Deerness Distillery Ltd has secured £246,000 from Highlands and Islands Enterprise (HIE) for the £820,000 development.

Construction is underway at the distillery, which was founded by husband-and-wife team Stuart and Adelle Brown. Located in Deerness, on a peninsula in the east end of the mainland, Deerness Distillery was set up in 2016 and is known for its multi-award winning Sea Glass Gin.

Once open this summer, the distillery will see the family begin production of their new whisky using Scottish barley and speciality locally grown grains from Orkney as well as increasing production of their existing gins, vodka and coffee liqueur.

The existing premises will be extended to house a new cafe, visitor centre and larger retail shop that allows visual access to the production process. Additional buildings will house whisky malting and distilling equipment and whisky casks.

The project has a strong focus on the drive towards achieving net zero and the firm is exploring green technologies to lower carbon emissions at the distillery. Plans include using spent grains from the distillery and food waste to produce electricity to provide power, heat and hot water.

The Browns also intend to produce animal feed from the draff, the waste grains, which will reduce waste from the whisky production cycle and complete the sustainability loop for the ‘grain to glass’ whisky production.

The HIE funding will contribute towards the building works and the cost of equipment for the café and the distillery including mash tuns and copper whisky stills.

Graeme Harrison, area manager for HIE’s Orkney team, said: “Whisky and gin production is a key part of our food and drink sector in Orkney. It provides valuable employment and contributes to community resilience.

“The development will help grow the business to a size where it can have a sustainable future. Orkney continues to experience a steady growth in volume tourism and this will be a valuable addition to our range of visitor attractions, particularly outwith Kirkwall, so we are very pleased to support this venture.”

Mr Brown said: “We’re delighted to be embarking on this development, which would not have been possible without the support of HIE.

“Building on our success with gin and vodka production is an important step in our journey, allowing us to increase sales both nationally and internationally while creating employment in the islands, attracting more visitors and having a greener footprint.”