Updated: 5th February 2020
A company called Gas2, which has been working on technology designed to make underground gas fields easier to exploit by turning their contents into liquid, has entered administration after failing to maintain a viable financial position.
Aberdeen-based Gas2 has been aiming to commercialise its technologies since its founding in 2005 but has been unable to generate revenues and profits.
The company has been backed by around £18 million in funding since it was first established but has struggled in recent years, with the business having been forced to let some of its employees go in early 2015.
Administrators are now seeking buyers for Gas2’s intellectual property and its assets, which include a pilot testing plant on Teeside.
Gas2’s primary goal as a business was to develop and find commercial uses for the technology its founders designed and which essentially aims to turn gas into liquid and make remote gas reserves easier to exploit.
“Gas2 was focused on perfecting a new technology that has the potential to cause a seismic shift in the GTL market,” administrators said in a statement.
“That significant market potential still exists, but unfortunately the company could not fund the next phase of R&D, and there was no alternative other than to place the business in administration.”
Among the company’s primary financial backers were the Robert Gordon University (RGU) in Aberdeen and the venture capital company Lime Rock, which helped see Gas2 backed with £10 million in growth capital in 2008.
“We are disappointed that the company has gone into administration,” said a spokesperson for RGU. “The university will continue to work on the technology that the company was bringing to market.”
Gas2 was backed by £2 million worth of funding for its research and testing efforts at its facility in Teeside as recently as December 2013.
Companies operating in the Scottish oil and gas sector have been badly impacted by the global fall in energy prices in recent quarters with Gas2 the latest in a growing list of businesses forced into administration in the face of challenging dynamics within the industry.
According to the trade body Oil and Gas UK, there have been as many as 60,000 jobs lost within the British energy sector and related markets since the beginning of 2014.
At Real Business Rescue, our advisers are currently helping a number of contractors and suppliers who are struggling due to the knock-on effect of the falling price of oil. Do you know where your work pipeline is? If the answer is uncertain, contact us today and a member of our team will be on hand to provide advice through a free consultation either on the phone or in person at our Aberdeen office. Our extensive office network comprises 78 offices across the UK with a partner-led service offering immediate director advice and support.