Halite wins High Court victory over gas storage plans

US energy group Halite has won a High Court victory to overturn the Government’s ruling to stop it developing an underground gas storage facility in Lancashire.

Halite took the matter to the court after the Department of Energy and Climate Change blocked its plan to build 19 caverns in the salt strata beneath Preesall in April 2013.

Halite claims its investment will create an average of 1,200 jobs a year during the eight-year construction phase. The chambers will also provide 35 permanent jobs once the project is complete.

Today the company said the High Court had upheld the challenge on all grounds.

In a statement it said: “The board of Halite Energy Group will be working with its legal and planning advisers and looks forward to participating in the process that will lead to a redetermination of our application by the Secretary of State. Meanwhile Halite will not be issuing any further comment.”

Recently-filed accounts show how the company filed pre-tax losses of £22m in the year to December 2012, and net liabilities topped £100m – mostly loans from its majority owner, the US-based private equity firm DE Shaw.

This prompted its auditor PwC to warn: “These conditions, along with uncertainty over the outstanding planning application and the requirement to obtain adequate additional funds to continue its activities, indicate the existence of material uncertainty which may cast significant doubt on the company’s ability to continue as a going concern.”

In the accounts the directors said: “The company’s future is dependent on the granting of planning permission to Halite Energy Group to store gas underground at Preesall and the availability of sufficient funding to finance the ongoing planning application and ultimately the gas stroage project.”

They added: “The directors would not have authorised the judicial review if they did not believe that it is reasonable to expect that Halite will be able to obtain the necessary funding through to the end of the process, and the directors remain confident that planning permission will eventually be granted.”