1. International Gas Union (IGU) Introducing the 2006 – 2009 Triennium Towards the 24 th World Gas Conference Buenos Aires, Argentina, 19-23 October 2009 Status Report as at 18 January 2006

2. Regulation Market Drivers E&P Storage T&D Utilisation LNG R&D 2006-2009 Triennial Work Programme Concept The Global Energy Challenge: Reviewing the Strategies for Natural Gas Retrospective/Prospective focus of the gas industry’s experiences and challenges Role of the World Gas Industry Sustainability: Global Learnings Outlook to 2030 Global Energy Needs and Prospects Oil Prices & Geopolitical Constraints  Regulatory Framework  Market Growth vs. Supply Alternatives  Technology  Environmental Impact  Cost Effectiveness IGU: 2006 – 2009 Triennium

3. President CC Secretary CC Vice Chairman Roberto Brandt Argentina Ernesto Lopez Anadón Argentina Andres Kidd Argentina WOC 2 Storage Vladimir Onderka Czech Republic WOC 3 Transmission Helge Wolf Germany TF R&D Marc Florette France PGC C Developing Markets Mohd. Farid Amin Malaysia CC Chairman Secretary General Peter Storm Denmark Authorities & Technical Team PGC B Strategy, Economy & Regulation Pedro Moraleda Spain PGC D LNG Seichi Uchino Japan WOC 4 Distribution Jeremy Bending UK PGC A Sustainable Development Knut Barland Norway WOC 1 Exploration & Production Vladimir Yakushev Russia WOC 5 Utilization Jean Schweitzer Denmark Vice President Datuk Rahim Hashim Malaysia Ho Sook Wah Malaysia IGU: 2006 – 2009 Triennium Task Force Gas Market Integration Jorge Doumanian Argentina

4. International Gas Union (IGU) WOC4 2006 – 2009 CHAIRMAN – JEREMY BENDING, UK VICE CHAIRMAN – ALESSANDRO SORESINA, ITALY SECRETARY ROBERT THOMAS, UK

5. WOC4: Topics ranked by members Materials 3 rd Party Damage Leakage Survey Leakage Reduction Leakage Repair Risk-based Asset Management Data Capture Pipe Replacement Smart Metering Remote Monitoring Also proposed: Odorisation Biogas Use Energy Measurement Regulatory KPIs Risk assessments for planning processes Managing Rights of Way IGU: 2006 – 2009 TWP Preparation

6. WOC4: Focal Themes Proposal (in suggested order of priority) IGU: 2006 – 2009 TWP Preparation Study GroupTitle/SubjectBrief Description WOC4.1Risk-based Asset Management Use of hazard & consequence models to prioritise maintenance & replacement WOC4.2Leakage ReductionMethods for measurement, reduction & repair of distribution leakage WOC4.33 rd Party DamagePractices for avoidance of interference damage by other excavators WOC4.4Leakage SurveyLeakage survey equipment, practices and application of findings WOC4.5Data CaptureSystems used to capture, record and retrieve asset data.

7. WOC4: Distribution IGU: 2006 – 2009 TWP Preparation Study Group Topic Strat. Guid. Possible interaction with: SG 4.1Review of asset management strategies & practices 2 WOC3 PGCA SG 4.2Review of leakage reduction strategies & practices 2 PGCA TF R&D SG 4.3Development of best practices for the prevention of third party damage to distribution assets 2 WOC3

8. Study Group 4.1. Review of Asset Management strategies and practices The study will review the processes and methodologies used to develop strategies for operating, maintaining and replacing gas distribution networks. This will build on the Distribution Integrity study from the previous triennium. The study will recognize the influence of differing regulatory frameworks both in defining local good practice and assessing the applicability of “best” international practices. OBJECTIVES AND EXPECTED RESULTS Evaluate and make recommendations in the following areas: –The definition of distribution integrity performance measures; –The use of available information systems, data and the management of data quality; –The availability and applicability of cost/benefit calculations; –The influence of national and international technical standards; –The influence of economic regulation and competitive markets; –The range of approaches within legal frameworks; prescriptive vs risk-based. –Reactive > Time-based > Condition > Risk-based prioritisation.

9. Study Group 4.2 Review of Leakage Reduction strategies & practices. The study will determine the process necessary for the evaluation and determination of leading practices used in the industry for the management of leakage from gas distribution systems. These leading practices will be based on reviewing commonly defined metrics of operational performance. Methane is a significant greenhouse gas and leakage is perceived to contribute to depletion of the ozone layer. Leakage also presents safety, economic and operational challenges to distribution operators. OBJECTIVES AND EXPECTED RESULTS The study will provide: –A review of leakage management strategies across member countries; –Assessment of the ability to quantify leakage from distribution systems; –Specific focus on the effectiveness of leakage survey methodologies; –Identification of best practices in leakage management systems; –Review of existing and emerging technologies for leakage control.

10. Study Group 4.3. Development of best practices for the prevention of third party interference damage to distribution assets. This is a study to evaluate how each of the IGU member countries approach the management of third party interference damage to gas distribution systems. This emerged as a major integrity issue from the 2003-2006 triennium study. It is important to determine the various approaches, funding levels, legal requirements and collaborative efforts currently in place. OBJECTIVES AND EXPECTED RESULTS The study will provide a review of damage control activities associated with gas distribution systems including: –Provision of plant records & information to enable location; –Legal/regulatory requirements driving plant location; –Measures of effectiveness of plant protection systems; –Resourcing requirements for site attendance where provided; –Review of existing and emerging technologies for damage control; –Identification of best practices in plant and damage location systems across all utilities.

11. Topic Summary – Draft – Not for publication IGU: 2006 – 2009 TWP Preparation Group Study Group 1 Study Group 2 Study Group 3 E&PConventional resourcesUnconventional resources U’grd StorageUGS databaseUGS improved technologiesIntelligent UGS TransmissionRegulation & safetyNew technologiesContribution to SD DistributionAsset managementLeakage reduction3rd party damage UtilisationIndustrialDomestic & commercialTransport (NGV) + Gas utilisation efficiency indicators SustainabilityGuidelines of Sustainable Development G’hse gas red’n case studies RegulationSupply & demand +Outlook to 2030 Price formation & trends + Outlook to 2030 Regulation & industry structure Develop MktsSW AsiaSouth AmericaEastern Europe LNGQuality & inter- changeability LNG contracting flexibilityRemote & offshore LNG facilities TF R&DRole and structure of R&D within the gas industry /IGRC TF GMI(Gas Market Integration)tba

12. International Gas Union (IGU) International Gas Union WOC4 2006 – 2009 First meeting – London. Draft programme Tuesday-Friday, 19-22 September 2006 Tuesday 19Guests arrive – Charing Cross Thistle Hotel Early evening trip on the BA London Eye Buffet supper at the Hotel Wednesday 20Meetings at the Hotel during the day Partners’ tour - to be confirmed Evening trip by coach to Tower Bridge for dinner Return to Hotel by coach Thursday 21Meetings at the Hotel during the day Partners’ tour - to be confirmed Evening dinner cruise on the River Thames Friday 22Technical tour – Distribution Challenges in London. Lunch - venue to be confirmed

13. North America 7.31 Russia & FSU 57.2 5.1 Production Net gas importers Net gas Exporters Western Europe Middle East 71.7 13.5 Asia Pacific Africa 13.8 Units: BCM South/Central America 7.19 Consumption Source of Data : BP Stats 2005 & IEO 2005 Gas Reserves, trillion cubic metres Overview of Global Gas Reserves, Supply and Demand