IBERDROLA plans to invest more than €130 million in natural gas distribution projects in the eastern coastal regions of Spain in coming years, with the aim of supplying gas to more than 150,000 customers in the Valencia and Murcia regions.

The company, which began to distribute gas in Spain in June, is to invest some €44 million in the Valencia region, and more than €88.5 million in Murcia to deliver gas to consumers.

It has now begun supplying clients at an industrial park in Segorbe (Castellón province), where it will soon extend its service to domestic customers. It has been granted a permit to supply gas to the busy resort town of Benidorm (Alicante province), and has applied for permits to install gas lines in 39 other municipalities in the Valencia region.

The company has also applied for permits to extend the service to six zones in the Murcia region, which, like that of Valencia to the north, has been undersupplied with piped gas. IBERDROLA has permits to supply new housing estates in the northern part of the city of Murcia, comprising more than 32,000 homes. It expects to begin delivering gas there in the third quarter of 2008.

A major gas operator

After entering the gas business in 2001 IBERDROLA swiftly rose to become the second-largest Spanish supplier and the largest developer of new gas infrastructures.

In 2006, the market supplied 4.3 bcm, which accounted for 15% of total demand in the deregulated market, supplying combined cycle power plants with a total generation capacity of 5,600 MW, as well as industrial, commercial, and domestic customers.

In the same year the company brought in 20% of Spain’s total LNG imports of 3.2 million tonnes, in 101 tanker shipments to regasification plants in Bilbao, Huelva and Sagunto.

IBERDROLA imported the gas under long-term supply contracts it has signed in recent years. Last year it began to receive supplies from Nigeria LNG and Snohvit, as well as its veteran suppliers Sonatrach, ENI and GNA. It also made purchases on the spot market.

The gas imported by IBERDROLA came from six countries: Nigeria (43%), Algeria (28%), Egypt (18%), Trinidad and Tobago (6%), Qatar (4%) and Libya (1%). The diversity of supply makes for a flexible and secure basket, and complies with legislation forbidding companies from buying more than 60% from one LNG supplier.

The company has a 25% stake in the Bahía Bizkaia Gas (BBG) regasification plant in Bilbao, 30% of the SAGGAS plant in Sagunto, and 20% of the MEDGAZ pipeline now under construction.

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