The Islandmagee peninsula is the site of Northern Ireland’s main gas-powered power station at Ballylumford, which provides half of the province’s power, and is also the terminating point of the existing Scotland-Northern Ireland gas pipeline, making it an ideal location for a project of this type.
Once complete, the Islandmagee storage facility will consist of 7 underground caverns, capable of storing up to a total of 500 million cubic metres of gas in Permian salt beds, a well-proven technique that represents the most environmentally-friendly, safe and efficient method of storing large volumes of natural gas.
The Islandmagee facility is unique in being the only gas storage project in North West Europe to be awarded ‘Project of Common Interest’ (PCI) status by the European Union (EU), confirming its strategic importance to the entire continent. PCI status unlocks EU grant funding, accelerated permitting procedures and incentivised regulatory conditions, further enhancing the long-term viability of the project.
Additionally, the company has obtained support from the governments of the UK (including Northern Ireland) and the Republic of Ireland; and the UK government has awarded it ‘Pre Qualified’ status for the UK Guarantee Scheme, which facilitates access to government guarantees on debt finance for 65% of the project cost.
Third-party consultants have confirmed the facility’s technical and commercial viability, and the project’s economics are underpinned by a long-term lease to an off-trader, that will trade seasonal and short-term gas price volatility by rapidly injecting and storing natural gas ready for immediate withdrawal.
Having secured the necessary planning permissions and environmental permits that can be obtained at this stage of the project’s development along with a having a fully-consented land portfolio with favourable geological features, Islandmagee Energy Limited completed the Front End Engineering and Design (FEED) phase of the facility during Q4 2018. Since the inception of the project, some £14.5 million has been invested in a number of work streams, including concept and front end engineering, land purchase, environmental, marine, geological and geophysical studies.
The Islandmagee facility is expected to provide over 25% of the UK’s natural gas storage capacity (based on 2018 data) and will support the growing demand for gas-fired power development and renewable energy generation throughout the United Kingdom and the Irish Republic.
Storage caverns will be developed in a natural salt structure below the seabed and will enable gas to be delivered, stored and then returned to the UK’s national transmission system.