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Council Attempt to Broker Nigg Deal

Issued: 15 Aug 2007

The Highland Council is set to step up its efforts to broker a deal to resolve a dispute between the owner and tenant of the Nigg yard in East Ross, which is delaying redevelopment proposals.

The Council is frustrated at the failure of KBR Construction Ltd, who hold the lease for the site, and Wakelyn Trust, who own the southern area of the yard, to agree the terms for the termination of the lease, in particular in relation to ground reinstatement conditions. KBR hold the lease until 2031, with a break option in 2021 and five-yearly rent reviews.

Without settlement, the redevelopment cannot proceed. The yard, which was established in 1972, was offered for disposal on the market by KBR in February 2005.

The Council's Planning Environment and Development Committee has agreed to complete a round of meetings with all parties concerned, including Highlands and Islands Enterprise and the Scottish Executive, in an attempt to resolve the dispute. This should be completed within a month.

If these talks fail to produce a result, a report will be submitted to a meeting of the committee before the end of the year when the prospect of pursuing a compulsory purchase order may be considered.

Committee Chairman Councillor Drew Hendry described proceeding with a compulsory purchase order as a 'last resort'. He advocated that the Committee exhaust negotiations with the two main parties involved as well as HIE and the Executive before considering following the CPO route.

He said: "The terminal and the yard at Nigg represent a facility of strategic economic significance to East Ross, the Highlands and, indeed, to Scotland. It is the only large scale industrial site that has the potential to be used as a flexible multi-user engineering and processing complex capable of service a wide range of industrial uses. It is therefore important to bring the site back into positive economic use and to avoid continued deterioration of the existing infrastructure."

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