Hundreds of jobs are set to be created during the construction of a vessel that will be used to redevelop the Penguins oil and gas field (about 150 miles north-east of Shetland) and extend the field’s life by a decade; eight wells will be drilled as part of the redevelopment.

Shell (www.shell.com) says that construction of the floating production, storage and offloading (FPSO) vessel will lead to between 300 and 400 new jobs — mostly in Scotland.

When operational, the vessel is expected to support around 70 jobs.

The announcement will see the construction of the company’s first new manned installation in the northern North Sea in almost 30 years.

It will be built overseas, but the Scottish jobs will be created to support the construction.

Steve Phimister, Shell’s vice-president for upstream in the UK and Ireland, said the company has had a “strong presence” in that area for more than four decades: “Having reshaped our portfolio over the last 12 months, we now plan to grow our North Sea production through our core production assets.”

Scottish Energy Minister Paul Wheelhouse said: “This significant investment is further evidence of rising confidence in the future of the region.

“It will offer a significant boost to communities across the north-east of Scotland, along with boosting the wider Scottish economy.”