Sunshine and the Robert Gordon’s College pipe band welcomed dozens of guests and members of staff to a special occasion at the Gateway business park to the south of Aberdeen in late August.
It was the occasion of multiple celebrations for Maritime Developments Ltd (MDL), which has been designing, manufacturing, installing and servicing back deck equipment for the oil and gas sector for decades. Like many entrepreneurial firms born in the rugged North Sea, the company has made firm inroads into decommissioning and has set its sights on putting its subsea expertise into offshore wind.
The company’s journey started, as so many did, in 1999 in the fishing industry. It was founded by Derek Smith, 58, a “loon” from Peterhead.
Like many raised in the coastal town, he thought he would be a fisherman. “I went to sea, hated it. So, I came ashore and got a job,” he said.
Instead, he started working with his uncle where he learned to fix fishing boats. A van, then a fleet of vans working in ports across the UK, was replaced by a workshop repairing tensioners and refurbishing reel drive systems.
© SYSTEMHowever, when the fishing industry changed and shifted to the European Union, Smith changed tack.
Orders started coming in from oil and gas customers, bringing with it demand for new-build equipment including tensioners, power packs and reel drive systems. At first, they made them then badged them up with the customers’ branding, until MDL started putting its own mark on the machinery.
Fast forward to August and Smith is hosting celebrations in the firm’s new 62,000 sq. ft headquarters and workshop. It is awaiting the final tranches of a £6m investment that will enable it to become a full assembly and testing facility. The grey, red and yellow paint on the floors is so fresh it gleams.
© Supplied by Maritime DevelopmensOnce the facility in Aberdeen is complete, the company is also looking to develop a new facility for fabrication and transpooling at Peterhead Port.
Peterhead Port is also looking to orient more toward the floating offshore wind market, which suits MDL’s focus on flexibles, cables and mooring lines. The market opportunity in cable handling and maintenance is already proving to be an area of growth. Meanwhile, MDL has also recently opened an office in Paris alongside the tier 1 and tier 2s that make up the subsea industry there.
Both of the firm’s UK operations bases will be “instrumental in executing our future green ambitions,” Smith proudly declares.
The Lord Lieutenant for Aberdeenshire, Sandy Manson, was at the event in order to hand over the King’s Award for Enterprise trophy. It is the second such recognition after MDL also hoisted the Queen’s Award in the same category in 2022, this one for “outstanding continuous growth” – granted for six years of consistent growth in overseas trade.
Manson, a chartered accountant by trade, said that while 252 businesses were recognised by King Charles in 2024, the scheme set a “high bar”.
“It is probably the most reputable business award that can be received, in my humble opinion,” said the Crown’s representative in Aberdeenshire.
© Supplied by MDLThe latest prize recognises “outstanding short-term growth” in overseas sales over three years. This is reflected in MDL’s recent export revenue growth of 120% alongside more than doubling its total turnover and a more than six-fold increase in net profits.
In its most recent accounts, the year to end March 2023, Smith noted that uncertainty around the UK government’s energy policies had reduced investment in the sector, which had had a “knock-on effect” on the supply chain.
Nevertheless, the company is in rude health – income soared to £28.9m from £17.1m in the prior year. Pre-tax profits also grew to nearly £5m, up from £1.6m.
Most of its income is from overseas and growing. In the early days, its push into new markets including Brazil, West of Africa and the US was driven by the seasons, in order to expand the business in geographies where business took place beyond the narrow North Sea window. Now, Smith said 92% of its revenues are international.
© Supplied by Maritime DevelopmentSmith said: “As the years pass, you find these markets are huge compared to the North Sea because the North Sea has been in sunset for a while. But I’m a strong believer it should be left to extinguish, not be driven out.”
However, Smith is worried that “history is repeating itself” and that the regulation that impacted the Scottish fishing industry and shifted it abroad a few decades ago is happening again to the energy supply chain.
In his speech to the audience, he said: “In the UK we are in an enormous rush to export our livelihoods and our jobs to overseas countries. These countries won’t complain about providing the UK with its ever-growing energy needs.
“I believe that overseas states are equally as serious about the need for change. But they just seem to have a more realistic approach about the journey and are taking a selfish, pragmatic approach; a real transition which will ensure that their green energy is more affordable than ours and full of local content and paid for at least in part by natural resources.
“I believe we share a common planet, and if we are going to use energy from gas or suchlike it should at least be our own and our own livelihoods to provide it.
“The similarities between the UK energy decline and the historic fishing decline may have been for different political agendas, but the outcomes to the local economy and the UK economy will be the same.”
Dream world
Smith points out its new Maritime House facility is within striking distance of the newly established Offshore Renewable Energy (ORE) Catapult’s new National Floating Wind Innovation Centre (FLOWIC).
He is betting that the industry shift to offshore wind will benefit his company eventually, but warns against complacency that assumes subsea expertise in the supply chain will wait for it without revenues to survive in the meantime.
“They live in a dream world where they think that, because of the skill set in the north east, the SURF-city and subsea expertise will continue. We are all still here because there is still an element of revenue coming through here,” he said.
He added: “I have kids that keep me really straight on the green topic and I’m a believer, but I’m a moderate in terms of how we get there.
“I do feel we are contributing here.
“My headquarters could be anywhere on the planet, but I like it here. I’m a north-east born and bred guy. My friends are here. For the top part of what we do, this is where we should do it.
“But don’t let these folk at Westminster think they are just going to run ragged over us. They have got to compete with the rest of the world.
“We have invested here. We are doubling down. We are able to do it because we are making money in foreign countries and it is all being deployed back here.”
He gestures out over his gleaming new workshop.
“I didn’t build this thing for oil and gas, this is for renewables. This facility is for the next thing that is coming down the road. But stop giving us a reason not to be here.”
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