Centrica has decided to close the Rough storage facility on a permanent basis following extensive safety tests.
It was announced today that the Rough gas storage facility will remain offline permanently due to safety concerns. Centrica, the operators of Rough have confirmed the shutdown following numerous tests and have now deemed the facility to be unsafe to continue storage operations and receive injections.
Rough is the UK’s largest gas storage facility but Centrica have confirmed that trying to extend the lifespan of an already ageing facility would not make economic sense.
The storage site has long surpassed its design life and its components have been in decline for some time, causing various technical issues. It was confirmed in April that no storage injections would take place at the facility during the 2017/18 gas year as more safety testing was to be conducted.
In a statement released this morning, Centrica Storage Limited (CSL) said:
“CSL has now completed the wells testing programme and has analysed the results of this extensive programme. CSL has also completed a review into the feasibility of returning Rough to injection and storage operations and concluded that, as a result of the high operating pressures involved, and the fact that the wells and facilities are at the end of their design life and have suffered a number of different failure modes while testing, CSL cannot safely return the assets and facilities to injection and storage operations.
“Furthermore, from a commercial perspective, an assessment of both the economics of seasonal storage today, and the costs of refurbishment or rebuilding the facility and replacing the wells, suggests that both pathways would not be economic.
“As a consequence, CSL intends to make all relevant applications to permanently end Rough’s status as a storage facility, and to produce all recoverable cushion gas from the field, which is estimated at 183 billion cubic feet.”
This news is expected to impact gas prices over the next few months, and you can keep up-to-date with any developments with our daily energy market analysis.