The Scottish Government has unveiled a £10million package for a proposed oil rig decommissioning facility in Shetland.
It is hoped the new deepwater quay at Dales Voe, which will dismantle installations currently based in the northern sector of the North Sea, will create about 150 jobs in the islands and Aberdeen.
First Minister Alex Salmond made the announcement at Holyrood yesterday following a meeting with the Norwegian civil engineering firm behind the project in Oslo.
The funding package comprises contributions of £5million each from the government and Highlands and Islands Enterprise (HIE).
It is subject to the plans being given the go-ahead to proceed.
Lerwick Port Authority signed an agreement with AF Group’s UK subsidiary in February, 2010, to develop the project, which aims to establish a “centre of decommissioning excellence” at Dales Voe.
The facility will incorporate a 78ft deep quay and oil rig decommissioning yard, and will provide a scale of capacity and environmental standard which its backers say is currently unmatched in the UK.
It could also be equipped to undertake projects like rig maintenance, ship dismantling and reception of subsea installations.
Although there are many years of productive life left in the North Sea, a steady stream of installations are approaching the end of their design life and demand for onshore demolition facilities is growing.
The total market value of decommissioning over the next 30 to 40 years is estimated to be just over £30billion.
Mr Salmond said: “I am determined the government and our enterprise agencies will do everything we can to support the continued success of the industry in Scotland.”
Pal Egil Rønn, chief executive of AF Group, added: “We wish to bring our experience from development and operations of similar business in Norway, to develop a unique site when it comes to operational and environmental standard for the UK market.”
Sandra Laurenson, chief executive of Lerwick Port Authority, which is due to meet UK Energy Secretary Ed Davey shortly, said the project would bring benefits to the area.
Shetland MSP Tavish Scott said: “There is a big win to be had in both governments working together here and that is what they should do.”