ABERDEEN Airport is embarking on a £13 million redevelopment of its terminal building as part of efforts to increase passenger capacity.

The plan,which is expected to lead to about 1100 new jobs, will create a new security area with more lines, new baggage reclaim areas, and more shops and restaurants. The executive lounges used by British Airways customers will also be included as part of the revamp. Almost two thirds of the passengers using the airport are business users.

Airport managing director Carol Benzie said: "This terminal was opened in 1977 and what we are about to embark upon is the biggest change since that time."

The work, which will begin next year, is scheduled to be completed by 2017. The redevelopment is the first step in a planned £100m upgrade of the entire airport over the next 30 years, including runway expansion.

The announcement was made at a CBI Scotland event in the Scotland Office hosted by Scottish Secretary Alistair Carmichael.

Mr Carmichael said: "As a regular user of Aberdeen Airport I know it is at full capacity for passengers. The airport is crucial for the economy for the north east of Scotland and this is very welcome news."

The investment follows an earlier announcement from Heathrow Airport Ltd, Aberdeen Airport's parent company, of £17m of funding for Glasgow Airport to prepare it for the Commonwealth Games.