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Statoil and Scottish and Southern Energy open New Gas Storage Facility

28 Jun 2011

Developers Scottish and Southern Energy plc (SSE) and Statoil (UK) Ltd opened the new gas storage facility at Aldbrough in East Yorkshire today, 27 June.

The UK Energy Minister, Charles Hendry MP, visited the new gas storage facility today to mark its official opening.

The Aldbrough facility comprises nine underground caverns, which have been formed by using seawater to leach out salt deposits around two kilometres under ground. The seawater is replaced by gas under pressure in a process known as dewatering.

Six of the nine caverns at Aldbrough are already storing gas. Leaching at the remaining three caverns has been completed. Testing has been completed at two of those caverns and they are being prepared to accept gas. All three of the remaining caverns should be ready for operation by the summer of 2012.

When fully commissioned, Aldbrough will ultimately have the capacity to store around 330mcm (million cubic metres) of gas. It will have the capacity to deliver gas to the National Transmission System at a rate of up to 40mcm per day, equivalent to the average daily consumption of eight million homes, and the ability to have up to 30mcm of gas per day injected. Aldbrough will provide around 7% of the total gas storage capacity in the UK and around 25% of gas deliverability.

The ownership of Aldbrough is divided between SSE and Statoil (UK) Ltd on a two-thirds/one-third basis. The companies' total investment in the development and construction of Aldbrough is expected to be around GBP 435 million. The companies have the consent to extend the Aldbrough development, but concluded during 2010 that an investment decision on the extension should be deferred while the UK government develops its gas security policy.

SSE already owns and operates a 325-mcm gas storage facility at Hornsea, 18 kilometres from the Aldbrough site.

Charles Hendry, UK Energy Minister, said: 'Together with our domestic production and imports, gas storage is a crucial part of ensuring we keep the lights on.

'This project is a fantastic example of how close co-operation with our neighbours can bring real benefits. The facility and workforce here in Aldbrough will make a vital contribution to the UK's energy security.'

Alistair Phillips-Davies, Generation and Supply Director of SSE, said: 'This official opening confirms the contribution that the Aldbrough development is already making to gas security in the UK and confirms that the construction of another of SSE's large capital projects is on course for completion in 2012. Ministers and officials are naturally keen to make sure that the UK's gas supplies can withstand unusual infrastructure, political or weather events and have seen for themselves the benefits that a new facility like Aldbrough can bring.'

Kjetil Johnsen, Managing Director of Statoil (UK) Ltd, said: 'The Aldbrough gas storage development represents part of Statoil's continuing commitment to the UK. Not only are we the largest supplier of natural gas to the UK, but we are actively investing to ensure that the security of supply is maintained and the demand for flexibility is managed. The UK needs to ensure that it can access reliable and flexible sources of gas for decades to come in order to efficiently meet its climate commitments. The Aldbrough gas storage facility is an important piece of the energy puzzle for Statoil, SSE and the UK.'

Source: Your Oil and Gas News