THE COMPANY behind the proposed €600 million Shannon liquid natural gas project said yesterday the investment and the creation of hundreds of construction jobs remain on hold because of a delay on the part of the industry regulator.
Shannon LNG, which is backed by the US-based Hess Corporation, accused the Commission for Energy Regulation (CER) of dragging its heels over a decision on charges for use of the Irish natural gas supply network.
The regulator has proposed that all natural gas companies, including Shannon LNG, would pay for use of interconnectors which link the Irish and British supply networks, irrespective of whether they use them or not.
Shannon LNG has objected to this on the grounds it would result in it subsidising British-based businesses that supply the fuel to the Republic.
The CER was due to make a decision on the issue last month but has not done so. Shannon LNG yesterday said the delay has effectively put its investment, which would lead to the creation of 650 construction jobs, on hold.
The company also argued the delay could ultimately hit consumers, as the LNG project would open up a new, far cheaper, source of natural gas to Irish consumers.
It will import the fuel from the US, where prices have halved in the last year. More than 90 per cent of the natural gas used in Ireland is supplied from Britain, where the cost is higher than in the US.
The CER said yesterday the delay was due to the fact Shannon LNG had made a complaint about the proposed charges to the EU’s Competition Directorate.
As a result of this, the regulator had to provide information to the directorate, which in turn caused the delay. A spokesman said the decision on the network charges was due later this month.
Bord Gáis Networks, part of the State-owned energy company, built the interconnectors. It favours charging all suppliers.
The State company argued recently that, as British prices ultimately set the cost of gas here, companies such as Shannon LNG will charge that in any case and could make super-normal profits at the expense of businesses and consumers.
Shannon LNG denies this and says it will bring more competition to the market, which will result in lower prices.
