A Near £1bn Ambition to Bring Cable Factory to the Tyne
Only six years ago, the 45 acre piece of land at the centre of one of the North East’s most exciting green energy plans was filled with about 200,000 tonnes of coal for export. Now, £923m cable factory plans have been lined up for the Tyne Dock site, in a potential investment that North East Mayor Kim McGuinness has said is as important as Nissan was to the region in the 1980s.
The early-stage business has launched a public consultation on the plans, which promise to bring 500 direct jobs and 1,000 in the wider regional supply chain, over a multi-generational 99-year lease. Spurred by runaway demand for the high voltage direct current cables that underpin energy transition projects like offshore wind farms and solar developments, the joint venture identified the Port of Tyne-owned site on the south bank of the river and last year secured an exclusivity agreement that allowed it to draw up design specifications.
Business Live is reporting that the proposals are the work of LS Eco Advanced Cables (LSEAC) – a joint venture between South Korean conglomerate LS Group and UK-based Global Interconnection Group, chaired by finance tycoon Edi Truell, who has previously advised Boris Johnson and has ambitious plans to bring volcanic geothermal power from Iceland to the UK via a £3.5bn subsea link.
LSEAC had originally hoped to have the facility up and running by 2027, but before that happens, there is the not insignificant matter of raising the near £1bn capital needed to pull off the factory, which would become one of only a handful in the world – including LS Group’s existing facility in South Korea, and another under construction in the US.
The group’s roughly £22.5bn sales last year, and Mr Truell’s city clout might offer some hope the huge sum can be raised.
“As a Combined Authority we will work with them to secure the investment they need, and obviously to provide some local support,” said Ms McGuinness, who also talked of her confidence in the proposals coming to fruition. She added: “The Port of Tyne has invested a huge amount in the infrastructure here in order to accommodate this. And we’re working with central Government to ensure this investment is supported and that LS can bring in their own finance.”
Looking out over the expansive site, which sits next to rows of gleaming new Nissans, ready for export to Europe, Port of Tyne CEO Matt Beeton is equally upbeat about the plans. He said: “It’s a lovely story that we’ve gone from coal to clean energy with some investment, some goodwill and some ambition in terms of seeing the big picture around the North Sea – this is a great story.”
Mr Beeton, who says he is confident the factory will be built, was among a Port of Tyne delegation to visit LS Group’s mammoth submarine cable factory in the South Korean port city of Donghae. Construction of that facility – which bears a similar 172m cable-stretching tower that its Tyneside counterpart could have – was started in 2021 and finished in 2023. The group built its first factory in the city 17 years ago and is said to have invested about 700bn South Korean Won since (roughly £376.4m).
Mr Beeton said that his visit showed how serious the firm is, and just how much investment has been driven into the surrounding supply chain. He said: “We’re really confident this will have a catalytic effect on the supply chain. Most of the opportunities in offshore wind are out in the North Sea, so we’re right on the doorstep and when the rest of the world sees investments like this – at the Port of Tyne and in the wider region – and see that we’ve got the skills to furnish these opportunities, I think it will have a huge catalytic effect.
“This isn’t just about LS Eco Advanced Cables, this is the start of something for the region and we’re really confident this will be a catalyst. The Port team has done an amazing job of transforming the Port ready for these kind of investments, and we’ve ploughed a lot of money into this. We’ve been working for years on a facility like this, and for the last year with the mayor.
“This comes to fruition after a lot of hard work and investment by the Port and a lot of time and effort by the mayor and her team. But this is just the start of it – we’ve got a whole host of other plans, and we’re sure with the land we have at the Port and its facilities – the fact that it’s deep sea and we’ve got all these people – that there will be a massive catalytic effect.”
“The UK is really committed to clean energy and most of those opportunities in the North Sea will come but actually when developers see huge supply chain investments like this, I’m absolutely confident that this Port and this region will benefit,” said Mr Beeton. “This will be one of a handful of these kind of facilities around the world and there’s a massive global shortage of these kinds of cables. So, to grab that kind of intellectual property and this kind of investment – not just into the Port of Tyne and the North East but into the UK – is quite something.”
Globally, more than $800bn of investment in offshore wind farms is expected by 2030, says Neil Gordon, chief executive of the Global Underwater Hub, which advocates for businesses trading in the UK’s multibillion-pound underwater industry.