A HUGE offshore plant is to be towed to Scandinavia rather than Scotland for decommissioning reigniting fears that the country is missing out on a new industrial boom that would hand a lifeline to thousands of North Sea workers.
Maersk Oil has confirmed that its Janice Floating Production Unit, which was earmarked for closure last year putting 200 jobs at risk, will be taken apart in a Norwegian port after Scottish and UK firms lost out on the lucrative contract.
The decision sparked fresh calls for more action from Governments in both Edinburgh and London to ensure Scotland becomes a centre of "decommissioning excellence", with upwards of £15 billion up for grabs over the next 10 years for safely taking facilities in the declining UK Continental Shelf out of action.
Read more: One in three North Sea oil jobs 'lost' since 2015
Unions reacted furiously to the announcement, with Jake Malloy, regional organiser for RMT, saying workers who had recently lost their jobs would be "horrified" to see the work disappear overseas.
He added: "We are going through an incredibly difficult time, with thousands upon thousands made redundant. Despite this being a UK installation for 30 years, nothing is coming back in terms of an economic return from decommissioning. It's appalling and a shocking indication of the UK and Scottish Governments' failure to ensure sustainability of employment and that an economic recovery is achieved."
Pat Rafferty, Scottish Secretary of Unite, said the news was "extremely disappointing" and hit out at Governments of being far too slow to see the potential of decommissioning.
He said: "If workers here are to have any chance of benefiting, we need the industry and government to put in proper investment, and to ensure that companies co-operate and come up with business models that work. That simply has not been the case up until now. In fact, it was only in June this year that we had any kind of plan to maximise the UK's economic benefit from decommissioning. That came from the Oil and Gas Authority and, although we welcome it, we believe it has come very late in the game."
The SNP has previously been accused of complacency over decommissioning, warning that it fears the North Sea energy industry could be wound down prematurely, while also claiming cities such as Dundee are already "at the races" when it comes to winning contracts.
However, Maersk's decision to send its 33-year-old, 30,600 tonne largely steel unit to the AF Gruppen facility in the Norwegian town of Vats will fuel fears that Scotland is already missing out. It has previously been claimed that Scottish yards are behind English counterparts in the race for contracts, with Shell facilities north of Shetland towed past Scotland to Hartlepool to be scrapped.
Read more: North Sea player to expand through £5m takeover
Maersk confirmed that yards from Scotland were vying for the disposal and recycling work on the Janice unit, situated 172 miles east-southeast of Aberdeen, but fell short following a tendering process. It is expected that the single project will take one year to complete.
A company spokesman said: "The tender process included a number of yards from Scotland, the UK and Northern Europe. Main drivers for the selection of the yard were the capacity of the facilities, cost and strong track record of the environmental management associated with decommissioning."
Willie Rennie, the leader of the Scottish Liberal Democrats, said: "Scotland should be a centre of decommissioning excellence employing many people but one of the first large contracts is being exported to one of our competitors.
"The news last year of the closure of the Janice Floating Production Unit was a devastating blow with hundreds of jobs facing the axe. Now, with the announcement that decommissioning will be dragged to Norway the prospect of much needed jobs at a time of real crisis has been snatched away. It is simply not good enough. Ministers cannot sit back and watch, they must get to grips and do all they can to work with companies to ensure contracts like this stay in Scotland."
It is estimated that between now and the mid-2050s, around 470 platforms, 5,000 wells, 10,000km of pipelines and 40,000 concrete blocks will have to be removed from the North Sea. Some estimates put the value of the decommissioning at £40 billion over the next 35 years.
Read more: North Sea hammer blow as one in three oil and gas firms plan to cut more jobs this year
Speaking earlier in the summer, Nicola Sturgeon described decommissioning as "a massive economic opportunity", adding: "want to make sure that the benefit of that opportunity is enjoyed here in Scotland and not elsewhere."
A Scottish Government spokesman said: "We are disappointed that Scottish yards were unsuccessful in their bids to support the decommissioning of the Janice FPU.
"However, we remain committed to invest in the necessary infrastructure support so that decommissioning opportunities remain in Scotland, and we are working through our enterprise agencies to provide support to the supply chain so they can to take advantage of the opportunities that decommissioning represents."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel