investments are needed so that natural gas can be supplied
at the guaranteed minimum pressure at all supply or border points and so that adequate resources
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are available to maintain grid balance. Fluxys also attaches great importance to working closely with
operators of neighbouring grids since the success of certain projects on Fluxys’ own grid requires
consultation and agreement on the nature and timing of investment needed on neighbouring grids.
Fluxys uses this approach in a bid to respond to market needs as best possible and also take into
consideration the time period required to complete a project. It takes approximately five years to
implement infrastructure projects of some scale because procedures for establishing pipeline routes
in a densely populated country like Belgium are becoming ever more complex and a range of permits
and laws need to be taken into consideration.
2.7.2 Key elements in the indicative investment programme for 2007 2016
The indicative investment programme for 2007-2016 is worth 21.7 billion and includes infrastructure
projects in transmission, transit, storage and LNG terminalling. The programme serves several
objectives : technical excellence in operating the infrastructure and perfection with regard to safety,
security of supply for end users, efficient competition on the natural gas market in Belgium and beyond,
and further development of Belgium as the crossroads for international gas flows in Western Europe.
These elements are achieved through investment in two areas : investment aimed at increasing the
flexibility in operating the Fluxys grid and investment aimed at safe operation of the infrastructure.
The main objectives of investment aimed at increasing the capacity and flexibility of the grid are to :
increase the flexibility in the choice of entry points in the Zeebrugge area
increase the entry, transit and transport capacities on the Zeebrugge-Zelzate/Eynatten transmission
route (RTR2)
offer firm entry capacity from the entry points at ’s Gravenvoeren and Blaregnies to the Zeebrugge area ;
increase transport capacity to the provinces of Antwerp and Limburg
increase transit capacity between Belgium and France (in the study phase)
increase the capacity and employability of the Loenhout natural gas storage facility
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Investment aimed at safe operation of the infrastructure will primarily be channelled into :
safeguarding the infrastructure’s integrity and accessibility ;
optimising markings of pipeline routes
improving and extending fire-fighting equipment in enclosed facilities ;
implementing new technologies for remotely logging work carried out in the immediate vicinity of
Fluxys pipelines.
Indicative investment programme
2007- 2016: breakdown by activity
Indicative investment programme
2007-2016: breakdown by type of investment
10%
8%
8%
5%
12%
25%
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72%
Transmission
Capacity enhancement
Transit
Replacement of
existing infrastructure
LNG terminalling
Safety
Storage
Other
123
124
2.7.3 2007 : 2132 million investment in infrastructure
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LNG Terminal
Construction of a fourth storage tank and additional regasification facilities with a view to doubling throughput capacity to
9 billion cubic metres per year (see p. 117).
Pipelines
Construction of the Zandhoven-Malle pipeline (5 km) to enhance supply capacity.
Construction of the Zandvliet–Lillo pipeline (11 km) to enhance supply capacity to the port of Antwerp. This project will be
completed in 2008.
Construction of the Zelzate–Rodenhuize pipeline (8.5 km) to enable three industrial consumers to be connected to the grid :
Electrabel (Rodenhuize 1 power station), Bioro-Cargill and Alcobiofuel. This project will be completed in 2008.
Construction of a pipeline under the Nimy-Blaton Canal at Ghlin, replacing the overhead pipeline fixed to the bridge crossing
the canal.
Stations
Construction of a compressor station at Zelzate (completion due 2008, see p. 108).
Construction of two additional pressure and flow regulation facilities at the OKS station at Dudzele (commissioning in 2008,
see p. 108).
Increase of the underground storage, injection and send-out capacities on the Loenhout storage site (see p. 115).
Construction of new pressure-reducing stations for distribution system operators : Angleur, Herentals, Kampenhout,
Mariembourg and Mettet.
Major adjustments or extensions to existing pressure-reducing stations : Merelbeke and Schoten.
Explorations
Seismic study to assess the feasibility of a new underground natural gas storage facility at Poederlee (see p. 116).
Seismic studies in Bree, Bocholt, Maaseik and Kinrooi to map out the deep subsoil and then assess whether it is suitable for
storing natural gas (see p. 116).
Industrial connections
Work on new connections to the Fluxys grid for industrial consumers : Electrabel (Kallo) and Esso (Antwerp).
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3.1Operating safely
3.1.1 Active policy to prevent damage by third parties
Statutory notification requirements : five steps
Anyone wishing to carry out works in the vicinity of Fluxys natural gas transmission infrastructure has a
legal obligation to inform Fluxys from the planning stage onwards (Royal Decree of 21 September 1988).
