Major UK investments unveiled at Olympics summit

London – Global oil & gas and petrochemicals companies are to announce plans for major investments in the UK at the British Business Embassy in London. The event has been organised by UK Trade & Investment (UKTI) to promote UK business during the Olympic and Paralympic Games.

The projects include a £1.4-billion field development plan for the southern North Sea by a partnership involving GDF SUEZ, Centrica and Bayerngas, while Versalis is investing €50-60 million to expand elastomer production in Scotland.

Up to 4,000 UK jobs will be supported by the GDF SUEZ- operated Cygnus project - the extraction of shallow water gas from an 18 billion cubic metre field under the Southern North Sea - in partnership with Centrica and Bayerngas.

Operator GDF SUEZ and its partners Centrica and Bayerngas decided to proceed with this £1.4 billion project following the Government’s 25 July announcement of a £500 million field allowance for large shallow water gas fields.

The partners are announcing initial contracts for the development of the Cygnus field worth a total of £375 million, of which £337 million will be invested in the UK, directly creating more than 1200 local jobs.

The Cygnus reservoirs hold estimated reserves of 18 billion cubic metres of gas and, once in production, should supply around 5% of the UK’s gas production, with the first gas being produced in 2015.

Around 80% of the project value is expected to be invested in the UK, and the total development is expected to be a significant economic boost and create around 4,000 UK jobs.

“There continues to be significant interest in the annual licensing rounds, with interest in established and the new frontier West of Shetland. The go-ahead for the Cygnus field is terrific news, and will contribute substantially to the UK’s gas needs and support thousands of high skilled jobs,” added Edward Davey, the UK’s energy and climate change secretary.

Versalis, Italy’s largest chemical producer, owned entirely by ENI SpA, will be investing between €50 and €60 million in the development and expansion of elastomer production capacity at its Grangemouth site in Scotland in order to service technical developments in the automotive tyre manufacture market.

Polimeri Europa UK Ltd, Versalis’ UK subsidiary, has been awarded a £600,000 Regional Selective Assistance grant awarded on the basis of creating 20 new jobs. A further seven jobs will be created within contracting companies who supply services for the site.

Other projects include a £50-million investment by BP in an International Centre for Advanced Materials (BP-ICAM) and Neftex’s recruitment of 50 new staff after winning new contracts.

The International Centre for Advanced Materials created by BP with universities including the University of Manchester will build on the UK’s international status in research and development.

The University of Manchester will act as the ‘hub’ of the centre, with ‘spokes’ in other universities around the world that have specific areas of expertise. At the launch these are: Cambridge University, Imperial College, London and the University of Illinois at Urbana-Champaign.

BP is committing $100 million (£60 million) over 10 years to the network of universities. It will create 25 new academic posts, at least 100 PhDs and 80 post-Docs, and help maintain the world-leading status of the UK in the research of advanced materials.

“The oil and gas industry’s immense contribution to our skills base, industrial capacity and strength as an exporter are pivotal as we rebalance our economy,” said UK business secretary Cable. “Today’s summit underlines the Government’s commitment to making the UK a great place for energy firms to do business, develop new technologies and recruit the best technicians and engineers.

Advanced materials and coatings will be vital in finding, producing and processing energy safely and efficiently in the years ahead, explained BP chief executive Bob Dudley. Energy producers, he said, will work at unprecedented depths, pressures and temperatures; as refineries, plants and pipeline operators seek ever better ways to combat corrosion.

“Manchester has world-leading capabilities and facilities in materials and it was chosen after a global search to act as the ‘hub’ of the centre, with ‘spokes’ in other university departments worldwide,” Dudley commented.

Neftex, an Oxfordshire-based geosciences consultancy business that supports the activities of global oil, gas and mineral exploration companies, has won several international contracts over recent months, including a UKTI-supported contract with JOGMEC (Japan Oil, Gas and Metals National Corporation) worth several hundred thousand pounds.

Neftex, which already has over 80 staff and is one of the biggest annual employers of geology graduates in the UK, expects to recruit up to 50 new graduate staff as part of its near-term plans.