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Repsol Sinopec strikes decommissioning deal for 40-year-old Nigg oil terminal

Aerial view of the Nigg Oil Terminal in the Cromarty Firth.
Decommissioning of the Nigg oil terminal on the Cromarty Firth is expected to be complete in 2025. Image: GEG

Aberdeen-based Repsol Sinopec has signed up an Australian specialist firm to decommission the Nigg oil terminal on the entrance to the Cromarty Firth.

Liberty Industrial, which launched its UK business last year on Teesside, will undertake the decontamination, demolition and site remediation of the terminal which stopped processing oil after Repsol’s Beatrice field in the Moray Firth shut down in 2016.

Planning and engineering work will begin by the end of the year with decommissioning work starting in 2023 with a goal of completion by 2025, at which point the terminal will be handed back to the leaseholder Global Energy Group (GEG).

The 75-acre facility consists of a large-scale crude oil process, storage and export facility that will require decontamination prior to the demolition and site remediation process.

Liberty is set to ensure all hazards are identified, and handled correctly and safely, while working alongside Repsol project and site teams.

What is Nigg oil terminal?

The Nigg oil terminal was commissioned in 1981 by the British National Oil Corporation as part of the Beatrice complex development.

Spain’s Repsol took control of it when it struck a deal in 2014 to buy the North Sea assets of Canadian operator, Talisman.

Repsol Sinopec Resources UK’s Beatrice Alpha platforms in the Moray Firth where oil and gas production stopped in 2016. Image: DC Thomson.

Earlier this year Respol Sinopec’s then-chief executive, Jose Luis Muñoz, said the firm plans to ramp up decommissioning investment including the terminal and around 100 wells in the North Sea.

Vice president of decommissioning and energy transition at Respol, Adam Sheikh, said: “We aim to deliver one of the North Sea’s most ambitious decommissioning programmes in the years ahead – including the full decommissioning of our Nigg onshore terminal.

“This contract award represents a significant milestone in our decommissioning journey and my thanks go to the teams for getting us to this stage.

“As a company we intend to deliver outstanding decommissioning minimising environmental impact and as cost-efficiently as possible.”

Aerial view of the disused rig fabrication yard at Nigg Bay, at the entrance to the Cromarty Firth
The terminal is part of the disused rig fabrication yard at Nigg Bay, at the entrance to the Cromarty Firth which was acquired by GEG in 2011. Image: Ken Whitcombe

Respol Sinpec‘s decommissioning project manager, Simon Reid, added: “A comprehensive tender process was followed inviting the UK’s leading onshore decommissioning contractors to submit proposals for the project.

“The technical evaluation focused on the contractor’s ability to demonstrate safe and robust methods, with a clear understanding of the hazardous inventories, to deliver the decommissioning scope in line with company and regulatory requirements in an efficient and fit for purpose manner.”

Liberty contracts director Jon Sowerby, said: “The decommissioning project being undertaken by Repsol Sinopec at Nigg encompasses all Liberty Industrial’s specialist and innovative service.

“This is a significant milestone in the history of the Nigg site, and Liberty Industrial is excited to be part of it.”

Nigg oil refinery after 41 years

Repsol Sinopec handed over ownership of the facility’s refinery jetty to GEG in 2019.

This came as the terminal stopped receiving oil when production ceased from the Beatrice field in the Moray Firth.

Beatrice supplied Nigg for 35 years before the field ceased production in 2016.

At the time, the terminal employed 40 staff which were supplied by Wood Group.

The Nigg oil terminal. Image: DC Thomson.

Last year, GEG announced plans to make the terminal green as it struck a deal with the world’s second-largest producer of methanol, Proman, to develop green energy.

The initiative was named the “Cromarty clean fuels project”.

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