There are five steps involved in meeting the notification requirement :
During the planning stage, the project owner – or the designer on the project owner’s behalf – must
notify where the works are to be carried out as well as the nature of the works involved. Then Fluxys
will inform the project owner (or designer) if it has any infrastructure in the vicinity. If it does, Fluxys
provides indicative location maps of its infrastructure along with safety instructions.
Once it is known which contractor will be carrying out the works, the project owner – or the designer on
the project owner’s behalf – must supply this contractor with all the information provided by Fluxys.
At least 15 working days before beginning works, the contractor must once again notify Fluxys of
the works. The aim of this step is to ensure that contractors also have the appropriate information
in cases where there is a long time between the planning stage and works being started. Fluxys
responds to this notification by again providing the indicative location maps of its infrastructure
along with safety instructions.
At least eight working days before beginning works, the contractor must provide Fluxys with a letter
sent by registered post detailing the location and timetable of the works, as well as the plans and
methods for carrying it out.
Fluxys asks contractors to contact Fluxys’ regional operating sector at least 48 hours before
beginning works. A patrol officer will then come to the site free of charge to indicate the location
of the pipeline and where and how many trial trenches have to be dug to confirm the location of the
pipeline. During the visit the patrol officer will run through the location maps of the pipeline, the
safety instruction and the work methods.
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3.1.1.1 Awareness-raising campaigns : statutory requirement to notify works
Serious pipeline incidents arise mainly from damage caused by third parties. That is why Fluxys has
for years now been carrying out awareness-raising campaigns on how to work safely in the vicinity
of its infrastructure. The campaigns are targeted at everyone involved in such work : project owners,
designers and anyone working independently or on behalf of a project owner. Special attention is
drawn to the statutory requirement to find out from Fluxys whether any natural gas transmission
infrastructure is present in areas where works are planned. With its team of dedicated staff and a highquality document management system Fluxys processes 75,000 to 80,000 notifications per year.
Information for municipalities
Provincial information sessions. – In 2007 Fluxys organised provincial information sessions for
municipalities, inviting a range of stakeholders from each municipality : the mayor or municipal
clerk, aldermen for public works and/or spatial planning, a representative of the technical works
department, the officer in charge of emergency planning and representatives of the fire brigade and
the police. The aim of these meetings was to inform the new governing bodies appointed following
the 2006 municipal elections about the safety aspects of construction works near natural gas
transmission facilities. Particular attention was also drawn to the Fluxys investment programme
and to the fact that Fluxys builds and operates infrastructure of public interest.
Individual information meetings for municipalities - Starting in 2008, Fluxys will resume its ongoing
information programme. The aim is to arrange – at some stage during their term of office – an
individual meeting with the authorities of each of the 391 municipalities with a Fluxys pipeline sited
either in the municipality itself or in its immediate vicinity.
Pipeline maps - Every five years Fluxys sends a mailing to each municipality with a full overview of the
pipelines in their territory. If new pipelines enter service or existing pipelines are moved during that
five-year period, the municipalities concerned are automatically sent a copy of the updated maps.
Initiatives for the construction industry
Preparatory meetings with contractor - Every day Fluxys staff have preparatory meetings to explain
essential safety measures to take when carrying out construction works near Fluxys’ transmission
infrastructure.
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Seminars with the construction industry - In 2007 Fluxys was an active contributor to the seminar
‘Working safely in the vicinity of pipelines and cables’ (held on 15 March) organised by the Quality and
Safety Unit of the Federal Public Service Economy, SMEs, Self-employed and Energy. Contractors
working on road infrastructure, representatives of the Federal Cable and Pipeline Information
Checkpoint (CICC/KLIM), the federation of Belgian pipeline transmission companies (Fetrapi),
Netmanagement, ALG/ALE and Elia attended the event. The seminar aimed to establish a constructive
dialogue amongst the participants.
Training programmes for excavator operators - Fluxys asked the regional employment agencies VDAB
and FOREM in 2007 to include in their training programmes for excavator operators a component on
working in the vicinity of transmission pipelines. Instructor training starts in early 2008 and pipeline
tubing has been supplied so that practical exercises in realistic conditions can be incorporated into
the training programmes.
Training programmes for safety coordinators - In 2007 Fluxys also worked with the Belgian National
Action Committee for Health and Safety in the Construction Industry (CNAC/NAVB) and the Catholic
University of Leuven (KUL) to add a component on working in the vicinity of transmission pipelines
to their training programmes for safety coordinators. The company trained instructors and supplied
training materials. KUL provided its first course including this element in December 2007.
