Kistos (LSE: KIST) has acquired a 100% stake in EDF Energy’s gas storage company, resulting in the firm picking up two UK storage sites.
The deal was signed for a total consideration of £25 million, paid from existing cash resources.
The two sites Kistos will be taking ownership of are Hill Top Farm and Hole House Farm, both located in Cheshire.
The two sites have the potential to be repurposed for future energy storage uses including hydrogen.
Andrew Austin, executive chairman of Kistos, said: “We look forward to working with the existing team with a view to maximising the value-accretive opportunities these gas storage facilities present, establishing Kistos’ presence across the energy value chain with a foothold in the midstream market.
“Over the longer term, we will also be evaluating our options to further expand operations via other energy storage sources such as compressed air or hydrogen.”
Hill Top’s gas capacity is currently 17.8 million therms, with an ongoing programme to increase this volume to 21.2 million therms.
At its current capacity, Kistos said Hill Top accounts for 3.1% of the UK’s total available onshore storage capacity and up to 11% of the UK’s flexible daily capacity if called upon.
The Hole House facility is currently non-operational, but Kistos said with reactivation and further development it could “materially” increase its proportion of the UK’s total onshore gas storage.
Following approval from the UK government, Kistos will be making its debut in the gas storage market.
Previously Kistos has said the purchase is in line with its acquisition strategy to pursue opportunities which “align with the energy transition” and said its entry into the gas storage sector “provides business diversity to its upstream portfolio”.
