BLOWTORCH BEACH
The MoS traces the stricken rig that ran aground on Lewis to a toxic corner of Turkey 2,500 miles away... where business is booming thanks to our struggling oil industry. For this is the graveyard of North Sea behemoths, where they go to be dismembered an
RUSTING and idle, it is a powerful symbol of the decline of Scotland’s oil industry.
Through the boom years, the towering rig was anchored in the North Sea, helping pump millions of barrels of crude oil and billions of pounds into the economy.
Now it stands thousands of miles away in a foreign scrapyard, an obsolete pile of junk, waiting to be broken apart.
Last week The Scottish Mail on Sunday tracked down the Transocean Winner, which ran aground off the Outer Hebrides earlier this year, to its final destination – a giant breaking-yard on the Turkish coast, known as Blowtorch Beach.
There, business is brisk as falling prices and dwindling reserves of oil force companies in the North Sea to decommission still more rigs.
Environmentalists are worried that the waters around the heavily industrialised stretch of coastline are becoming a ‘death zone’ because of the contaminated seawater.
But for the Turkish scrapyard bosses, the arrival of the Winner and all the other rigs made redundant by collapse of Scotland’s most lucrative industry is a godsend. For years, the mile-long stretch of coast at Aliaga has been the scrap capital of the world for ships. Now oil rigs are becoming big business, too.
Last night, the boss of the Turkish company scrapping the Winner told The Scottish Mail on Sunday of his delight and said he expected to see more rigs from the North Sea making their way to Blowtorch Beach.
Soner Sari, foreign trade manager for Isiksan Ship Recycling, said: ‘This is extremely special for my company, and for Turkey. The Winner itself is really important and has created 80 jobs for us here.
‘It makes me very proud of my country and my company that we’ve been able to get such an important North Sea rig. This was an iconic rig and because of its history and the story around it we’re pleased to have it.’
Last year, among the rigs consigned to the Blowtorch Beach scrap heap were two North Sea drill platforms – GSF Arctic III and JW McLean. This year, besides the Transocean Winner, Borgny Dolphin and Transocean John Shaw were also torn apart.
For the past 16 years, Mr Sari’s firm has mainly scrapped ships, but in a sign of where the industry is heading he said: ‘Really, our business now is built on oil rigs.’
Last year 42 offshore rigs were scrapped worldwide compared with 30 in 2014 and nine the year before that. Of those, 11 rigs were scrapped in Aliaga last year compared with only one in 2014.
The boom has drastically altered the face of Blowtorch Beach. Dozens of giant rigs – almost double the height of merchant ships and containing roughly four times as much steel – tower above the beach where 22 firms now compete for business.
For the Transocean Winner, even the journey to Blowtorch Beach proved eventful. As the rig began its journey to Turkey in August, it was being towed past the Outer Hebrides when bad weather saw it run ashore at Dalmore, near Carloway on the Isle of Lewis.
Despite fears of pollution and oil spills, it was refloated and anchored at Broad Bay, before being put on board a ship for further transportation.
In early November, after months of effort and a 2,500 mile journey, the Winner arrived at Aliaga, the sprawling scrapyard on Turkey’s west coast.
For the Winner, the scrapyard represents an ignominious end for a rig which symbolised all that the oil industry promised to be when it was built in 1983. On October 19, 1970, BP had announced to a fanfare that it had struck oil in the North Sea, around 110 miles east of Aberdeen.
It was hailed as the dawn of a lasting North Sea oil industry. But now experts who predicted it would prop up the Scottish economy for years have been confounded.
Output swiftly nosedived and by 2014, production was slower than at any time since 1977. Now experts estimate as many as 120,000 oil jobs could be lost by the end of the year.
Passenger numbers at Aberdeen Airport have dropped by around 20 per cent since 2014 and helicopter traffic from the airport to rigs has plunged by 25 per cent.
Brent crude is trading at under $50 a barrel, less than half the price it was in 2014, and far from the $145 in 2008 when oil industry-related jobs peaked at more than 450,000.
In July, analysts at S&P Global Platts said investor concerns would add to the ‘existing gloomy prognosis’ for the North Sea, warning: ‘Uncertainty alone could lead to years of delay for new development projects and put more weight behind any planned closures.’
But a surprise winner has emerged from the North Sea collapse. Decomthe
It makes me proud we have got such an important North Sea rig
missioning firms paid millions to uninstall and dismantle platforms and rigs are poised to cash in.
‘For a very long time, everyone was told there’s a big market coming. Well, now it’s coming in a very big way,’ said Alexander Kemp, Professor of Petroleum Economics at Aberdeen University. ‘There is something of a decommissioning boom about to take place and the UK needs to be ready for it. In UK waters alone, we predict that between £4045 billion will be spent on decommissioning between now and 2050.’
Energy consultant Douglas-Westwood says it anticipates that ‘146 platforms will be removed from the UK during 2019-2026’, around 25 per cent of the current total. It predicts: ‘The oil price collapse has been bad news for nearly every company involved in the industry, but one group that could actually benefit from it are specialist decommissioning companies.
‘For these companies there is an opportunity to be part of removing the huge tonnage of infrastructure that exists in the North Sea.’
Much of that tonnage is beginning to makes its way to Blowtorch Beach. Neither Transocean nor Isiksan Ship Recycling disclosed how much the Winner was sold for but experts suggest that old rigs can go for as much as £10 million. Each rig takes between two and three months to dismantle and produces around 10,000 tons of steel.
But scrapping has come at a high price for the local environment. A damning European Commission report in June revealed the surrounding seawater was polluted with ‘extremely high levels’ of aluminium, iron, nitrates, phosphates and other pollutants linked to the ship-scrapping industry.
‘These kind of scrapping jobs are very labour intensive and there is a lot of cheap labour in Turkey,’ Professor Kemp said.
‘Aliaga is used to scrapping ships so it’s exactly the kind of place that is geared up for it,’ said David Aron, of Petroleum Development Consultants.
‘The issue is that you need somewhere you can take the rig to and effectively you can do that through the Mediterranean. They seem to have cornered the market.’
For Mr Sari, and dozens of other scrapyard bosses in Aliaga, the future is bright. With an optimism unlikely to be shared by workers in the North Sea, he added: ‘We have lots of work and are expecting lots more in the next few years. It’s a great time to be in the industry.’
We have lots of work, it’s a great time now to be in the industry