Infastrata takes big charge on storage facility

AIM-listed InfaStrata fell heavily on Monday after it announced a big loss due to faltering plans for its troubled gas storage facility.

The UK-focused firm reported a loss for the year of £19.72m, compared to a 2011 profit of £4.31m.

Much of this was related to a charge of £18.42m against Portland, its large gas storage project in Dorset.

The firm said continuing poor market conditions for seasonal gas storage facilities meant it was unlikely it could realise the project in the short term.

"As a board, we consider it is appropriate to take a conservative approach to the applicable accounting treatment of the project and the carrying value of the asset in the company's account," the company said.

"This has resulted in a substantial reduction in the financial asset value of the project cost carried on our balance sheet."

The firm is now looking at whether the site could be used as a salt solution mining facility.

"The location adjacent to a deep water port makes the export of salt to UK and international markets potentially attractive," it said.

"If such a project could be established in the shorter-term it would enable the Company to retain the option for gas storage in the longer-term."

The news pushed the shares down 10.2%