Orkney Islands Council
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Council following up international interest in Lyness project

Council following up international interest in Lyness project
21 February 2018

The Council is exploring new options for the development of Lyness as a decommissioning base for the oil and gas industry.

A number of international industrial investors have approached the Council and expressed interest in Lyness’ potential as a site for a decommissioning facility.

OIC is actively following up on these leads, after a decision by DSM Demolition to scale back on its involvement in a decommissioning project at Lyness at this time.

The company signed an agreement with the Council in 2016 to take forward an initial assessment of the site, as the first step towards developing Lyness as a base for decommissioning redundant offshore oil and gas facilities.

Gavin Barr, the Council’s Executive Director of Development and Infrastructure, said: “Lyness offers huge potential as a decommissioning base. With its location within the deep-water harbour of Scapa Flow and close to the North Sea, Lyness is ideally located to serve as a facility of this kind.

“Like the Council, DSM remains confident that a decommissioning project at Lyness will come to fruition and has the potential to create significant employment, a range of business opportunities for local companies, and considerable economic benefits for Orkney as a whole.

“The company has informed us that for a number of reasons it no longer wishes to have the same level of involvement as before at the present time. As a result, we have revised our agreement with DSM and will pursue the new interest we’ve received from potential investors in a Lyness project, alongside a continuing dialogue with DSM.”

The Scottish Government recently signalled its interest in Lyness playing an important role in North Sea decommissioning work, with the award of a £96,000 grant. This is supporting first-phase survey and preparatory work, which got underway last year.

Graham Crowe, from DSM, said: “From the outset we experienced strong support from the Hoy community and the council and DSM still firmly believe that Lyness is well positioned to benefit from the growing North Sea decommissioning market.

“Unfortunately, DSM is unable to progress Lyness as project leader due to changes in company structure and priorities.

“DSM will however continue to work with the council in a supporting role at Lyness.”

A report on potential options for a decommissioning project at Lyness is due to be considered by Councillors in June.