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Edition: U.S. / Global

Global Business

Aberdeen, With a Foot on the Seafloor

Kieran Dodds for The International Herald Tribune

Union Street in Aberdeen, which as the hub of the North Sea oil industry seems immune to Europe’s doldrums.

ABERDEEN, Scotland — Peter Blake has an American employer, the oil giant Chevron, and his work is global. It is his job to pull together and dispatch billions of dollars’ worth of sophisticated undersea equipment needed for oil and natural gas fields in the Gulf of Mexico and offshore from Angola, the Republic of Congo, Indonesia and Australia.

Kieran Dodds for The International Herald Tribune

Ships crowd the harbor in Aberdeen, a center of innovation for offshore drilling technology.

So why is Mr. Blake, head of Chevron’s undersea unit, based here in northeast Scotland?

Because since the early 1970s, when oil was discovered in the British North Sea, Aberdeen has evolved from a fishing town, to an oil boom town, to the world’s center of innovation and execution for the technology that makes the modern offshore energy industry possible.

“Scotland has been the home of subsea engineering,” Mr. Blake, a Scot, said in a conference room in Chevron’s European headquarters on a hilltop overlooking this city and its many dark granite buildings. “The expertise generated by the North Sea continually influences undersea work across the globe.”

That expertise, with a resurgence of investment in natural gas and oil fields in and near the North Sea, means that Aberdeen, with 468,000 people in the city and surrounding area, has been able to nearly escape the economic doldrums that have plagued most of Britain and Europe. Aside from central London, Aberdeen is the wealthiest place in Britain, with an annual income of about £32,000, or about $49,000, per person. And thanks to the more than 100,000 jobs the oil industry generates in the area, unemployment in the city and neighboring shires is less than half the 7.8 percent national average.

The average pay for each of those oil jobs, at £64,000, is more than double the British average.

“We’ve got plenty of well-paid people,” said Bob Keiller, chief of executive of Wood Group, a company that traces its roots to an early 20th-century fishing and boat repair business that has developed into a global oil services company with more than £7 billion a year in revenue.

Aberdeen does not look rich, though it does seem to have a disproportionate number of Range Rovers, Mercedes and BMWs. Its battered waterfront bars, with names like Neptune and Character, appear to have been little changed by four decades of an oil economy.

But the fishing boats have been replaced by big, brightly painted oil field vessels that pull in and out of the narrow harbor entrance day and night. Such is the demand for pier space that the harbor authorities are contemplating construction of an additional pier in the next bay.

Aberdeen remains a boomtown even though North Sea oil reserves are gradually being tapped out. And yet that is why the city has become such an innovation hub.

New development projects are having to venture ever deeper into more treacherous waters, whether west of the Shetland Islands in Britain or in the Barents Sea off Russia.

For two planned projects, Rosebank off the Shetlands and Alder in the North Sea, Chevron and its partners recently awarded contracts worth £550 million, or more than $840 million. In the case of Rosebank, equipment must work at depths of 3,600 feet, and its surface production vessel must withstand waves 98 feet high or more.

The companies winning those contracts included a joint venture of the oil services giant Schlumberger and Cameron International, an undersea hardware specialist; and Aker Solutions, a Norwegian maker of oil and gas equipment. Each has a big presence in Aberdeen.

As the rest of the global oil industry moves offshore and into deeper water off Brazil, Africa and the United States, the techniques and technology honed in the North Sea are increasingly in demand worldwide.

Oil installations in water thousands of feet deep often resemble jellyfish, with a single platform or vessel floating at the top and far below a mass of wellheads, underwater controls, pump stations, piping and processing units snaking along the seabed.