Covid19 and Oil Extractivism

In recent weeks we’ve published a number of articles on the impact of the drop in global oil prices on employment in North Sea oil and gas and on the urgent need to protect workers in the midst of the pandemic and seize the opportunity to organise for a rapid and just transition to renewables. Simon Pirani, Senior Research Fellow at the Oxford Institute for Energy Studies spoke at our 10th May public meeting.

You can watch the video of Simon’s talk here:

As background to the talk and for more information on the North Sea Oil and Gas industry you might also like to read the report on taxation and subsidies to the oil companies operating on the North Sea that we published in February.

If you’d like to look at Simon’s slides without watching the full video you can see them here:

We have a small number of Simon’s book available at the reduced price of £11 (postage extra). Email triple.e.scot@gmail.com if you’d like a copy.

A transition to renewables is coming but will it be a just transition

James Masson is a university student who is also involved with environmental activism. Coming from the North East of Scotland Just Transition is of particular interest to him.  We are really pleased that he’s given us permission to republish this article on Just Transition, which was written as a journalism project.

In recent years, climate change has become a key issue and we are only starting to realise the full impact that it could have on our lives. The Intergovernmental Panel on Climate Change (IPCC) fifth report stated in 2013 that they are 95% confident that climate change is being caused by humans burning greenhouse gases. More recently the UN Chief called climate change an existential threat to humanity. In light of the scientific consensus that burning fossil fuels is bad for the planet and therefore all life on Earth it seems obvious to suggest we stop burning fossil fuels, and of course we should. However, we cannot forget about all the jobs and money tied up in the fossil fuel industry. 

The North East of Scotland is a region that depends upon the oil and gas sector for much of its wealth. Scottish government stats show that in 2019 the oil and gas sector accounts for £16.2 billion or 9% or Scotland’s economy. The high concentration of fossil fuel jobs within the North East has meant that the employment rate in Aberdeenshire, in 2018, was 82.3% compared to the UK average of 74.8%.

 The North East relies heavily on the existence of the oil and gas sector for its prosperity and therefore we must replace the oil and gas industry with an equally strong industry that will mean the local area isn’t hurt economically. This is a concept that is referred to as a just transition. The aim of a just transition is to ensure that communities reliant on fossil fuel industries are not economically disadvantaged when moving away from fossil fuels and are provided with opportunities to grow economically in other sectors, namely the renewable industry. 

If we want to avoid the worst consequences of climate change a just transition needs to happen very soon. Scotland just like the rest of the world is warming at an alarming rate.

Read the rest of James’ article here.

Protect North Sea workers now and in the future

At the same time as making some workers redundant, oil and gas companies have continued to operate rigs on a three weeks on three weeks off pattern.  In ‘No Market Solution’, posted on this blog yesterday, Neil Rothnie asks a critical question about the safety of the workforce.  He queries whether at a time of global oil glut this is really essential work and whether it can possibly be safe

Who knows how effective this [testing] is, or whether the infection is spiraling offshore only to come home with these guys at the end of their trip?  Are all the companies quarantining all outward and inward bound workers?  Are they testing everyone every day? Otherwise what possible precautions could be put in place to get workers offshore via helicopter to work eat and sleep (sometimes in shared cabins) cheek by jowl in an atmosphere of endlessly recycled air? 

One of the tragic lessons we’ve learnt from Covid-19 is that concentrations of people in enclosed environments are horribly vulnerable to a highly infectious virus.  Too late in the day the consequences of not protecting elderly and vulnerable people and care workers living and working in care homes have come to the fore in public debate.  After initial publicity the plight of 100,000 workers who are still trapped on cruise ships around the world has been largely ignored.  According to the Guardian newspaper at least fifty of the ships have Covid-19 infections spreading onboard while the workers are shut out of ports and unable to return to their homes.

In this context we need a public debate and rapid action to protect the lives of the North Sea workforce.  It’s clear that the industry is not putting safety first – at a time of crisis they are making the workforce pay the price through redundancies and unacceptable risks to their lives, while at the same time continuing to pay out massive dividends to share holders.

Protect the workers now

Shut down offshore production and development until there is a clear case that it’s safe to resume.  Ensure that livelihoods are protected.

Protect the workers in the future

Organise for a rapid, planned just transition out of hydrocarbons and into a new sustainable economy.

Oil Platform in the North Sea

Overdue! A Just Transition for Scotland’s offshore Oil and Gas workers: Part One

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Taking a battering. Will North Sea oil withstand the coming Covid-19, world recession and Climate change storms?

For over 40 years the North Sea oil and gas industry has been hailed as Scotland’s economic and industrial crowning glory. But economic dips and global price wars have seen the industry drop in both output and workforce over the past decade. And now, the most-deadly of confluences- a Coronavirus pandemic, a global economic recession and a rapidly closing climate crisis- confront the industry with its hastened demise.

In this brief paper we examine the closing economic vice on the industry- a crashing oil price against a sudden and historic decline in petroleum demand- as well as the realities of the urgent need to cut and eliminate carbon emissions in order to offset an impending environmental catastrophe.

But here we will argue that rather than crises spelling the death-knell for workers and their communities, new industries requiring new skills and more jobs should emerge via a Just Transition that can offer workers, their families and communities hope for a secure, bright and clean future.

