4C Offshore Empowering Intelligence

BiFab cash crisis

4C Offshore | Tom Russell
By: Tom Russell 14/11/2017 Burntisland Fabrications Limited
Beatrice Offshore Windfarm LimitedBurntisland Fabrications Limited (BiFab), a Scottish-based fabricator of offshore structures, is currently facing a critical cash position as a result of a challenging situation regarding its ongoing contracts for the  £2.6bn Beatrice offshore wind farm project.

One contract is nearing completion whilst the other is at a much earlier stage and is expected to run to 30 April 2018. Its work includes the manufacture of jacket foundations for the project.

The cash flow problems have reportedly stemmed from a dispute over payments between BiFab and the wind farm's main contractor, Seaway Heavy Lifting (SHL). Last year BiFab secured a £100m contract from SHL for the manufacture of 26 turbine jackets, sustaining employment at the Burntisland and Methil yards in Fife and also at Arnish on the Isle of Lewis.

The Directors of BiFab have been seeking to secure an immediate financial solution with its key stakeholders and are actively in discussion to consider solutions that will allow the business to continue trading / overcome this temporary difficult position and have been encouraged by the rapid communication between the parties in the later part of last week and over the weekend.

However, given the financial position of the company the Directors have taken steps to protect the company via the filing of a Notice of Intention to Appoint Administrators. The company stated it is not currently in administration and hopes that a solution can be reached to secure the future of the business and the workforce.

Martin Adam Managing Director for the company said "We are very disappointed that we have found ourselves in the current position which has arisen as a result of a challenging situation in respect of our ongoing contracts which have been providing much needed employment locally in Scotland. We are seeking a rapid solution with our key stakeholders and the Scottish Executive to our current cash flow position and are hopeful that this can be achieved quickly to secure the future of the business and the 1,400 strong workforce."

BiFab operates three facilities – Burntisland and Methil on the east coast of central Scotland, and Arnish on the Isle of Lewis. It is a major employer in Scotland with a workforce of anround 1,400 people across the three sites. This comprises 251 permanent staff, and 1,132 employed via agencies. The company informed trade unions that is has no money left to pay the wages of its staff.

British trade union, GMB Scotland, urged the Scottish Government and industry stakeholders to pull together for the fabrication firm.

Gary Smith, GMB Scotland Secretary, said: “This is a critical moment for the future of BiFab, its workers and the communities these yards support. We were told that despite the evident problems, it would be business as usual and our members should report to work as normal.

"This morning we were told that there is no money to pay our members wages, stemming from a cash flow problem with the contractor Seaway Heavy Lifting (SHL).

"Everyone with an interest in these workers, their communities and the welfare of the Scottish economy must pull together now and the Scottish Government must lead this effort.

"This is a viable workforce and these are viable yards - important strategic assets - and they stand ready and able to help deliver the future of Scottish manufacturing. Letting these workers and their communities go under is not an option.”

The Beatrice project is a joint venture between SSE Renewables Limited, SDIC Power of China and Copenhagen Infrastructure Partners. Full commissioning is anticipated by October 2019 and when fully operational the project is expected to capable of generating enough electricity to power approximately 450,000 homes annually.

The installation of piles, which form part of the jacket foundation, has almost been completed at the site. Work was carried using SHL's vessel Stanislav Yudin which is scheduled to re-mobile to the site to continue to install the jacket foundations.

For more information please follow the links provided. You can also view offshore wind projects worldwide using our interactive map.


ForeSEE Premium, our most popular subscription, gives you full access to use the ForeSEE WebApp which includes exclusive offshore wind, transmission and vessel reports, news and downloads.

Request a 30 minute Demo

Trending News!