North-East Subsea Sector to Make Waves
12 February 2010A north-east energy sector body has predicted an upturn for the region’s subsea sector, amid warnings by UK business leaders of painful hikes in the cost of living caused by oil price surges.
George Rafferty, chief executive of NOF Energy, said new projects were due to come online, including exploration in the deepest waters yet to target untapped oil and gas frontiers.
He made his comments yesterday at Subsea 2010 - a key conference that saw delegates and exhibitors from the North-east’s supply chain showcase their work at Aberdeen’s Exhibition and Conference Centre.
“We are at the point of an upturn in the sector,” said Mr Rafferty. “Things are beginning to pick up and projects should materialise in the second half of this year.
“There is a degree of optimism at the exhibition this year that was not there last year, due to the recession.
“The North-east cluster of companies involved in subsea are very well placed to capitalise on that.
“We are also seeing a move into the renewables markets, including offshore wind. Businesses involved in subsea who have been focused on oil and gas are beginning to wake up to offshore wind opportunities - they can really benefit from this technology.
“Without a doubt, the North-east has had a chance to showcase what it can offer. The UK’s subsea sector leads the world in many regards and there are now global opportunities to go into deeper waters.”
Among the North-east companies exhibiting at the conference were Stockton engineering firm Cordell Group and subsea trenching and installation company CTC Marine. The Darlington company plans to double its revenues after clinching a seven-figure deal to work on the largest power cable ever laid in the Persian Gulf.
Last month the Government announced a generous tax allowance of up to £160m per oil field to entice companies to explore as-yet untapped frontiers, including the UK’s last remaining field, west of Shetland.
French giant Total is leading the way with the £2bn Laggan-Tormore gas project, and engineering companies on Teesside are already gearing up to bid for the work.
Meanwhile, business leaders including Richard Branson have this week warned the UK risks being racked by painful hikes in the cost of food, heating and travel because it is unprepared for surging oil prices. Their report, entitled “The Oil Crunch - a wake up call for the UK economy”, warns the world is running out of oil and predicts shortages and price spikes as soon as 2015.
It said the challenges facing the UK would exceed those presented by the financial crisis - and the poorest in society were most vulnerable. The report said Government must acknowledge the risks to the economy and produce contingency plans for transport, retail, agriculture and alternative power.