At its January 2026 board meeting, South Tees Development Corporation (STDC) CEO John Barnes was bullish about the prospects for the corporation, and its private sector twin, Teesworks. Barnes never tires of talking about “Europe’s largest brownfield project”. But it’s time to forget about the spin and do a reality check.
Do you want the good news or the bad news?
The bad news was that BP had formally confirmed its decision to withdraw its Development Consent Order (DCO) application for the H2Teesside ‘blue hydrogen’ project at the former Redcar steelworks. This followed the company’s press statement on 1 December 2025. Importantly though, the withdrawal of the DCO “had removed the uncertainty that had existed around the site”.
H2Teesside was meant to be built in the Foundry zone at Teesworks, next to BP’s HyGreen ‘green hydrogen’ plant. But HyGreen had already been cancelled the previous March. Before I go any further, here’s a map of Teesworks, which gives an idea of where various Teesworks / STDC projects are meant to be located:
The SeAH factory
It wasn’t long before John Barnes got around to discussing the SeAH monopile factory in the South Bank zone. This is the signature Teesworks project. By virtue of the fact that it’s the only building that has made it above ground level. Redcar and Cleveland Council (RCBC) leader Alec Brown asked whether the factory had been completed. Barnes said that “this depends on who you are asking”. Well, he’s asking John Barnes, the CEO of the STDC, who ought to know these things. The company’s own website says that the factory is 99% complete.
Slow progress
On 30 July 2025, SeAH issued a press release stating that it had “commenced commercial production on its inaugural contract”. This contract is for the manufacture of monopiles, ie bases for offshore wind turbines. More than six months later, and more than 15 months since the first raw steel was delivered to the factory, the company hasn’t confirmed whether it has completed any monopiles. To complicate matters, the GMB union has been in dispute with SeAH, as reported here, since October 2025.
Business rates
Notwithstanding this uncertainty, the Tees Valley Combined Authority (TVCA)’s Interim Director of Finance and Resources, Jo Moore, told the STDC Board on 15 January 2026 that she had reviewed business rates income in respect of the SeAH factory. Moore had concluded that ‘supported by external advisors’ she had identified a further £4.7mn in business rate income for this financial year 2025/26. This review is awaiting confirmation from the Valuation Office (VO). The VO confirmation was due by the end of January 2026, but there’s been no news so far. I suppose the decision will depend on who they are asking.
It’s oh so quiet
And that revaluation can’t come soon enough. The lack of activity at the SeAH factory has resulted in a quiet year at the neighbouring South Bank Quay. Jo Moore had been relying on £2.7mn income from the quay in 2025/26, but now it’s only expected to generate £0.2mn. The STDC budgeting process is like a grim version of Whack-a-Mole.
Don’t put all of your eggs in one basket
Teesworks’s business rate income is split 50 / 50 between the STDC and RCBC. At a 15 January RCBC meeting, Alec Brown had told fellow-councillors that it would be “foolhardy” to rely on future business rate income from Teesworks. Never mind the future, the Finance Director needs it now. Jo Moore’s late intervention in the 2025/26 STDC accounts MAY save them from red ink for a few weeks. We’ll soon know if this is going to stick. But, if it doesn’t, future income will need to be reprofiled too.
Claim and counterclaim
At a Teesside business event on 2 February 2026, Tees Valley Mayor Ben Houchen re-iterated his claim that the SeAH factory and Net Zero Teesside (NZT) projects alone would soon be generating £79mn per annum in business rates. That’s more than RCBC’s council tax base of £70mn. So, theoretically, the council will soon be able to abolish council tax altogether and even have a surplus of £9mn. Here’s an example of one of Houchen’s numerous social media claims:
Porky Pie watch
But eagle-eyed maths fans will have noticed that RCBC only gets half of the business rate income from Teesworks, the rest goes to the STDC. The STDC needs this cash to service its debts. So, even allowing for that optimistic assumption about business rates growth, the council would still have an annual deficit of £30.5mn. Meanwhile, back on Planet Earth, RCBC has just had to request an emergency £15mn bail-out from the MCHLG to get it through the 2026/27 financial year. And the council has had to disregard Ben Houchen’s Instagram post, and downgrade its medium term business rate income forecast for Teesworks by £30mn.
Dorman Point zone
John Barnes then notified the STDC board of an upcoming victory at Dorman Point, if a somewhat Pyrrhic one. In mid-March, financial close is expected on the long-awaited Tees Valley Energy Recovery Facility (TVERF) scheme. Viridor has bagged the deal. Somebody at housing developer St Modwen has got a gallows sense of humour, though. Its new housing development, less than a mile from the proposed giant incinerator, is to be named Ember Park. And the fun will start when the TVERF contract winner, Viridor, asks someone to build it. Recent events in Aberdeen and London demonstrate how everybody involved with incinerators gets burned. Here’s how the site looks in February 2026. Details of the slag heap in the centre background and the landfill to its right, can be found here.