SAUDI-CALEDONIA

 In his Black Gold Charles More[1] dates the origins of the UK’s North Sea industry to a day in the early 1960’s when a Dutch family’s garden caught fire. Initially investigating for wartime explosives, the authorities eventually discovered that the fire was from an out-burst of gas from hydrocarbon bearing seams that ran west out to the North Sea- towards the UK.  Initially, interest in North Sea hydrocarbons was restricted to natural gas- as a cheaper and cleaner option to town coking-oven gas- but with the founding of a Department of Energy with a sovereign security of supply remit, oil, which was found in equally abundant reserves, became a growing area of interest.

Then following a humbling miners’ strike in 1972, followed by the Yom Kippur war and subsequent OPEC oil embargo and price shock, gears were shifted to put UK Continental Shelf (UKCS) oil production (and nuclear power)- on high priority as energy security hedges. Subsequently a Labour government priority became the setting up of a British National Oil Corporation (BNOC) alongside a similar gas enterprise- British Gas, to ensure the fullest exploration and extraction of North Sea assets.

In late February Scot.E3 released a hitherto unpublished paper which in great detail explained how an intricate range of taxation vehicles and regulations had encouraged oil companies into the North Sea basin by ensuring that blocs would be virtually given away by the device of zero-valuing proven oil and gas deposits whilst also ensuring that capitalisation would be subsidised, investment risk deferred to the tax payer- along with future decommissioning liabilities.

The exploitation of offshore oil resources however, failed to realise any power-generation security of supply in that the oil from the first drillings (Aramco Montrose field developed 1967, BP Forties field developed 1969 and the huge Shell Brent field developed 1971-76) all proved to have oil totally unsuitable for burning in power stations. But nevertheless, UK Continental Shelf (UKCS) oil was able to provide up to 70% of crude for the purpose of refining into transport fuels. But the reserves were substantial.

And overnight the east of Scotland ports were transformed into oil and gas bonanza towns. Texans, Uzbekis and Arabs with exploration drilling skills flocked in- to be followed by newly recruited oil and gas workers with substantial numbers from the declining Scottish shipbuilding industry.  And here it is worth noting that at its peak at the time of the millennium, total UKCS employment was around 600,000.

For Scotland, the offshore waters that proved to be the most fruitful were in the Central North Sea sector where at its peak, over 50% of all N Sea offshore activity took place- the more remote North N Sea and West of Scotland sectors being later in development. And with continued tension between the big OPEC producers and the ‘west’, up until the early 2000’s the UK Continental Shelf resource looked certain for continuous development- albeit on a slight declining output expectation.

DECLINE AND FALL

Oil, and to a lesser extent, natural gas, is the most necessary commodity on the world market. It is also the most precarious and volatile. Slight fluctuations in global growth, political tensions, commodity markets speculation- and more lately, growing environmental concerns, all influence a vast capital intensive and continually technologically evolving industry.

So with these factors in mind we have to then consider the status of the UKCS oil business as both marginal- in terms of total resource strength- as well in terms of exploration, development and extraction costs. Hence the tax and subsidy fiscal environment that the industry has enjoyed under successive UK governments since 1970 as explained by Juan Carlos Boue. But with a vastly expanding global hydrocarbon resource base, it was inevitable that a tendency to over-production would lead to a continued trend of downward prices- a trend that the high cost UK oil business would find impossible to compete under.

Wars are good for oil- particularly wars in the Middle East global energy hub. So some 20 years of Iraq-Iran, the US/UK- Iraq conflict has been good. But in 2014, OPEC led by Saudi Arabia started an over-production war in order to kill off the burgeoning US shale oil industry- which it virtually did by driving oil prices at one point down to $14 per barrel- only to be followed by an oil price 6 month long depression of a price at around $35-40 per barrel. And it is this historical juncture of 2014 that has since cast a shadow on the future of the UK oil and gas industry.

So it is 2014 we should use as the pivotal point where we see the immediate loss of 75,000 offshore and onshore support jobs, after which there is a marked decline in both employment and investment- as well as a weakening of world oil prices alongside a further expansion in marginal cost producers entering the market. By 2015 total N Sea related job losses were put at 185,000.

graphs for north sea

UKCS Report Sept 2019

The balance of offshore UKCS jobs is elsewhere in the Irish sea and West of Shetland.

The oil price recovery since mid-2014 has been patchy but generally upwards. Contract prices have on occasion held at around $100 per barrel, although more recently, $85 pb has tended to be the average price which has been sufficient to maintain global output at a growing over-capacity level. Once again OPEC has attempted to control over-capacity by throttling out-put in a bid to kill off the higher cost and marginal cost fields. In this endeavour, they have sought the cooperation from Russia- a joint venture that although unstable, was able to drive down prices from the $65 pb at which 2020 opened.

But 2020 opened with the signs of a global economic recession. And now the Covid-19 pandemic.

PRICE CRASH…AND GOING DOWN

2020 began with oil prices at around $65 per barrel- which for most N Sea production requiring a $40-50 as a ‘comfort zone’- looked set to ensure a good rate of return on the more ‘mature’ N Sea infrastructure. Output from the N Sea is divided into two grades; Brent and N Sea Light crude. The Brent grade due to its viscosity and chemical content characteristics is a ‘premium marker’ grade, which along with West Texas Intermediate (WTI) provides the benchmark prices by which world traded oil prices are measured.

