Royal Dutch Shell Plc  .com Rotating Header Image

The Guardian: Oil prices jump after fire at gas terminal

· Explosion at Norfolk plant importing 13% of supplies
· ‘Major incident’, but no reports of casualties

Martin Hodgson and Dan Milmo , Friday February 29 2008

Emergency teams were last night fighting a big fire at one of Britain’s largest gas terminals, which sent more jitters through energy markets.

The blaze is believed to have broken out at a water treatment plant at the Bacton gas terminal in north Norfolk. Norfolk fire service said 10 crews had contained the fire, which was described as a major incident.

National Grid said the terminal imports 13% of Britain’s gas supply, but a spokesman said only part of the terminal had been closed and moved to reassure the public that the facility was still receiving adequate supplies.

“There is plenty of gas coming ashore and there is plenty in storage,” he said.

UK oil prices rose sharply to a new record high above $101 a barrel (£50) as investors speculated that the incident would cause concerns about supply.

The terminal, owned jointly by several energy companies and operated by Shell, distributes natural gas between Britain and mainland Europe through pipes beneath the North sea. It also houses gas processing facilities.

Gas is brought to the terminal by pipes from the North sea and the low countries. Gas bills have soared by an average of 15% in recent months as wholesale prices have gone up. The incident at Bacton will do little to alleviate the pressure on prices.

The National Grid spokesman played down the significance of the incident: “We have many different supply sources in this country.” But supplies have been tight, and cold weather can easily cause a sharp rise in wholesale prices.

Gas and oil prices tend to move in tandem. If there is not enough gas supply then demand for oil increases. Pressure on prices has risen on the back of fears that Opec ministers, who meet next week, could call for a cut in the cartel’s production.

John Ellis, an emergency planning officer at the terminal, told the BBC that there had been an explosion related to a fire, which broke out shortly before 6pm.

Jean Smith, who lives about half a mile from the plant in Kimberley Road, said she heard an explosion about 6pm and saw a ball of smoke followed by flames.

She said: “We heard a bang, like a plane going through the sound barrier. The place shook and we looked out to see a ball of black smoke above the plant.

“Then all the alarms went off up there.

“It seems to have died down now but there’s a lot of flashing lights and a helicopter. It seems to be in just one area of the plant.”

Patricia Myles, who lives near the terminal, said: “First we heard a bang and then I came out of the back and walked along the track, and all I could see was black smoke.

“Once I got to the end of the lane there were flames shooting up 10 or 20ft, maybe more, in the air. Within about five or six minutes the flames went down and there was just a lot of black smoke.” Anna Hollis, at a nearby holiday park, said: “Just after the fire broke out we could see flames and smoke shooting up into the air and the alarm was going off. We could see the fire was right in the centre of the terminal and there were helicopters flying all around.”

The Bacton fire set off a frenzy of speculative buying in New York. US crude oil futures moved above the previous inflation-adjusted record high of $102.53 from 1980. Oil prices have doubled in the past year, causing petrol prices to hit record highs, as well as bringing pain to industry.

A Norfolk police spokesman said: “The fire was in a waste-water treatment plant. All 17 staff working in the area have been accounted for and there are no reports of casualties. The fire is now under control.”

A spokesman for the East of England Ambulance Service said: “We’re there but on standby, just watching over the fire service while they fight the fire.

“We have one ambulance and two staff there. We’ve had no reports of injuries.”

This article appeared in the Guardian on Friday February 29 2008 on p4 of the UK news section.

http://www.guardian.co.uk/business/2008/feb/29/oil.marketturmoil

This website and sisters royaldutchshellgroup.com, shellnazihistory.com, royaldutchshell.website, johndonovan.website, and shellnews.net, are owned by John Donovan. There is also a Wikipedia segment.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Comment Rules

  • Please show respect to the opinions of others no matter how seemingly far-fetched.
  • Abusive, foul language, and/or divisive comments may be deleted without notice.
  • Each blog member is allowed limited comments, as displayed above the comment box.
  • Comments must be limited to the number of words displayed above the comment box.
  • Please limit one comment after any comment posted per post.