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UK’s largest gas storage site could be reopened within weeks to ease winter crisis

City AM logo City AM 16/08/2022 Nicholas Earl

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Centrica could begin pumping natural gas into the UK’s largest storage facility within a matter of weeks, after it was cleared to reopen by safety inspectors.

The owner of British Gas could begin pumping into the Rough facility as soon as September, after securing approval from the Health and Safety Executive, according to The Telegraph.

This means the only remaining obstacles to reopening the site are an agreement between Centrica and the Government on state support, and final consent from the North Sea Transition Authority (NSTA).

Downing Street officials and Centrica are aiming to conclude their talks in time for the company to begin filling up Rough in the next two weeks.

This reflects the growing urgency to ensure secure supplies this winter, amid supply shocks in Europe such as droughts in Norway, nuclear outages in France and a Russian squeeze on natural gas flows across the continent.

The Government has wargamed blackouts as an extreme worst-case scenario while European Union member states such as Germany and Austria have brought in emergency rationing plans ahead of winter.

Gas prices are at record highs on European benchmarks, while UK prices are also historically elevated at £4.23 per therm.

The Dutch TTF Futures and UK Natural Gas Futures benchmarks are up nine and 12 per cent respectively today amid continued volatility and a sustained summer heatwave.

The Rough storage facility has not been used since 2017, with Centrica deciding the site was both unsafe and not commercially viable without Government support – which was not offered at the time.

However, Business Secretary Kwasi Kwarteng has asked for it to be brought out of retirement to help bolster UK energy security.

Video: Energy Sector ‘Wargaming Very Serious Scenarios’ Ahead Of Winter (Evening Standard)


He believes that Rough – which sits 18 miles off the Yorkshire coast – could provide Britain with extra supplies at crucial moments.

The facility can hold enough gas to meet winter demand for around 10 days when full, although it is only expected to return at around one quarter of its capacity this winter.

The company is reportedly aiming for Rough to build up around 800 million cubic metres of gas for this winter and 1.7bn for the next.

This is much less than the 3.4bn cubic metres it could hold before its closure – when it accounted for 70 per cent of the UK’s storage capacity.

However, it would still be a substantial increase on current levels of UK gas storage, however, which only amounts to 1.6 bn cubic metres in total. 

Centrica has already been granted licences and temporary waivers by the NSTA and energy regulator Ofgem.

However it still requires two technical consents from the NSTA.

A spokesperson told City A.M. that Centrica must submit a gas storage development plan for approval and then obtain official consent to store gas to secure the technical consent.

Centrica reported hefty quarterly profits of £1.34bn earlier this year, having sold off its Norwegian oil and gas assets.

It could make hundreds of millions of pounds more from releasing gas to the market this winter, when spot prices are expected to surge higher.

It is also open to repurposing the site as a hydrogen facility over the long-term.

Centrica declined to comment.

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