By early February 2020 the international oil markets had come to realise that a forthcoming pandemic was about to hit an already faltering global economy- and this, combined with the OPEC-Russia oil price tussle- was about to have a massive impact on the future of whole sections of the oil industry- let alone immediate oil prices.

By mid-February N Sea oil and gas prices were ($ per barrel or unit):

Brent                         32.93

N Sea Light              25.76

Natural gas                1.484

Then by 17th March (at which NYMEX trading was suspended) prices were:

Brent                         28.02

N Sea Light              18.27

Gas                               1.7

And of 20th April:

Brent                         25.93

N Sea Light              15.05

Gas                               1.95

These prices are subject to speculative swings and as such give no certainty to which point the oil and gas prices will level out. But with world oil and petroleum products storage at about 98%, there is clearly little- if any room- left for further production above what is an already collapsing rate of consumption. And it is also clear that world prices for the foreseeable future are likely to remain well below the cost of N Sea production.

But by the morning of 21st April the Financial Times, in a departure from its usual austere and responsible mode, was in full panic flight with a front page screaming about how for the first time ever the commodity markets had turned negative. Overnight the price of premium grade crude oil had been trading at minus $40 dollars per barrel. And elsewhere analysts were suggesting a possible market intervention by producers and traders alike where for the foreseeable future oil has a traded ‘floor’ where a demand-led ‘swing’ of between $10-20 per barrel would be permitted.

However, such a ‘swing price’ would eliminate the higher cost producers such as the US shale sector, the Canadian tar sands, about 35% of OPEC members- and with certainty- the entire North Sea operation.  But in the first stage of the crisis many big drilling and appraisal contractors are already cutting back on their operations with some 40% of forward investment cut overnight and hundreds of workers sacked under force majeure terms with neither redundancy pay nor furloughing support.

If we look at the employment profile of Scottish workers engaged in N sea oil and gas we find around   110,100 overall in the direct production sector. And if we then factor in a c.£45,000 per capita annual income, this translates into £4.95 billion in total earnings of which some c.£3 billion constitutes disposable income into the regional economy per year.

If we look at recent job loss events in the Scottish economy (going back some 30 years) we find that losses in coal up to 2000 were 10,100 and steel (Ravenscraig) 14,000, pale by comparison to what could happen in oil and gas losses. By any measure the present situation represents a schism from which point the status quo is irrecoverable. The terminal collapse of UK oil and gas is now a possibility, which for Scotland would be an economic catastrophe.

Oil has no cover of long-term contracts. It is a Just-In-Time commodity which in the past has been robust enough to weather any market storms. But as Goldman Sachs have reported, the free market advocates of the US oil business have just issued an emergency appeal to the Federal Reserve for a $600 billion bail-out.[1] And at the same time Brent has been trading at a mere $21.54 with its sister marker grade, West Texas Intermediate at $14.85- and falling.

The International Energy Agency now reckons that over 1 million oil and gas jobs will go by the second quarter end of 2020.[2]And if it comes to screwing more effort and more oil out of the workforce- then forget it. Since April 2014 to January 2020 North Sea oil workers have contributed to a 16% increase in annual productivity from an offshore workforce cut of 38%. Furthermore, almost punitive working conditions of 17-hour shift on a 7-day week, with a three week onshore/offshore regime have been imposed- what some workers have suspected as being ideal conditions for the cultivation and transmission of the Covid-19 Coronavirus.

Silver lining

The confluence of the Covid-19 pandemic, a protracted global recession and a mounting antipathy to hydrocarbons in what is now widely perceived to be a growing climate crisis make any return to an oil and gas status quo inconceivable. And from this a North Sea high cost marginal offshore industry faces a bleak future. But the principal asset of that industry- its workforce could be easily redirected to a green economy urgently in need of a growing renewable infrastructure.

The North Sea workforce embraces a wide range of skills only found in the most modern production processes of construction, shipbuilding, aerospace and chemical engineering. This young workforce- average age 34 years- could easily be set to task in a new vertically integrated renewables industry where point of power production to plug via a publically owned and accountable energy company could provide Scotland with a secure, safe, secure and equitable future. For that, a Just Transition is crying out.

Brian Parkin 22nd April 2020.

Sources

 Goldman Sachs. Financial Times, 22nd April 2020

IEA. Energy trends April 2020.

Oilprice daily bulletin quoting Bloomberg, New York 20th April 2020.

Charles More Black Gold: Britain and Oil in the 20th century. Bloomsbury, London 2011.

Report back from the XR “Oil & Gas” Public Meeting

We recently published the Scot.E3 contribution to the XR “Oil & Gas” Public Meeting held in the Garnethill Multicultural Centre, Glasgow on Saturday January 25.  Thanks to Neil Rothnie for this much more comprehensive report.

Rather than try and summarise the individual contributions by invited speakers and the discussions from the work groups, I’ll try and give a sense of what I thought the meeting achieved. 

It was, it seemed to me, a success.  It was well attended.  Maybe 60 odd people? Men and women were fairly equally represented and there was a wide range of ages amongst those attending, though we were predominantly young.  The speakers were good, the meeting attentive and discussion lively. 

The success of the meeting owes much to the fact that it took place at the end of the month long Rig Rebellion 2 which, receiving considerable media attention, had brought the issue of fossil fuel production in UK into sharp focus. This meant that the struggle to end fossil fuel production on our patch was no longer just a theoretical question.  We are engaged.  This was reflected in the meeting.

