Centrica pulls out of Baird and Caythorpe gas storage projects

23rd Sep 2013 07:02

Centrica has pulled out of its Baird and Caythorpe gas storage projects amid a challenging market.The company said it will not proceed with Baird in the UK North Sea or Caythorpe in East Yorkshire due to "weak economics for storage projects and the announcement by the UK government on September 4th ruling out intervention in the market to encourage additional gas storage capacity to be built".All costs from the projects will be written off. Centric expects impairments and provisions of around £240m as an exceptional cost in the group's 2013 preliminary financial results. Caythorpe is a depleted onshore gas field in East Yorkshire in which Centrica acquired a 100% interest from Warwick Energy in September 2008.Baird is a largely depleted gas field in the Southern North Sea. Centrica bought a 70% interest in the project from Perenco in February 2009.The firm will continue to own and operate Rough, the largest gas storage facility in the UK which is capable of meeting about 10% of the UK's current peak demand.RD