Industry NewsClearance has been given by the Government for a new gas storage facility which will help improve security of supply. The Saltfleetby onshore gas field will be converted to a storage facility by WINGAS, and increase the UK's gas holding capacity by an estimated 15 per cent. When the site is completed in 2011, it could help reduce price volatility. The UK Government has faced attacks over not promoting gas storage. However, a call for levels of capacity like that seen in Europe ignores the investments made in other supply assets.
WINGAS – the Wintershall/Gazprom joint venture – aims to provide 700 to 800 million cubic metres of storage at Saltfleetby. It will be smaller than the massive Rough site owned by Centrica, but still provide a sizable level of capacity for the system. Last winter, there were renewed demands for more investment in storage when a series of balancing alerts were called for. While the Government has not been actively rejecting such assets, it has also not gone the way of some European nations by developing straight storage assets. Instead, there has been greater promotion of projects such as interconnectors and LNG facilities.
Frank Tauchnitz, Managing Director of Wingas Storage UK, commented, "We are convinced that the UK needs more storage facilities, in particular seasonal storage, as UK gas production continues to decline." Signalling that the new Government is as keen for diversification as the last, Energy Minister Charles Hendry added, "We will introduce measures in the Energy Security and Green Economy Bill to encourage not only more gas storage, but greater gas import capacity to help ensure that our market will deliver gas when it is needed."