The west Cork shellfish firm Bantry Bay Seafoods is investing €4 million in a new Chilean mussel processing plant with Spanish partner Mascato.

The €13 million joint venture, based on Chiloe island near the provincial capital Puerto Montt, will produce and process an estimated 19,000 tonnes of mussels annually. This represents more than 20 per cent of annual mussel production levels in Chile.

Named Blue Shell, the company will be located near sea farms and will produce mussel meats, along with frozen half-shell and canned mussel meat.

It will employ 80 people initially, and up to 200 within the next three years.

Bantry Bay Seafoods sales and marketing director Denis Minihane said the Spanish partners had "generations of experience" in the international seafood trade and had been operating in Chile for the past 10 years.

Founded in 1990, Bantry Bay Seafoods employs 120 full-time staff and produces more than 6,000 tonnes of mussels annually.

Turnover last year was €16 million and its main overseas markets are Britain, France, Germany, Italy and the US.

The company has patented a method for processing shellfish and has won a number of awards, including Irish exporter of the year in 2003.

Work on the new Chilean plant is expected to start shortly, and the company plans to capture a valuable share of the "half-shell" market dominated by New Zealand and Denmark.

"Bantry Bay Seafoods is already the number one mussel company in Europe and the combined production from our facilities in Bantry and Chile will go a long way in helping us to become the leading processor and supplier of top quality branded mussel products in the world," Mr Minihane said yesterday.