Information for owners and farmers
Fluxys has an ongoing programme whereby around 60,000 landowners and farmers over a period of
five years are contacted in writing to remind them that a Fluxys underground pipeline runs beneath
their land. To this end, Fluxys launched an eye-catching mailshot in 2007.
3.1.1.2 Work notification quick and simple thanks to CICC/KLIM – a success story
The Federal Cable and Pipeline Information Checkpoint (CICC/KLIM) was launched in 2006. CICC/
ENSEMBLE
POUR PLUS
DE SÉCURITÉ
KLIM is a website for anyone wishing to carry out works in the vicinity of high-voltage connections or
pipeline transmission facilities. The site can be used to notify planned works anywhere in Belgium to
the transmission operators concerned.
The development of the CICC/KLIM website came in the wake of the Memorandum agreed in July 2005
between the federal Energy Minister, the federal Home Affairs Minister, Fetrapi (Federation of pipeline
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FLUxyS EST LE gESTIONNaIRE DU RÉSEaU haUTE PRESSION DE TRaNSPORT DE gaz
NaTUREL EN BELgIqUE. CECI EST UN gUIDE à L’aTTENTION DES PROPRIÉTaIRES
ET ExPLOITaNTS DE TERRaINS PaR LESqUELS PaSSE UNE CaNaLISaTION FLUxyS,
ET DE TOUTE PERSONNE haBITaNT à PROxIMITÉ D’UNE CaNaLISaTION FLUxyS.
Fluxys - Brochure Riverains FR.i1 1
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transmission companies), Elia and the construction industry federations. The website is run by the
CICC/KLIM non-profit association, which alongside Fluxys also has the other Fetrapi companies and
Elia as members.
There was a sharp rise in the use of the CICC/KLIM compared to 2006 : whereas in 2006 there were
nearly 7,000 notifications, 2007 saw them rising to 24,000. Some 6,000 of these notifications were
addressed to Fluxys, meaning that in 2007, 8.5% of notifications for Fluxys came from the CICC/KLIM
portal compared to less than 1% in 2006.
In another development, the General Administration of Patrimonial Documentation enquired into the
possibility to include land-registry in the CICC/KLIM database. In response research has been done
into the requirements to broaden searches based on street maps with searches based on land-registry
data. Such a change would make the database even more user-friendly for notaries and architects
amongst others. The Board of Directors of the CICC/KLIM has signed an agreement in principle for
the project being implemented in 2008.
3.1.1.3 KLIP alongside the CICC/KLIM
The CICC/KLIM is a federal initiative whose members include Elia as well as all companies having
obtained a transmission licence under the federal gas legislation and are represented by Fetrapi, the
Federation of pipeline transmission companies. There is also the cable and pipeline information portal
KLIP, a Flemish portal to notify all pipeline and cable operators of any work to be carried out in the
Flemish Community.
To ensure that notification of planned work does not require using both the CICC/KLIM and the KLIP
portals, data needs to be exchanged between the two systems. The modalities for these exchanges have
been provided for by a Memorandum of Understanding (dated 20 April 2007) between Federal Minister for
Energy Marc Verwilghen and Flemish Minister for Public Works, Energy and the Environment Kris Peeters.
The exchange module is currently being developed and will be tested during the first half of 2008.
7 9 th f i n a n c i a l y e a r 129
CICC/KLIM undertakes to cooperate in a similar way once the Walloon web portal (e-impétrants) and
its Brussels counterpart (Iriscom) are on-line.
3.1.1.4 Presence of pipelines : optimising visibility
In 2007, Fluxys continued its programme of making the presence of underground pipelines more
visible by optimising markings along pipeline routes. Fluxys plans to cover the entire grid by the
end of 2008.
3.1.1.5Helicopter patrols stepped up
More than 60 Fluxys patrol officers inspect the pipeline system every day. There are three ways in
which they do their rounds :
car patrols to take measurements, find works that have not been announced, and support contractors
carrying out work in the vicinity of pipelines,
once a year the whole pipeline system is checked on foot,
helicopter patrols to find works that have not been announced.
In a bid to improve its detection of unannounced work in the vicinity of pipelines, Fluxys has since 2006
increased the number of helicopter patrols it carries out : helicopters pass over the main pipelines
every working day to log any work that is going on and some pipelines are also patrolled at weekends.
