IBERDROLA exceeds the minimum safety stocks of natural gas established in the legislation in force, as has recently been certified by the Petroleum Products Strategic Reserve Corporation (CORES), thus recognising the reliability of the company’s storage and supply system.

Following the latest inspection carried out by this entity, in the middle of the winter period - December 2005 - on all the supply and transport companies of the sector in compliance with the Royal Decree regulating them, in force since last year, IBERDROLA has accredited that it has 36.5 days of gas reserves, against the 35 legally required, to meet without problems all the contracts signed with its customers.

The company’s stocks, which this year are forecast to provide 15% of the total gas consumed on the Spanish market, are held in the underground storage facilities of Gaviota (Vizcaya) and Serrablo (Huesca), in the tanks of the regasification plants of Barcelona, Bilbao, Sagunto and Huelva, circulating within the gas pipelines and in carrier ships close to the regasification terminals where they are to discharge.

It is worth remembering that the aforementioned Royal Decree makes it compulsory to hold safety stocks of gas for customers with firm demands in emergency situations. In these cases, the company would mobilise its reserves to guarantee supplies to IBERDROLA customers.

The company has consolidated its position, since the implementation of the Strategic Plan, as Spain’s second largest gas operator. In 2005 it supplied the system with 4.6 bcm (billion cubic metres) of gas, 50% more than in the previous financial year, a figure representing 14% of all gas consumed in Spain in the financial year and 22% of liquefied natural gas (LNG) transported on carriers – in 136 consignments.

IBERDROLA is also promoting front-line gas infrastructures in Spain. It has a 25% share in the regasification plants of Bahía Bizkaia Gas (BBG), which is already operational and with a capacity for 6 bcm per year, and a 30% share in Sagunto, also operational and with a capacity for a further 6 bcm per year. It also holds a 12% share in the gas pipeline developed by Medgaz that, with a capacity of 8 bcm per year, will directly connect the Algerian gas fields with Spain from its start up in 2009, after its declaration by the Council of Ministers as a priority.

Regarding diversification of its sources of gas supplies, IBERDROLA in 2005 received 41% of its gas from Algeria, well under the 60% established by the law as the maximum import from a single country, 34% from Nigeria, 13% from Egypt, 7% from Oman, 3% from Qatar and 2% from Trinidad and Tobago. In this sense, the natural gas supply for the company in the long term, which already amounts to 7.35 bcm per year, is the most reliable and secure of the Spanish gas system.