20 Nov Will UK Energy Policy mean More Gas Pipelines Are Needed?
Until the turn of the century, the UK was all but self-sufficient in hydrocarbons. Even though coal was already on the way out, substantial North Sea oil and gas reserves had made the country’s supplies robust.
Since then, the energy situation has changed markedly. Renewables have grown by vast amounts, especially offshore wind, although a lack of new nuclear plants has caused concern among many (except for environmentalists opposed to them). Coal use and supply have continued to dwindle to almost nothing.
As for gas, around half of the UK’s supply came from overseas in 2021. Today, imported liquefied natural gas comes primarily from Qatar, while the BBL pipeline connects the UK to the Netherlands and the Langeled Pipeline provides a direct link with Norway.
This set of arrangements did mean the UK used very little Russian gas at the time of the outbreak of war in Ukraine. But a key question that may be asked is how many more underground (and undersea) gas pipelines might the UK need in the future, and whether they will all be importing gas from foreign lands.
While some campaigners bemoaned the recent government announcement of new North Sea oil and gas exploration licences, others believe there has been a lack of firm policy in this area and that much more needs to be done to secure domestic supplies.
Critics include petrochemicals giant Ineos. Its director Tom Crotty, who is also president of the Chemical Industries Association, told the organisation’s annual dinner in London there is a “complete lack of energy policy” in the UK.
He claimed: “The rest of the world is encouraging local oil and gas production, while we destroy ours through high North Sea taxes and disincentives, making us totally reliant on overseas supplies.”
Mr Crotty added: “It puts UK consumers at the mercy of foreign producers and causes massive volatility in prices, pushing yet more people into fuel poverty.”
This may be seen by some as part of a backlash against the windfall taxes on UK oil and gas firms, although these are mainly multinationals whose soaring profits amid record high oil and gas prices have come from dealings in more than just the UK’s segment of the North Sea.
However, Ineos has expressed similar sentiments before. In particular, it has been an advocate of producing gas from the hydraulic fracturing of shale. The failure to establish a shale gas industry in the UK, unlike the US and some other countries, may be seen as a blow to UK energy security, whatever the arguments over the rights and wrongs of fracking.
If the UK has to import more gas and oil via pipelines, this means that more pipelines might need to be built until such time as the UK can wean itself off fossil fuels, and they will need more maintenance and security due to their greater length and vulnerability as they cross international boundaries.
This is a very real fear not just because of general maintenance issues, but because of the same geopolitical issues that led to the recent surge in energy prices. A number of undersea incidents have raised the spectre of pipelines being sabotaged deliberately, with the suspicion that Russia might seek to hit the gas supplies of Western countries.
Indeed, this issue has been raised by NATO previously and there is much uncertainty about who are what was responsible for various incidents, including recent damage to an interconnector pipeline between Estonia and Finland (now, of course, both NATO members).
Given the Langeled Pipeline is 724 miles long, a world record until Nord Stream 1 was completed, it must clearly be vulnerable even if increased efforts are made to monitor it for signs of potential sabotage. If more pipelines of this size are added, the risk will be greater.
Indeed, even if the Russian threat ends with Putin’s ambitions in Ukraine being thwarted there will still be risks. While the Finns have concerns that the interconnector damage may have been deliberate, they are also investigating the possibility of an accident involving a ship’s anchor. Needless to say, more pipelines means more potential accidents.
Of course, securing sufficient gas supplies can also involve building more pipelines between storage locations and plants, with Dalcour McLaren recently applying for the construction of a 4km pipeline from Helsby to the Stanlow oil refinery.
However, if this application goes through, the issue will remain of just where the gas comes from to start with. If Mr Crotty and others are right, the engineering and construction challenges will stand alongside some significant economic and energy security questions unless more is done to bolster domestic supplies.