In 2007, Fluxys made 1,200 helicopter patrols. Three times a day on average helicopter patrols asked
for a car patrol officer to be immediately sent to a site because of work that was not being carried out
according to the rules or work of which the regional operating sector had not been informed despite
the statutory notification requirement.
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3.1.2 Cooperation with fire brigades and the police
Pipeline maps. Every five years, fire brigades receive location maps giving a full overview of the Fluxys
pipelines in their area. If new pipelines enter service or existing pipelines are moved during that fiveyear period, the fire brigades concerned are automatically sent a copy of the updated maps. Since
October 2007, Fluxys has been applying the same systematic approach to local police zones.
Courses for fire brigades. In the Pipelines working group of the Federal Public Service Home Affairs’
Civil Safety Unit, Fluxys contributed in 2007 to a practical course about the Natural Gas Action Card
and the accompanying manual, which were drafted in 2006. The Natural Gas Action Card enables a
swift assessment to be made of the seriousness of an incident and outlines the measures to take and
emergency numbers.
In 2007, all fire brigade training officers had the chance to take this practical course. The aims of the
course are for them to subsequently pass on what they have learned to the fire-fighters and for the
Action Card to be made part of fire-fighters’ training.
Emergency and intervention plans. Through cooperation with the Crisis Centre (Federal Public Service
Home Affairs), fire-fighters now have access via an internet application to the numerical database
of Fetrapi, the Federation of pipeline transmission companies. In addition, the guide to emergency
measures for gas and liquid transmission pipelines is being drafted. The guide will enable municipalities
and provinces to include transmission pipelines in their emergency and intervention plans.
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3.1.3 Quality management system
Pursuant to the legislation covering Seveso companies, Fluxys applies a Safety Management System (SMS).
Fluxys has three Seveso facilities, namely the LNG Terminal and the peak shaving facility in Zeebrugge
and the underground natural gas storage facility in Loenhout. The SMS is a quality management system
based on the ‘Plan-Do-Check-Adjust’ (PDCA) methodology aimed at continuous improvement.
The SMS is based on a good knowledge by staff of processes and procedures. In 2007 Fluxys and Fluxys
LNG staff took a total of around 8,250 hours of courses.
The authorities responsible for the safety of Seveso facilities carry out an audit each year to monitor the SMS.
During these audits the SMS is reviewed and follow-up is provided on improvement actions.
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3.2Looking after our human capital
3.2.1 Staff development
Recruitment efforts stepped up. In 2007, Fluxys and Fluxys LNG hired 82 members of staff – a net
increase on 2006 of 36 staff members. This increase is slightly below Fluxys’ objectives, due to both
shortages on the labour market and the specific nature of the vacancies. To ensure that despite this
situation it could still recruit as many new members of staff as possible, Fluxys considerably stepped
up its recruitment efforts in 2007. A new advertising campaign was launched in the national and local
media. Fluxys also went into universities and other higher education institutions and, as in previous
years, took part in job fairs such as Stepstone Job Challenge and Career Launch. These intensive
recruitment efforts will continue in 2008.
Personal induction programme for new staff. Fluxys draws up a personal induction programme for
all new staff. Throughout their trial period, they are provided with support to help them familiarise
themselves with their new work environment. This includes training courses on Fluxys procedures
and working methods, visits to the sites and sessions to explain the company’s activities. Executives
are very much involved in the induction programme and have the task of smoothly integrating new
staff into their team.
Special attention to career development. Fluxys encourages job mobility as part of its employees’
career development. This not only means promotions, but also moves to jobs of the same level in
another team. If there are vacancies, members of staff are given the chance to apply first and if there
are structural changes in the organisation, an analysis is made of existing skills to establish how
members of staff can be employed to the best advantage. In 2007, 8% of staff seized the opportunity
to take up a new position within the company.
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Training hours increase. In 2007, Fluxys and Fluxys LNG employees attended over 39,000 hours
of training, compared with 35,000 hours in 2006 and 29,000 hours in 2005. Just over 94% of Fluxys
employees attended training courses ; the figure for Fluxys LNG was just over 78%. Job-specific,
technical, quality and safety training courses in 2007 accounted for over 78% of all training.
3.2.2 Well-being at work
Comprehensive prevention plan. A comprehensive prevention plan aims to promote actions to
boost the prevention of accidents at work and follows the Plan-Do-Check-Adjust methodology.
