New agreement struck to ensure supplies of CO2

In an announcement yesterday (1 February), it was confirmed that the deal will enable US group CF Fertilisers’ Billingham plant in Teeside to continue to operate while global gas prices remain high.

Last September, amid soaring natural gas and wholesale energy prices, CF Fertilisers was forced to halt operations at Billingham.

The company produces around 60% of the UK’s CO2, which is primarily used by the food sector, with the gas used to stun animals for slaughter; package meat; and also in refrigeration systems.

It is also used in fizzy drinks, beer, cheese, fruit and vegetables and crumpets, among other items.

At the time there were warnings​​ that the food sector was facing a fresh shortage of CO2 gas that could ‘dwarf’ the crisis that led to widespread food and drink shortages in 2018.

The Government provided limited financial support for CF Fertilisers’ operating costs for three weeks to keep the plant running​​, and then in October the carbon dioxide industry came to an agreement​​ to ensure CF Fertilisers on Teesside could continue to operate for three months.

Responding to the new announcement, the Government said the agreement was in the best interests of businesses, but added that in the longer term it would like to see the market take measures to improve resilience and is engaging on ways this could happen.