A document laying out the basic premises on which the meeting was called had been circulated widely in the movement in Scotland. A “critique” of Rig Rebellion 2 presented by Andrew and a further document for discussion presented by Paul had been received by the facilitators and Paul was able to attend and speak to the documents during group discussion.  All three of these documents are appended.

The meeting was facilitated by Dario Kenner, active in XR Families in London who had travelled up with partner and two toddlers – an expression of seriousness if I ever did see one.  Dario is author of “Carbon Inequality: The role of the richest in climate change” (Routledge, 2019). He’s also co-author with Rupert Read of a memo to XR. I’ve appended it.  Dario’s presence, more than any argument, shouts that the struggle to decarbonise the economy, to take on the polluters, is a UK issue as part of a global issue.  Certainly not a Scottish issue. No more than XR Aberdeen can be expected to shoulder the burden of confronting Big Oil, XR Scotland do not have the resources to take on the UK’s major polluters and chief source of UK’s greenhouse gasses.  We are part of a movement that spans the whole of the UK. 

A very personal message from a rebel “allegedly” involved in the most ambitious of the Rig Rebellion 2 actions was delivered to the meeting. It placed central stage, the issue of civil disobedience and direct action against the polluters, and nailed, as central to the struggle for survival, the end of fossil fuel production.  Our speaker challenged the web of relationships in which oil and gas worker, rebels and the myriad other victims of climate change are caught up, in a toxic system built on misinformation, social conditioning, debt, powerlessness, privilege, excuses and ignorance.  Rig Rebellion 2 means that no longer is the discussion about the future of North Sea oil & gas to be solely the property of industry and Government.  The text will be appended if legal advice allows.

My ideas/comment on what the meeting achieved borrows heavily from the contributions of the two main speakers.  Ryan Morrison from Friends of the Earth Scotland talked us, at breakneck speed, through the FotE sponsored “Sea Change” report , and Pete Cannell from Scot E3 took the discussion on to how we respond to this crisis.  I’ve tried to reflect, as best I could,  what came out of the group discussion I was involved in, and/or had notes from.

The big lie at the centre of today’s, still restricted, public discussion about global warming and species extinction is laid out clearly in Sea Change as presented to the meeting by Ryan. We can’t avoid climate chaos without tackling global warming.  We can’t stay “well below” 2 degrees of warming without decarbonising the global economy.  That is, not without the planned rundown of the source of greenhouse gasses – fossil fuel production. (North Sea oil & gas on our patch).  And we can’t decarbonise the economy by following the “magic thinking” of industry and Government (Pete Cannell) who want business as usual and the maximum economic recovery of every barrel of oil & gas under the North Sea.  20 billion barrels more is the industry’s guesstimate. This gives us warning of what the industry plan is globally.

The issue of a “just transition” is central to the struggle to end fossil fuel production, and it’s not just about providing well paid jobs in renewables for workers who stand to lose well paid jobs in oil & gas, important as this is.  Just transition is seen very differently in the global south (Ryan) and when we get the chance to explore this when activists from throughout the global south descend on Glasgow for COP26 later this year, we can show no more solidarity than be seen to be fighting to end to fossil fuel production in the global north starting with on our own patch, the North Sea.

The meeting took the discussion forward from the understanding that the Sea Change report gives us.  Direct action is crucial in applying pressure on industry and Government and as Rig Rebellion 2 did, bringing the issue centre stage.  But it is not in itself enough if the mass of people only look on – scared.  The ideas of a just transition must become the common sense of society. (Pete)  But to do that the ideas need to be sharply defined, not just the easy ones like why the oil & gas needs to stay in the ground, but those that confront the smoke and mirrors employed by industry and Government to justify business as usual.  We need to understand carbon capture and storage (discussed by Ryan).  If, as widely suspected, it cannot be delivered at anything like the  scale required, then we need to be able to expose this with thoroughly researched materials and in a clear and concise fashion.

Multi billion pound taxpayer subsidies (our money) is handed to the industry by a Government whose ear they have.  The threat of job losses in oil & gas that the industry say would accompany the ending of such subsidies and the ludicrous industry claim that they are ready to deliver net zero as a part of the solution as they continue business as usual. (Ryan). Our answer is the massive expansion of renewables during (and financed by) the end to subsidies to the oil & gas, and the planned run down of the industry starting now.  This could leave us with a world class green energy industry to replace oil & gas.  Otherwise where would we be in 2050 if this ludicrous plan for “maximum economic recovery” is allowed to proceed.  Apart from fire fighting the results of another 30 years of full on fossil fuel greenhouse gas emissions, we’d still have a reliance on oil & gas from wherever, when the North Sea fields have been pumped dry.

The weakness in the regulatory regime that encourages the misuse of migrant labour who are paid a fraction of the UK minimum wage in the offshore renewables industry was noted. (Ryan)  A practice they no doubt learned from offshore oil decommissioning.  The Sea Change report puts trade union organisation at the centre of a just transition to renewables, though this, given the state of trade unionism on the North Sea, is problematic.

When we confront Big Oil in Dundee and Aberdeen as we have begun to do, who are we actually speaking to?  We challenge the industry’s vice grip on a media traditionally prepared to repeat any old nonsense that flows from oil company PR.  But we’re also speaking to wider society.  Those working in the industry might be the last people to be convinced, but they need to know that the energy transition is inevitable one way or another, and that their intervention will be crucial in determining whether it is to be fair to them or not.  They also need to know they do not have a veto.  All our grandchildren must have a future.

