French energy giant in £350m storage deal

Aug 29 2007 by Alistair Houghton, Liverpool Daily Post

A MASSIVE £350m gas storage facility under the Cheshire countryside will be run by French energy giant Gaz de France.

The company has signed an agreement with Ineos Enterprises to develop the scheme in salt caverns at Stublach, mid-Cheshire.

Gaz de France says the site, which will hold up to 400m cubic meters of natural gas, will be one of Britain’s largest gas storage sites, and will help secure the country’s gas supplies as North Sea production declines.

The group, which owns the Shotton Combined Heat and Power station in Deeside, hopes the new development will help it continue its growth in the UK.

The Stublach project was given the go-ahead by Cheshire County Council in June 2006 and won government backing in December.

It was opposed by protest group Residents Against The Plant, who feared the project would “wreck” the Cheshire countryside.

Work excavating the caverns is set to start in 2009. Ineos Enterprises, a sister company of Runcorn chemical company Ineos Chlor, will create the caverns by leaching, where salt is dissolved by injecting water into the ground.

Ineos Enterprises will use the resulting brine for industrial purposes.

The site will be developed between 2013 and 2018 in up to 28 caverns and will be one of the largest cavern projects of its kind in Europe.

Having large stores of gas means the UK’s gas market is better protected from fluctuations in supply.

Gaz de France said stored gas currently makes up just four per cent of annual consumption in the UK, compared to 24% in France and 19% in Germany. Pierre Clavel, senior vice-president international at Gaz de France, said: “This acquisition gives Gaz de France the opportunity to extend its international storage portfolio by applying its 50 years of experience and expertise in the different storage technologies.

“This agreement also reflects Gaz de France’s significant role in the UK.

“This new facility will be able to provide up to 12% of the UK’s average daily consumption and therefore enhance the security of supply to the UK market.”

Dr Harry Deans, chief executive of Ineos Enterprises, said: “We are pleased that we have been able to reach this agreement with Gaz de France.

“This alliance plays to the key strengths of Gaz de France and Ineos Enterprises, and will secure delivery of this much-needed and strategically important storage facility.

“The facility will make a significant contribution to the long-term security of gas supplies in the UK.”

alistairhoughton@dailypost.co.uk