Surplus Gas Going Abroad

melbury

OH came in and told me that he has just seen on TV a report stating that during the summer months we produce quite a surplus of gas, which we sell to France and Germany at a pretty cheap price.

Apparently they have vast storage facilities for gas whereas we don't have any such storage facilities. Then, when the winter kicks in, we have to buy gas back from them at a much higher price. Apparently French and German governments make sure that doesn't happen in their countries, they do not sell any surplus at cheap rates.

What the heck is the matter with our government - are they just plain stupid or what?

Stormy

Sounds a bit like tabloid spin to me, see the graph here for average gas prices for European nations. Unfortunately Germany isnt listed.

http://news.bbc.co.uk/1/hi/business/7195811.stm

The telegraph article suggests the UK has much less storage capability. I guess this is where your OH saw it?

http://www.telegraph.co.uk/money/main.jhtml;;?xml=/money/2007/12/23/cngas123.xml

But it also mentioned France having 20% but looking at the graph from the BBC, they pay more on average anyway. So its not all cut and dried.

Historically the problem is probably in part due to the North Sea Gas fields which we relied on, and didnt feel the need for Gas Storage like France and Germany. I am sure in future, more Gas Storage Facilities is one of the areas the UK will need to invest in.

The following article was issued in 2004, mentioning the need for increasing storage facilities. I am not sure what the big 6 in the UK are actually doing about it.

http://www.parliament.uk/documents/upload/POSTpn230.pdf

I'd be interested to read more on it, but my 5 minute search was not that fruitful.

Mike

ChumpusRex

By and large what you've said is true.

As a result of the rapid run down in North Sea gas, the UK has been caught short with not enough gas storage. The UK has about 20-30 days capacity, whereas most Mainland European countries have about 90 days storage. This is a result of not having copious supplies on tap, and having to import strategically (i.e. during the Summer) but use it during the Winter.

This means that the excess in the Summer can't all go into storage, and in Winter, we have to import as well as using storage.

So, during the Summer we export what we don't use or store, and we export at a very low price because of the low demand. Typical prices last Summer were about 0.5 - 0.6 p/kWh. By contrast, in Winter, we're importing, while everyone is running off stores (so we're draining France, Germany and Holland's stores) and we have to pay a high price to be sure of getting it; currently we're paying about 2.0 p/kWh to import it.

melbury

Why don't we just start storing gas again like we always used to - I mean every town had the ugly old gas storage thing (can't remember was it called a gasometer??)

Why do we always end up paying the highest prices for virtually everything in this country - are we just so complacent that we don't care?

notbritishgas

I have seen the same report about exporting cheap gas in the summer. But what I cannot understand is why do we need to because the gas is already in storage here under the North sea.
What we should be doing is just extracting enough for our needs in the summer and leave the rest under the sea for us in the winter. Is that too simple?

beingjdc

notbritishgas wrote: »

I have seen the same report about exporting cheap gas in the summer. But what I cannot understand is why do we need to because the gas is already in storage here under the North sea.
What we should be doing is just extracting enough for our needs in the summer and leave the rest under the sea for us in the winter. Is that too simple?

We're talking about private companies. If they can extract it at a profit at any time of year, they will. They're not going to pay half their staff to go on holiday all Summer, and let their rigs sit there rusting when they have repair and maintenance costs.

Anyway, not much left under there now.

http://www.peakoil.net/UKoil_gas.jpg