From The Province of the Cat – The Agony of North Sea Oil

Cameron offshore

by George Gunn

On Monday 24th February 2014 it was a tale of two cabinets and one city. This was the day we saw two different political cultures at work. After a brief sprint around BP’s ETAP platform roughly 100 miles East of Aberdeen the Prime Minister David Cameron met most of his cabinet in a suite at Shell’s Aberdeen HQ. Afterwards he issued some statements about North Sea Oil in relation to Britain and Scotland which managed to combine being patronising, sinister and brief. The Prime Minister matter of factly answered a few pre-selected questions from some friendly TV reporters and then the entire shooting match flew back to London as soon as possible. One noticeable absentee was the Chancellor George Osborne. Presumably he was told to stay as far away from Scotland as possible which is probably why he took the opportunity to fly to Singapore.

On the same day the Scottish cabinet met in Portlethen, some seven miles South of Aberdeen, where the First Minister along with his colleagues answered questions and had a discussion with 300 or so of the general public in a church hall. Whilst calling Westminster “thieves” in relation to North Sea oil Alex Salmond also committed £60k of Scottish Government regeneration cash to the Portlethen Jubilee Hall. Although you could argue that both events were stage managed: one was exclusively corporate whilst the other was… well, if not quite couthy then slightly more human.

The last time the “British” cabinet met in Scotland was in 1921 when on 7th September Lloyd George summoned his legions to Inverness to discuss a newly independent Ireland’s “relationship with the British Empire”. No doubt they all came straight off the grouse moors so it was a handy location. Home Rule was also a popular idea in Scotland in 1921. It was also the year that the British Parliament recognised the Church of Scotland as being “independent in spiritual matters”. Corporeal and secular matters were very much under the control of Westminster. In that and in the grouse shooting habits of Tory grandee’s nothing much changes in ninety three years.

In 1921 the British state was coming to terms with what it had lost. In 2014 it is trying to come to terms with what it might lose. Last month in Aberdeen, as it was when the tanks rolled over the border into Iraq in March 2003, the cry went up “It’s all about oil!” This month, this week and every day up and until the September 18th Referendum – and after – it is, and always has been, “all about oil”. Those who think that the UK plc will walk away from the riches which the hydro-carbon reserves in the North Sea, West of Shetland and potentially West of the Hebrides provide for the UK exchequer “misunderestimate” – to quote ex-US President George W. Bush – the mind set of the British State. However reasonable Cameron and co appear on camera we Scots should be under no illusions that when it comes to getting what they want the British ruling class will without hesitation abandon any pretence at respecting democratic outcomes and rights and will fight hard, dirty and long to protect, consolidate and exploit their “interests”. They have done it before – all over the world – and they will do it again, here in Scotland. That was what the Prime Minister David Cameron was doing in Shell’s Altens HQ: he was issuing us with a warning. He was saying, “You can think what you like, but this stuff belongs to us.”

I was nineteen in 1975 when the Queen in a green suite and a green hat – looking for all the world like a huge courgette on our colour TV – pressed the golden button in Dyce to set the first batch of black stuff flowing down the 130 miles long BP pipeline from Cruden Bay to Grangemouth. For the next ten years, like many of my generation, I worked on drilling rigs which undertook, almost exclusively, wildcat exploration all over the North Sea – and the Irish Sea – searching for the precious crude. These were the years without frontiers or boundaries, when wealth was new and its potential vast. In the mid seventies oil also meant war in the Middle East, petrol shortages and power cuts, chaos and conflict.

I975 was the year my political life began and when my life was politicised – not necessarily the same thing. Ever since that day when I first set foot on a semi-submersible drilling rig the oil industry has possessed and obsessed me, appalled and thrilled me, turned my head and opened my eyes. 1975 was also the year Margaret Thatcher became leader of the Conservative Party, Britain voted in a referendum to stay in the European Union, the Vietnam War ended in defeat for the US, Watergate unfolded and on June 5th 1975 the Suez Canal opened for the first time since the Six Day War of 1967. For the oil companies and Western governments that meant it was back to “business as usual” – except in the oil business there is no “normal” – and an end to the Arab’s “holding us to ransom.” For the North Sea it was “go, go, go!” American oil companies flooded in as only they can. There was an attempt – half hearted and ill thought out – to set up a British equivalent of the Norwegian Oil Fund but the British National Oil Corporation, formed in 1975, was designed to maintain adequate levels of the supply of oil rather than exert ownership or accrue taxation, even though they did build a big new building on Guild Street in Aberdeen and the Labour Energy minister, Tony Benn, did have some good ideas. It all, sadly, came to nought as Thatcher rose to power in the election post the 1979 rigged referendum on a Scottish Assembly and Jim Callaghan’s “Winter of discontent”. BNOC was turned into Britoil and its shares were issued on the London Stock Exchange in 1982 and 1885 and by 1988 had been bought by BP. So our future wealth from North Sea Oil was privatised, or wasted, depending on which side of the grouse guns you happen to be standing. Norway currently has an oil fund worth in excess of $800 billion. It increases every day. As of the first quarter 2013 UK government debt amounted to £1,377 billion. It also increases ever day.

