Offering an excellent location for international gas trade along with its state of the art infrastructure and numerous gas supply routes, Baumgarten in Austria offers a unique connection point between liquid and non-liquid markets. The central European gas hub in Baumgarten, established in 2005, serves as one of the largest stations in Central Europe.
With its 20 billion cubic meters (bcm) of high storage capacity within a 400 kilometer radius, it assures high flexibility as well as supply security for Central European gas consumers. What makes Baumgarten so different is in its ability to interconnection point in which the gas hub receives gas from various sources and then these supplies are re-routed to other gas consuming countries via a number of pipeline systems covering various regions. Moreover, the facilities at the Baumgarten gas hub are able to receive, meter, as well as test and compress natural gas at the station.
As one of the most advanced dispatch centers and with its transmission and distribution system operators, Baumgarten handles great volumes of gas for various countries such as Italy, Slovenia and Croatia through the Trans-Austria Gasleitung (TAG) pipeline and Süd-Ost-Leitung (SOL) pipeline. The Hungaria-Austria-Gasleitung (HAG) pipeline handles flow to Hungary and the March-Baumgarten-Gasleitung pipeline transmits to Slovakia and lastly, the West-Austria-Gasleitung (WAG) and the Penta-West Pipeline (PW) transfers to Germany and supplies France respectively.
The continuous flow of gas, supplied mainly by Russia, Norway as well as other countries, arrive at the Baumgarten hub where it is then directed through the aforementioned pipelines transiting to various destinations in Hungary, Slovenia, Croatia, Germany, Italy and France through a total length of approximately 2,000 kilometers of underground and undersea pipelines.
According to Austrian OMV’s statistics, a volume of approximately 46 billion cubic meters (bcm) of natural gas was transported through these pipelines in 2014 and volumes increased to around 57 bcm in 2015. As stated by OMV Gas & Power, currently over a hundred million cubic meters of gas is transported through Baumgarten on a daily basis.
Almost one-third of gas imported to the Baumgarten gas station is from Russia, only one-sixth of which is retained for domestic consumption. According to BP’s Statistical Review of World Energy 2015, Austria consumed around 7.9 bcm of gas in 2014, and exported 46 bcm. Clearly these figures demonstrate what can be considered a benchmark for a successfully operating modern gas hub.
In comparison with Baumgarten, Ceyhan, located in the Adana Province of southern Turkey, which is among other stations currently only handling gas for domestic consumption, would do well to emulate this increase in volumes to raise its terminal to gas hub status.
Since 2012, after meticulous upgrading, Baumgarten, once a physical point only, has also become a virtual trading point through a new system which has brought more liquidity. This means that competition is stimulated among newcomers to the gas market with the aim of providing better prices for end users.
Overall, an energy hub operating as a virtual trading point has the following characteristics: implementation of market-based pricing, free access to the market for all participants, and an effective functioning trading system that fosters hub-to-hub trading.