The discussion is impossible for me to record in any readable form.  I’m here setting down some of the ideas that emerged from the contributions of our speakers and from the workgroups I have notes from.  This is obviously not definitive and my be controversial.  It’s not the final say and can only at best provide a framework for further more concrete planning if, as I hope, an Oil & Gas Working Group can be set up to carry forward what the Rig Rebellions have started.

Although direct action can’t stop oil & gas production, it can identify Big Oil as the problem and can generate press interest and effectively open the issues to public scrutiny.  Maybe we can call our self Big Oil’s Big Nuisance.  That’s a joke!  But not for the industry who spend big keeping everyone “on message”.

Only as the role fossil fuels plays in generating greenhouse gasses and climate change becomes “common sense” in society (throughout the UK) can pressure be progressively brought to bear on Government and industry and finance to begin the mass expansion of renewable energy in sync with the rundown of oil & gas production.

The voice of even a small minority of oil & gas workers prepared to speak out on the issue of just transition and a future for their grandchildren would have a powerful effect and therefore outreach amongst this group is particularly important.  But whatever they want to say, the workforce must be encouraged to say it.  It is the workforce who will be forced to transition sooner or later, in a planned or a chaotic way.  They need to intervene if it is going to be anything like fair to them.  The last time there was an energy transition the coal miners and there families and communities, were shafted.

Amongst the citizens of Aberdeen, and amongst oil & gas workers, is where there is likely to be maximum pushback against these ideas, and has to be where we do our most serious listening. They will tell us where our arguments are weakest. Aberdeen also provides us with potential allies amongst those sections of the population who live amongst oil wealth and the high prices it generates, but who are living without oil wages.  Making common purpose with them in the Oil Capital of Europe will bring the spotlight on the iniquity of the system and the nature of Big Oil. The transition is inevitable.  But the industry, left to its own devices, will leave that city with little of value.  What it threatens to leave society with is mass extinction of species

Research into carbon capture and storage, and hydrogen production, pushed as solutions to global warming needs to be accessed and turned into outreach material. 

Imaginative materials allowing us to interact with citizens and oil & gas workers will be needed. 

Media penetration will be important.

Should it be decided that an Oil & Gas Working Group be established to take this discussion further and make concrete plans, I think one of it’s first tasks will be how it can penetrate XR UK Circles, and challenge them to take responsibility for encouraging the whole movement to see ending oil & gas production from the under North Sea, and a major upscaling of renewable energy production, as a major strategical aim for the movement. This will need the whole movement with all its skills and operating at its regenerative best.  UK’s greenhouse gas reserves/emissions are not a Scottish issue. XR UK must be challenged to encourage a movement wide campaign.

None of this is possible unless the necessity becomes “common sense”.  Outreach is fundamental.

This is the year of COP26 in Glasgow.  Let us show our solidarity with the activists from the Global South who come to Scotland.  Let them see our determination to end fossil fuel production in the UK.  We can organise transport and hospitality for Nigerian and other activists from around the world who may want to share our action and give their own message to Shell (and others) in Aberdeen, one of the the Oil Capitals of the Global North. 

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Image: Aberdeen Harbour  CC0 from Pixabay.com

Glasgow XR meeting on North Sea Oil and Gas

Following actions in Dundee (see video) and at First Ministers Questions Glasgow XR held a well attended meeting on the 25th January.   The meeting began with contributions from XR activists, Friends of the Earth Scotland and ScotE3, before breaking into discussion groups.  The remainder of the post reproduces the text of the ScotE3  contribution in which we shared some thoughts on strategies for achieving a just transition to a zero carbon economy.

ScotE3 campaigns for the importance of climate jobs.  Jobs that are critical to the economic transformation that is needed to prevent a climate catastrophe.   In Scotland  100,000 of these jobs are needed .  However, to date we are not doing well.  According to the Office of National Statistics the UK’s green economy has shrunk since 2014.  The number of people employed has declined as has the number of green businesses.  This is true UK wide and in Scotland.  It’s no wonder that some representatives of unions that organise workers in the hydrocarbon sector pour scorn on talk of a just transition.

The Sea Change report makes it clear that unless we phase out North Sea Oil and Gas the UK will produce far more green house gas emissions than is compatible with restricting global temperature rise to 1.5 degrees.  But we have a huge challenge; the big energy companies are still committed to maximising extraction of oil and gas and so are the Holyrood and Westminster governments.  Just a year ago when the discovery of new oil and gas reserves east of Aberdeen was announced energy Minister Paul Wheelhouse highlighted,

 the significant potential for oil and gas which still exists beneath Scotland’s waters.

He added:

Scotland’s offshore oil and gas industry has an important role to play with up to 20 billion barrels of oil equivalent remaining under the North Sea and in the wider basin and discoveries such as this help to support security of supply as we make the transition to a low carbon energy system.

 Just this week the Africa summit in London ended with the Westminster Government pledging £2 billion to projects concerned with fossil fuel extraction.

From the outset North Sea has been a bonanza for the oil companies.  Nigel Lawson, now a prominent climate change denier, was Chancellor of the Exchequer in 1986 and said then

the whole outstanding success of the North Sea is based on the fact that it is the freest petroleum province in the world

He meant of course almost complete freedom for the oil companies – few if any benefits accrued to society as a whole and even centres of the industry like Aberdeen were then, and remain, centres of acute inequality.

