Is Scotland a country of the Arctic?

1‘Scotland is a nation of the north; it is a Nordic Scotland, it is a country of the Arctic’ argues Graham Hogg from our friends at Lateral North. Here he explores the old adage that Edinburgh isn’t the Athens of the North, but the Reykjavik of the South.

Lateral North recently attended the Arctic Circle in Reykjavik. Into its second year it brings together over 1000 delegates at the Harpa Conference Centre for discussions on the future of the Arctic. Speakers in its first year included Ban Ki Moon and Hillary Clinton, while this year was to be headlined by the President of Iceland and Angela Merkel.

Lateral North proposes that Scotland should begin to look to the north for new resources and industries and documented this as part of their book An Atlas of Productivity. Here they splice together their ideas along with their experience of the conference in Iceland.

2aIs Scotland a country of the Arctic? That is the question that our Atlas of Productivity asked when we launched it back in May, and that is exactly why we were in Reykjavik. We wanted to know how Scotland was represented within the Arctic and so we took a trip to only the second Arctic Circle conference.

When we launched our Atlas it investigated Scotland’s relationship with the Nordic and Arctic regions. Through our research it became quite apparent that we were a country of the north, a Nordic Scotland, yet it was not being reflected by our ambitions within these regions.

We are, arguably, the closest neighbour of the Arctic. It was something which was repeated throughout the British delegations presentation at the Arctic Circle. However, we (including the British delegation there) are not pursuing key opportunities that are being afforded to us by the opening up of this emerging economic region. Most people will know that the Arctic holds a wealth of oil, gas and minerals that key Arctic nations such as Canada, Russia, Denmark, Norway and USA are scrambling over ownership of (Denmark has in fact just made its biggest claim yet – it owns the North Pole).

What most people will not know though is that Arctic sea ice is receding to such an extent that shipping routes are opening up throughout the region, tourists are going in their droves to look at the polar bears and glaciers, and Russia is currently building 14 search and rescue bases along their northern coast in anticipation of this increased activity.

‘Increased Activity’ is indeed the phrase that we would use at the minimal.

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5If we take shipping as an example there has been a huge increase in activity alone. In 2010 a mere 4 ships requested permission (because Russia, of course, charges a fee to go through ‘international waters’ close to their borders), yet in 2013, a mere 3 years later, that number had skyrocketed to 204 ships requesting permission.

Why is this important to Scotland though? Well, to quote the British delegation we are the ‘closest neighbour of the Arctic’. We are the first significant land fall within northern Europe when coming from the Arctic. We like not to think of ourselves as a periphery of northern Europe but instead we are the gateway.

6-450x300Harnessing this increased shipping opportunity can be done in a number of ways but the most obvious is through the creation of a container terminal to capture increased trade between the east and the west. Before embarking on how this is possible though, we must first understand how shipping works within Europe.

Unlike South East Asia where all of the large cargo ships go to Singapore before cargo is distributed on smaller ships throughout the region, ships coming to Europe visit each location (Antwerp/Rotterdam/Hamburg for example) regardless of size. Herein lies our opportunity.

20130510 Scotland copyBeing the closest neighbour of the Arctic, Orkney could very easily become one of the largest container terminals in northern Europe and adopt the hub and spoke system that is prevalent throughout other parts of the world (see Singapore example above). Siting a container terminal within Orkney would mean that the container terminal would not only take advantage of arctic shipping but also has the opportunities of taking cargo in from across the Atlantic and for the already established shipping routes up the west coast of France heading up the west coast of Ireland and Scotland to feed into this container terminal – this could have added advantages as it ensures that the English channel would not be as congested as it normally is.

Such an industrial development would obviously affect the local community so we must first consider how Orkney is affected. We looked in detail at this in our project called Possible Orkney. A loop could be created around Scapa Flow where the ships would anchor while waiting to dock at the container terminal that sits at the gateway to the flow. This loop would carry along it, people, water, waste, energy, cargo, food and tourists ensuring that the archipelago takes advantage of this new infrastructure.

Going back to the big picture though, I hear you ask one question: why would ships decide to come through the Arctic rather than go through the traditional Suez canal route? The reason is quite simple – on average the journey is 40% quicker. If you go from Japan to northern Europe you are shaving off somewhere in the region of 60% from the journey. In the big money business of international shipping that is 40% less fuel, 40% less costs. It is a no brainer.

8-503x300It is such a big opportunity that others are already forming their stance on it. Norway (Narvik), Iceland (Finnafjord) and most recently the Faroes have all investigated the possibility of hosting a large container terminal to take advantage of these changing patterns of international shipping. Scotland, you have been warned, do not miss this boat!

However, as mentioned before, there are so many other fantastic opportunities that are being afforded to Scotland by the increased activity within the Arctic.

Could Shetland become a key search and rescue base for northern Europe. The precedent is there at the moment with Russia building 14 search and rescue bases along its northern coast.

