HL Deb 27 April 1981 vol 419 cc1030-1

2.46 p.m.

Lord Morris

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government how many and which British firms were invited to tender for the construction contract of the new BNOC semi-submersible oilrig.

The Minister of State, Department of Employment (The Earl of Gowrie)

My Lords, I understand from the corporation that they have not placed a contract for the construction of a rig but have chartered one from Dyvi Drilling of Norway. The details are a matter for the management of the corporation and are commercially confidential.

Lord Morris

My Lords, I am most grateful to my noble friend for that information. May I ask whether he is entirely satisfied, bearing in mind the fact that some 2,000 jobs would have been available if the £50 million contract had been awarded to a British firm?

The Earl of Gowrie

My Lords, as I say, it was not a question of a contract; it was a question of a chartering. But I can say to my noble friend that I am not satisfied that British industry is taking all the opportunities available to it in offshore technologies regarding these very considerable opportunities at home and abroad, and one must hope that British industry will wake up.

Lord Orr-Ewing

My Lords, will my noble friend perhaps tell the House whether British Shipbuilders had been advised that BNOC were contemplating chartering rather than building a rig and, if that knowledge was available, whether British Shipbuilders or one of their companies had an opportunity of chartering a rig after constructing it?

The Earl of Gowrie

My Lords, my information is that the corporation approached a number of drilling contractors, including British companies, and that no British companies were able to meet their requirements either for construction or for charter.

Lord Orr-Ewing

My Lords, can my noble friend look into the circumstances whereby this French company already had a rig available? Was it built on spec, like so many other French projects? They build ships on spec and then either sell them to their customers or incorporate them into their Navy. They do this in many other respects. Does this make competition fair? Ought the BNOC to consider the vast numbers of unemployed in Birkenhead, where this work would not only have benefited 2,000 people directly for two years but would have benefited a further 10,000 people in the sub-contractors, particularly in the steel industry, which is badly in need of work of this type?

The Earl of Gowrie

My Lords, I altogether share my noble friend's views on the desirability of fair competition and of British industry meeting that competition. I do not think this was a question of French industry undercutting British industry on speculation. As I said in my earlier answer, I understand that the needs of the corporation could not be fulfilled here. As a result rather than commission a construction abroad, they chartered one from Norway.

The Earl of Lauderdale

My Lords, would my noble friend revert to his comment on the need for British industry to wake up? Would he not agree that we have had a very sad record of delivery dates being overshot in the case of a number of platforms and drilling rigs, with the result that the weather window has been missed and a whole year's extra cost has been incurred, thanks to such delays?

The Earl of Gowrie

My Lords, it is very important for British industry to feel that this technology and this activity is not restricted only to the North Sea—it is now international—and certainly there will be great opportunities both here and in other offshore areas for the rest of this century. So I agree with my noble friend.