ATLANTIS Resources has agreed a deal to acquire tidal power assets owned by ScottishPower Renewables.

Tidal Power Scotland (TPS), a subsidiary of AIM-listed Atlantis, is taking on the 10 megawatt project at the Sound of Islay in western Scotland and a 100MW site at the Ness of Duncansby at the north eastern tip of Scotland.

ScottishPower Renewables is receiving a six per cent shareholding in TPS as part of the agreement. The move could see up to 20 jobs created at the Atlantis headquarters in Edinburgh as well as potentially providing further fabrication work for manufacturing yards around Scotland.

Atlantis chief executive Tim Cornelius described the Sound of Islay as a “real trophy asset” and said: “[It] is the next shovel ready project that is available to commence construction certainly anywhere in the UK and you would probably argue anywhere in Europe. It has its consents, it has grid and we can seek to go forward and get financial close and then start construction in a short space of time. That then gives us a project on the west coast of Scotland.”

Construction on the first phase of Atlantis’s flagship MeyGen project in the Pentland Firth is already quite advanced with first power generation being targeted for next year.

Mr Cornelius said the addition of Ness of Duncansby would allow the company to “supersize” the MeyGen project from just short of 400MW to close to 500MW using “all the common infrastructure”.

Atlantis is targeting starting construction work at Sound of Islay before the end of next year.

Mr Cornelius is keen to keep as much of the fabrication work, which could include the foundations for the underwater turbines, in Scotland as possible.

Atlantis expects to have to raise a similar sum to the £55m it secured for the first phase of MeyGen.

Sound of Islay has already received €20.7 million of funding from the European Commission.

Mr Cornelius confirmed the company is working with investment bank Macquarie to identify funders and said: “We will now be running very quickly to reach financial close on Sound of Islay and I’d like to think that by the end of 2016 we will have commenced construction so it is a short time cycle.

“That is what is so exciting about it for us.”

As part of the agreement SPR will have a representative on the board of Tidal Power Scotland.

Keith Anderson, chief executive of ScottishPower Renewables, said: “The MeyGen project has moved the tidal power sector forward in Scotland and Atlantis is now the world’s leading developer. This agreement will drive momentum in the sector.

“We look forward to working with Atlantis and adding value to the Tidal Power Scotland board. With our hard work to design and seek consent for the Islay project, it is now ready to go in to construction, heralding an exciting new chapter in the progression of tidal power.”

Atlantis also has project sites at the Mull of Galloway in south-west Scotland and Brough Ness, to the north of MeyGen.

Mr Cornelius added: “By 2022, we aim to have at least 640MW of installed capacity in the UK through development of just our existing portfolio, and in the process we want to help build a UK-based supply chain based on world class manufacturing.”

Already this month Atlantis has signed a collaboration agreement with subsea cabling firm JDR Cable Systems and hired Stephen Ward as director of power generation.