Exclusive:'Escalating crisis' as Scots decommissioning firm tells staff it can no longer trade
Job loss fears as company at the forefront of Scotland’s decommissioning industry is set to cease trading
A company “at the forefront of decommissioning oil and gas facilities” in Scotland has told staff it faces closure.
Cesscon Decom, based in Livingston, which dismantles and recycles defunct offshore infrastructure, has told workers it faces going into liquidation with around 20 staff at risk of losing their jobs.
The Scottish Government’s economic development agency, Scottish Enterprise, has confirmed that it provided Cesscon Decom with a £572,000 loan in 2021, which was paid to the company in full, to support the growth aspirations of the company.
Fife Council has also confirmed around £1.5m was spent on preparing a site at Methil before being leased to Cesscon Decom.
The company was central to ambitious plans for Energy Park Fife in Methil.
In 2021, Cesscon announced it had won Scotland’s biggest oil and gas decommissioning contract to dismantle and recycle Spirit Energy’s Morecambe Bay DP3 and DP4 platforms in the Irish Sea.
The contract, awarded by global offshore contractor Allseas, was intended to create 50 jobs at a planned £33m energy park in Methil, a joint venture backed by the investment arm of Fife Council and Scottish Enterprise.
Cesscon had been allocated four of the 55 hectares of land at the “world-leading” energy park, next to the Navantia shipyard, formerly run by Harland & Wolff.
The following year, another 50 jobs were promised at the Port of Aberdeen after Cesscon revealed plans for an oil and gas decommissioning hub. The new hub was poised to be located within Crathes Quay at South Harbour and deliver dismantling, recycling, and reuse services with a key focus on subsea infrastructure.
A memorandum of understanding was signed between the port and Cesscon, which hoped to establish Aberdeen as a centre of excellence for the offshore decommissioning sector.
But in an email to staff, seen by The Scotsman, Cesscon chief executive Lee Hanlon has told workers that the company has “received a petition to liquidate Cesscon Decom Ltd” and claimed he is awaiting “the winding up of the company with all bank accounts frozen and all assets sold”.
He added that “this is completely out of our control”.
Mr Hanlon said that “we have fought tooth and nail for some time to keep the business going”, but has pointed to “the acquisition falling through” and “the lack of decommissioning work in the UK” alongside “the postponement of anticipated projects into 2026”, it has left the company “in this very difficult position which has now been taken out of our hands”.
Mr Hanlon was named an “export champion for Scotland” by the UK government’s Department for Business and Trade in 2022 and has been CEO of the company for eight years.
GMB Scotland has condemned the company’s failure to engage with its workforce and called for clarity about how much public money has underpinned its business plans.
Andrew Bell, GMB Scotland organiser, said: “The company’s absolute failure to inform workers of this escalating crisis is beyond the pale.
“Staff have not been paid since May and we are still working to establish if the company has paid its pension contributions.”
He added: “Our members urgently need clarity and support while taxpayers deserve to know exactly how much has been spent supporting this company and its plans.
“Four years ago, we were told it would be at the forefront of decommissioning oil and gas facilities in Scotland.
“Today, the gates are shut, workers have not been told why and taxpayers have not been told how much.”
Scottish Labour economy spokesperson, Daniel Johnson, said: “This must be an incredibly worrying time for the workers at this site and they deserve answers.
“The loss of these jobs would not only be a blow to the workers and the community, but it would be a loss to Scottish industry.
“Cesscom Decom must urgently sit down with trade unions and workers and provide clarity on its plans.”
Lib Dems MSP for North East Fife, Willie Rennie, said:"This will have been incredibly tough news for the workers of Cesscom Decom.
"The Scottish Government and Scottish Enterprise need to set out whether they are likely to be able to recover anything on their substantial investments.
"Decommissioning work has often be cited as one of the future work streams for a host of North Sea firms and workers so to see a firm unable to make it work is an ill omen.
"Scotland needs a comprehensive plan for building on its economic strengths in order to provide the highly skilled, high wage jobs of the future."
Fife Council's service manager for economic development Pamela Stevenson said: "A total of £772,744 was provided through the Vacant and Derelict Land Fund (VDLF) and £745,000 through the Decommissioning Fund, both supported by the Scottish Government.
"These funds were used to support site remediation and preparation works. The land, owned by Scottish Enterprise, was subsequently leased to the company on commercial terms.
"The improvements made to the site remain in place and continue to represent a valuable asset for future use by other operators at the energy park."
Scottish Enterprise provided Cesscon Decom with a £572,000 loan in 2021, which was paid to the company in full, to support the growth aspirations of the company.
A Scottish Government spokesperson said: “Funding was provided to Fife Council through the Vacant and Derelict Land Fund and the Decommissioning Challenge Fund to support the regeneration of a derelict site into an industrial unit.
“As set out by Fife Council, this land, which is owned by Scottish Enterprise, was leased to Cesscon Decom on commercial terms. The improvements made to the site remain in place and continue to represent a valuable asset for future use by other operators at the energy park."
Cesscon Decon, Mr Hanlon and Allseas all could not be reached for comment, despite repeated attempts.
A spokesperson for the Port of Aberdeen said: “We are aware of the situation with Cesscon Decom. While the company previously held an option agreement with Port of Aberdeen for the right of use of a quayside area at the port’s South Harbour, this was never executed and subsequently lapsed in October 2024. This development does not affect the port or our wider plans.”
Comments
Want to join the conversation? Please or to comment on this article.