DSM Demolition is studying the potential of creating a new base in the Orkney Islands for North Sea oil and gas decommissioning work.

The company believes Lyness on Hoy has suitable capacity to provide a base for its activities in Northern Scotland and the project is at an early stage of development.

An initial assessment of the area has been carried out and, following an agreement with the council, DSM will now begin further exploratory work.

The company will engage with the local authority, local businesses as well as the Hoy and wider Orkney community as it develops its proposals.

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It will also engage with the Oil and Gas sector to determine potential business for a new facility and undertake the environmental assessment and feasibility testing processes which are essential to ensuring the developments sustainability.

Council Convener Steven Heddle said: "This project has the potential to create significant employment, a range of business opportunities for local companies, and considerable economic benefits for Orkney as a whole.

"There will be a growing demand for oil and gas decommissioning facilities in the years ahead. Lyness and the natural deep-water harbour of Scapa Flow, with their location close to the North Sea, are ideally located to serve as a potential base for work of this kind.

"We now look forward to working with the company. Our priorities will be to ensure that Orkney benefits economically and that a development of this type is approached in an environmentally responsible manner, in order that we maintain our excellent track record for stewardship of our local environment and the seas around us."

(LM/CD)