The comprehensive prevention plan for 2006-2010 involves 25 cross-cutting projects. The projects are
clearly defined in terms of actions required and departments concerned and serve as the basis for
annual action plans.
The annual action plan for 2007 focused among others on work in noisy environments, safety in explosive
settings and work with potentially hazardous products. The instructions on working with products likely
to contain asbestos have been updated and the staff concerned has been trained accordingly.
Comprehensive prevention plan: 25 cross-cutting projects
2006
2007
2008
2009
2010
Do
Do
Do
Do
Do
Plan
Check
Adjust
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Plan
Check
Adjust
Plan
Check
Adjust
Plan
Check
Check
Adjust
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There have also been on-the-job training courses in ergonomics. Furthermore, the procedures have
started for updating local emergency plans and optimising existing safety procedures when launching
new projects.
Actions taken to raise awareness on safety culture. Fluxys publishes a newsletter twice a year to raise
awareness amongst employees about working safely ; it also provides practical information on accident
prevention. Particular attention is paid to working safely in contexts that give the initial impression of
being less dangerous, for example an office environment.
Anti-smoking policy implemented. The anti-smoking policy launched by Fluxys in 2006 was fully
implemented in 2007. Special facilities for smokers have been set up on all sites. In addition, support
has been provided for employees who want to give up smoking, whilst stickers and posters have been
put up in the buildings to draw the attention of visitors and newcomers to Fluxys’ anti-smoking policy.
Positive results for Safety Checklist Contractors (SCC) audit. Fluxys’ Project Management, Supervision
& Interventions and Cathodic Protection departments operate on the work sites. They have a Safety
Checklist Contractors (SCC) certification, version 2004/04. In 2007 improvements were made to the
SCC approach and it was incorporated into the Safety Management System (see ‘Quality management
system’, p. 132), which applies the same Plan-Do-Check-Adjust methodology. The 2007 SCC audit was
carried out successfully.
Safety coordination on temporary and mobile work sites. Fluxys puts in place a health and safety plan
right from the outset of its own infrastructure projects. The company also strives to communicate as
much as possible with contractors both prior to and during the work. Safety coordination within the
company is also organised in such a way that the required safety measures are standardised in both
the design and implementation phases, and only need to be adjusted to take account of the specific
nature and environment of each individual project.
Fluxys works with external safety coordinators for larger projects. Since 2007 project leaders and study
engineers who have taken training courses as level B safety coordinators have been responsible for
smaller scale projects.
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3.3 Good neighbourship
3.3.1 Infrastructure projects : transparent communication policy
Fluxys strives to ensure, in a spirit of good neighbourship, that municipal authorities, local residents
and other stakeholders are informed in a completely transparent way of works the company intends to
carry out. We focus in particular on the company's approach to safety and on the fact that our pipelines
and installations are infrastructure of public interest.
Information session about the Schoten pressure-reducing station. Adjustments made to the
distribution system operator IGAO’s grid triggered noise nuisance from the pressure-reduction lines
of the Fluxys station at Schoten. Fluxys put forward solutions at an information session for local
residents and adjustments were made to the station.
Presentation of the Zelzate compressor station. When Fluxys started building the compressor station
at Zelzate, the company invited neighbouring companies and representatives of the municipality to a
presentation of the project and the project team.
Information session about the new regulation facilities at the Dudzele OKS station. At a municipal
information session, Fluxys provided local residents living near the OKS station at Dudzele with details
of its project to build two additional regulation facilities there.
The port of Zeebrugge
centenary celebrations
on 8 July 2007 saw
Information session about storage of natural gas in the Limburg Campines region. In November
Fluxys welcome some
600 local residents and
2007 seismic studies were started in Bree, Bocholt, Maaseik and Kinrooi to map out the deep subsoil
other interested parties
and then assess whether the sites are suitable for storing natural gas. In June, Fluxys held a joint
to the LNG Terminal.
information session with the Flemish Institute for Technological Research (VITO) to present the project
to residents of the municipalities concerned.
Information session about the Lauw pressure-reducing station. Fluxys invited local residents to a
presentation of the project to build a new pressure-reducing station at Lauw.
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Information sessions about the Lier pressure-reducing station. Fluxys organised information sessions
in Lier to inform local residents about the construction of a new pressure-reducing station there.
Subsequently they were given the chance to visit a similar station at Herentals.
Information sessions at Baudour and Quaregnon. At information sessions in Baudour and Quaregnon,
Fluxys presented the project to clean a series of pipelines. The pipelines were out of service and had
previously been used for transporting coke oven gas.
