Red tape ties up Saltfleetby plans

Speaking out: Rainer Seele

German-Russian joint gas venture Wingas has had to delay the opening of its 700 billion cubic metre Saltfleetby gas storage facility in the UK due to a bureaucratic obstacle, its chairman Rainer Seele said today.

"I'm afraid that the project will be delayed by a year or two from 2008," Seele told Reuters.

"It's a bureaucratic obstacle. It has nothing to do with politics. Our documents were sent back to us a couple of months ago and we now have to do all the paperwork again.

"It ... makes us uncertain how the authorities will behave towards the project... It would be very helpful if Britain had specific legislation covering storage activities, like we have in Germany."

Another official, who declined to be named, said the hold-up was the result of a local government decision.

"But anyway it will be loss-making for our business because we have been planning to sell more gas in the UK," the official told the news agency.

Wingas, a subsidiary of Wintershall, in partnership with Russian gas monopoly Gazprom.

Gazprom has 35% of the venture but expects to raise it to 50% in the near future.

Wingas wants to expand its vast storage facilities to exploit seasonal price swings in Europe's growing gas market.

In April it agreed to buy its partner, Norway's Hydro, out of the HydroWingas joint venture which had bought the Saltfleetby site in 2004 and planned to open it in 2008.

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