Interesting article in yesterday’s Times about how reduced demand for salt is impacting on gas storage plans in Cheshire. It doesn’t refer to Canatxx direct, and our problem is that the brine wells are already there, but readers might find it interesting as it places our own local Canatxx debate in a much wider perspective.

http://business.timesonline.co.uk/tol/business/industry_sectors/natural_resources/article5542427.ece

Gas storage under threat as industry loses taste for salt

Plans to strengthen the security of Britain’s energy supplies by building more gas storage facilities are being threatened by the collapsing demand for salt in the chemicals industry.

Two of Britain’s largest gas storage projects are being built at saltmines in Cheshire close to a site at Runcorn where Ineos, Britain’s largest private company, produces plastics and chemicals. Ineos uses the salt as a key raw material to make products including construction materials and vinyls used in car manufacturing. The extraction process, which involves injecting water into wells and leaching out the salt as brine, creates large underground caves suitable for secure gas storage.

However, the collapse in industrial demand for many of the products from Runcorn has raised questions about the proposed timetables for opening the gas storage sites, which are being developed by E.ON, the German power group, and GDF-Suez, its French competitor. The delays will increase fears about Britain’s vulnerability to energy supply shocks.

Britain has 15 days of gas storage against 99 in France and 122 in Germany, leaving it far more exposed to disruptions such as the recent pipeline dispute between Russia and Ukraine. Once built, E.ON’s 162 million cubic metre gas storage facility at Holford would hold enough gas for 3.5 million British homes, but it is up to three years behind schedule because of technical problems, a spokesman said.

Sources say that falling industrial demand for chemicals produced by Ineos at Runcorn is emerging as a key issue that could delay the opening still further.

David Steven, chief operating officer of British Salt, a company that is developing a third gas storage project at nearby Warmingham, Cheshire, said that falling industrial salt demand had placed several UK gas projects under threat, although he pointed out that its site already had ten existing cavities and therefore remained on track.

GDF-Suez is developing an even bigger project at nearby Stublach with 28 caverns and 400millioncubic metres of storage. If built, it would represent 10 per cent of Britain’s gas storage capacity. The project is due to be commissioned between 2014 and 2018.

Plunging demand for salt is the latest in a series of hurdles to confront Britain’s struggling gas storage developers. The UK has four billioncubic metres of gas storage, most of which is at a single subsea location operated by Centrica in the North Sea.

A further four billion cubic metres are planned but schemes have been held up by financing problems as well as difficulties obtaining planning permission from local authorities fearful of their environmental impact.

Most British supplies of natural gas have come from the North Sea, but reserves are falling rapidly, making the country more dependent on imports. By 2015, it is thought that up to 80 per cent of the UK’s gas supplies will be imported, compared with 40 per cent at present.