3.3.2 Dedicated Fluxys contacts for owners and operators of land who have a pipeline passing
through
From the initial planning of a pipeline route to the site restoration after a pipeline has been laid, owners
and operators of land who have a pipeline passing through have their own contact person at Fluxys.
In this way they can consult someone who has a thorough knowledge of their concerns and the features
of their land. The Fluxys contacts’ task is to defend the interests of the owners and operators of the
land and ensure harmonious relations between the parties.
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3.4Environment
3.4.1 Key elements in the environmental policy
Systematically further restricting minimum environmental impact. Traditional modes of transmission
are no match for underground pipeline transmission when it comes to use of space, safety, energy
efficiency and environmental impact. In designing, laying, operating and dismantling infrastructure,
Fluxys’ environmental policy is designed to further limit in a systematic way the already minimal
environmental impact. This preventive approach is based, among other things, on Fluxys research and
seeks to strike an optimal balance between respect for the intrinsic value of the environment and the
imperatives of economic development.
Environmental quality assurance system. Fluxys carries out regular environmental assessments of
all of its stations to ensure compliance with environmental permits and environmental standards (such
as emission limit values). Fluxys uses this environmental quality assurance system to make sure that
the environmental impact of its stations remains minimal.
With regard to the environmental quality assurance system, in the period 1998-2005 all LNG and
storage facilities, compressor stations, metering stations, pressure-reducing stations and sites in
regional operating sectors were subject to an environmental analysis. The environmental analysis
is repeated every five years for the three Seveso sites (the LNG Terminal and peak shaving facility in
Zeebrugge, and the underground natural gas storage facility in Loenhout) and for the compressor
stations. For the other stations, a new environmental analysis is carried out when the environmental
permits are renewed periodically.
Environmental action programme. The results of the environmental analyses (1998-2005) serve as the
basis for the environmental action programme, which focuses on, among other things, measures to
limit noise emissions at pressure-reducing stations (p. 143) and measures to improve energy efficiency
(p. 140). The 'sewage treatment' part of the environmental action programme was completed in 2006 :
a separate drain system was laid and an industrial sewage treatment plant or a reedbed percolation
system was installed in all large stations.
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The action programme was originally supposed to last until 2014, but Fluxys is planning to finalise
environmental actions by the end of 2008. Subsequent actions will be taken as and when necessary
on the basis of periodical environmental analyses.
Environnemental audit. By law, Seveso facilities must undergo an environmental audit every three
years. In 2007, the audit was performed in all three Fluxys Seveso facilities : the LNG Terminal and
peak shaving facility in Zeebrugge, and the underground natural gas storage facility in Loenhout.
The audit was validated and approved by Vinçotte, the independent inspection organisation.
3.4.2 Kyoto sites
Fluxys : 6 Kyoto sites. Under the Kyoto Protocol, the maximum permissible level of greenhouse gas
emissions each year for the period 2008-2012 is 92% of the 1990 emissions level.
The European Commission issued an Emissions Trading Directive in order to comply with these
commitments. The directive took effect on 1 January 2005. In Belgium, tradable emissions are
LNG Terminal Zeebrugge
Natural gas
storage facilityLoenhout
Compressor stationWeelde
Compressor stationWinksele
Peak shaving
facility –
Zeebrugge
7 9 th f i n a n c i a l y e a r Compressor stationBerneau
139
distributed across the three regions. Within each region, they are then allocated to each industrial site
that emits a certain quantity of greenhouse gases. Fluxys has six such Kyoto sites.
Fluxys approach fully compliant with European directive
In accordance with the European directive, Fluxys holds emission rights for each of its Kyoto sites;
As per the directive, Fluxys applies monitoring protocols to its Kyoto sites. Monitoring protocols are
groups of procedures making it possible to monitor daily emissions of CO2 and to report them by type
of consumption. This means that immediate action can be taken if emissions exceed the authorised
level. Every year all of the procedures are subjected to an internal audit. The internal audits did not
identify any non-conformities in 2007;
Fluxys also prepares an annual emissions report for each Kyoto site in line with the directive.
These reports are then subject to an external audit. The conclusions of the external audit were
also positive.
3.4.3 Focus on energy efficiency
3.4.3.1 Committed to joining the global energy efficiency elite
Global benchmarking. On its own initiative, Fluxys joined the Flanders Benchmarking Covenant
on energy efficiency (Benchmarking Convenant Vlaanderen). Through this membership the company
commits itself to make the necessary investments in its Kyoto facilities in order to join and remain
in the global energy efficiency elite for facilities that consume natural gas, electricity and gas oil.
