Harland & Wolff Taking Over BiFab Methil, Arnish Sites
Owner of the Harland & Wolff shipyards, InfraStrata, is acquiring the assets of Scotland’s Burntisland Fabrication (BiFab) at Methil in Fife and Arnish in Western Isles.
BiFab officially went into administration in December 2020 after a deal for jacket foundation work for the Neart Na Gaoithe (NnG) offshore wind farm at the Methil site fell through a month earlier. This came after a few years of struggle for the company, which started back in 2017, at the time BiFab was working on the fabrication of jacket foundations for the Beatrice offshore wind farm.
Now, the Methil and Arnish sites will trade under the Harland & Wolff brand and will work alongside Harland & Wolff (Belfast) and Harland & Wolff (Appledore) to deliver projects across multiple markets, including offshore wind.
“With this acquisition, we now have a footprint in Scotland, which is the hotbed for major wind farm projects as well as for shipbuilding programmes. We have now positioned ourselves strategically across the UK with four sites capable of servicing our five core markets”, said John Wood, CEO of InfraStrata.
The Methil site will be focused on fabrication for the oil and gas, commercial and renewable energy markets, according to the new owner, while the site in Arnish will accommodate work from all Harland & Wolff’s five markets: defence, oil and gas, renewables, commercial, and cruise and ferry.
“This acquisition gives us the flexibility to optimise our operations across the Group and offer our clients the ability to fabricate faster and de-risk their exposure by offering multiple sites. As we move into larger contracts, it is crucial that we demonstrate the capacity to bid for and deliver on these projects”, John Wood said.
“Finally, I wish to warmly welcome the personnel whom we have taken on at Methil and Arnish and I am confident that we will turn these facilities into highly successful businesses that generate jobs and investment into their local economies in due course”.
BiFab has another site in Burntisland in Fife, which is not part of the acquisition by Harland & Wolff.
BiFab: From First Issues in 2017 and Takeover by JV Driver to Missed Offshore Wind Contract
In 2017, while BiFab was executing a contract for the now operational 588 MW Beatrice offshore wind farm, the company hit a critical cash position.
The BiFab management informed trade unions on 13 November 2017 that there was no money to pay the wages of their staff, after problems emerging from a dispute over payments with Seaway Heavy Lifting (now known as Seaway 7 and owned by Subsea 7) had brought the company a few steps away from going into administration.
A couple of days later, the Scottish government got involved in the BiFab case and became a minority shareholder in the company. A few days after that, Seaway Heavy Lifting, SSE and the partners to the Beatrice offshore wind project, JCE Offshore, provided a financial package to enable BiFab to complete the fabrication work for the Beatrice wind farm, for which the company was contracted to deliver 26 jacket foundations.
At the beginning of 2018, with the Beatrice project coming to a close and no new orders in sight, the BiFab management told the trade unions that some 260 workers would be made redundant, starting that May, and the yards would be completely closed by the end of June if no new contracts were secured.
However, in April 2018, the Scottish Government managed to broker an agreement with the Canadian company JV Driver which, through its subsidiary DF Barnes, acquired BiFab. In a little less than a year after the acquisition, BiFab secured a new contract in offshore wind with a pin pile order for the Moray East offshore wind farm.
In December 2020, BiFab was officially placed in administration after failing to secure new contracts, more specifically after the company had no guarantees on disposal to secure its contract with Saipem for the Neart na Gaoithe offshore wind project.
In November, the Scottish and UK governments issued a joint statement saying that, in the absence of a guarantee by majority shareholder JV Driver, there was no legal route for either the Scottish or UK government to provide BiFab with the guarantees to secure its contract with Saipem for Neart na Gaoithe.
“The Scottish Government has been clear that State Aid regulations are a barrier to us providing guarantees on the contract from Saipem to build foundation jackets for the Neart na Gaoithe (NnG) project. The UK Government has similarly concluded that there is no legal route for them to provide support”, said Scotland’s Economy Secretary Fiona Hyslop.
“The situation at BiFab is a culmination of a number of issues, the main one being the unwillingness of the parent company and majority shareholder JV Driver to provide working capital, investment or guarantees for the company”.
The governments then set up a joint working group to consider ways to save the BiFab yards and to strengthen the renewables supply chain in Scotland.
“We are determined to secure a new future for the yards in Fife and the Western Isles. We will explore options for the future of these sites and, through this new working group, work with the UK Government to strengthen the renewables and clean energy supply chain”, Economy Secretary Fiona Hyslop said.