Managing strategic oil reserves
Established in 1988, on the initiative of oil operators and under the aegis of public authorities, the Société Anonyme de Gestion de Stocks de Sécurité (SAGESS), has the purpose of building up and stockpiling strategic oil reserves in order to contribute to meeting the obligations set by national and international standards and to allow its shareholders to delegate their obligation.
Managing strategic oil reserves is a complex mission because it is based on logistical and financial dynamics, which leads in particular SAGESS substantial share of maintaining the national compulsory stock obligation levels, thereby necessitating a regular recourse to financial markets. To fulfill their obligation to stockpile strategic oil reserves, oil operators, its shareholders, rely more and more on CPSSP which, as a consequence, has to increasingly use SAGESS owned stocks.
A mission dedicated to supply security
Since 90 years, France has been a precursor in regard with strategic oil reserves. Its international commitments or, more recently european, have consolidated the policy already established with minor adjustments.
The transposition of the European Directive in the French regulatory framework results in a national obligation in strategic stocks equivalent to 29.5% (on July 1st of the each year) of the inland consumption of the preceding year. This obligation is guaranteed by the oil operators who delegate an increasing part of this obligation to the CPSSP. SAGESS ensuree 73.9% of this obligation (by year-end 2018), with its own stocks, which release on the market by the operators is decided by the State.
As a result, SAGESS deploys means to:
- Make stocks available to oil operators in the event of a supply crisis at the request of the State;
- Ensure a timely response in releasing its stocks;
- Ensure their availability nationwide through an adequate network of its stocks;
- Ensure an optimized and sustainable financing of its stocks.
All within the frameword of a dialogue with the CPSSP.