Work will begin next week on the largest single capital project undertaken at Lerwick Harbour, with £12m being spent providing improved vessel access and deeper berths in the Shetland base.

There will also be opportunities through land reclamation for future development. Almost 490,000 cubic metres of good-quality materials will be removed from the seabed. Most will be used to reclaim 14.4 acres of land to the north of Greenhead Base, creating an additional area for use in the decommissioning of offshore oil and gas production facilities. The rest of the material will be stockpiled there.

The dredging project will be carried out in three phases over approximately eight months by Westminster Dredging Company, part of Royal Boskalis Westminster, one of the world's biggest dredging contractors.

The initial phase will see the large self-contained, ship-shape trailer suction dredger Waterway, the first of her type to operate in Shetland, spend around a month from next week removing the softer seabed material. It will suck it into an onboard hopper and then move it to the reclamation site, where the material will either be pumped ashore through a temporary pipeline, or blown ashore if conditions are right.

The dredger Manu Pekka will then use its large excavator plant to dig out weathered rock directly and also fresh rock pre-blasted by a drill-and-blast barge.

The material will be transferred into two self-propelled hopper barges for delivery to the reclamation site where it will either be dumped or, to assist placement, trucked to the site. The Manu Pekka will operate from mid-May to September. At the same time, a drill-and-blast barge will be operating from mid-June to August.

Dredging will be to a depth of nine metres throughout, a major improvement on the shallower areas, currently at six metres' depth.

Sandra Laurenson, Lerwick Port Authority chief executive, said: "The deeper and wider access and the deepened berths will suit the larger vessels now operating and will be of particular benefit to the pelagic fish sector and offshore industry decommissioning, while the reclaimed land will offer opportunities to decommissioning and other industries."

Local resources will be used wherever possible for logistics, supplies, reclamation and other construction activities and could generate around a third of the total of 90-to-100 jobs involved in the project.

Arch Henderson LLP, Lerwick, is responsible for the design and supervision of what will be one of the largest marine civil engineering projects to be completed in Scotland in 2008.

Westminster Dredging has established project offices at SBS's Greenhead Base, and will have a workforce of 40 to 50, depending on the phases which will see up to 40 accommodated onshore.