Columbia International Affairs Online: Working Papers

CIAO DATE: 07/2008

Security of European Natural Gas Supplies

Jonathan Stern

July 2002

Chatham House


This paper investigates the impact on security of supply of increased import dependence and liberalization. It looks at the four different parts of the traditional security framework: reserves and reserve-to-production ratios, long-term contracts and multi-billion-dollar investments, import dependence, and emergency security events, all of which may be affected by liberalization and competition. In particular, using the UK as an example, it shows how a liberalized market requires much greater transparency in terms of the security events to which market players are required to respond without curtailing supply to firm customers. It sets out a framework for defining these events and for allocating the costs associated with responding adequately to them.