CRUNCH talks to prevent job losses at troubled engineering firm BiFab will take place next week, as it confirmed staff had now been notified of potential redundancies.

Union bosses said yards in Fife and Arnish on Lewis are in line for possible closure – with some 260 jobs to go by early summer.

In a statement, BiFab said its senior management were continuing to do “everything possible to avoid redundancies within the business”.

But it warned it was now critical new contracts were secured to support jobs after its work on the £2.6 billion Beatrice Offshore Windfarm comes to an end in June.

BiFab was offered a £15 million loan from the Scottish Government just months ago, and has been facing a fresh threat to its survival after being hit with a multi-million pound lawsuit.

Shadow Scottish Secretary Lesley Laird MP said negotiations with potential investors were ongoing, with a joint trade union meeting due to take place in Holyrood next week.

She said: “This is devastating news for BiFab workers and their families. I think everyone recognises that when the Scottish Government intervened it was a stay of execution and that, following the completion of the Beatrice contract, further work was needed to save the yards.

“This announcement increases the urgency for a successful outcome – both for the workforce and the supply chain – but it is imperative that scheduled work continues.

“Securing future contracts is vital to securing the long-term future of the yards and its workforce skills, not only for the benefit of local communities here in Fife and Arnish but in terms of Scotland’s wider industrial strategy in the renewables sector, and clearly BiFab’s management team is working hard to achieve this.

“BiFab is very much on the radar of both the Scottish and UK Governments and I’m optimistic that, if we all work together and stay focused, we will hopefully secure a positive outcome.”

Next week's meeting will see trade union officials sit down with Economy Secretary Keith Brown to help secure a future for the yards.

BiFab said it was going through a “natural down-manning process” as it nears the end of its work on the Beatrice windfarm.

It said it had notified the Scottish Government of “potential redundancies to permanent staff”, but insisted this was “part of the collective consultation process to inform staff about potential planned redundancies and not a decision that redundancies will take place”.

The firm said: “A number of target projects remain under tender – both within the renewables and oil and gas sectors, where further discussions continue in hope to secure further work across each of the BiFab sites and maintain continuity of employment in the business beyond the Beatrice Offshore Windfarm project.

“It is not underestimated that the timing of securing those projects is now critical as [we are] coming to an end of existing work, which is scheduled to be complete by June of this year.”

November’s rescue package allowed BiFab to continue trading through to the completion of the Beatrice project, but the firm has come under further strain following legal action from German firm EEW – a co-contractor on the Beatrice project.

Scottish Conservative shadow economy secretary Dean Lockhart said it was a “hugely concerning time for workers across sites in Fife and Lewis, and their families”.

He added: “It is critical for the Scottish Government and relevant agencies to work together to strive for a solution.

“The workers at BiFab have shown great commitment by fighting for their company’s future. We need to make sure that politicians show an equal level of commitment to this situation.”

Scottish Liberal Democrat leader Willie Rennie said BiFab needed to be awarded a contract in the short-term, pointing to a project in Kincardine – which the firm have put in a bid for – as a starting point.

Meanwhile, Scottish Green MSPs John Finnie and Mark Ruskell said they had written to the Scottish Government urging them to step up efforts to secure new orders.

They called on enterprise agencies to attend a cross-party meeting of MSPs to discuss what actions can be taken to support BiFab.

Business minister Paul Wheelhouse said the Scottish Government had offered BiFab support to see through its Beatrice contract, and was "fully focussed and working intensively to secure a long-term future for the company".

He added: “Ministers recognise that more work remains to be done to secure the long term future of the company and are fully committed to offering support where possible to attract long term investment in this vital sector of the Scottish supply chain and economy.”