ONE of Britain’s top chemical firms may be forced to suspend production over the winter because of the soaring price of natural gas.

Terra Nitrogen (UK), a leading producer of fertiliser and other nitrogen-based products, has prepared plans to temporarily stop production at its plant in Billingham, Teesside. It would instead import ammonia.

“It is conceivable that prices could hit a level where it makes no economic sense to actually make the product any more,” said Jim Robertson, director of energy at Terra Nitrogen. “In that case, one of our options would be to import it in the short term.

“Shutting our plant is inefficient because of the extra costs required to cool it down and then fire it back up. It is something we try to avoid.”

Terra is one of several British companies facing a bleak winter because of soaring gas prices. Shortages mean that some companies with “interruptible” gas contracts could have their supply cut off in order to maintain supplies to homes.

Terra Nitrogen had to suspend production for a week in February when spot prices for UK natural gas reached £1.16 a therm. Forward gas prices for this winter have already risen as high as 70p a therm.

The potential suspension of production highlights Britain’s growing problem of gas shortages. As North Sea production has declined, Britain has been forced to rely on gas imported from the Continent. With several gas-importing facilities not due to come online until next year, the prospect of shortages during a cold winter has risen.

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