Significant investment and surge in harbour activity

Significant increases in marine traffic at Shetland’s main harbour have been confirmed by Lerwick Port Authority, reinforcing its importance to diverse industries.

The figures for the first half of 2024 demonstrate growth in virtually all sectors, and with multi-millio

n-pound investment due to expand the harbour’s ultra-deepwater quayside there is potential for further growth.

Lerwick Port Authority chief executive Captain Calum Grains said: “The increased activity across various sectors and the opportunities for the Shetland supply chain were outstanding features of the period. Coupled with the recently announced next phase of port developments, the performance underpins future operations.

“New capital projects will position Lerwick to enhance support for the fishing, energy and cruise sectors.”

Overall, there has been a 6% increase in vessel arrivals compared to the same period last year. That includes a 10% rise in fishing boats and a 20% spike in oil vessels.

There was also a big increase in the tonnage of vessels, up a third at almost 8 million gross tonnes. Offshore industry tonnage was up too including shipments for significant energy industry projects west of Shetland for Equinor/Ithaca Energy, and decommissioning projects for the newly-finished Phoenix Decom depot at the harbour’s Greenhead Base.

There was a slight dip in cargo, down 3% but still over 400,000 tonnes. The drop is partly due to the completion of the construction phase of the Viking Energy Wind Farm, which is due to begin generating renewable energy in 2024.

The number of passenger arrivals in Lerwick also rose by 35% to 146,535, including ferry and cruise ship arrivals. The cruise season is set to be the busiest yet, with a longer season attracting more ships. May was a record month for cruise passenger arrivals with over 36,000 visitors, many of them spending time browsing in Lerwick and visiting other famous locations in Shetland.

The announcement of a busy first six months of 2024 comes weeks after the LPA announced it was seeking consent for a series of capital projects. Applications and scoping reports have been submitted to Marine Scotland , a Scottish Government department, following the LPA board’s decision to pursue the projects,

Capt. Grains said: “We have applied to Marine Scotland for a licence for a capital dredging project, which will be the key to future quayside developments. The investment will support the fishing, cruise, and energy sectors and increase our capabilities to handle larger vessels.”

That would open the way for more business for the port, and the extensive supply chain and highly skilled engineering and support firms that operate from the quayside.

LPA chairman John Henderson explained: “These early-stage steps are in line with our long-established proactive approach to the port’s continuing evolution. The projects will benefit users across all sectors and sustain and encourage economic activity in Shetland.”

The dredging project would deepen and widen the North Ness Channel, improve access to the Gremista industrial area, and to Mair’s Pier, which opened in 2020. The work would also include quayside deepening at the energy-related deep-water Dales Voe Base and “enabling works” for the proposed ultra-deepwater quay.

If approved, the improvements would signal a significant new phase of work, and opportunities for Shetland’s skilled workforce, in the harbour.

It is hoped the work will begin in 2025 subject to the financing and availability of equipment.

The Authority has already submitted a scoping report to Marine Scotland to understand the requirements of a future Environmental Impact Assessment and Harbour Revision Order related to the planned ultra-deepwater quay at Dales Voe, which will give energy industries unique UK capabilities. The major quayside improvement works could begin in 2027 or 2028.

A marine licence application is being prepared for the construction of an additional small breakwater at the Gremista marina entrance in 2024 or early 2025. The breakwater is needed before redevelopment in the Arlanda/Gremista area begins to support the pelagic fishing sector.

Captain Grains added: “The combination of projects ushers in another significant phase in the development of Lerwick Harbour and reflects our commitment to invest in supporting current port users and new opportunities.”

Decommissioning waste experts Phoenix Decom are investing around £1 million pounds in a new base at the Greenhead Base.

The port has already hosted significant decommissioning projects, and the new investment represents another step forward.

It follows completion by Lerwick Port Authority of a 2,400 square metre heavy-duty pad for Phoenix to dispose of offshore industry waste materials located at Greenhead berths six and seven. The leased site is seen as a key to future company growth and job creation.

The investment will see a new material handler, mobile shear unit and decontamination system installed. Together the equipment will reduce risk of the contamination and improve safety.

Phoenix was established in 2021 and has bases in North-east Scotland providing integrated solutions for management and disposal of waste from the subsea sector.

Company Managing Director, Craig Smith, said the LPA’s support had paved the way for Phoenix to move into Lerwick. The location is attractive because of its proximity to oil and gas installations and Shetland’s extensive experience supporting major energy industry projects.

Mr Smith said the new base, “positions us correctly to maximise opportunities within the decom sector and create work within the local area.”

Captain Calum Grains, Port Authority Chief Executive, said: “It is important that facilities and services at Lerwick continue to evolve to meet the industry’s increasing decommissioning requirements. The third licensed heavy-duty pad reflects our commitment and is complemented by Phoenix’s investment and activities which are a significant addition to the port’s capabilities.”

Discover more about the thriving sectors attracting more investment in Shetland's dynamic economy.