UKEn signs hydrogen storage collaboration agreement with National Gas

UK Energy Storage (UKEn), a subsidiary of UK Oil & Gas PLC, has signed a Memorandum of Understanding with National Gas Transmission PLC to develop hydrogen storage infrastructure. This collaboration aims to connect National Gas’s planned Project Union pipeline to UKEn’s proposed salt cavern facilities in East Yorkshire and South Dorset, strategically positioning both companies to secure government revenue support for hydrogen projects starting in H1 2026. The initiative is critical for establishing the UK’s future hydrogen network, with UKEn’s South Dorset facility identified as a unique national-scale storage node for southern England, supporting Project Union's phased rollout by 2032.

Analysis

UK Oil & Gas PLC (AIM:UKOG), via its subsidiary UK Energy Storage (UKEn), has signed a strategic Memorandum of Understanding (MoU) with National Gas Transmission PLC to collaborate on hydrogen infrastructure. This agreement formally links UKEn's proposed salt cavern storage facilities in East Yorkshire and South Dorset with National Gas's planned 'Project Union' hydrogen pipeline system. The collaboration is explicitly aimed at strengthening both companies' bids for UK government revenue support through the Hydrogen Transport and Storage Business Model allocation rounds, set to begin in H1 2026. The significance of this partnership is underscored by the identification of UKEn's South Dorset facility as the sole planned national-scale hydrogen storage node in southern England, making it a critical component for the future national network. While the MoU is non-binding, it represents a significant validation of UKOG's energy transition strategy, aligning its assets directly with the UK's primary gas pipeline operator and a national infrastructure project scheduled to launch its first phase by 2032.

Key Decisions for Investors

• Investors should view this MoU as a material de-risking event for UKOG's long-term hydrogen strategy, as it provides a clear path to integration with national infrastructure and a powerful partner in National Gas.
• The primary catalyst to monitor will be the H1 2026 government revenue support allocation rounds; success in securing this funding is critical to converting these strategic assets into tangible economic value.
• Given the non-binding nature of the agreement and the long-term project timeline extending to 2032, this development should be viewed as a positive step in a long-duration, speculative energy transition play, rather than a driver of near-term earnings.