China pitch for Halite blasted by campaigners

Chancellor George Osborne in China.
Chancellor George Osborne in China.
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Campaigners have slammed Chancellor George Osborne for “touting” a controversial underground gas storage plan to the Chinese.

The Chancellor was on a five- day visit to boost trade with China and took a Northern Powerhouse Pitch Book containing schemes to attract investment from China.

A page from the pitch book he has taken to show Chinese businessmen

A page from the pitch book he has taken to show Chinese businessmen

One of the schemes in the list is Halite’s bid to store up to 900 million cubic metres of gas in 19 salt caverns under the Wyre near Preesall.

The scheme was given to go-ahead this summer by the Government despite it being rejected at inquiry twice and huge opposition from local residents.

In the document it says: “Preesall storage facility will be key to responding to fluctuations in UK gas demand in future.

“A high proportion of the subsurface and engineering work for the project has already been completed.

A high proportion of the subsurface and engineering work for the project has already been completed

“Preesall can supply 21 per cent additional UK storage deliverability.”

But campaigners said the scheme would not be able to store that much gas due to fault lines in the salt, the document overstates the work already done on site and there were no funds for the project.

Howard Phillips of Protect Wyre said: “It seems to me to be just hype and that Halite are just desperate to find funding for the scheme they have already spent a lot of money on.

“A Government study estimated the total gas that could be stored was 200 million cubic metres but it is likely to be more in the region of 100 to 150 mcm. So it is not as an attractive return for investors.”

Ian Mulroy said: “It is extremely disappointing to see the Chancellor touting the Halite project as part of the Northern Powerhouse but touting for business and obtaining it can be a world apart.

“It’s presumed that any Chinese investor would undertake a due diligence exercise before committing to anything and they will no doubt then find out how marginal the Preesall salt is.

“It will be interesting to see how the Chinese interpret Halite’s statement: ‘A high proportion of the subsurface and engineering work for the project has already been completed.’ Local residents don’t see any evidence of any subsurface engineering work being completed – have we missed something?”

But Halite said interest was growing in the scheme.

John Roberts, chairman of Halite Energy, said: “I was invited by UKTI to attend the Chancellor’s trade delegation to China, with our project at Preesall featuring prominently in his investment plans for the Northern Powerhouse.

“With planning approval now in place, there is strong market interest in our project, which is one of the most economically viable sites for gas storage development due to its fast-cycle capabilities, the depth of the salt, its proximity to the National Transmission System, the water source and brine disposal route.”

“Since the project received consent from energy minister Lord Bourne in July, there’s been a significant increase in interest and we’re currently in discussions with a number of industry and financial investors.”