The benchmarking involves comparing the energy performance of the sites in question every four years
to comparable facilities around the world. Proposals are then drawn up on improving energy efficiency.
The first benchmarking exercise carried out in 2006 revealed that the LNG Terminal and the Winksele
compressor stations exceeded or equalled the target values, while the other Kyoto sites were
approaching or very close to the target values. In its implementation of the agreement, Fluxys drafted
several energy management plans listing all of the changes required so that the energy efficiency of
the Kyoto facilities can reach the global elite level of 2006 and maintain that position in 2012 when
using even more stringent benchmarks.
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2007. Changes totalling around 21.5 million were made in 2007 in accordance with the energy
management plans and with a view to achieving target values at all levels. These changes included
replacing boilers with higher performance units at the peak shaving facility in Zeebrugge and at the
natural gas storage facility in Loenhout, as well as replacing air compressors at the peak shaving
facility in Zeebrugge and the Weelde compressor station. The latter modification is continuing in
2008. Although the LNG Terminal is already part of the global elite, various changes were also made.
The feasibility of using open rack vaporisers (see page 143) was also examined.
2012. To determine the 2012 benchmark, targets are systematically tightened up in line with
technological developments. Modifications and replacements worth some 275 million are planned
for the period 2008-2012. These include the replacement of three gas motors at the Weelde compressor
station and the replacement of two gas turbines in Winksele. Fluxys is also looking into replacing two
gas turbines at the Berneau compressor station.
3.4.3.2 Sturdy approach to Rational Use of Energy (RUE)
New infrastructure projects : energy study. Fluxys carries out a thorough energy study into any project
for new natural gas transmission infrastructure that will consume a significant amount of energy.
This study is used to find the most effective solution for improving the project's energy efficiency.
In the new compressor station in Zelzate, for instance, an electric drive and an electric motor are
to be installed to increase injection flow as part of the project to expand capacity at the Loenhout
underground storage facility. For the OKS station in Dudzele and the compressor station in Winksele
the choice has been made to install high performance condensation boilers.
Buildings : energy saving measures. The Flemish decree on energy performance and indoor temperature
management encourages the use of renewable energy resources and sets insulation requirements for
7 9 th f i n a n c i a l y e a r 141
new constructions and renovation projects. In accordance with these obligations, Fluxys is examining
the possibility of implementing energy saving measures in its new construction projects. This involves
using solar water heaters or heat pumps to produce hot water, photovoltaic solar panels to generate
electricity, ventilation systems with heat recovery and low-energy lighting. Fluxys' biggest construction
projects include the administrative building at the new compressor station in Zelzate, the new building
on the Loenhout natural gas storage site and the new building at the Wetteren regional operating sector.
Studies on energy saving measures were completed in Wetteren and Loenhout : the installation of solar
water heaters to produce hot water at each of the sites is economically viable. The study on solar panels
to generate electricity also yielded positive results at Wetteren.
Fluxys' goal is to proactively adopt the same approach for all buildings - new and old – and in all
regions. For instance, in the period 2008-2010 an energy study will be carried out on the buildings at
the regional operating sectors, the Zuun intervention centre and the border metering stations (with
personnel). Proposals for optimisation can then be drafted on the basis of these studies.
LNG Terminal : assessment of open rack vaporisers. In connection with the environmental permit
for the enhancement works at the LNG Terminal in Zeebrugge, Fluxys is studying the feasibility of
supplementing the new regasification facility with a second cogeneration facility or a series of open
rack vaporisers. Open rack vaporisers regasify LNG using heat from seawater and could lead to a
major reduction in energy consumption. The environmental impact of using open rack vaporisers was
assessed in 2007. It turned out that the impact is limited and consultation with the relevant regional
and federal authorities was begun to assess the feasibility of the project.
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3.4.4 Breakdown of results for the different indicators
3.4.4.1 Noise
In recent years, Fluxys has carried out studies and pilot projects on silencing technology. This technology
is fitted as standard in new stations and is gradually being implemented in existing stations.
At pressure-reducing stations (the most frequent type of station by far), Fluxys systematically takes
all possible steps to reduce the noise impact by fitting silent pressure regulators and installing
boilers inside buildings. In 2007, noise reduction measures were taken at the Berneau and Winksele
compressor stations, as well as at the Zandvoorde, Hannut, Sint-Truiden, Evergem, Gilly and Vielsalm
pressure-reducing stations.
