Gaz de France has agreed a deal to develop salt caverns in north-west England into a huge underground gas storage facility that should help ease concerns about the security of the UK’s energy supply. The £350m project, being developed with chemicals firm Ineos, involves pumping water down boreholes to dissolve salt deposits and then pumping out the liquid to leave room to store gas. It plans to open the first caverns at Stublach, Cheshire, by 2013 with the project being completed by 2018. Total capacity could reach about 400m cubic metres of natural gas, making it the second-largest gas storage site in England. However, this would still be far smaller than the offshore Rough facility in the North Sea. Gas storage has become a political as well as economic issue over the past couple of years as production from the North Sea begins to fall and the UK becomes increasingly dependent on imports. More storage facilities should help maintain continuity of supply to UK consumers when there are sudden surges of gas demand during cold winters or disruptions to imports. Dr Harry Deans, chief executive of Ineos, said: “The facility will make a significant contribution to the long-term security of gas supplies in the UK.” A report by the Energy Contract Company last week said that Britain’s gas supplies should be comfortable until around 2012-13 but will then turn into a deepening deficit. It predicted that by 2015-16, demand could exceed supply by about 20pc on the coldest days of the year during a very cold winter. The Stublach project will be developed in three stages between 2013 and 2018 and could eventually involve storing gas in 28 salt caverns hundreds of metres underground. A similar, but smaller, facility is being built a few miles from Stublach at Byley, and is expected to be ready by late next year. Gaz de France will operate the Stublach site under a 30-year lease agreement running until 2037.

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