BLUGAS S.p.A.

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Case History of a New Operator
Mark Hayes Supply Manager
Rome 27th April 2004
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ORIGINS
Born in 2000 from an undertaking between four
leaders from the world of public service
companies Tea s.p.a. Mantova, AEM s.p.a.
Cremona, ASM Pavia s.p.a. and ASTEM s.p.a. Lodi
A company which buys and sells natural gas.
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First Experiences

• May 2001 First importation experience
• 2001 Blugas Appeal against Snam Rete Gas.
• 2002 Antitrust sentence per abuse of
  dominant position.
• April 2004 A new sentence from Antitrust
  contesting Enis proposals for market opening
  and offering 30 days to explain.

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Development

• 2001/02 Imported flat supplementary volumes.
• 2002/03 Increased import contracts
• First storage campain
• 2003/04 Full swing supply to our partners
  customers

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2003, NEW PARTNERS SALERNO ENERGIA VENDITA SRL,
AMAG SRL AGLIANA-PISTOIA, CONSIAG SPA PRATO AND
INTESA SPA SIENA
In 2003 Blugas opens to new partners. Amag srl
Agliana-Pistoia, Consiag s.p.a. Prato, Intesa
s.p.a. Siena and Salerno Energia Vendita s.r.l.,
become shareholders. The new partners carry
Blugas into the top flight of national importers
and traders, entrusting Blugas with the task of
providing them with the complete package of gas,
transport and daily swing requirements.
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GAS VOLUMES
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Production Project on Italian Soil
Joint Venture with WPN Resources
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Blugas Advantages

• Speed of Decision
• No rigid ties to any single supplier
• The complete mandate from our partners
• Experience in international supply and transport
• A company which is reknowned by many
  international operators
• Solid financial backing

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Prospects

• In Italy the rules are clear, if not perfect
• But when trying to supply ourselves from abroad,
  we find severe restrictions in obtaining
  transport capacity leading to impossibility of
  long term supply contracts.
• This obliges us to buy an excessively large part
  of our gas from the main national operators which
  will only supply at the city gates AND on an
  exclusive basis.

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Prospects

• Supply at city gate vs border takes away the
  flexibility we need to supply gas to where we
  want in a continuously evolving market.
• The Italian Hub Punto di Scambio Virtuale
• Helps towards a solution to flexibility but there
  is a great reluctance to operate on it from the
  two major operators.
• To develop fully major suppliers must be present

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Prospects

• As the increase in importation capacity looks
  limited in the near future
• LNG terminals will bring new big players to the
  market offering gas at the beach or PSV.
• Gas release programs.

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Growing Together