KBR is expected to decide the fate of the Nigg yard on the Cromarty Firth this month.
Energy understands that the company is considering whether to invest a rumoured $150million or more in rejuvenating the facility and get into the offshore renewables business, which in Europe alone is now seen to be as huge an opportunity as North Sea oil once was.
We believe that KBR’s president/chairman, William Utt, has visited the yard and held discussions about the facility’s future in the face of mounting pressure from Highlands and Islands Enterprise, which wants it put back to work and could implement compulsory purchase to free the way forward.
We further believe that the focus is renewables and not offshore oil&gas fabrication, even though a number of fairly large new UK projects are in the pipeline for development.
A major study commissioned by HIE points to a range of potential opportunities for Nigg, but with offshore renewables seen as the best bet. Get it right and hundreds of jobs could be created. A source has told Energy that a case has gone forward to Houston and “will be dealt with at board level in December”.
Nigg is very strategic, not only for Scotland, but for the UK, as this former offshore fabrication yard has the potential to become a major offshore renewables facility.
The source said: “KBR see that by putting £150million into the Nigg facility that they can claim some of the renewables market. I would have thought that, just in North Sea terms, building turbine substructures on a production-line basis could be economic.
“I’m thinking that KBR is also wrestling with whether they can attract turbine manufacture into that facility, so turning Nigg into a showcase for what they could do in other parts of the world.”
There are two further alternatives: remain a landlord – though Isleburn is the only tenant we are aware of – and widen that remit, or get bought out.
However, the yard’s infrastructure is deteriorating. It would seem that there really needs to be a decision very soon as to whether there is to be significant investment or not.
“Probably if they invested in renewables it would be a big fillip for this area and the UK. The Germans and Danes are doing the business, so why not here,” said the source.
“It would be a real coup if that sort of money was invested in this area.”
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