Lerwick Port Authority (LPA) and international energy logistics company Peterson is planning investment totaling £20million to make Lerwick, Shetland, a decommissioning centre of excellence.
LPA is undertaking a £11.95 million quayside infrastructure project at Dales Voe South in order to support oil and gas decommissioning projects.
Peterson (United Kingdom) is proposing investments up to £8.64 million in its Deep Water Shetland project to further support and expand its existing decommissioning capability.
The growing oil and gas decommissioning industry has a current market value of between £30 billion and £40 billion in the North Sea, estimates the Scottish Government.
Both projects are supported by the Scottish Government and economic development agency Highlands and Islands Enterprise (HIE). HIE has approved £628,000 to Peterson and a further £1,195,000 to Lerwick Port Authority, including £324,416 through the European Regional Development Fund (ERDF). LPA has also been awarded £1.2m from the Scottish Government.
Peterson has also been awarded £1.1m of Regional Selective Assistance (RSA), from by Scottish Enterprise.
Sandra Laurenson, Lerwick Port Authority Chief Executive, commented: “The Dales Voe South development is in line with our strategy to meet the changing requirements of port users and expand Shetland’s resources. Almost trebling the quay to 130m, its design, length and strength will future-proof the deep water port for handling a wide range of opportunities and contractors. The load-bearing capacity of 60-tonne per square metre will make the extension unique in Scotland and be another major selling point for Lerwick when available in 2016.
“Peterson’s plans will also mean another significant addition to the port’s decommissioning capabilities and to the benefits to Shetland.”
Murdo MacIver Board Director of Peterson Offshore Group said:
“This support shall secure and enhance Shetland’s position to become a leading hub for decommissioning works in the Northern North Sea. The investment Peterson has made in facilities and capabilities in Shetland is part of a wider growth strategy where the decommissioning market is a particular focus. Along with our partner Veolia, we already have valuable experience in the completion of a number of decommissioning projects and we believe this experience, matched with greater facilities will earn Shetland the position as a world leader.”
The existing quay at Dales Voe is one of the deepest in Scotland, at 12.5m. The LPA project will extend the quayside in order to accept heavy loads to handle large oil and gas decommissioning projects and substantial cranes lifting sizable kit.
The intention is to engineer the facility as a multi-user centre, for decommissioning projects that require significant water depth and for oil and gas projects when the facility is not being used for decommissioning. In the longer term, it may be used for offshore and marine renewable developments as these sectors grow.
Peterson currently operates the decommissioning facility at Greenhead Base in Lerwick which has been operational since 2005. With its partner Veolia, Peterson has a track record in decommissioning small, medium and large scale projects but this expansion and investment will give the firm capacity to compete for works at a much larger scale.