Natural gas can no doubt be more and more important on these two fronts

Recent fluctuations in the demand for natural gas have been actively debated in recent weeks. This debate is important because decisions taken by Governments and energy companies could have important implications in the fight to reduce emissions of CO2 and to the security of energy supplies. Natural gas can no doubt be more and more important on these two fronts.

Natural gas can, in effect, reduce gas emissions greenhouse of advantageously. Figures European policies are trying to believe that there is no alternative to renewable energy such as wind or photovoltaic technology, but our estimates show instead that if less than half of coal in Europe were replaced by cycle plants combined operating to the gas (CCGT), CO2 emissions are decreased to 185 million tonnes - either half of the reduction referred to in the EU by 2020. It cost about 50 billion, that is three times less saving 100 billion European energy bill which should be invested to obtain the same reduction by wind energy - be. In addition to this financial benefit, gas-fired power plants are more reliable and more flexible than the direct operation of the forces of nature. A true energy security is based on the ability to meet peak demand in a predictable and cost-effective way, while the availability of renewable energy is subject to the vagaries of the weather. No operator cannot guarantee to respond to peaks of demand with renewable energy. Thus, in France, the cold weather of last January with peaks of demand in electricity, but also a low wind, as is generally the case during periods of intense cold. While the combined-cycle power plants start time is measured in minutes - hours for a central coal in days for a nuclear power plant-, natural gas perfectly responds to peaks in demand.

It is often claimed that the global economic crisis has profoundly altered the European gas market - demand actually reached its lowest and it will take years for the market found its 2008 level. Even if it is without doubt a record decline in the history of the gas industry, it is not an irreversible change. Indeed, in absolute terms, consumption of gas in Europe during the crisis did not fell below its level in 2007. At Gazprom, we believe therefore that the European gas demand will drop to 5-7, given the constant increase in demand for gas in our contracts.

We are convinced that the current situation is reversible, and that the return to an upward trend is inevitable, because of the real opportunity that provides gas to reduce carbon emissions.

Demand for gas in Europe already at its lowest and most projections anticipate a stable increase in the longer term. Also the gas deposits in the territory of the European Union begin to dry up; therefore an increasing share of this request should be met by imports.

It is in this perspective that we should assess the adequacy of the calls to change the existing system of long term contracts. It would be a serious mistake to abandon operation systems which have been tested and approved for years for the benefit of short-term measures with which the uncertainty and speculation dominate - at the expense of security, investment and, in fine, of the environmental efficiency.