Centrica has announced that it will permanently shut the giant Rough gas sotrage facility under the North Sea.
The site it the largest of its kind, and is able to meet around 10% of the country’s winter peak day gas demand. It represents more than 70% of the UK’s current gas storage capacity.
Centrica Storage Limited (CSL) said that the site suffered from a number of failures while testing, and therefore cannot safely continue to operate on the site.
“Furthermore, from a commercial perspective, an assessment of both the economics of seasonal storage today and the costs of refurbishment or rebuilding the facility and replacing the wells suggests that both pathways would not be economic.
“As a consequence, CSL intends to make all relevant applications to permanently end Rough’s status as a storage facility and to produce all recoverable cushion gas from the field, which is estimated at 183bcf.”
The closure of such a large storage facility raises questions about long term resource. Short term, the nation is expected to increase gas imports from places such as Qatar, which will have cost implications.