A Marine Construction Licence has been granted to a gas storage project off the coast of Northern Ireland, allowing it to begin construction.
The project will generate 400 new jobs. The Islandmagee Energy gas storage project will begin with seven gas storage caverns.
When completed and fully operational, the gas caverns in County Antrim will hold approximately 500 million cubic metres of natural gas and provide Northern Ireland with "security of supply" during peak demand for up to 14 days.
Ballylumford, Northern Ireland's main gas-powered power station, is located on the Islandmagee peninsula and provides half of the province's power.
It is also the terminus of the existing Scotland-Northern Ireland gas pipeline, making it an ideal location for this type of project.
The UK is said to have one of Europe's lowest gas storage capacities, with only 1% of annual demand in storage, making it less resilient to supply issues than other European countries, which store up to 30% of annual demand.
When completed, the Islandmagee gas storage project will account for more than 25% of the UK's storage capacity.
John Wood, Group CEO of Islandmagee Energy’s parent company, Harland & Wolff, said: “This is good news for consumers and businesses in the UK who are currently experiencing distressing hikes in energy prices and fears of potential blackouts as gas and power grids face peak demand stresses during the winter months.
“With the current energy supply crisis, everyone now understands just how important gas storage is to secure supply and protect against extreme volatility in gas and power prices in the UK.
“We are delighted with this major step forward in the project’s journey, paving the way for the construction of our facilities. We look forward to playing a greater role within the energy sector and in securing a safer future for all.”
Islandmagee Energy also plans to store hydrogen in the long run.
"Large-scale hydrogen storage will enable the UK to make the most of excess renewable energy as it transitions to net zero," said John Wood.
“The existing power grid cannot always accept all of the electricity generated from wind farms during periods of surplus wind power generation.
“It is during these frequently occurring periods that wind farms are temporarily scaled back as there is no way to store the excess electricity produced. Production of large-scale hydrogen and its storage is the long-term solution to this.
“Excess wind generated power can be used to produce green hydrogen which can then be stored in salt caverns for future use during peak demand periods.”
During construction, 400 direct jobs will be created, as well as between 800 and 1,200 indirect jobs, with an annual economic impact of around £7 million.
It is also estimated that during this stage, for every £1 million of capital expenditure, an additional £2 million will be created in the economy per year; this means that with 75% local content, the wider economy could benefit by around £400 million.
During operations, an additional 60 direct jobs are expected to be created, bringing in around £1 million per year to the local economy, and between 120 and 180 indirect jobs, bringing in an additional £2-3 million per year.