There are those who, quite reasonably, cry out as Douglas Marr does in an otherwise very pertinent and wise article in the latest edition of The Scottish Review, that “it is scarcely credible that after four decades of North Sea Oil the economic and social problems of the 70’s and 80’s are still with us and in some respects, more acute than ever.” But this is to misunderstand history. The British State has repeatedly shown and oil companies daily prove that the wealth created by exploitation of hydro-carbons – or anything – is not for the improvement of the many. Quite the opposite. The exploitation of nature and the exploitation of the working class – the majority in Scotland – are seen by multi-nationals and many governments (the present UK government especially) as being the same thing. That capital depends on labour’s compliance in this scam is capital’s inherent flaw. But David Cameron, Shell and BP will see four moons in they sky before they expose that flaw to any critical pressure. What the history of oil shows is that for any people, wherever in the world they be, being reasonable to those who treat power as hereditary – especially when politically you are suffering a deficit of democracy and as a result have no influence – gets you absolutely nowhere. But no state of affairs is, as a cause, necessarily an historical one. Neither are events, by their nature, permanent. The Referendum in September at least gives us a chance to put pressure on the flaw in the abusive relationship between labour, oil companies and the Conservative government. Scotland has an opportunity to show Westminster that our debate with them – what the ancient Greeks called the “agon”, literally “debate”, and it is the root of the word “agony” – is not just about money, that it goes beyond capital, that it is about justice and democracy. Westminster may not care overly much about any of this, but the rest of the world cares, in as much as it is watching what is happening and history, as usual, is waiting.

In ancient Athens tragic drama and democracy evolved at the same time and created the recognisable fabric of the society we inherit today. Any society which cannot engage in a public debate – the “agon” – about its tragic flaws and political possibilities is a society heading for atrophy. The signposts pointing to this state are up all around Westminster.

So, to return to oil, why were the two cabinets in the same city – Aberdeen, more or less – on the same day last February? It was the day that Sir Ian Wood published the UKCS (Continental Shelf) Maximising Recovery Review: Final Report and the Tories were there to mark the occasion which some of them hailed as a “game-changer”. I can only assume they hadn’t looked at the report very closely. Of the estimated £200 billion worth of retrievable oil in the North Sea Sir Ian suggested that the Department of Energy and Climate Change (yes, I know, one leads to the other) was an organisation not fit to harness its recovery. David Cameron heartily agrees yet he told the BBC that “For many years the UK has supported the North Sea oil and gas industry…” when it is obvious, as history shows, that the exact opposite is true. Sir Ian Wood further recommends that oil companies co-operate with each other in future oil field development. History also shows this co-operation between the big beats is extremely rare. The Scottish government – who were in Aberdeen for the same reasons as the Tories – want to create two oil funds: one to deal with oil price volatility and the other to invest in the future. The scoffers in the Better Together lobby claim that for Scotland the opportunities of the North Sea have gone, but as Sir Ian Wood has shown in his report, they are wrong, some £200 billion wrong.

It is also easy for the media to get excited by the Chief Executive of BP, Bob Dudley, claiming that Scottish independence would create “big uncertainties” for his company. For “big uncertainties” we can translate as “allergy to democracy”. I wonder what “uncertainties” BP will finally be responsible for by their pollution of the Gulf of Mexico? A poll which found that a majority of North Sea oil and gas workers actually support Scottish independence went, by contrast, almost unreported. The online poll by industry website Oilandgaspeople.com found that 7 out of 10 of 1,000 respondents plan to vote “Yes” in the referendum. Like me, I suppose, they see, and have seen, the reality of the oil field from the inside and have drawn the same conclusions as Leonard Cohen, “I’ve seen the future and, baby, its murder.” And, yes, I know polls can be made to mean anything.

I cannot help but recall this passage from Rilke when I think about Scotland and North Sea oil,

“What is coming

seems insipid no longer. Not the same

as that last year, but as something new.

Always expected, but when it came,

you never got it. It got you.”

In September, in relation to North Sea oil and our future, the people have a choice: do we get it, or does it get us? We need to own our resources: all of them. As far as the forty year waste of wealth which the North Sea oil industry represents for Scotland: it is time to end the agony.

© George Gunn 2014  

 



Categories: Commentary, Economics

Tags: , ,

10 replies

  1. I think you are right George.
    We keep hearing (from Westminster) about North Sea oil revenues being divided up on a per capita basis i.e. we get to keep around 9% of the revenues and Westminster the rest.
    How far they are prepared to go to keep the cash cow in their possession?…we shall see.
    Westminster has never been about democracy,especially as far as Scotland is concerned and is a place run by vested interests.
    It is a club where wealth and power go hand in hand as we have been seeing recently in announcements by the friends of Westminster issuing threats against independence.
    It was always going to be a battle between Westminster and the people of Scotland for control of our resources and once the working people of Scotland realise this the referendum outcome will be a certainty.
    Thanks George.

  2. How much more do the Scottish people want to give…they gave the Industrial revolution through scots like James Watt…they all this knowledge through their superior education system, not just to england but also throughout the anglo world e.g. Mcgill University…they gave their sons and daughters to go and fight around the world for king/queen and country…they gave their oil…they gave up their language and adopted english…

    How much more does the Scottish people have to give?

    It is time for the english to stand on their own feet…

  3. Aye I remember those days well.We have gave too much to London and they have wasted all of it,this time we should hold onto what we can for those Scots still to be born.

  4. Lovely writing Mr. Gunn.

  5. Bella is a busy place and the typos in the article are mine, not Bella’s. In para 6 the second date for the flotation of Britoil shares was 1985, not 1885. Also , a few pars after I refer to the oil companies as “big beats”, This should read, “big beasts”. It would be interesting, as an historical fantasy, to speculate if Scotland had been independent since 1885 and had assets to float on the then stock exchange, as to what kind of country it might be now?

  6. “An interesting government commissioned report came out yesterday in Britain, prepared by a commission under oil veteran Sir Ian Wood, and dealing with the prickly issue of what to do with the fast dwindling oil and gas production – and tax revenue – that comes from the British North Sea patch.”

    http://www.theautomaticearth.com/debt-rattle-feb-25-2014-bombshell/

  7. Spot on George – the oil card is what makes me concerned about how really dirty this campaign is going to become -energy ownership is essential.

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