Alaska OCS Socioeconomic Studies Program

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Continental Shelf a Office Socioeconomic Impacts of Selected Foreign OCS Developments & The United States Department of the Interior was designated by the Outer Continental Shelf (OCS) Lands Act of 1953 to carry out the majority of the Act’s provisions for administering the mineral leasing and development of offshore areas of the United States under federal jurisdiction. Within the Department, the Bureau of Land Management (BLM) has the responsibility to meet requirements of the National Environmental Policy ~ Act of 1969 (NEPA) as well as other legislation and regulations dealing with the effects of offshore development. In Alaska, unique cultural differences and climatic conditions create a need for developing additional socioeconomic and environmental information to improve OCS decision making at all governmental levels. In fulfillment of its federal responsi- ~1 bilities and with an awareness of these additional information needs, the BLM has initiated several investigative programs, one of which is e ‘c the Alaska OCS Socioeconomic Studies Program. !: The Alaska OCS Socioeconomic Studies Program is a multi-year research effort which attempts to predict and evaluate the effects of Alaska OCS ..- Petroleum Development upon the physical, social , and economic environments -3 within the state. The analysis addresses the differing effects among . J various geographic units: the State of Alaska as a whole, the several regions within which oil and gas development is likely to take place, and within these regions, the various communities. ! The overall research method is multidisciplinary in nature and is based e“.-. on the preparation of three research components. In the first research component, the internal nature, structure, and essential processes of i these various geographic units and interactions among them are documented. \ In the second research component , alternative sets of assumptions regarding L [ the location, nature, and timing of future OCS petroleum development ~ events and related activities are prepared. In the third research com- $2; ponent, future oil and gas development events are translated into quantities and forces acting on the various geographic units. The predicted con- sequences of these events are evaluated in relation to present goals, values, and expectations. In general, program products are sequentially arranged in accordance with BLM’s proposed OCS lease sale schedule, so that information is i timely to decision making. In addition to making reports available through the National Technical Information Service, the BLM is providing an information service through the Alaska OCS Office. Inquiries for information should be directed to: Program Coordinator (COAR), Socio- economic Studies Program, Alaska OCS Office, P. 0. Box 1159, Anchorage, Alaska 99510. ,. II i Final Technical Report Contract No: AA550-CT6-61 Alaska OCS Socioeconomic Studies Program SOCIOECONOMIC IMPACT OF SELECTED FOREIGN OCS DEVELOPMENTS Prepared For Bureau of Land Management Alaska Outer Continental Shelf Office April 30, 1979 III NOTICE This document is disseminated under the sponsorship of the U.S. Department of the Interior, Bureau of Land Management, Alaska Outer Continental Shelf Office in the interest of information exchange. The United States Government assumes no liability for its content or use thereof. Alaska OCS Socioeconomic Studies Program Socioeconomic Impacts of Selected Foreign OCS Development Prepared by Habitat North, Inc. April 1979 Iv ACKNOWLEDGEMENTS Several people have been especially helpful in locating or discussing material contained in this report. They all gave freely of their time and knowledge and are to be thanked accordingly: ) Mel Burrell, Lothian Regional Council, Edinburgh Stewart Fulton, Scottish Development Department, Edinburgh Tony Mackay, University of Aberdeen Angus Scott, The Planning Exchange, Glasgow David Steel, White Fish Authority, Edinburgh Robert Turnbull, Scottish Development Department, Edinburgh Mary Collins, Mary Collins Consultants, Calgary Nellie Cournoyea, COPE, Inuvik Terry Foster, Government of the Northwest Territor” es, Yellowkn-fe Special thanks are due to Terrie Gekler for service in cryptography and typing beyond the call of duty. TABLE OF CONTENTS LIST OF MAPS IX PART ONE: NORTH SEA XI CAPSULE HISTORY XIII INTRODUCTION AND SYNTHESIS 1 I. ECONOMIC AND SOCIAL ISSUES General .1 Localized