The decision by oil company BP and its partners to shelve the £600m Clair development off the west coast of Scotland will lead to the loss of around 2,000 engineering and construction jobs over the next two years.
The suspension of Clair which would have been the largest UK offshore project this year was a further serious blow to the offshore engineering industry, said Ian Bell, chief executive of the Offshore Contractors’ Association.
BP said last week that high costs and falling oil prices had driven it to halt all external work on the project indefinitely.
The move terminated three preliminary engineering contracts BP had awarded to Brown & Root, Dresser Drilling & Production Services and KCA Drilling.
Brown & Root had the most people committed to the project, with a team of about 50 engineers working on the front-end design of two large steel platforms.
A spokesman said these staff would be reassigned to other jobs.
But he added that the alliance contract for the detailed engineering and project management that was expected to follow would have created more than 200 positions for employees and contract-agency staff.
Alliance contracts with KCA and Dresser for drilling services and the well engineering, respectively, would have probably provided more than 100 new opportunities, while an export pipeline to the Shetlands not yet subject to pre-sanction work had been expected to bring even more.
Brown & Root said the biggest loss of potential jobs was in the offshore fabrication yards.
The firm’s Barmac subsidiary, which has yards either side of the Cromarty Firth on the north-east coast of Scotland, was looking to the Clair platforms which would have required about 50,000 tonnes of fabricated steel to provide continuity of work for its 2,500 employees when its two large jobs are completed in the first half of next year.
The spokesman said Clair would have provided enough work to keep over 1,000 people in jobs at Barmac for more than two years.