The boss of British Gas has warned that Britain's biggest gas storage facility will be forced to close unless ministers agree to help fund the site's redevelopment.
Chris O’Shea, the chief executive of British Gas-owner Centrica, warned that the Rough facility in the North Sea would be decommissioned unless the government agreed to underwrite its £2billion overhaul.
The Telegraph reports Centirca is seeking to redevelop the site - which represents half of UK's natural gas storage capacity - to be able to store hydrogen alongside gas.
The company has asked ministers for a cap-and-floor mechanism to help fund the project, but without the support, the Rough facility would face closure.
Mr O’Shea told the BBC: “Inevitably what will happen is this asset will be decommissioned. It will be shut down, we’ll remove everything that we’ve got here, it will be like it was never here, and then we’ll lose this resilience.”
The site, which lost £100million last year, can hold enough gas to meet Britain’s needs for six days, but could provide up to 30 days of supplies if upgraded.
The closure of Rough would risk Britain running out of gas in a crisis, and increase the threat of possible blackouts.
A government spokesman said: “The future of Rough storage is a commercial decision for Centrica, but we remain open to discussing proposals on gas storage sites, as long as it provides value for money for taxpayers.”