Shipyard wins MoD order

The shipyard has been in difficulties for some time

The Belfast shipyard Harland and Wolff has won an order to build two ferries for the Ministry of Defence.

The contract is a lifeline for the yard which last month made half of its 1,200 strong workforce redundant because of a lack of work.

An announcement was made in the House of Commons on Thursday which confirmed that the MoD has ordered a total of six vessels worth at least £240m, from a consortium which includes the east Belfast yard.

Two of the ships will be built by Harland and Wolff and the remainder will be constructed in a German shipyard.

Prime Minister Tony Blair, who visited the yard on Thursday ahead of talks with politicians, said the contract was a sign of the government's support for shipbuilding in Northern Ireland.

David Trimble: Welcomed the news

Mr Blair said: "This order has been given here because of the strength of the workforce.

"Because of their dedication and their commitment and for all the difficult times they have been through.

"The fact they have secured this order is an indication of our degree of confidence and faith in the future here."

The First and Deputy First Ministers David Trimble and Seamus Mallon have also welcomed the announcement.

Mr Trimble said: "This is excellent news for both Harland & Wolff and their workforce who have been facing a very difficult time in recent months.

"I welcome the safeguarding of jobs that this announcement brings and I hope that this will be the start of a process of renewal for this important sector of our manufacturing industry."

Mr Mallon highlighted the need for a competitive economy.

He said: "This is good news for Northern Ireland.

"These two new vessels will ensure that key manufacturing skills and knowledge are kept within the workforce to allow Harland & Wolff to compete effectively for further contracts."

'In the red'

Despite the good news, construction is not expected to begin on the roll-on, roll-off ferries for a few months, leaving the Belfast yard with a significant hole in its order book in the short-term.

On Wednesday, it emerged that the parent company of Harland and Wolff had gone into the red as a result of losses at the yard.

In the last three months, the yard lost about £11m, which its owner - Fred Olsen Energy - blamed on the cost of redundancies and under-utilisation of facilities at the yard.

The parent company said it had agreed to fund the shipyard until the end of January, by which time it is expected to break even.

The company also said it had still not finalised a contract to build four passenger vessels for a Scandinavian company.

The British shipbuilding industry is facing hard times

Meanwhile, a High Court appeal over a disputed £23m final payment is due to begin on Thursday.

US oil company Global Marine is seeking to appeal an arbitration ruling that £22m be awarded to the shipyard.

The row centres on the final payment due on an oil drilling vessel.

The shipyard has said the appeal was simply an attempt to cause as much delay and damage as possible, a claim strenuously denied by Global Marine.

The shipyard has been ailing for some time.

In September, Fred Olsen Energy, announced that 613 people would be laid off as part of a plan to keep the troubled business solvent.

Just under 600 workers were left at the yard as part of a plan to restructure Harland & Wolff, in an effort to sustain shipbuilding as a viable business in Belfast.

Unions representing shipyard workers said in the past that other jobs could be lost if new orders were not won.