A controversial gas storage company has racked up £22m debts after failing to secure planning permission for its ambitious project.
Halite Energy is currently awaiting the decision of a judicial review after its plans to store gas in 19 caverns in the salt strata beneath Preesall were rejected in April.
But auditors at Pricewaterhouse Coopers warned of a “material uncertainty” as the company, previously known as Canatxx, awaits the High Court’s decision.
Halite’s accounts show the company filed pre-tax losses of £22m in the year to December 2012, and net liabilities topped £100m, mostly loans from its majority owner, the US-based private equity firm DE Shaw.
However, Halite’s directors said they were confident they could get funding to finish the project.
A spokesman for PwC said: “These conditions, along with uncertainty over the outstanding planning application and the requirement to obtain adequate additional funds to continue its activities, indicate the existence of material uncertainty which may cast significant doubt on the company’s ability to continue as a going concern.”
The gas storage proposals were rejected for the fourth time in April by the Department of Energy and Climate Change, with the planning inspectorate suggesting it could only be approved if the suitability of the area could be proven.
The judicial review challenged the decision to turn down planning consent.
The process will not overturn the Government’s decision, but it could be quashed and the DECC would have to consider the plans again.
In the accounts, the directors of Halite said: “The company’s future is dependent on the granting of planning permission to Halite Energy Group to store gas underground at Preesall and the availability of sufficient funding to finance the ongoing planning application and ultimately the gas storage project.
“The directors would not have authorised the judicial review if they did not believe it is reasonable to expect Halite will be able to obtain the necessary funding through to the end of the process, and the directors remain confident planning permission will eventually be granted.”
Keith Budinger, chief executive of Halite Energy, said: “It is common for a project development company such as Halite to operate in this way.
“Halite and its board remain confident in the future of the project and in the company’s ability to secure the funding required to achieve a consent.”