A UK Government minister has rejected calls to support a £2bn investment in Britain's largest gas storage facility, despite mounting concerns over winter energy shortages.
Defence minister Luke Pollard said the Rough facility in the North Sea, operated by British Gas owner Centrica and accounting for around half of Britain's gas storage capacity, 'is not something that the Government is choosing to invest in'.
Centrica has warned that Rough could close by April 2027 without government support, and is seeking a cap-and-floor regulatory mechanism to unlock £2bn of private investment.
Mr Pollard said: 'Centrica are a big company with deep pockets. They can choose their investments that they want to make.'
However, Centrica chief executive Chris O’Shea warned: 'The future of Rough is too important to the UK to be dismissed as simply a ‘commercial decision’.'
He added: 'We are ready to invest £2bn of our own money in critical national infrastructure. Government should not allow this opportunity to be lost.'
The row comes as Britain enters winter with historically low gas reserves, while disruption to Middle Eastern supplies has pushed European wholesale gas prices to a four-year high of almost €87 per megawatt hour, compared with around €32 before the Iran war.
A European energy network report has warned that UK gas storage could be completely depleted by spring in the event of a cold winter, adding to pressure on Prime Minister Andy Burnham to approve the Jackdaw and Rosebank North Sea developments.
Source: Aberdeen & Grampian Chamber of Commerce