Benefits ;; .2 Economic Forecasts 39 .3 Economic Expansion 45 .4 Local Business Impact 53 .5 Employment Shifts 59 .6 Employment Forecasting 65 .7 Migration .8 Social Analysis z Perceptions of Change 87 .i; Temporary Workforces 95 .11 Rundown 101 ) 11. ADMINISTRATIVE AND POLITICAL ISSUES General 105 .1 Local Government and Planning 109 .2 Planning Inquiries 120 .3 Local Variations 129 .4 Coastal Guidelines 137 .5 Petrochemical Activities 143 .6 Approvals vs. Demands 149 .7 Housing Planning 153 .8 Infrastructure Planning 159 .9 Local Fiscal Planning 165 .10 National Political Change 169 .11 Shetland Politics 177 .12 Shetland Legal Powers 185 .13 Government Participation 193 III. OIL AND FISHING General 197 .1 Fishing Employment 201 .2 Access and Debris 207 .3 Coastal Competition 213 .4 Perceptions of Conflict 219 NORTH SEA BIBLIOGRAPHY 223 VII PART TWO: CANADIAN BEAUFORT IV. CANADIAN BEAUFORT EXPERIENCE General 267 .1 Wage Economy 275 .2 Environmental/Social Conflict 281 .3 Socioeconomic Monitoring 287 .4 Social Impact 293 CANADIAN BEAUFORT BIBLIOGRAPHY 303 APPENDIX: LIST OF ABBREVIATIONS 313 VIII LIST OF MAPS i. World Context x 1.1.1 Scotland (Mainland) 25 1.1.2 Scotland (North) 26 1.1.3 Oil Activities 27 IV.1 Canadian Beaufort 274 Ix Map i World Context x PART ONE NORTH SEA EXPERIENCE XI CAPSULE HISTORY Major natural gas d scoveres in the southern North Sea in the mid-1960s led to initial development of the offshore energy industry in the United Kingdom. These fields, located in British and Dutch portions of the area (see Map 1.1.3, page 27) have been producing gas for over ten years. Exploration for oil and gas reserves in the northern North Sea progressed from the late 1960s into the 1970s. The first major discovery was in the Ekofisk field in Norwegian waters, followed by British Petro~eum’s discovery of the large Forties field in Scottish waters at Latitude 58° N in October 1970. Since then, a continuous pattern of new field discoveries has occurred, with deposits clustered along the U.K.-Norway median line and especially in the so-called “East Shetland Basin” at Latitude 61° N. Exploration activities have been undertaken all around the Scottish coast, and major new fields have been discovered in the inner Moray Firth and in the “West Shetland Basin” in the north Atlantic Ocean. Exploration is now contemplated in Scottish and Norwegian waters north of Latitude 62° N, and in further tracts in the north Atlantic. A number of fields have been developed, the majority using steel jacket platforms for production phases. The fabrication of these paltforms has taken place in several locations on the British mainland. In deeper waters (up to 200m/650 ft ) concrete gravity platforms have been uti 1 ized. These have also been fabricated in Scotland as well as Norway. Oil reserves are brought ashore by five submarine pipeline systems; two additional systems presently bring associated natural gas ashore, and more gas lines are under XIII development. In some cases oil is transferred directly to tankers at sea by means of buoy moorages. Servicing of North Sea fields has been undertaken from a number of Scot- tish locations; in particular from Aberdeen, Montrose, Peterhead and Dundee on the Scottish east coast. Other service bases have been established in the Shetland islands, and on a temporary basis from the Orkney islands. Separation and drying facilities have been constructed at pipeline landfalls on the Scottish mainland (at St. Fergus and Cruden Bay on the Grampian coast) and at Flotta in the Orkney islands and Sullom Voe in the Shetland islands. Major expansion has occurred at the principal Scottish refining and petrochemical complex at Grangemouth; overland pipelines have been constructed from northern landfalls to this and other locations. Trans- shipment of crude oil from Orkney and Shetland to British, European, and North American destinations has occurred. New refining and processing complexes have been planned in a number of locations in Britain. As further exploration is continuing, no estimate of ceiling reserves for North Sea fields can be made with great reliability. The lifespan of reserves discovered thus far is generally regarded to extend beyond the turn of the century. Manufacturing in Scotland associated with development-phase activities will probably keep pace with new discoveries, though not at the rapid pace experienced in the early 1970s. XIV 9 The principal impacts on Scotland

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