Finger on the pulse
Barnes described progress at the Lackenby zone, noting that “the EOS scheme is in the final stages of legal agreements; planning permission has been granted”. EOS intends to build a Battery Energy Storage System (BESS). Alec Brown asked why EOS was moving from the Long Acres zone, in Redcar, to Lackenby. The CEO said that he didn’t know anything about that.
Curiouser and curiouser
However, Teesworks’s announcement of the investment in December 2024, stated that EOS would build its BESS at Long Acres. The press release purred that this zone was located adjacent to the NZT zone, the site of the prospective NZT project. Which it is, as you can see from the map above. EOS’ new neighbours would also include BP’s twin hydrogen schemes HyGreen and H2Teesside. But, as we’ve seen, things move quickly at Teesworks, and neither of these are now going to make it off the drawing board.
Upping sticks
But now EOS was quitting Redcar too, if only to head two miles down the road to Lackenby. And the STDC CEO didn’t even know about it? I submitted a written question to the STDC Board, asking why EOS had made the transfer. The STDC replied that no such transfer has taken place. I’ve submitted a Freedom of Information request to seek further clarification. This can be read here.
To lose one BESS is unfortunate
Until not long ago, Long Acres was going to possess two BESS facilities. But Teesworks has already lost the NatPower BESS Gigapark to the former ICI works now known as Wilton International, as reported here. Ironically, if both BESS projects go ahead in their new locations, they’ll be close neighbours again. The Lackenby zone is just across the A1085 Trunk Road from Wilton International.
Paradise postponed
The EOS scheme hasn’t been lost to Teesworks, but the loss of both BESS projects from Long Acres may indicate that STDC doesn’t intend to remediate this land in a hurry. In fact, NatPower had been warned of such a delay, which may have influenced its decision to move to Wilton. And now those pesky 2025/26 budgetary constraints have interfered again. Disposal of stockpiled ‘legacy waste’ and ‘onshore dredgings’, valued at £1.1mn and £1mn respectively, has had to be deferred until 2026/27. These are thought to be earthworks related to land remediation at Long Acres. In addition to this, a further 4.1mn in capital spending is having to be postponed, as can be seen in this extract from Jo Moore’s report to the STDC board:
Another investor flying away
Two months after NatPower quit Teesworks, Willis Sustainable Fuels decided that it would be moving its investment to Wilton International too. Willis is planning a Sustainable Aviation Fuel plant. This had been planned to be built at Teesworks’ Dorman Point. Willis’ original choice of location was revealed in October 2023. As with NatPower’s switch to Wilton, the company didn’t mention its original choice of site when it made its October 2025 announcement about its new location. It’s almost as if everybody is keeping quiet about this on purpose.
Teesworks has lost four investments in less than a year
The loss of BP’s two hydrogen projects was widely publicised, but NatPower and Willis Sustainable Fuels slipped away unnoticed. So, why are so many investors losing faith in Teesworks? BP’s decision-making process is worth examining in more detail.
Driving a hard bargain
On 28 January 2026, Leigh Jones of The Teesside Lead reported that Martin Corney, one of the two Teesworks Joint Venture (JV) partners, had tried to pressure BP into making up-front payments to remediate STDC / Teesworks land. The remediation was necessary to prepare for the construction of HyGreen and H2Teesside. BP refused to co-operate, but this incident may be one of the reasons that it bailed out of both schemes. This all happened more than two years ago, but neither BP nor Teesworks made this information publicly available at the time. You’ll recall that the HyGreen and H2Teesside decisions weren’t made public until March 2025 and December 2025 respectively.
How to win friends and influence people
While keeping quiet about BP’s decision, Teesworks simultaneously started negotiations with a tech company, thought to be Google, to build an Artificial Intelligence (AI) data centre on the same piece of land in the Foundry zone.
AI will save the day
Back at that January 2026 STDC Board meeting. John Barnes opined that “The lifting of this (BP) uncertainty provides increased clarity.. …and will enable STDC.. …to focus on accelerated development across a number of priority areas, including .. … AI-led digital infrastructure”. Hopefully, prospective AI investors won’t all be offered the same piece of land. But the Google data centre is at the whim of US President Donald Trump. The UK is supposed to have concluded a trade deal with the US in May 2025. But now, predictably, Trump is walking back the so-called deal, and making more demands. If he doesn’t get his way, he’ll pick up the phone to Google, and that will be the end of that.
Stubborn as a mule
Remediation of the Foundry zone is particularly problematic, because it contains the stump of Redcar Blast Furnace. This remnant, consisting of solidified iron, had refused to budge when the furnace was dynamited in November 2022. Eighteen months later, a company called Precision Engineering was tasked with finishing the job. Despite an excitable press release from Teesworks in May 2024, the blast furnace is still there nearly two years later.
No hidden fees
Martin Corney, and his other Teesworks JV partner, Dubai resident Chris Musgrave, were criticised in the Tees Valley Review report for not having invested a penny in Teesworks. It comes as no surprise that Corney tried to get BP to clear up the Foundry zone. And if BP was on the receiving end of these sorts of demands, who else was?
