Highlands and Islands Enterprise (HIE) and Orkney Islands Council (OIC) are to create a £6.5m R&D centre in Stromness to support marine renewables activity.
The two organisations have formed a partnership to create Orkney Research and Innovation Campus. Work on the 3.75-acre campus will start by the end of the year.
The campus will be located at the Old Academy, already home to the European Marine Energy Centre, Heriot-Watt University’s International Centre for Island Technology and marine consultants Aquatera.
The two adjoining buildings will be refurbished, updated and extended to create the campus.
HIE said the aim of the campus is to attract academic institutions and businesses with an interest in carrying out a wide range of research projects in an island setting.
OIC will also transfer the ownership of the Old Academy and former Stromness primary school to the new partnership. HIE Board is to contribute £5.15m for the project, with OIC £1.5m.