Shetland has been chosen as the best site for a new ultra-deep port to carry out large-scale decommissioning projects.
Dales Voe, which was previously extended to allow former oil rigs to be moved for dismantling, has been selected following a UK-wide feasibility study to find the optimal and most cost-effective location for decommissioning work.
Norway already has several deep quaysides to decommission oil and gas rigs, and the UK industry plans to compete for projects but needs larger ports to operate heavy lift vessels.
The Scottish Government said an ultra-deep port will support a wider supply chain in other parts of the country.
The announcement was made as oil and gas operators and service companies gather on Shetland for an Oil & Gas Authority event.
Scotland’s Energy Minister Paul Wheelhouse said: “This year’s Programme for Government reaffirms the Scottish Government’s commitment to establishing an ultra-deep water port in Scotland.
“Following an extensive feasibility study, which explored a number of UK-wide options, including a number of Scottish sites, Dales Voe was identified as the optimal location with potential for a deep water facility.
“I believe investment in a deep water port will unlock the potential for Scotland to secure the largest decommissioning contracts that require the largest heavy lift vessels currently in operation in the North Sea.
“A deep water port in Scotland will bring significant benefits not only for a single location, but as a key part of an integrated and networked Scotland wide decommissioning offering, with wider opportunities realised through the supply chain.
“We will continue to engage with industry to measure expected demand and to ensure that investment in a deep water facility will bring the widest possible economic benefit and most substantive boost to the decommissioning supply chain in Scotland.”
Sandra Laurenson, chief executive of Lerwick Port Authority, said the ultra-deep port would be “an excellent future opportunity” for Shetland.
“Such a development would benefit the country, greatly strengthening capabilities in a highly-competitive international market,” she said.
“We look forward to working with the Scottish Government, including Highlands and Islands Enterprise, industry and others on the next steps necessary for such a significant investment to be realised.”