Striking Gold? North Sea Oil

During the 1970s the North Sea would become one of the most lucrative and cost effective areas for oil exploration in the world. North Sea oil improved Britain’s Balance of Payments, transformed the lives of people in the North East of Scotland, and brought great wealth to the United Kingdom as a whole. It also led to increasing political difficulties within Britain as Scottish nationalism developed greatly as a result.

Small reserves of oil had been discovered off East Anglia in 1965 but it was not until the 1970s that large reserves were discovered or oil came on line. On 7th October 1970 British Petroleum announced its discovery of an oil field 110 miles north east of Aberdeen. A year later Shell discovered the Brent field off Shetland. The Forties field, in particular, was not just a large discovery; it was massive. BP began pumping oil from the Forties field in September 1975 with production peaking at 500,000 barrels a day in 1979, providing 25% of Britain’s daily oil requirements.

Aberdeen and the North East of Scotland had traditionally relied on fishing but oil became the new direction of the local economy. Living standards and wages increased as many men traded trawlers for oil rig work which offered substantially higher wages. Workers also relocated from across Scotland and the rest of the United Kingdom to buy into the North Sea gold rush. The population of Aberdeen rose from 436,000 in 1971 to 480,000 in 1981. The discovery alleviated some of the economic depression associated with the decline in industry in Scotland throughout the 1970s, as between 1970 and 1974 coal production had fallen by 1/3 and steel production by 1/5. The unemployment created by the decision to not nationalise Upper Clyde Shipbuilders prompted many Glaswegians to seek work on the oil rigs, as the Clyde’s position as the centre of industry in Scotland began to slip. There was a competition between Aberdonians and Glaswegians for off shore work which started the heated rivalry between Aberdeen FC and the Old Firm.

The discovery of oil reserves was greatly beneficial to the Scottish Nationalist Party, and became one of the fundamental arguments of the ‘yes’ campaign in the 1979 referendum. Throughout the 1970s one of the SNPs key slogans was “it’s Scotland’s oil”; arguing that Scotland lacked control and did not receive the benefits from North Sea oil that it had a right to. This translated into political power for the SNP. At the 1970 General Election the SNP had won one seat and 11.4% of the vote in Scotland. The massive oil reserves in Scottish waters translated directly into a surge in Scottish nationalism. At the February General Election in 1974 the SNP increased their number of seats to seven and 21.9% of the vote, and again at the October General Election the SNP won eleven seats and 30.4% of the vote. This proved to be the high water mark of Scottish nationalism in British politics until the 2015 General Election. The 1979 referendum caused controversy as despite winning 52% of the vote in favour of devolution, only 32% of the electorate voted for the changes so devolution failed to pass. However, Scottish nationalism had developed greatly during the 1970s and was fundamentally linked to North Sea oil.

_55369166_oil_web_1409

The British government is argued by historians, such as Alexander Kemp, to have deliberately played down the benefits of North Sea oil in order to subdue the rise in Scottish nationalism. In April 1974, the economist Gavin McCrone submitted a nineteen page document to the Cabinet regarding the benefits to Scotland of the oil reserves. If Scotland was to become an independent country it was predicted to be more prosperous than Switzerland, and have one of the strongest currencies in Europe. McCrone also predicted that by 1980 North Sea oil would yield £3billion per annum to the government; a far higher estimate of even the SNP’s prediction of £800million per annum. The document was allegedly buried by the British government because it posed such a threat to the United Kingdom.

The legacy left by the exploration of North Sea oil reserves during the 1970s is one of great economic importance. It transformed Aberdeen, and the North East economy, as well as creating great prosperity for Britain. Politically, North Sea oil prompted a rise in Scottish nationalism which attempted to undermine the unity of the United Kingdom during the 1970s and continues to do so today.

Leave a Reply