Working with us

We work closely with stakeholders to ensure that the potential of offshore gas storage is fulfilled

Undersea  gas storage is a commercial activity in a competitive market. In our view, it is fair and reasonable to charge a commercial rent for this activity, and such a rent may legitimately exceed a cost plus basis without offending the rules around anti-competitive behaviour.

We do not have a set charge for offshore storage projects. Each project is different, both in terms of size and deliverability, and has different capital cost requirements. As a result we will seek to negotiate terms individually, having assessed the unique components of that project. In all cases we will look to establish a rental proposition by the application of consistent value-based principles.

Previously, we have undertaken the following:

(a) commissioned an independent storage modelling exercise (2008)

(b) confirmed that we would offer to refer the matter of rental valuation for independent determination by the Valuation Office, or the Chairman of RICS or an energy relevant expert

(c) when the proposal for a valuation office determination was declined by potential developers, we commissioned (December 2009 / January 2010) a further independent report from Oxera

(d) we sought legal advice from energy specialist law firm Hunton & Williams

The conclusion is that to charge above cost plus is not an abuse of our monopoly position.