£30m cash boost expected to create up to 1,200 jobs

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AS many as 1,200 jobs could be created in south east Northumberland by two investment packages together worth almost £30m.

One of the largest grants ever handed out by the government’s Regional Growth Fund (RGF), for £15m, has been given to energy company Five-Quarter.

The cash will help pay for the UK’s first commercial deep gas extraction plant within the new enterprise zone at Blyth, creating more than 600 new skilled jobs.

A further £11.75m of investment has been secured by the South East Northumberland Business Growth Programme developed in response to the closure of the Rio Tinto Alcan aluminium smelter at Lynemouth.

That cash is expected to create a further 600 jobs.

Five-Quarter is already working with Northumberland County Council and the North East Local Enterprise Partnership on its plans to build a gas-processing facility.

It is intended that jobs it generates will be filled by skilled and retrained professionals within the region with experience in industries now in decline.

Company chairman Harry Bradbury said the grant will help the company turn its plans to create energy from otherwise unworkable rock strata buried deep beneath the North Sea into a reality.

“We are absolutely delighted that the government has recognised and is supporting the viability of our plans to convert subterranean solid rock to gases of economic importance, including

methane and hydrogen,” he said.

“The magnitude of the award shows that the scheme is now clearly being recognised by the UK government as a strategic energy project of national significance.

“Five-Quarter has combined the intellectual rigour of a key spin-off team from Newcastle University with existing, world-class knowledge and technology from the UK mining, oil and gas industries in order to achieve this giant step forward in deep gas winning.

“We hope to share our success with the wider region, bringing new jobs and regeneration to the north of England and Scotland and, in the longer term, to apply our knowledge strategically to grow both nationally and internationally.”

Estimates suggest that the UK has reserves of a few thousand billion tonnes of gas beneath the North Sea, as well as others elsewhere onshore.

Newcastle-based Five-Quarter currently holds government licences to extract just over two billion tonnes in a 400 sq km area off the Northumberland coast.

Mr Bradbury added: “This area alone contains more energy than has been extracted from the totality of the North Sea during exploitation of its natural gas reserves – the equivalent of approximately 11 billion barrels of oil.

“The gas reserve potential from this and similar areas is sufficient to satisfy energy demand in the UK for several decades.

“We have been really happy with the support we have received for the project from the outset in the north east, not only from the county council and the local enterprise partnership but also from local MPs.”

Steve Stewart, the council’s chief executive officer, said: “This substantial award is a great recognition of a visionary project, which will use natural resources creatively and innovatively and which has great potential both for the national energy market and for local job creation.”

Following the closure of the Rio Tinto Alcan smelter earlier this year, moves have been made to increase the number of jobs available for one of the areas of the county hardest hit by unemployment.

The South East Northumberland Business Growth Programme was developed to try and help the 500 staff who lost their jobs at Alcan, as well as those already out of work.

The £11.75m of investment it has secured will go to its sites and premises fund to provide grants to businesses looking for help to pay for new premises and property extensions.

It will also be handed out by a business growth fund to enable firms to grow, diversify, support training or develop new markets, products or services.

The two funds are expected to be up and running by the spring.

The RGF bid was developed by the development company Arch in partnership with the county council, backed by Rio Tinto Alcan.

Jeff Reid, chairman of Arch and leader of the county council, said: “The funding will be a great boost to Northumberland’s economy and helps us to provide support for investment and businesses.

“It will be especially important in the south east of the county, which has been severely affected by the Rio Tinto Alcan closure.”

Peter McIntyre, Arch’s managing director, added: “This is fantastic news for Northumberland.

“The RGF funding will help to kick-start developments in areas such as the Blyth enterprise zone, as well as providing valuable funds to attract new investors and help local businesses to grow.”