The U.K. government has opened the way for resuming gas imports into Britain by approving a contract signed by U.K. electric power utility National Power to buy gas from Norway.
A new joint marketing venture of BP Exploration, Den norske stats oljeselskap AS (Statoil), and Norsk Hydro AS (OGJ, Jan 27, p. 27) also will be allowed to import gas for electric power plant fuel once it has a contract.
National Power and the BP/Statoil/Norsk Hydro group will use the Frigg pipeline from Norwegian waters into St. Fergus, north of Aberdeen, the only existing link between the British transmission system and foreign supplies of gas.
Meantime, progress is under way toward a second pipeline to link the U.K. with foreign natural gas supplies, calling for a pipeline across the English Channel joining the continental European pipeline system to the U.K. network.
After talks with the government, BP, Statoil, Norsk Hydro, British Gas plc, Elf UK Ltd., and Conoco U.K. Ltd. will undertake the first stage of a feasibility study into the new pipeline.
While the cross-channel link is aimed initially at exports of U.K. and possibly Norwegian gas to the continent, in the longer term Britain is destined to become a larger importer of gas.
In other developments involving European gas transmission, an independent feasibility study by J.P. Kenny on behalf of a number of large industrial companies shows a pipeline from Kaliningrad, Russia, to Britain across the Baltic Sea and Denmark would be technically feasible and economically viable.
Meantime, Kinetica Ltd., a joint venture of Conoco and PowerGen, has signed a second bulk customer for Britain's first independently owned pipeline.
NORWEGIAN IMPORTS
National Power, Britain's biggest electric power generator, agreed to buy 77.6 bcf from Norway's gas negotiating committee but was forced to wait almost a year for government approval to begin imports in 1995.
These will be the first imports since deliveries from the Norwegian part of Frigg field began in the 1970s.
An attempt by the former British Gas Corp. to buy Sleipner reserves from Norway was vetoed in 1985.
BP/Statoil/Norsk Hydro will be allowed to import a similar volume of gas to service a future contract with one of the smaller independent electric power companies.
The new venture will leave the two big power generators, National Power and PowerGen, to conclude gas supply arrangements directly with the Norwegian gas negotiating committee.
All future gas import contracts beyond the two deals by National Power and BP/Statoil/Norsk Hydro will need. specific approval by the U.K. Department of Energy.
PIPELINE TO FRANCE
The six companies involved in the initial study on the cross-channel pipeline to France will work under the chairmanship of Geoffrey Chipperfield, a former permanent secretary to the Department of Energy.
By summer the group should be ready to approve a full scale feasibility study for the 200-300 million ($358-537 million) project.
At that point, the number of participating companies could be increased and may include companies in continental Europe such as France's state owned Gaz de France.
Prospects for the pipeline will depend on sufficient continental demand for British or Norwegian North Sea gas and less restricted access to the European gas pipeline system as envisaged by the European Community.
RUSSIAN GAS IMPORTS?
The J.P. Kenny feasibility study into the possibility of importing Russian gas into the U.K. also looked at the possibility of using the European grid and a cross-channel pipeline as the vehicle for transporting Russian-as to the U.K.
The study, conducted on behalf of Bank of Scotland subsidiary Fiscot Ltd. and a group of large industrial companies that would be potential users of the gas, concluded that trans-European tariffs would make the delivered price of the gas very high.
However, this situation might change if the European Community overcomes objections to opening up the pipeline system.
The EC has proposed large industrial companies have the right to buy gas supplies and electric power anywhere within the EC effective Jan. 1, 1993 (OGJ, Feb. 10, p. 30).
The study also concluded the concept of delivering Russian natural gas from liquefied natural gas terminals on the Baltic Sea or Barents Sea is not economically viable.
KINETICA CONTRACT
National Power will use the line from the Conoco-operated North Sea gas terminal at Theddlethorpe to Killingholme on the River Humber to deliver gas to a new power plant under construction at Killingholme.
The 32 mile, 20 in. line was originally planned to deliver gas to a PowerGen gas fired power station also at Killingholme.
In addition to linking the new line to the National Power site, Kinetica noted, a connection to the British Gas national transmission network at Thornton Curtis also is planned.
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