Well you could ask PD Ports about that time Teesworks tried to extract £108mn in access payments to its own port estate. Details of this attempt are contained in Private Eye magazine’s excellent “Stripped Tees” special. This can be found here.
Open your wallet, and say after me, “help yourself”
So, if BP won’t pay to remediate the Foundry, who will? In May 2025, the TVCA issued a £13.2mn tender for remediation of the zone. The tender was issued on behalf of the STDC. To date, all of the Teesworks / STDC land remediation has been done at public expense. We’d better get used to the idea that this isn’t going to change. However, a contract hasn’t been issued at this stage, possibly due to the black holes in the 2025/26 accounts. There are £7.2mn of permanent costs which were ‘unbudgeted, and which are now causing a significant pressure on the base budgets’. The unbudgeted costs consist of interest on loans from the TVCA, which the previous finance chief, Gary Macdonald must have assumed were interest free. Now that’s careless.
Where could savings be made?
Planning costs are an area of interest. Planning matters at the three Tees Valley mayoral development corporations, including the STDC, are outsourced to Nathaniel Lichfield & Partners Limited, a private company based in Newcastle-upon-Tyne. Middlesbrough and Thornaby East MP Andy McDonald, among others, has criticised this arrangement.
That’s your lot
At meetings of the Hartlepool Development Corporation (MDC) on 2 December 2025, and the Middlesbrough Development Corporation (MDC) on 18 December 2025, Jo Moore notified both boards that, after discussions with Lichfields, a fixed ceiling figure had been agreed for planning fees. It’s easy to see why. Only eight months into the financial year, the planning budget at Hartlepool was overspent by £180,000. Middlesbrough had gone over-budget by £236,000. However, the planning budget for the STDC hasn’t been capped yet. In 2023/24, the last period for which information is available, the STDC paid Lichfields £823,690 in planning fees. This figure was obtained via a Freedom of Information (FOI) request for all STDC expenditure. The full details can be found using this link.
Chris Harrison
Lichfields has a close and long-standing relationship with the STDC / Teesworks. Chris Harrison, the “development partner lead” at Teesworks, was employed by Lichfields from 2000 to 2014, by which time he had become a director. His LinkedIn page, which includes his Lichfields role, can be found here, but it doesn’t appear to have been updated for some time. Mr Harrison is also a director and shareholder in Northern Land Management, and a director at DCS Industrial Limited. These two firms have key financial links to Teesworks Ltd. Mr Harrison has received substantial payments from Northern Land, as can be seen in the data tables below.
Payments for dividends and services
Table 1 lists dividends and payments made by Teesworks Ltd over the past four years. In addition to dividend payouts, Teesworks is charged fees by “a company which holds a participatory interest and has shared directors” for “marketing and other consultancy services”. The actual wording varies slightly from year to year, but these payments are made to DCS Industrial Ltd. The fees are substantial, amounting to almost £50mn over four years.
Dividends and Fees
Dividends are allocated to four partners according to Teesworks Ltd’s complicated structure. The largest beneficiaries are JV partners Chris Musgrave and Martin Corney. Corney’s stepfather Ian Waller comes in third, benefiting from his shareholdings in Northern Land and DCS Industrial Ltd. Chris Harrison makes up the quartet, also due to stakes in these companies. Chris Musgrave is the main beneficiary of the DCS Industrial Ltd fees, as he owns 50% of this company. The allocations can be seen in Table 2 below, with the total amount paid to each of the partners shown at the bottom.
Bedtime reading
For reference, I’ve linked to the relevant Companies House records of the various Teesworks entities at the end of this article. However, the information on Northern Land’s ownership is based on research contained in Private Eye’s ‘Stripped Tees’ special. Here’s that link again.
The unacceptable face of capitalism
One critique of capitalism is that it privatises the gains and nationalises the losses. There’s no better example of this than a comparison between the private Teesworks and the public STDC, under the stewardship of Conservative Mayor Baron Houchen of High Leven. At the private Teesworks company, an extraordinary amount of wealth has been extracted by four individuals. Meanwhile its public sector partner, the STDC, verges on insolvency, despite government investment approaching £600mn.
Is there a backstop?
On 26 January 2026, Peter Morris reported for North East Bylines that the HDC may have requested a bail-out from the TVCA. The following day I noted that the finances of the MDC are treading water. At the TVCA Cabinet meeting on 29 January, Alec Brown sought financial assurance from Ben Houchen. Would the five constituent local authorities of the combined authority be on hook in the event of meltdown at any of the mayoral development corporations? Or even the TVCA itself? Houchen said that TVCA CEO Tom Bryant had spoken to civil servants at the MCHLG, who gave him assurances that this would not be the case. But everybody knows that this debate is academic. Either way, if the worst comes to the worst, public funding will come to the rescue. As it always does. Because the losses are ALWAYS nationalised.
Further Reading
Companies House records:
Thanks to James Waterson for providing further research for this article