So we need a rapid phasing out of North sea Oil and Gas.   How can we overcome the powerful vested interests that oppose this and at the same time protect the lives and livelihoods of the workers in the industry.  Theer is no evidence that the private sector can lead such a transition.  The public sector has to take the initiative – and in Scotland that means a much more ambitious role for a state energy company and the new national investment bank.  However, for this to happen we need a powerful movement of movements that has deep roots throughout Scotland.

To grow the movement and force the pace of change clarity of ideas is essential.   We don’t have all the answers but the core issues around climate jobs and just transition are clear.  So we need to patiently and persistently explain why hydrocarbons need to stay in the ground, why we need zero carbon, why the counter proposals from the industry are a dangerous diversion and how a just transition would have a positive impact on working people.

Reaching the audience we need goes hand in hand with maximising pressure on the energy corporations and local and national government.  Much of this will be through all kinds of direct action.  There have been some brilliant examples already but we need much more.

Direct action is necessary but not enough.  The power to force a transition can only come from a mass movement and to build the movement we need to win hearts and minds.  This means reaching out into unions, communities and community organisations with a vision of just transition that goes beyond simply defending existing jobs and embraces practical steps that have direct and understandable benefits for working class people across Scotland and beyond.   We need win people to a positive vision of transition, but more than that we need to win them to be active agents in the transition: part of a movement of rebels, not just on the streets, but in workplaces and communities.  So as we plan actions we always need to think about how to reach new audiences – through stalls, street leafleting, public and workplace meetings and patient door to door leafleting debate and discussion.  It may be that some of those who work in the industry will be the last to be convinced (although that’s not inevitable – our opponents are the same corporations that drive down their wages and conditions and play fast and loose with health and safety).  But if they are unconvinced we need to aim for a situation where climate justice is common sense to millions and where the people that oil workers meet in the pub, out shopping, their kids and relatives, are all won to the need for transition.

With the COP being held in Glasgow this year we have a huge opportunity to build outwards and take a massive step forward in creating a campaign for transition that is unstoppable.

North_Sea_Oil_Rig_(7573694644)

North Sea Oil Rig by Gary Bembridge, CC BY SA 2.0

Update on the November conference

We are really pleased that Simon Pirani will be speaking at the Scot.E3 conference on 16th November.  Simon is the author of ‘Burning Up: A Global History of Fossil Fuel Consumption’ (Pluto, 2018).  Here’s a video of him speaking about the book:

 

Stopping Oil and Gas Part 3

Daisy Jamieson was the third contributor to Scot.E3’s Glasgow public meeting on stopping North Sea oil and gas. In her talk Daisy reflected on the importance of just transition.  Part 1 of the public meeting can be viewed here and part 2 here.

Stopping Oil and Gas Part 2

The second contributor to the discussion at the Glasgow Scot.E3 meeting on phasing out North Sea Oil and Gas was Mike Downham on behalf of Scot.E3.  You can watch the video or read the text of Mike’s talk below.  (See the first contribution from Ryan Morrison here).

STOPPING NORTH SEA OIL AND GAS EXTRACTION   24.9.19

Thank you, Ryan, for giving us such a clear explanation of the Sea Change report. If some of you haven’t had a chance to read the report, I recommend that you do. It’s quite something. Not only is this new research a vital contribution to the Climate Crisis, but the report is unusually well-argued, well-written and well-illustrated. What’s more, it offers the reader three choices within the same download – a half-page outline, a seven-page summary, and a 62-page full version.

Fundamentally the report says four things:

  1. The quantity of oil and gas still available in the North Sea is huge, and to go on with the current Government and industry policy of extracting it indefinitely will lead to disaster levels of global warming.
  2. Shifting Scotland’s energy strategy to renewables is not only feasible but would create more than three times the number of current jobs in North Sea extraction.
  3. Here’s a roadmap of how to make this change, starting now.
  4. If we don’t start along that road now, escalating climate change will soon force governments to shut down extraction suddenly, with dire consequences for the 40,000 North Sea workers and their communities.

We chose the first word of the title of tonight’s meeting because ‘Stopping’ has two meanings. It can mean beginning to stop doing something, and Sea Change tells us exactly why and how this has to be done in the North Sea. But it can also mean stopping someone else from doing something. In the case of stopping North Sea oil and gas extraction the someone else we have to stop is the extraction corporations. These are giants – giants in terms of financial turnover, and in terms of profit. And because of the huge profitability they can see ahead, as reserves of oil and gas run down and demand gets stronger, they are literally hell-bent to get ahead of their competitors and extract every last drop.

These are the people we have to overcome. And we have no choice except to overcome them because they are responsible for a large proportion of the world’s carbon emissions. What they extract inevitably gets burned. ExxonMobil for example, just one of the giants, is responsible for carbon emissions equivalent to those produced by the whole of Germany.  (And, as an aside, to park for another meeting, these are one and the same people as those driving the case for the jargon-wrapped Bio-Energy-with-Carbon-Capture-and-Storage idea, which is nothing more than a huge scam and primarily an excuse to carry on extracting fossil fuels.)

