Natural Gas (Hansard, 15 January 1990)

§ Sir Trevor Skeet
To ask the Secretary of State for Energy how much natural gas he estimates will be used for the production of electricity in the United Kingdom in 1995 and 2000.

§ Mr. Peter Morrison
The amount of gas used for the production of electricity in the United Kingdom in 1995 and 2000 will depend on many factors. The attractions of gas to power generators together with the availability of competitive UKCS gas supplies seeking new markets suggest that gas burn in electricity generation will increase in the 1990s.

§ Sir Trevor Skeet
To ask the Secretary of State for Energy what is the average cost of producing natural gas from the United Kingdom continental shelf; and what information he has as to the cost of the most economic method so far recorded of gasifying coal.

§ Mr. Peter Morrison
To date some £12 billion has been spent in developing our natural gas resources on the continental shelf and some 260 billion therms of gas have been produced. This gives a simple average cost over the past two decades, excluding exploration costs and a return on capital, of some 5.0 pence per therm.
The Watt committee report number 20, published last year with financial support from my Department, provides a comprehensive assessment of the costs of coal gasification. The production costs of the cheapest method are about twice the cost of the coal feedstock used. The average price of coal purchased by large United Kingdom industrial consumers in the third quarter of 1989 was 15 pence per therm.

§ Sir Trevor Skeet
To ask the Secretary of State for Energy whether he is prepared to authorise connection with the European gas grid to supplement gas supplies from the United Kingdom continental shelf.

§ Mr. Peter Morrison
It is for the private sector to bring forward proposals for the financing and construction of a connection with the European gas grid. Known reserves of natural gas in the UKCS are, as presently assessed, capable of meeting the needs of the United Kingdom gas market competitively for the foreseeable future. The Government will give full consideration to any proposal to build a marine pipeline link to the European gas grid on the merits of the case.