Shetland oil drilling contract agreed

Oil giant BP has announced a multimillion-pound contract with a specialist offshore engineering firm for the second phase of a massive project off the Shetland Islands.

Subsea 7 will produce new pipelines for the Clair Ridge drilling project where the North Sea and Atlantic Ocean meet.

The second phase of the giant Clair field forms part of £10 billion being spent on four projects by BP and its partners Shell, ConocoPhillips and Chevron over the next five years.

At their peak, the projects are expected to provide 3,000 oil and gas supply jobs and play a part in sustaining the more than 3,500 jobs in BP's North Sea operations.

The latest contract, which includes a 14km (8.7 mile) gas pipeline, is worth around £63 million.

Around 100 jobs at Subsea 7's base in Wick have been secured by the new contract.

Offshore operations are due to get under way next year.

Scottish Secretary Michael Moore said: "This major contract underlines the confidence of the oil and gas sector and world-leading engineering firms with bases in Scotland. The construction of the pipeline is an essential step in opening up the considerable potential of the west-of-Shetland field.

"The contract award to Subsea 7 is just the latest piece of good news for the UK's oil and gas sector and its supply chain in Scotland. I welcome the investment by BP and the jobs and expertise which will be secured in the Wick facility as a result."

Subsea 7 UK vice-president Steph McNeill said: "We are pleased to be awarded this major pipeline project by BP. We look forward to helping bring on-stream the Clair Ridge project in an efficient, timely and safe manner."