The total capacity could reach 400M.m3 of natural gas. The group will operate the facility under a 30-year lease agreement running until 2037; the first caverns will be commissioned in 2013. INEOS will provide solution mining services for the creation of the caverns.
This new facility, which will be one of the main UK storages, will enhance the security of supply to the UK market. The total development investment budget is about £350M.
This major operation sees Gaz de France extend its international storage portfolio. The group has Europe’s second largest storage capacity with additional facilities in France, Germany, Slovakia and Romania.
The UK gas market is one of the largest in Europe with a forecast growth of 2% per year, with imports of natural gas to increase as North Sea production declines. This means the new gas storage capacity, which brings flexibility to security of supply, will develop rapidly.
Storage represents about 4% of annual consumption, compared with 24% in France and 19% in Germany. Storage is a crucial link in the gas chain and Europe offers huge growth potential in the area. Average storage capacity has been growing by more than 5% per year since 1989, compared with the world average of 1.7% over the same period.