EnergyPathways (AIM:EPP) will focus on developing its Marram Energy Storage Hub (MESH) in the UK Irish Sea over its Marram gas project.
According to its unaudited results for the first half of the year, EnergyPathways will focus on moving straight to developing MESH over the fast-track standalone development of Marram.
EnergyPathways CEO Ben Clube said: “With material changes to the regulatory and fiscal energy environment in the UK and further changes being introduced under the new government, EnergyPathways has moved directly to our more ambitious and higher value MESH project rather than the phased approach that we had originally intended when we came to market last year.”
MESH is designed to store and supply around 50 bcf of natural gas and green hydrogen to the UK market.
The company aims to a final investment decision (FID) on MESH) in late 2025, with first energy supplies expected to commence in 2027.
MESH was originally planned to store natural gas produced from Marram, with the potential for conversion to green hydrogen storage in the longer term.
MESH is located around 11 miles off the coast of Lancashire, Northwest England
According to EnergyPathways, the decision to focus on MESH was taken following an assessment of the challenges in obtaining financial and regulatory support for a standalone gas development versus MESH.
Development of the 35bcf Marram gas field was hit by delays in its licence application.
Company chairman Mark Steeves stated: “I must emphasise that the MESH project is not only higher value than the original stand-alone gas development, but it is also eminently more deliverable from a financing and approval perspective.
“Accordingly, we are presently engaged in constructive discussions with the lending arm of a major integrated oil and gas company for project financing, with the vast majority of capex to be in the form of debt, given the infrastructure-type annuity cash flows associated with such a project.”
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