It’s critical I think that we understand exactly what we’re up against. In a market economy based on the assumption that economic growth can continue indefinitely, money is power. Power flows from money in many ways, but the biggest of these is the stranglehold big companies have over national governments. All governments need capital for investment and economic development. When capital is privately owned, and once capital controls had been removed, as they were first in the US in 1974, then in the UK in 1979, and across the rest of Europe and Japan in the 80s, there has been nothing to stop companies moving out of one country into another where labour is cheaper, for example, or government subsidies bigger, or environmental regulation weaker. Large companies have been given the power to sanction government policy. No government can dare to challenge them for fear that they’ll take their money out of the country.

ScotE3 recognises the scale of the challenge to stop extraction, at the same time seeing it as an absolute necessity if we’re to limit global warming to a 1.5 degree rise. We see ourselves as a component of a movement which focusses on social justice and working class action, and we have a special interest in a just and rapid transition from North Sea oil and gas to renewables as Scotland’s exclusive source of energy. We gather and share information, hold public meetings and conferences, and support climate protests and campaigns wherever they emerge, most recently the student strikers and their worker and trade union supporters, Extinction Rebellion, Fife Ready for Renewal, and Friends of the Earth Scotland. You can see all this, as well as a draft manifesto, on the ScotE3 website – there should be a card on your seat giving the website address. Have a look if you can at the blog, and at some of the Briefings – for example Briefing 7 on fuel poverty in Scotland. If you’d like to join the ScotE3 mailing list, we’ll pass a sheet round later.

Interest in ScotE3’s contribution to the movement is growing fast this year, judging by numbers attending meetings and supporting protests, and by website hits. But for the movement to be able to stand up to and defeat the extraction corporations, it has to become very large – a mass movement across Scotland – and it has to be fronted by all those workers who are at risk of losing their North Sea jobs, standing in solidarity with the even larger number of workers who have already been pushed to the bottom of society with jobs that are underpaid, insecure and monotonous, and who struggle on a daily basis to keep their families housed, fed and warm. The power of this mass of workers lies in their ability to withdraw their labour and to bring Scotland’s economy to a stop. This power is even greater than the power of the extraction corporations. The giants can’t be stopped by appeals to reason and morality. Reason and morality have long-since ceased to have any part in their thinking. They can’t be stopped by the heroism of a small number of people – the truly heroic Greta Thunberg has always made this point. They can only be stopped by a vey large number of workers who are prepared to withdraw their labour. In the face of that, the corporations are powerless. And as we witnessed on Friday, when the school strikers mobilised an estimated four million people, the global mass movement, now crucially involving workers and unions, is growing fast.

How much can we expect from governments? This has always been a key question for movements aiming to bring about radical change, and it’s a key question now for the climate movement. Even governments seen at the time as left-wing have failed large movements in the past, most notoriously in Germany, when in 1914 the Social Democratic Government, despite massive popular protest, compromised and failed to take its opportunity to prevent the first world war. And the story of Allende’s government in Chile in1973 carries much the same general message. But could this Scottish Government be different? Could it come behind the things the Sea Change report recommends it should do? And could that Government act quickly enough in the context of the climate emergency?

On the same day the UK Prime Minister announced that parliament would be prorogued, it wasn’t much noticed that the Scottish Greens announced their radical proposals for a Green New Deal. They gave this summary of their proposals:

Scotland can

  • Redirect massive investment into low carbon industries
  • Grow a world-leading low carbon manufacturing sector
  • Restore our natural environment
  • Give everyone a warm home
  • And provide access to cheap, reliable and green transport.

But to do this we have to ditch neoliberal economics for good.

At the heart of a Scottish Green New Deal is a belief that the Scottish Government can and must take a direct role, working in partnership with citizens, communities, and companies to deliver the change Scotland and the planet so urgently needs

It would be nice to think that tomorrow, when the Scottish Parliament debates the final version of the Climate Bill, it will take notice of the Greens’ recommendations, take notice of the Sea Change report, and insert into the Bill a commitment to phase out North Sea oil and gas extraction, to do that rapidly and to start now.

But it’s highly unlikely the Government will do any such thing tomorrow, and highly likely that we’ll be left looking at a weak and ambiguous Bill based on long-term targets. Governments like long-term targets – they can get away with missing them.

There are three reasons that the Scottish Government is unlikely to commit to rapid phase-out of North Sea extraction. First, remember that business, particularly large business like the oil and gas extraction corporations, has a stranglehold on governments. If the Scottish Government committed to phasing out North Sea extraction quickly, the corporations would immediately withdraw their support for the Government and for the SNP – support which the Government can’t do without. The second reason, a reflexion of the first, is that the SNP remains committed to continuing economic growth, as made clear by their so-called Sustainable Growth Commission. The third reason is that only the UK Government has the power to stop North Sea extraction, because it issues the licenses for exploration and the permits for extraction. And it would be about as sound a bet as you could make that this UK Government won’t stop issuing the licences and permits in the foreseeable future.

So what are we to do? The Sea Change report is clear about this when it says: “We need a new approach to economic development, industrial policy and ownership, which emphasises local democracy and workforce participation.” Exactly. But I submit that we need also to get real and realise that we aren’t going to get this radical approach from the Scottish Government, nor the UK Government, nor from any government across the globe by reasoning with them, appealing to their morality, or being polite. After all, how long have governments been meeting at international COPS to reach agreement about actions against global warming, and what impact have those meetings had so far? The answers are 27 years and none. In fact, global carbon emissions have risen by an eyewatering 60% since those meetings began, and are still rising.

