MORE than 1,500 new jobs are to be created in the North over the next five years. The US parent of engineering company F.G. Wilson is to invest £113 million in a joint venture at three sites in Northern Ireland.

The investment, which is backed by a grant package of £36.4 million from the North's Industrial Development Board, is the second largest project secured by the IDB since its creation in 1982.

The new company, a joint venture between US companies Emerson Electric and Caterpillar, will produce diesel engine generating sets which will be exported worldwide. F.G. Wilson is a subsidiary of Emerson Electric and the new company will operate under its name and management.

Most of the new jobs will be created in an expansion of F.G. Wilson's existing premises in Larne, while new supply plants are to be set up in Newtownabbey and West Belfast.

F.G. Wilson, which was bought by Emerson Electric two years ago for almost £200 million, employs nearly 1,200 people at Larne in the design, manufacture and marketing of generating sets.

F.G. Wilson will continue to produce its own range of generator sets and will also produce this under the Caterpillar brand. The generators are used in developing countries and as a secondary source of power in many western economies. The smallest generator set in the product range weighs 600 kilos, while the largest is about 60 tons. F.G. Wilson exports 92 per cent of its output to 170 countries and the new company expects to mirror this.

The chief executive officer of F.G. Wilson, Mr Mike Antonis, said the experience of the operation in Larne played a large part in attracting the project to the North. The proximity to the port of Larne was a key factor as the average size of unit is live tons, and almost all production is shipped by sea.

The two sub supply factories will manufacture components for the range of power generating sets, which will be assembled at Larne. Both supply plants are located quite close to Larne, and are convenient to the main road link to the town. According to Mr Antonis, shipping costs for such large components are high, and the further the factories were from Larne, the higher the cost of transportation.

The quality of the North's engineers and the number of third level students who took engineering courses in the North also contributed to the investment decision, according to Mr Antonis. "More than 10 per cent of our staff will be engineers, and the engineers from Queen's and other universities are of a high standard," he said.

Construction work on the extension to the Larne plant will begin in August, while work on the other two sites is due to start one month later.

Announcing the new investment, the North's Economy Minister, Baroness Denton, said the project was "the clearest indication since the peace process started of how positively US companies now regard Northern Ireland as an investment location". The investments "an unprecedented endorsement of Northern Ireland by two of the most successful, innovative, and respected blue chip corporations in the US" she said.

Emerson Electric with its headquarters in St Louis, Missou as sales of $10 billion (£6.34 billion). Earlier this month a subsidiary, Copeland, announced it was investing £33 million in a compressor plant in Cookstown, Co Tyrone, which would create 300 new jobs. Caterpillar, which owns a minority stake in F.G. Wilson, is based in Peoria, Illinois, and has sales of $16 billion (£10.15 billion).