EnergyFromTheEdge
A conference about sustainable energy, large-scale resource development in remote communities, and more ...
12-14 SEPTEMBER 2007 Shetland Islands
Shetland and Oil
The discovery of North Sea Oil off Shetland in the 1970s has been a key event in the islands' recent history.
The North Sea oil industry has long been recognised as a key component of not only Shetland’s economy but the economy of the UK as a whole. At a local level this reflects in three main areas: Sullom Voe Oil Terminal, the offshore oil and gas fields and the services related to both of these.
The discovery and development of oil in the East Shetland Basin in the early 1970s occurred at a time when the Shetland way of life was based on fishing, crofting and knitting. It presented itself as a challenging new prospect and together with the oil industry, Shetlanders set about managing the development in a way that would demonstrate their awareness of its significance.
The Zetland County Council (ZCC) - now the Shetland Islands Council (SIC) - recognised the potential effects of the oil discovery for both the economy and the environment of the islands. In 1972, they promoted a pioneering Bill through the UK Parliament, the Zetland County Council Act, which became law in 1974 and set the legal framework for developments. This Act gave Reserve Powers to the Council in its dealing with the oil industry, enabling the SIC to have considerable control over developments in and around the islands.
The Council wished, as one of its main objectives, to prevent the proliferation of oil-related installations and to identify the area, or areas, where the environmental impact would be minimal. Calback Ness in Sullom Voe was subsequently selected for the terminal, on a site of approximately 400 hectares on the shores of Sullom Voe, 46 km (29 miles) north of Lerwick. In 1975, the construction work for the Terminal began, as did the development phase of laying the Brent and Ninian pipeline systems. The first oil was piped to Sullom Voe in 1978 and in 1980, the construction workforce peaked at over 7000. Two years later the final construction and commissioning work at the terminal was completed and Sullom Voe received its one billionth barrel of oil.
The visionary ZCC Act also provided the basis on which the Council’s financial strength and extended levels of service provision to the population of Shetland were established. The underlying philosophy of the politicians at that time was a commitment to the way of life and fabric of the islands. The Shetland Charitable Trust was established in 1976 to receive income from the oil industry, known as “disturbance receipts”. These Disturbance Receipts were intended to compensate the people of Shetland for situating the Sullom Voe Oil Terminal at Calback Ness.
The Charitable Trust was considered to be the most appropriate body to manage the funds on behalf of the Shetland community. This enabled the “oil money” to be retained and managed locally and establishing a charity meant that the funds were exempt from certain taxes. It also enabled the Trust to build major facilities, such as the Clickimin Leisure Complex, which were beyond the means of the Council at that time.
Today, although the relative importance of the oil industry has declined, Sullom Voe Terminal is still the largest oil shipping terminal in Europe.
Exploration and Development
- 1970 – The exploration phase for oil and gas offshore Shetland began when the Government allocated the first Licence Blocks.
- 1975 – The development phase including the laying of the Brent and Ninian pipeline systems and the floatout of the Beryl and Brent field production platforms. Construction work began on the Sullom Voe Oil Terminal.
- 1978 – The first oil was piped to Sullom Voe through the Brent pipeline from the Dunlin oilfield on 25 November. The first oil was shipped out from the terminal by the Shell tanker ‘Donovania’ five days later and on 3 December the first oil arrived through the Ninian pipeline from the Heather oilfield.
- 1980 – Construction workforce peaked at over 7000.
- 1982 – In April the first fractionation of gas took place at the terminal and a month later the first gas was shipped out. In December the final construction and commissioning work at the terminal was completed and Sullom Voe received its one billionth (1,000 million) barrel of oil.
- 1994 – In August the terminal recorded one million manhours without a lost time injury.
- 1997 – On 13 June the six billionth barrel of crude oil was produced at the terminal.
- 1998 – During April the terminal was awarded, for the fourth consecutive year, the Gold Award for Occupational Safety by the Royal Society for the Prevention of Accidents. On 24 April the ‘Hellespont Grand’ became the largest tanker to visit the terminal with a dead-weight of 421,680 tonnes, and took the largest cargo from the terminal, 376,000 tonnes. In May the LPG ship ‘Havrim’, 37,300 cu.m., was the 1,000th LPG vessel to visit the terminal since operations commenced. On 8 August the ‘Nordic Savonita’ offloaded the first cargo of oil, 38,000 tonnes/300,000 barrels, from the Schiehallion field, west of Shetland. The ‘Windsor’ was the first tanker to collect a cargo of 630,000 barrels of Schiehallion crude, bound for Rotterdam on 19 August. October saw the longest tanker ‘Empress Des Mers’ to berth at Sullom Voe. This Nassau registered tanker was 381.82 metres long.
- 1999 – On 6 January the ‘Hellespont Grand’ took the largest cargo of oil from the terminal: 395,567 tonnes.
- 2001 – On 15 December the seven billionth barrel of oil was produced at the terminal.
- 2005 – The Clair Field, 47 miles west of Shetland, produced its first oil on 24 February. In May the ‘Shetland Spirit’ became the first tanker to export oil from this field, with a cargo of 90,392 tonnes.