Ships on horizon

May 14 2008 Evening Gazette

NEWS that two of the defence and engineering firms working on a contract to deliver the biggest aircraft carrier ever built in Britain are ready to sign a deal has been welcomed on Teesside.

A spokesman for VT Group, which is poised to strike a joint venture with BAE Systems to build the 65,000 tonne ships, said it was a matter of weeks before the order was confirmed by the Ministry of Defence.

It will bring to an end more than five years of planning, during which Teesside firms have been at the forefront of discussions with the Aircraft Carrier Alliance, made up of BAE, VT and Babcock International.

Babcock has already upgraded its Rosyth dockyard in Scotland ready to assemble what will become the biggest weapons in Britain’s air-sea defence arsenal at a cost of nearly £4bn.

One local firm - Dutch-owned Heerema at Hartlepool - said it fully expected to be in the running for fabrication work.

The firm recently announced a contract to build a 5,900 tonne deck and 500 tonne bridge for a platform working in the Nexen Buzzard oilfield off North East Scotland.

The project will swell the number of staff working at Heerema’s two dock yards from 120 to more than 300.

Director Frank Moran said the firm had already been in discussion with prime contractors in the Alliance.

“The Alliance is drawing up a list of potential tenderers. We have had interface with them and would expect to be tendering, but when that happens is up to them, although we expect it will not be far away - within this year.

“The earliest fabrication would start is 2009.”

Winning the contract would help keep the jobs created for the Nexen Buzzard oil platform on Tees.

“We are in a cyclical business and it can be feast or famine. We generally look for continuity in order to keep people from one project to the next,” said Mr Moran.

A spokesman for Northern Defence Industries, which works with defence departments around the world to secure orders for small and medium sized companies, said the aircraft carrier project would be the biggest test of the Defence Industry Strategy, launched last year by former defence procurement manager Lord Drayson to ensure small British companies got a slice of the Ministry’s cake.

“This project is so huge, it dwarfs almost anything gone before,” said the spokesman.

“It will be the biggest test of how the strategy works and when the MoD signs it off, we will be getting the big boys - the prime contractors - to the region to meets SMEs face to face.

“We may not have the capacity in the North-east to build ships any more, but we have the talent and expertise to provide the complicated kit that goes into them, including weapons systems, radar, electronics and more straightforward engineering projects, such as pipes and ducts.

They are not looking to bring these ships into service until 2014/16, which gives you a sense of the scale of the project.”