While testing has been “typically positive” it remains unclear when, and to what extent, injections into the Rough gas storage site will be available. This could have a significant impact on the supply picture for the 2017/18 winter season. It could also affect prices throughout the year.
The Rough gas storage site has been unable to inject any gas into storage since June 2016 after testing works identified problems with several of the wells. Injections immediately ceased and Centrica has been conducting tests and maintenance surveys on the affected wells over the last eight months.
The UK entered the current winter season with significantly lower storage stocks than previous years. This issue was assessed by Utilitywise in our blog back in November. Withdrawals from the facility returned at a restricted rate in December. Stocks have since fallen sharply from 40% of capacity to 22%.
Centrica announced today (6 February) that it has completed general maintenance “Calliper” surveys on 20 of 24 wells affected. Subsequent pressuring testing has also been completed on 12 of those 20 wells. However, 6 of the 12 wells tested will not be capable of returning to operation by 30 April 2017 and have been isolated. Furthermore, Centrica confirmed the return to injections at Rough this year is dependent on completion of testing on all wells. At the time of writing a further 12 wells require testing.
Centrica intends to provide a further market update as soon as it can. The issue does not impact on current withdrawals from the site. However, with no guarantee of an ability to re-inject at this stage, there could be a slowdown in withdrawals from the site. The situation remains unclear and will be monitored closely by our Market Intelligence team at Utilitywise.
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