A gas storage project, located off the coast of Northern Ireland, has been awarded a Marine Construction Licence, giving it the green light to proceed towards construction.
Islandmagee Energy’s gas storage project will initially unlock seven much needed gas storage caverns. Once constructed and fully operational, these gas caverns will hold around 500 million cubic metres of natural gas and provide security of supply during peak demand for up to 14 days for Northern Ireland.
The UK has one of Europe’s lowest gas storage capacities at just 1% of its annual demand in storage, leaving the UK much less resilient to supply issues than other European countries which hold as much as 20-30% of annual demand in storage. Once fully developed, the Islandmagee gas storage project will hold over 25% of the UK’s storage capacity.
John Wood, Group CEO of Islandmagee Energy’s parent company, Harland & Wolff, comments:
“This is good news for consumers and businesses in the UK who are currently experiencing distressing hikes in energy prices and fears of potential blackouts as gas and power grids face peak demand stresses during the winter months.
“With the current energy supply crisis, everyone now understands just how important gas storage is to secure supply and protect against extreme volatility in gas and power prices in the UK.
“We are delighted with this major step forward in the project’s journey, paving the way for the construction of our facilities. We look forward to playing a greater role within the energy sector and in securing a safer future for all.”
Islandmagee Energy also has longer term ambitions to store hydrogen.
John Wood further explains:
“Large-scale hydrogen storage will enable the UK to make the most of excess renewable energy as it transitions to net zero.
“The existing power grid cannot always accept all of the electricity generated from wind farms during periods of surplus wind power generation. It is during these frequently occurring periods that wind farms are temporarily scaled back as there is no way to store the excess electricity produced. Production of large-scale hydrogen and its storage is the long-term solution to this.
“Excess wind generated power can be used to produce green hydrogen which can then be stored in salt caverns for future use during peak demand periods.”
In addition to enhancing the security and flexibility of the UK’s energy supplies and supporting the transition to a net zero, the Islandmagee gas storage project will create long-term and high value employment and support investment into Northern Ireland.
During construction, 400 direct jobs will be created, as well as between 800 and 1,200 indirect jobs, expected to bring around £7 million into the local economy annually. It has also been estimated that during this stage that for every £1 million of capital expenditure, a further £2 million will be created in the economy per year; this means with 75% local content, the wider economy could benefit by around £400 million.
During operations, a further 60 direct jobs may be created, expected to bring in around £1 million into the local economy per year and between 120 and 180 indirect which would bring in a further £2-3 million every year.