Clause 14
Energy Bill
2:45 pm
Malcolm Wicks (Minister of State (Energy), Department for Business, Enterprise & Regulatory Reform; Croydon North, Labour)
Where a gas storage development intends to use a geological feature that contains hydrocarbons, in addition to a gas unloading and storage licence, a developer will also need to obtain rights under a petroleum production licence. That is due to the inevitable production of indigenous hydrocarbons, which will be mingled with the stored gas when it is recovered. Where the intention is not to use a geological feature containing hydrocarbons, such as a salt feature, no rights would need to be obtained under a petroleum production licence.
However, in some cases, a developer with a gas unloading and storage licence may discover trace amounts of hydrocarbons that could not in any way be considered as suitable concentration for their production. In such cases, the gas storage licence holder can seek a direction for the avoidance of legal doubt, stating that a petroleum production licence is not required. The clause empowers the Secretary of State to make such a direction where he is persuaded that the concentration of hydrocarbons is insignificant.