11 April 2007

St Fergus Cash Will Extend Life Of Plant - Press & Journal

by Keith Findlay, Press & Journal

A £350million regeneration programme and a new link for gas imports from Norway was predicted yesterday to extend the life of a north-east gas plant until at least 2021.

Energy giants Shell UK and Esso Exploration and Production UK, a subsidiary of ExxonMobil, officially announced plans to pour the cash into their jointly-operated gas complex at St Fergus, near Peterhead, as well as their operations at Mossmorran in Fife.

They also revealed that a 14-mile link between a gas supply pipeline from Norway and the 25-year-old Buchan site would allow the St Fergus plant to operate at full capacity again.

The plans were hailed as a major boost for the north-east economy and for national efforts to meet energy demand. Shell and Esso said their investment would safeguard about 300 jobs at their sites, create a further 100 positions and help secure the UK's future energy supplies.

St Fergus installation manager John Lang said: "We have fantastic infrastructure at St Fergus and Mossmorran. The aim is to keep these plants operating effectively and safely through to 2021."

Mr Lang said that without further investment, Shell and Esso's operations at St Fergus would soon have been winding down as they had reached the end of their 25-year lifespan.

Welcoming yesterday's announcement, SNP leader Alex Salmond said it vindicated his party's efforts to secure a tax concession for the St Fergus plant four years ago.

Holyrood SNP candidate Stewart Stevenson launched the project in the north-east, while Chancellor Gordon Brown performed the role simultaneously at the Mossmorran gas plant in Fife.

Mr Stevenson said the plans were "great news" for Banff and Buchan and a vote of confidence in both the workforce at St Fergus and the future of oil and gas supplies from the North Sea.

Speaking in Fife, the chancellor said the new link with Norway was good for the UK's energy supplies and for Scottish jobs.

The natural gas plant at Mossmorran and the nearby Braefoot Bay loading terminal will both benefit from the investment.

The plants at St Fergus and Mossmorran employ about 300 people between them. The numbers fluctuate but there are usually about 150 working at St Fergus.

It is estimated that another 100 contract staff will be needed for the onshore improvements.

Developments at St Fergus will include an overhaul of the plant's ageing equipment, with new technology being introduced in a bid to build strong foundations for future growth.

The project will also address current skill shortages in the oil and gas sector through a strong focus on training and apprenticeship schemes, as well as links with Banff and Buchan College.

With declining output from the UK North Sea, the new link to Norway is expected to play a major role in plugging the gap between demand and supply in the UK's future energy needs.

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