UK grid doubts Russian pipeline extension plans for Britain

Britain's energy network operator National Grid has said it doubts that Russian plans to extend its Baltic Sea Nord Stream pipeline to Britain will materialise, citing infrastructure challenges and a weak gas demand outlook.

In its annual publication forecasting the long-term state of Britain's energy market National Grid did not include direct gas flows from Russia to Britain.

Nord Stream ambitions

Russia has discussed plans to expand its existing Nord Stream pipeline, which currently lands in Germany, to Britain, Europe's largest gas consumer. Russia currently does not supply Britain directly.

"There is a lot of uncertainty," said Peter Parsons, National Grid's Energy Supply Manager, when asked about the project.

Gas forecasts inform opinions about extending Nord Stream

Parsons said that there was already a considerable amount of gas import capacity available in Britain.

At the same time, gas demand forecasts for Britain show the need for gas will fall in coming decades, giving less incentive for new supplies to reach the UK market, Parsons said at the launch event of National Grid's forecast report.

The operator predicts UK gas demand to decline regardless of whether Britain manages to increase its green energy share or not, with total volumes forecast to fall below 800 TWh after 2035 in its slow progress scenario.

Improved energy efficiency in housing and electrification of heating systems that currently use gas are the main drivers for this forecast.

Talks in June

A month ago, British Energy Minister Michael Fallon and Russian energy firm Gazprom’s CEO Alexei Miller discussed Britain’s natural gas imports from Russia during talks at St. Petersburg International Economic Forum.

Fallon said during the meeting that London is interested to increase its natural gas imports from Russia, which stood at 11.7 billion m3 last year.

This comes as Russian president Vladimir Putin had earlier said Gazprom and its British partners are considering plans to build an extra Nord Stream extension to carry natural gas to Britain.

The Nord Stream pipeline is Gazprom's offshore project that carries Russian gas through the Baltic Sea to Germany. The Nord Stream lines are each designed to transport about 1.9 trillion ft3 of natural gas. The first leg of the pipeline system went into service in 2011.

Gazprom announced last year that British energy company BP has shown interest in extending the pipeline, which is owned 51% by Gazprom.

"We are interested in boosting Russian natural gas supplies to the UK market and we hope for deeper co-operation in gas storage, power generation and infrastructure projects," Fallon said in a statement in June.

Edited from various sources by Elizabeth Corner

Published on 19/07/2013

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