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.

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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%