Does this mean we should turn our backs on the Scottish Government at this point? I suggest not. History shows us that making specific and feasible demands on governments, even if they take no notice, is a good strategy for growing the mass movement to the point where it realises it has to take power into its own hands. In Scotland at this particular point I suggest we could make three demands on the Government, if their Climate Bill turns out this week to be as inadequate as we expect. These demands are firmly based on the climate movement’s in-depth work over recent years. As well as being focussed and feasible, they directly address the current most desperate issues for millions of working people – fuel poverty, poverty in general, and jobs which are badly paid, insecure and unsatisfying.

We can demand:

  1. A just transition from North Sea oil and gas to renewable energy, starting immediately with the phasing out of North Sea oil and gas extraction, as recommended in the Sea Change report co-authored by Friends of the Earth Scotland, Oil Change International and Platform (2019).
  2. An immediate programme for the insulation and draught-proofing of all homes, public buildings and businesses, as recommended in the One Million Climate Jobs booklet produced by the Campaign Against Climate Change (2014).
  3. An immediate nationwide Free Public Transport system, as described and argued for by the Scottish Socialist Party since 2007, and now by the Scottish Greens (2019)

We will make it clear to the Scottish Government that we won’t take no for an answer, confident in the new-found strength and breadth of the global movement for democracy, as more and more people, after 40 miserable neoliberal years, seek to break with the Economy of Madness and with the Politics of Division. That movement has been boosted today by the UK Supreme Court ruling.

I want to end by arguing that Scotland has exceptional opportunities to make an immediate and significant contribution to the global climate crisis.

Scotland’s exceptional opportunities are technical, geographical and political.

Technically, the skills of North Sea extraction workers are largely those needed for the expansion and further development of renewables, and in the work to make all buildings across Scotland more energy efficient. The Sea Change report is strong on this point, providing a lot of new detail, effectively illustrated with diagrams, about how the various skills of North Sea workers overlap with the new skills needed. The report estimates that there is a significant skills-overlap for at least 68% of North Sea workers, probably more. This isn’t only about just transition for existing workers and their communities. The skills and experience of these workers are vitally necessary for rapid transition. If we had to recruit and train a whole new generation of workers, we’d miss the only window of opportunity to reduce emissions in time to limit global warming to a 1.5 degree rise.

Geographically, Scotland’s opportunities are huge. Its long, windy coastline, large tides, strong currents, Atlantic rollers and mountains favour between them off-shore wind, tidal, wave and hydro development.

Politically, Scotland has several characteristics which make radical change more possible. It’s a small country. It has an independence movement with a long history. And it has a very long history of protest against its exploitative southern neighbour – going back 800 years, from William Wallace to Robert the Bruce, to the Jacobite rising, to resisters of the Highland Clearances for agrarian capitalists, to the Clydeside Rising against grinding poverty under the heel of industrial capitalism in 1919 – a centenary celebrated vigorously this year by thousands. Under the heel of neoliberalism protest, especially strike, has been made more difficult, but how much longer will the people of Scotland put up with the dismissive disrespect of this UK Government?

You may be thinking that Scotland on its own can hardly have much impact on global emissions, and of course you’d be right. But another exceptional thing about Scotland is that internationalism is embedded in its culture. This goes back a long way too, but you only have to look at the EU referendum result to see that internationalism is still alive and well in Scotland. It can no longer be denied that Scotland has scandalously racist elements. But one of the most frequently brandished placards by the School Climate Strikers on Saturday in both Glasgow and Edinburgh proclaimed “Climate Refugees Are Welcome”. And last year Green MSP Ross Greer made a well-argued pitch for devolution of immigration and asylum powers, received well in Scotland, but not of course in Westminster.

In the context of its international reputation and relationships, if Scotland can stop North Sea oil and gas extraction, it could have a significant influence on governments and anti-fossil-fuel movements across the world as an example of what can be done

The 20th century Gallic poet Sorley MacLean predicted that Scotland would eventually rise in response to its centuries of oppression. In his poem The Cuillin, written in 1943, but not widely available in translation until the 70’s, he says:

Beyond the lochs

of the blood of the children

of men

Beyond the frailty of the plain

and the labour of the mountain

Beyond poverty,

consumption, fever, agony

Beyond hardship, wrong

tyranny, distress

Beyond misery, despair,

hatred, treachery

Beyond guilt and

defilement

Watchful, heroic,

the Cuillin is seen

rising on the other side of 

sorrow

Sorley MacLean’s life spanned most of the 20th century. In that century, we learned many things about how to change human society and about how not to change it. The biggest thing we learned was that only a mass democratic movement is capable of forcing radical change, and that because of their numbers, their ability to withdraw their labour collectively, and their commitment driven by daily hardship, the organised working-class majority plays the decisive role. With 540,000 members the Scottish Trade Unions Congress has embarked on work to chart a route to a carbon-free society while advancing workers’ interests. Can the Scottish TUC act as a meeting point for the forces of workers, students, greens, socialists and the Extinction Rebellion?

As we all know we have no time to lose. Naomi Klein gave a new twist to the urgency in her recent book On Fire. She says: “It just so happens that we are all alive at the last possible moment when changing course can mean saving lives on a truly unimaginable scale.”