Statoil's UK subsidiary holds a 33.3 per cent stake in the joint venture project. SSE Hornsea Limited, which is owned by the UK's fourth largest energy provider Scottish and Southern Energy plc, holds the other 66.7 per cent. SSE Hornsea Limited is operator of the Aldbrough project and also owner and operator of the Hornsea gas storage facility just north of Aldbrough.
"Originally both companies were planning their own separate projects, but these schemes were merged less than two years ago," reports Statoil's project manager Osvald Arne Olsen.
"This has created a number of environmental and financial advantages, including a two-thirds reduction on the amount of land required when compared with the original proposals."
The Aldbrough facility will comprise nine underground caverns some 2,000 meters below ground, providing a working gas storage capacity of 420 million cubic meters. A processing plant is also being constructed, designed to provide fast and flexible gas injection and withdrawal capabilities.
Statoil has the right to utilize one third of the total capacity, providing the group's gas traders in London opportunities to exploit gas market price fluctuations and achieve the best possible returns.
Directional drilling – a technique also utilized offshore – is being deployed to drill horizontally from the storage sites to around two kilometers below ground.
This ensures that surrounding farming can continue without disruption. The temporary leaching facility comprises a pipeline system running from the site through coastal cliffs and out to a platform about 800 meters from land. This facility is needed to transport the seawater to the wells for salt extraction and disposal of the resultant salt solution (brine) back out to sea.
When completed, the Aldbrough facility will be connected to the UK's national gas transportation network (NTS) and operated remotely by SSE from the Hornsea facility. The first five caverns are scheduled for commercial use on 1 October 2007, with the remaining four caverns expected for completion in 2009.
Jan Schøpp, who heads Statoil's gas trading division in London, is very pleased that the work is on schedule.
"We're looking forward to being able to use this facility," he affirms. "This winter, we've seen prices in the UK gas market vary sharply.
"They reached about NOK 7.20 per cubic meter in early March – the highest for seven years. In times when prices fluctuate this much, the storage will be a very important tool for us."
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