Closure of giant offshore Scottish-British Gas storage plant threatens security of UK energy supplies, warns onshore oil and gas chief

The closure of the giant offshore Rough gas storage facility in the North Sea threatens the security of UK energy supplies, according to onshore oil and gas chiefs.

Britain’s biggest natural gas storage site under the North Sea will be permanently shut by operator Centrica as repeated well-failings have prevented the facility’s safe restart.

Centrica is the FTSE-listed giant which owns and operates the Scottish Gas and British Gas brands.

At over 30 years old, the Rough facility accounts for about 70 percent of UK storage capacity and a lack of new-build to replace it will increase dependency on imports over the next few years, boosting wholesale gas market volatility and prices, analysts and traders said.

Rough could provide 10% of Britain’s peak winter demand.

Seasonal gas storage provides security and flexibility of supply. At times of low demand and therefore low gas prices in the summer, gas is injected into storage to be kept for when demand rises in the winter.

Ken Cronin, Chief Executive of UKOOG, commented: “The short-term solution for the UK will be to increase gas imports, mostly via ship, from places such as Qatar.

“As we have seen from recent events in the Middle East, this not only has a negative economic impact for the UK and consequences for global emissions consequences, but is also politically risky when it comes to ensuring our security of supply.

“The solution for the UK in the medium term cannot be to transport gas across oceans and continents.

 

“Only the development of the UK’s onshore resources just a mile under our feet can do this, simultaneously maximising the employment and economic benefits that come with producing our energy at home.

“The UK needs to ensure that whatever gas replaces that from Rough comes from sources that can deliver the same high levels of environmental and regulatory standards.”