Bord Gais expect prices to steady

Although Bord Gais is looking for a price rise of 30-40 per cent, the company is expecting prices to moderate in the medium to long term.

This is due to the construction of new pipelines and because Europe is embracing liquefied natural gas (LNG).
Although the firm’s pretax profits have fallen, turnover has gone up to Eu857 million. Gerry Walsh, Bord Gais chief executive said that gas prices would face pressure because of “unprecedented” wholesale prices. He was optimistic about the long-term fortunes of the company.

“The distilled wisdom is that in the next year and a half the perceived squeeze in the UK will be sorted and , as a result, from mid-2007 onward, prices will soften a bit,” he said.
He added that new pipeline routes and the construction of LNG plants in Europe would help to stabilise prices in the medium to long term.

LNG is natural gas converted to liquid form by cooling to a very low temperature of around minus 162 degrees centigrade. It can then be transported by ship. After reaching its final destination, it can be turned back into a gas and injected into pipelines. Its growth means that gas can move more freely around the world.

The company is keen to do a deal to take the gas from the Corrib field off Co. Mayo. Mr Walsh stated that no deal had yet been signed. He said that talks with Shell and other Corrib shareholders were at an advanced stage.