The facility is proposed to be constructed on the east side of the Wyre Estuary at Preesall in Lancashire and will be used to store and extract gas in underground salt caverns.
More than 40,000 people signed a petition against the proposals, which were turned down three times.
The fourth appeal to the Government by Halite to build the facility was also initially refused, before courts ruled the Government must revisit the proposal.
Energy and Climate Change Minister Lord Bourne, who is the Minister responsible for energy planning consents, said: “Investment in new energy infrastructure is essential if we are to keep the lights on and bills down.
“This is a major project which will benefit the local economy by creating jobs and stimulating businesses.
“Gas is also the greenest fossil fuel and helps us lower our carbon emissions, which is important in the UK’s move to a cleaner energy future.”
In making this decision, the Department of Energy and Climate Change said listened to all views and took into account further geological information that demonstrated the anticipated storage.
It also considered an assessment by Senergy, an independent geological assessor, which suggested that the development was suitable for the local geology.
The project may create up to 300 jobs during construction and up to 40 permanent jobs once operational.
Preesall would be a demand response facility, with gas entering the national system in response to market conditions.
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