BiFab lives to fight another day

Offshore fabrication company BiFab will not go under after all after last week’s threat that the company might go to administration following a dispute with key clients.

According to reports last week, the issue had arisen over unpaid fees to BiFab by Seaway Heavy Lifting for work related to the construction of the Beatrice Offshore Wind farm, putting around 1400 jobs in BiFab under threat.

In a statement on Monday, the Scottish government said that an agreement had been reached for BiFab that would lift the threat of administration, and will see work continue on SSE’s Beatrice Wind Farm for which it is building jackets under a contract awarded last year.

The government said on Monday that a financial package to complete the contract has been provided by Seaway Heavy Lifting, SSE and the partners to the Beatrice Offshore Windfarm project, JCE Offshore.

The Scottish Government has also said that it will, if necessary, make available a commercial loan facility to BiFab, the company building facilities for offshore oil & gas and renewables.

The agreement will see BiFab receive payments to alleviate immediate cash flow issues enabling the threat of administration to be lifted and ensuring the full funding of the Beatrice contract.

What about long term future?

The First Minister, Cabinet Secretary and Business Minister met with Unite and the GMB to discuss the agreement and ministers will remain in close discussion with BiFab regarding longer term prospects for the company and the prospect of future contracts.

First Minister Nicola Sturgeon said she welcomed the moves made by Seaway Heavy Lifting, SSE and the partners in the Beatrice Project, JCE Offshore and Siemens to resolve this situation and enable BiFab to continue its work on this contract.

“Over the last seven days we have worked to ensure all partners understood the urgency of the position BiFab found themselves in and the part they could play in relieving the financial pressure on the company. Seaway Heavy Lifting and SSE in particular have chosen to back BiFab today to complete their contract and that is a real vote of confidence in the company and the workforce.

“While this deal lifts the immediate threat of administration, we recognise that there is a lot of work still to do to secure the long term position,” First Minister said.

“I know that this has been an anxious time for people employed at BiFab, as well as their families and the wider communities of Burntisland, Methil and Arnish and the trade unions have ensured that the importance of this company was made clear to all companies involved.

“All companies including BiFab have had to take difficult decisions to secure this outcome. While this deal lifts the immediate threat of administration, we recognise that there is a lot of work still to do to secure the long term position. Ministers will continue to work with BiFab, the trade unions and industry partners to identify ways to secure the long term future of renewables manufacturing on these sites.”

As for BiFab, apart from building structures for the renewable energy industry, the company was in 2015 involved in the development of one of the largest gas fields in the North Sea – the Cygnus. In mid-2015, BiFab delivered a 4600 tonne Cygnus accommodation module from its Methil yard in Fife, Scotland.

Read more on BiFab and the Beatrice Wind Farm on our sister website, Offshore Wind.

Offshore Energy Today Staff