Friday, 9 March 2012

Risk to UK gas supply in 2012?

There's an interesting article in the Telegraph today, looking at the future of LNG imports to the UK:

Britain has become increasingly dependent on shipments of LNG as domestic production of gas falls "precipitously", the analysts at Merrill Lynch Bank of America said. LNG imports accounted for about 25pc of UK supplies last year.
It is not implausible that UK LNG imports fall to zero by the end of 2012 especially if none of Japan's nuclear power plants are re-started this year.... With Asian demand resurging, UK and European gas prices will have to increase to stem the ongoing diversion of LNG cargoes to Asia.

full story
If you look back at an earlier post I wrote, DECC noted that gas supplies actually dropped 20% in 2011, not the 10% reported in the above article. Part of the reason for elevated gas prices last summer, which fed through into all of our bills, was the nuclear shutdowns in Japan (as I mentioned here). A story here, originally in the New York Times, says:
All but two of Japan's 54 commercial reactors have gone offline since the nuclear disaster a year ago, after the earthquake and tsunami, and it is not clear when they can be restarted. With the last operating reactor scheduled to be idled as soon as next month, Japan -- once one of the world's leaders in atomic energy -- will have at least temporarily shut down an industry that once generated a third of its electricity.

So perhaps these concerns about the LNG market, which the UK is depending on more every year, are valid. Thankfully we've just had a mild winter, but we can't count on that happening every year...


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