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Industry news: May 2008

Plans for salt cavern gas storage announced

The companies Northern Ireland Energy Holdings and Portland Gas have announced plans to store natural gas within salt deposits underneath Larne Lough, Northern Ireland.The required caverns would be created by dissolution using water in the thick salt deposits which are part of the Carrickfergus saltfield. Gas would then be pumped into the cavities through pipelines from Scotland that supply Northern Ireland with gas.The scheme will only go ahead if preliminary tests, to be carried out later this year, are successful. Up to three months supply of gas could be stored by the planned scheme, improving the security of gas supply to Northern Ireland.

Portland Gas has also announced it has received approval for the construction of a deep underground salt cavern gas storage facility at Portland, Dorset. Dorset County Council has granted planning permission for development of the facility, based at the Upper Osprey former naval base.The project has an estimated cost of £500 million and should be completed by the end of 2015. Portland Gas has also applied to the Department for Business, Enterprise and Regulatory Reform (BERR) for permission to connect the storage caverns to the national grid via pipelines. Andrew Hindle, CEO of Portland Gas, commented "The decision is good news for South Dorset and for the nation as a whole".

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Oil exploration in the South Downs

Oil extraction in Dorset, BGS©NERC

West Sussex County Council has granted planning permission for Northern Petroleum plc to explore for oil. Northern Petroleum plans to drill a well at a site in West Sussex near Chichester.The well is targeted to intercept the eastward extension of the currently producing Horndean Field in which Northern Petroleum is a partner.

The well will be sited in Markwells Wood which is an area of ancient woodland located within the proposed South Downs National Park. It is also a designated Area of Outstanding Natural Beauty (AONB).The drilling will mean the loss of around one hectare of the woodland but local planers decided there was a "clear and overriding need" for the exploration for oil so, according to national minerals policy, the development should proceed.The Woodland Trust, Friends of the Earth, Chichester District Council and the South Downs Joint Committee have all opposed the plans, concerned over possible damage to ancient woodland.The permission is, however, subject to the restoration of the site to structured woodland once the drilling has been completed.

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Construction of world's largest offshore windfarm

Wind turbine, BGS©NERC

The contract has been signed for construction of the Greater Gabbard scheme, a £2 billion windfarm development to be situated 12 miles off the Suffolk coast.The development will, on completion, be the world's largest offshore windfarm with 140 turbines covering 150 square kilometres of the Thames Estuary and the potential to power 415 000 homes.The scheme received planning permission in February 2007 and is a joint venture between Airtricity (the renewable energy division of Scottish and Southern Energy) and US–based company Fluor.


Old quarry permissions revoked in Brecon Beacons National Park

Brecon Beacons, BGS©NERC

The Brecon Beacons National Park Authority has announced its success in revoking planning permissions for 11 dormant quarries within the park.The quarries, many of which have not been operational for decades, had valid planning permission allowing quarrying until 2042. This resulted from to the Town and Country Planning Act of 1984 which imposed an end–date of February 2042 on all quarries that had previously been without an end date for permission. Due to concern that quarrying could restart at these sites the National Park Authority submitted prohibition orders, which the Welsh Assembly Government has now approved, preventing the quarries from reopening.The Brecon Beacons National Park Authority chief executive, Chris Gledhill, has welcomed the decision saying "The official closure of these 11 quarries is not only good news for the landscape of the park, but also for the wildlife which has colonised these long–disused sites".


Shutdown of Northfleet cement works

UK cement works, BGS©NERC

Lafarge has begun its phased closure of Northfleet cement works and has shut down the site's two kilns. The kilns are no longer required due to exhaustion of chalk reserves at the site.The site will, however, continue to produce cement from stockpiles until the end of 2008. Once Lafarge has completed decommissioning of the works a cement freight terminal is to be developed on the site.

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Success against cement cartel

Extraction of limestone for use in cement in Staffordshire, BGS©NERC

Seven cement companies, including Heidelberg, Lafarge, Holcim and Cemex, have failed in their attempt to get a lawsuit against them in relation to allegations of price fixing thrown out of court.The lawsuit, which was filed by Cartel Damage Claims (CDC) in Germany in 2007, seeks over €350 million in damages from about 35 companies after investigations undertaken during 2003 uncovered cement price fixing dating back to the 1970s.

The British Aggregate Association (BAA) has charged CDC with investigating alleged cement cartels in the UK. BAA Director, Robert Durward, has said "this result is very good news" and hopes this decision will help further action in the UK. CDC hopes this German ruling will encourage UK producers to come forward and bring UK cement prices into line with those on the continent.


Slow first quarter for minerals industry

Three major UK minerals producers, Lafarge, Aggregate Industries and Cemex, have reported falls in sales in the first quarter of 2008. Holcim, the world's second largest cement maker and owner of Aggregate Industries, reported a 2.5 per cent fall in earnings, part of which it blames on decreasing cement sales from Aggregate Industries. One of the reasons for this is a weather–related decline in exports from Scottish quarries for markets in Scandinavia and around the Baltic Sea.

Cemex UK has reported volumes of sales of ready mix falling by 17 per cent and cement by 11 per cent. The president of Cemex UK, Gonzalo Galindo, predicted further reductions in sales throughout 2008, partly due to the slow-down in the private housing sector.

Major aggregate producer Lafarge UK was no exception to the slow start to 2008 and reported revenues falling by over £12 million compared to the same period of 2007.

Sources: [no longer available], [no longer available] and [no longer available]

Scotgold release resource estimate

Gold mineralisation, BGS©NERC

Scotgold Resources has released the first JORC code compliant resource for the Cononish gold–silver deposit in Perthshire, Scotland.The resource statement was compiled by Snowden Mining Industry Consultants Ltd and gives a measured, indicated and inferred resource containing 154 000 ounces of gold and 589 000 ounces of silver (using a 3.5 grams per tonne cut-off). The report also notes that there is potential to prove further reserves within a few kilometres of the existing mine in the region of 160 000 to 320 000 ounces of gold.This JORC–compliant resource is consistent with previous non–JORC resource estimates that have been previously undertaken. Scotgold now plans to drill around 2 500 m to target additional areas of mineralisation at Cononish and estimates that the mine could potentially produce 20 000 to 30 000 ounces of gold a year.

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Rio Tinto fund mining research centre

The international mining giant Rio Tinto has announced a partnership with Imperial College London to develop advanced mining and mineral processing techniques in a new research centre to be based at the University.The Rio Tinto Centre for Advanced Mineral Recovery will receive £6 million in funding for research aimed at pushing forward the development of innovative mining technologies and techniques to improve the extraction of minerals, whilst minimising environmental impacts.The research themes are diverse, ranging from more efficient techniques for block caving to methods of dissolving minerals in situ then extracting them via pumping. The £6 million will be used over a five-year period to fund six post–doctorate posts and 12 other researchers.

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