Letter: Obstacles to a gas link with Europe

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Sir: David Bowen's article on European connections ('Time to get closer to Europe over gas', 30 December) summarises very perceptively some of the long-term reasons why a gas link between the UK and Europe is desirable. As a potential major purchaser of gas, I would like to expand the debate to cover the commercial end of developing a competitive gas supply business in the UK.

My company is one which has sought to buy gas from Norway since 1990 without any response from the Norwegian authorities. We have, in the meantime, been able to acquire gas from UK reserves and certainly see potential UK gas being able to supply us for a long time yet. However, our producer suppliers would, I am sure, be keen to export gas. This can only help our business as more reserves are brought to market. The European link could then, in the longer term, be used to provide imports from Russia or the Middle East if or when necessary.

There is, however, a threat in not building the link and that, as Mr Bowen underlines, comes from Norway. The companies in Norway and the UK, who can control imports from Norway, themselves control 70 to 80 per cent of the gas reserves in Norway and claim to be the biggest companies in gas in the UK.

I find it unsurprising but disturbing, therefore, that it is these companies to whom the Government has been planning to give import rights, when other companies are unable to discuss the possibility of buying gas at all. Not only will Norway benefit at the expense of the UK, but so also will companies who are already dominant in the UK. Without the export link coming at the same time as imports from Norway, the UK could become strategically exposed, as Mr Bowen suggests.

Is it sensible to perpetuate dominance when the professed objective is to have a freely competitive and open market? An interesting question for the Government to ponder, perhaps, in its energy review.

Yours sincerely,

ALAN MARSHALL

Managing Director

Associated Gas Supplies

London, SW3

30 December

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