France imported 97% of its natural gas needs in 2003
At the beginning of 2005, France had about 450 billion cubic feet (Bcf) of proven Natural Gas reserves. France has very little domestic natural gas production; in 2003, the country consumed 1.6 trillion cubic feet (Tcf), with only 3% of that demand met from domestic sources. The most important sources of France's natural gas imports are Norway, Russia, and Algeria. Natural gas is a small component of France's energy mix, representing only 15% of total energy consumption in 2002.
The EU has enacted numerous directives seeking to liberalize European natural gas markets. To date, France has been one of the slowest EU members to implement these directives into national law, though there has been considerable progress of late on this issue. Beginning in July 2004, non-residential customers could freely choose their gas distributor, with this freedom scheduled to extend to all customers by 2007.
The French government has made some progress on liberalizing GdF itself; in 2004, it legally changed GdF into a joint stock company. The most significant change caused by this new legal definition was that the French government would no longer guarantee GdF's debt. GdF planned to offer its stock to the public for the first time in 2005, though French law requires that at least 50% of GdF's stock remain held by the French government. France has also begun the process of privatizing its natural gas transport system, also a requirement of EU directives. By the end of 2005, distribution companies should be able to purchase stakes in the parts of the system that they utilize.
Since deregulation began, Total has been the private company with the most success in gaining access to the French market. While most natural gas enters France from the north, Total appears to have concentrated on natural gas customers in the south, where prices are higher and there are greater opportunities for undercuting the tariffs charged by GdF. In 2000, Total purchased Gaz du Sud-Ouest, a small regional gas transportation company in southern France. Total also planned to construct a new natural gas import Pipeline from Spain, and it had a stake in the Medgaz pipeline from Algeria (see below). Foreign operators, such as BP and Ruhrgas, have also made some progress in gaining market share.
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