Forget gasfields — gas storage fields under the sea are the new must-have asset. That, at least, is what Island Oil & Gas is pinning its hopes on.

The cash-strapped Irish oil explorer, listed on AIM and in Dublin, rose ¾p to 7½p after it said that it had received expressions of interest in its Celtic Sea gasfields for use as gas stores. Interested parties could include Petronas, which bought a nearby field for gas storage from Marathon Oil in December. Island implied that one field, Old Head of Kinsale, could fetch between £22 million and £33 million.

Britain and the Republic of Ireland are short of gas storage capacity, vital to prevent the price shooting up in winter during a not-unprecedented Russian threat to switch off pipelines. Ireland has less than the three months’ capacity recommended by the European Union. Island needs a deal because it does not have enough cash to continue drilling its more promising Moroccan fields. The option of a share issue failed to entice investors during a roadshow, the company indicated. Bryan Benitz, the chairman, is providing a £500,000 loan to keep the company alive while it negotiates a sale.

Portland Gas rose another 14¼p to 93¾p a day after it said that it would begin construction of its gas storage facility, even though it has yet to raise funding. Gulf Keystone Petroleum, which put its Algerian permit up for sale on Tuesday, fell ¾p to 12½p after RBC, its broker, cast doubt on whether a sale would be quick enough. It plans to spend $50 million this year but had only $34 million on January 1. Gulf has stopped paying fees for the Algerian permit, which means that BG Group, the operator, may be able to take some or all of Gulf’s stake for nothing.

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