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3.4.4.2 Air
Fluxys mainly uses natural gas to operate its transmission infrastructure. The combustion of natural
gas produces nitrogen oxides (NOx) and carbon dioxide (CO2). Pressure-reducing stations can also
produce a small amount of methane (CH4). Methane may also be emitted during work on pipelines or
when compressor stations are started or stopped.
Fluxys systematically measures emissions at all of its combustion facilities. These systematic
measurements enable Fluxys to fine-tune its facilities so as to increase their energy efficiency and
keep levels of harmful emissions to a minimum.
Greenhouse gases : methane (CH4) and carbon dioxide (CO2). The nominal value of the Global Warming
Potential (greenhouse gases) for the operation of Fluxys infrastructure in 2007 was down 11% compared
to 2006 and at the same level as in 2005. The Global Warming Potential was down 18% compared to 1990.
Evolution Global Warming Potential (in tons of CO2 eq.)
350.000
325.000
300.000
275.000
250.000
225.000
200.000
175.000
150.000
125.000
100.000
1993
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1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
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Methane (CH4). CH4 emissions per volume of transported natural gas were up 17% compared to 2006.
Over a larger number of years, emissions of CH4 per volume of transported natural gas remain at the
limit of what is technically possible, with fluctuations from year to year depending on the number of
gas movements in the grid. For example, when machines have to be activated more frequently and
for shorter periods of operation, emissions of CH4 per volume of transported natural gas are higher.
CH4 emission relative to the volume of natural gas transported (in %)
0,040
0,035
0,030
0,025
0,020
0,015
0,010
0,005
0
1993
1994
1995
1996
1997
1998
1999
2000
2001
Breakdown of CH4 emission in 2007 2002
2003
2004
2005
2006
2007
(in %)
1%
Compressor stations
24%
Storage
33%
8%
Pressure-reducing stations, blending stations and metering stations
Pipelines
34%
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145
Carbon dioxide (CO2). CO2 emissions per volume of transported natural gas dropped 10% compared with
2006. This reduction is mainly the result of adaptations made in connection with energy management
plans to reduce emissions.
CO2 emission relative to the volume of natural gas transported (in mg/MJ)
250
225
200
175
150
125
100
75
50
25
0
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
Breakdown of CO2 emissions in 2007 2006
2007
(in %)
Compressor stations
36%
42%
Storage
Pressure-reducing stations and blending stations
LNG
17%
5%
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Nitrogen oxides (NOX). NOx emissions per volume of transported natural gas fell 23% compared to
2006. The decrease is primarily due to the fact that the gas motors at the Weelde compressor station
were not used as often : the gas motors emit higher levels of NOx than the gas turbines in the same
station. The gas motors at Weelde are scheduled for replacement in 2009-2010.
NOx emission relative to the volume of natural gas transported
(in mg/MJ)
1,0
0,9
0,8
0,7
0,6
0,5
0,4
0,3
0,2
0,1
0
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
Breakdown of NOX emission in 2007 3%
2006
2007
(in %)
9%
5%
Compressor stations
Storage
Pressure-reducing stations and blending stations
83%
LNG
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3.4.4.3 Fauna and flora
Fluxys takes great pains to conserve ecosystems in areas where pipelines are laid. Where required, the
company carries out environmental impact assessments for new projects. The environmental impact
assessments must be approved by the relevant authorities.
In 2007, environmental impact assessments were drafted and submitted to the relevant authorities
for the following projects :
laying the RTR2 pipeline on the Haccourt-Eynatten route ;
laying the pipeline between the Dilsen metering station and Dilsen-Boslaan ;
laying the Lommel-Ham-Tessenderlo pipeline ;
laying the Kallo-Melseledijk pipeline ;
replacing compressors at the Weelde compressor station ;
building a third nitrogen tank and installing open rack vaporisers (see page 143) at the Zeebrugge
LNG Terminal ;
building a pressure-reducing station in Kallo ;
laying the RTR2 pipeline on the Opwijk–Haccourt route.
Environmental impact assessments were approved by the relevant authorities in 2007 for the project
to expand capacity at the Loenhout storage site and for the Ranst-Lier pipeline.
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Fluxys SA
Registered Office - Avenue des Arts 31 – B-1040 Brussel
Tel +32 2 282 72 11 - Fax +32 2 282 02 39 - www.fluxys.net
VAT BE 0402.954.628 - RPR Brussels - D/2008/9484/12