British oil and gas major BP has dropped the option to acquire a 50.495% stake in the Islandmagee natural gas storage project, based in Northern Ireland.
Irish developer InfraStrata – which owns a 65% stake in the project – said on Tuesday that BP Gas Marketing (BPGM) will turn away from the project after providing funding for the past two years which has enabled the securing of land rights and planning permission.
“The funds invested by BPGM have left [Islandmagee Storage Ltd] IMSL in a position to cover the company’s existing commitments and leave funds, which IMSL anticipates are sufficient, to secure the project until there is new funding to develop the project to the next stage,” said InfraStrata.
IMSL is a joint venture between InfraStrata, Moyle Energy and Mutual Energy.
At this stage, Islandmagee has left unchanged its targeted start-up date of 2018 for commercial operations.
“Discussions will commence shortly with potential new investors,” InfraStrata said.
When fully operational, the Islandmagee site will have a maximum capacity of 500 million cubic metres.
Irish natural gas regulatory authorities want to introduce a combined entry-exit tariff from the Moffat point in Scotland by 2015 to make the use of Irish storage facilities more attractive to NBP shippers ( see ESGM 13 January 2014 ).
The Republic’s Commission of Energy Regulation (CER) and Northern Ireland’s Utility Regulator plan to report on their progress on how to reduce or eliminate regulatory barriers for cross-border use of storage facilities on the island of Ireland by May. Jack Elliott