Halite Energy Group, the company behind a major underground gas storage facility in Lancashire, has entered liquidation after exhausting funds needed to complete the project. The firm, which secured a high-profile legal victory against the UK government in 2014, appointed turnaround specialist Donald McKinnon from accounting firm Wbg as liquidator.
Project Background and Opposition
The scheme, located in Preesall on the eastern side of the Wyre Estuary, involved washing out up to 19 underground salt caverns to store gas. The proposal faced fierce opposition from Wyre Council, Lancashire County Council, and the campaign group Protect Wyre, who raised concerns about geological safety and impact on the rural landscape.
Despite the Department of Energy and Climate Change rejecting the plan in 2013 due to Lancashire's complex geology, Halite successfully challenged the decision in the High Court, overturning the rejection and securing a Development Consent Order in 2015.
Financial Struggles and Liquidation
According to the company's most recent financial accounts, filed in January 2025, directors stated the business remained a viable going concern. However, earlier this year, agents estimated that completing the project would cost between £5.7 million and £7 million. With insufficient revenue streams and an inability to secure additional funding, the directors decided to cease trading.
Wbg liquidator Donald McKinnon said: "Halite Energy Group had the rights to develop a fully permitted gas storage facility in former salt caverns. When developed, the site would account for 25% of the UK's gas storage capacity. However, earlier this year, the company's agents estimated that the costs to complete the project were in the range of £5.7 - £7m. With insufficient revenue streams to meet these costs and an inability to secure additional funding, the directors made the difficult decision to cease trading and appoint myself as liquidator."
Impact on UK Gas Storage
Had the scheme been completed, it would have significantly increased the UK's gas storage capacity, helping to prevent supply disruptions, reduce price volatility, and support intermittent renewable energy sources like wind turbines. The collapse leaves a gap in the nation's energy infrastructure plans.
