In the past, RAG’s equity gas output was sold almost exclusively to its owners. This was in the days before gas market liberalisation, when contract design and fulfilment were still a simple matter. The pace of change has been rapid since then.
RAG has international gas trading operations, and supplies domestic and foreign energy companies, and industrial consumers. The company specialises in providing flexible and secure supplies of gas produced from domestic reserves.
The EU’s energy liberalisation efforts, initiated in 1998, have opened up the gas markets in large parts of Western and Central Europe, and traders and suppliers can now buy and sell gas on increasingly liquid exchanges and trading platforms. As a result of gas market liberalisation in 2002, RAG was able to market its gas production outside Austria and the focus switched away from sales at entry points to the national low pressure grid, towards exports via virtual trading points. RAG has since made a name for itself as an flexible, independent company. In 2002 its natural gas sales topped 1 bn cu m for the first time. The company has progressively built up a trading and supply business which operates on markets throughout Europe.
RAG is an active market participant of a number of European gas hubs and exchanges. EU-wide gas liberalisation and the creation of entry/exit systems have opened up new trading opportunities. The company’s downstream division is responsible for gas trading and sales, and gaining the necessary access to markets. Many years of experience and close monitoring of markets enable RAG to provide its customers with tailor-made solutions.
With pricing increasingly decoupled from oil and driven by spot quotations, the influence of European trading points and exchanges is steadily growing. The resultant price volatility is bringing new challenges for supply portfolio design and risk management.
RAG also produces and supplies liquefied LNG (Liquefied Natural Gas) for use as a low-carbon transport fuel, or to make gas available to industrial and commercial consumers, that are not connected to the public gas grid.
“Security of supply is the core issue for the energy sector. That’s our mission, too, and we are totally committed to it. When everything is running normally people tend to forget how vital complete security of supply is in an emergency. We supply regional utilities and are the backbone of their services. Our storage facilities have to keep functioning, come what may, and be ready to spring into action at any time. That’s our day-to-day business. There’s a lot of high tech behind the scenes.”