British subsea sector set to grow by 20 per cent

By FRANK URQUHART
Published on 06/02/2013 15:10

BRITAIN’S booming subsea sector is set to increase business by at least 20 per cent this year alone, it was revealed today.

Some companies are predicting more than 50 to 75 per cent growth during 2013 while almost half are forecasting a 30 per cent rise in business both at home and abroad, according to a survey released by Subsea UK, the sector’s trade body, on the opening day of the annual Subsea conference and exhibition in Aberdeen.

But Neil Gordon, chief executive of Subsea UK, warned that a glaring skills gap and the lack of Government tax incentives and funding to help develop new subsea technologies was hindering the rate of the sector’s global expansion.

The sector already employs 50,000 people in the UK. But a study of the trade body’s 250 member companies has indicated that up to 10,000 new employees will be needed in the sector over the next 12 months to meet current and future demand.

Mr Gordon said: “Subsea continues to be the unrecognised jewel in the crown of British industry. The sector is one of, if not the, fastest growing in the country and these findings will come as no surprise to the oil and gas industry as whole.

“Several respondents anticipate growing by over 75 per cent in 2013 and many of our small, entrepreneurial companies focused on niche products and services are set to double or treble in size.”

The global market, he explained, was set to double in the next five years from £20 billion - with UK companies responsible for a third of the current market.

But Mr Gordon said the UK’s reputation as a world-leader in subsea was coming under increasingly fierce competition from other countries such as Norway and the United States.

And he continued: “To keep ahead we want to encourage our governments to look at this subsea industry and get more engaged in supporting our industry so we can actually play on a level laying field and support our industry in this competitive market in other parts of the world.

“Our membership is made up of almost 80 per cent of SMEs and these are the companies that need the help to go into some of these other parts of the world.

“There is a stark warning in the survey from members increasingly concerned about the UK’s competitive edge. With other countries receiving significant support and funding from their Governments for the development of new technology, we risk losing out.”

He said the industry also needed to look at ways of attracting more people into the industry. The sector was set to launch a new initiative to fast track the recruitment of professionals and graduates into the subsea sector.

And he explained: “We are also launching a programme, probably in the second quarter, to get companies more enabled in how they can get talent into their companies. Rather than training individuals we are going to help companies develop their talent for the future.”

Mr Gordon added: “Well over 50 per cent of UK subsea output is already exported and that is set to increase as the global market expands and our companies seek to build on the UK’s reputation in subsea. “Subsea UK is working hard to assist companies break into new markets and the international delegations led by UKTI from various countries at today’s event will prove invaluable to many of our members.”