Aberdeen: time to imagine a managed North Sea transition

“Wur doomed, entombed, marooned!”

Private James Frazer, Dad’s Army

I thought I was being clever by taking a photo of the blackboard in Aberdeen Maritime Museum, onto which the oil price $44-89 was scrawled. The previous numbers had been rubbed out as the price and hence the requisite figures got lower and lower, leaving big yellow smudges round the digits. It won’t go much lower than that, I thought, so figured it was worth taking a photo before the price came back.

That was in late November. It’s now January, and within the first fortnight of 2016 something upwards of 750 job losses have been forecast for the North Sea basin. Oil has just dipped below $30 per barrel, petrol on the forecourts is back in double digits. It is getting so bad they had to have Prof Alex Kemp on the radio yesterday to explain what’s up (or down).

It goes without saying that this is not a nice time to be in Aberdeen. I don’t need to tell you how many jobs in the city depend on the North Sea. There are countless op-eds and features out there, usually starting with someone getting in a taxi at the station and talking to the driver about oil prices (I don’t for one minute doubt the veracity of the writers’ tales, but I want to know who these taxi drivers are and where they hide – because in my thirty years of living in north Scotland I have never managed to get more than a grunt out of this fair city’s cabbies). Perhaps it is just me, but I sometimes feel I can detect the faintest hint of smugness in these writings, as if people are deriving pleasure from seeing all these Range Rover-driving Cala Home-inhabiting characters being hung out to dry after years of lording it over the rest of Scotland.

As an inhabitant of Aberdeen and someone whose job exists, albeit indirectly, as a result of the energy industries in the north-east, I can assure you there is nothing funny about what tanking oil prices could do the Granite City. The issue is not the folk at the very top of the oil companies pulling in massive salaries – they will likely get deployed elsewhere or at least be able to draw on savings to tide them over. It’s all the other people in the service industries – those working in hotels, restaurants and on shop floors – whose employment is contingent on having people in the city with money to spend and on people visiting the city to do business who need somewhere to stay and somewhere to eat. And then there are the people on the lower rungs of the oil and gas ladder – even near Inverness where I grew up, going to work ‘on the rigs’ provided a good and stable income for those without the skills and qualifications to do otherwise. If things continue to go the way they are, this source of employment could dry up or at least contract significantly, with no alternative offering comparable pay.

But what really worries me is that there seems to be no vision for how Aberdeen is going to transition away from oil and gas. In Energy Voice – essentially the local rag’s oil and gas arm – there are stories urging the Chancellor to cut tax, MSPs calling for action on North Sea oil, and the various authorities pledging to ‘support’ the industries. All the talk is about prolonging and supporting the North Sea, rather than thinking of the alternatives in a systematic way. Many will point to the previous downturns in 1986 and 1994-5, and will argue that the price of oil is going to rebound, that there’s plenty of life left in the North Sea yet. Others have more pessimistic predictions. Either way, surely now is as good a time as any to realise that oil and gas are finite resources, and that there will come a time when it is no longer viable to extract these resources from the UK Continental Shelf. That might not happen this year, or next, but there will be a point at which oil and gas operations in the North Sea as we know them will have to end.

So to my mind the question should not be how can we support the North Sea, but how might we use the current price downturn to instigate the managed transition for Aberdeen and its periphery that will inevitably be required? This doesn’t mean we abandon all the rigs and shut down the industry overnight. Our society will need oil and gas for a little while yet, and we might as well make the most efficient use of existing fields rather than prospecting for new ones in the Arctic or deep seas or wherever – especially considering we now have even stricter climate agreements to adhere to. But while we are doing that, it’s a good opportunity to think about how to diversify. In the research I’ve done over the last few years, I’ve talked to a fair few people who think Aberdeen is in danger of missing out on many of the things that could supplant oil and gas – renewables, shipping, even being a base for decommissioning – because the companies doing these things can’t attract people to Aberdeen because they just can’t match the salaries oil and gas is offering. Anecdotally too, I’ve heard that the high rents and house prices, directly attributable to the extractive industries, don’t exactly encourage researchers to come to the city’s two universities. Now is the time for our city’s authorities and those higher up the food chain to be doing everything in their power to retain the diverse skills in Aberdeen, whilst at the same time attracting new people and also new employers eager to take advantage of what we have.

Detroit. There, I’ve said it. And let’s make it the only time I ever use that word in connection to Aberdeen. Let’s think positively instead. Let’s use the current oil price crash as a point of departure for imagining not just what Aberdeen could be like after North Sea oil and gas, but also how we might get there in a sensible, sustainable and coordinated manner. Perhaps this is too naïve, but given the UK government’s disdain for renewables and indeed any kind of ‘low carbon’ energy not involving shale gas or nuclear, why not see if Scotland can use political will if not also finance to attract some of the solar, wind, wave and tidal developers that have been cut adrift to the north-east? And maybe by the time the next independence referendum comes round, rather than oil prices we’ll be quibbling over whose carbon dioxide storage space and wind-generated electricity it is.

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