9-424x300Scientific research is something which popped up throughout the British delegations presentation and this is of course another Arctic industry that Scotland could be involved with. However, throughout the Arctic region universities already run student exchange schemes to share and educate each other. University of Highlands and Islands and Aberdeen University are on this program and something we should continue to develop further as we learn more and more about the region.

While at the conference there was a French delegation (they weren’t the furthest-from-the-arctic-delegation!) who used their time not to market their country and its possible involvement within the Arctic, but instead advertise a French company that takes cruise ships up to the Arctic throughout the summer. Scotland sits on the route between France/northern Europe and the Arctic so there is clear opportunities to bring this maritime industry to our coasts en route to the Arctic.

10-424x300Our experience within oil extraction could play an obvious advantage, but we should begin to move away from oil and focus (like Scotland should itself) on renewable technologies. Scotland has a huge renewable industry and we should be looking to how we can take our skill set to our northern neighbours. In Orkney again we have the European Marine Energy Centre. In Shetland we have Viking Energy, an inspiring onshore wind farm. Many other community schemes throughout the country can be used as key precedents for Arctic communities – we need only look to September 2015 to see that there is an Arctic Energy Summit in Alaska that Scotland should be represented at. We are going as Lateral North, but why don’t we take a delegation to create international relationships and involve ourselves within this northern region.

11-450x300The Arctic Circle also repeats again in Reykjavik in October 2015 and we’d hope to build on some of the many connections already made while there this year. Only in its second year the conference is still finding its feet, but there were some fantastic presentations from organisations such as Polarisk (http://www.polarisk-group.com/) and Arctic Futures (http://arcticfutures.com/ ) that added a different dynamic to the conference – more of that is needed.

12-450x300We believe that there is a massive amount of opportunities within the Arctic for Scotland. A lot of our ideas are big and bold, but is that not what the Scotland of the present is? It is big and bold. We are asking the question of who we are and what we want to be. Our identity is being questioned and now is the opportunity for us to throw in our tuppence.

13-450x300Scotland is a nation of the north; it is a Nordic Scotland, it is a country of the Arctic. We should no longer be thinking of ourselves as a country on the periphery of northern Europe, but instead a gateway to it. We challenge you and our government to join us in October 2015 in Reykjavik for the third Arctic Circle – let’s take a Scottish delegation. Let’s show what Scotland can contribute to this economically emerging region. Let’s take advantage of New Northern Frontiers.

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Categories: Commentary

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24 replies

  1. I say yes – we have many cultural ties and a connection with the Nordic countries. Let’s take Ireland with us. This is our future direction, not tying with the US.

  2. Graham: no denying Scotland as Arctic, but the models of continual economic growth from shipping (a further aid to global warming) whether of goods or tourists seems to me increasingly peripheral. Maybe we could look towards modelling 21st century, greener, lateral ideas for the Arctic. Think really fresh? Maybe even look to smaller, indigenous populations for inspiration: Sami, Inuit?

  3. I don’t see the Viking wind farm as inspiring, the whole idea of it is complete madness, the cost of the sub sea cables to get the electricity to the mainland is enormous, then you have to transport that electricity to the central belt and England. I think when future generations assess the efforts we made to tackle climate change the will shake their heads, wasting money on such schemes will be demmed as extreme folly. Of course renewables could and should be used to make islands like Shetland and Orkney carbon neutral, but by using such remote locations to supply mainland Uk is complete madness.

  4. good blue sky thinking here. Interesting stuff.

  5. Okay I’m sold.
    When do we start?

  6. It is a matter of historic fact that the Shetland and Orkney Isles, Caithness and Sutherland, Western Isles were part of the Norwegian Kingdom and The Maid Of Norway was betrothed to the King of Scots, but she was tragically lost in a storm at sea. Many of our place names are of Norse origin.

    • The Norwegian kingdom had a weak hold on these regions. Politically they were more or less autonomous.

    • And before that were part of the Pictish Kingdoms. Insse Catt and Insse Ork. 10-15% of our place names are of Celtic origin, as Dr Jacobsen found.

      Find me a broch in Norway and I will sit corrected.

    • She wasn’t betrothed to the King of Scots. She was the heir to the throne (at three years of age) after the sudden death of Alexander III. She died en route to Scotland from Norway, whcih eventually led to Edward I of England’s attempted takeover of Scotland and the First War of Independence (Wallace, Bruce, etc.).

  7. The shrinking of arctic sea ice that makes possible these exciting opportunities is one of the most worrying symptoms of climate change. It’s interesting to read an article like this emphasising the positive, but I find the situation very alarming. If we are to avoid overheating our planet all that arctic oil and gas needs to be left where it is. And while it’s good that ships would use less oil per trip, having 25% of worldwide cargo carried through arctic waters probably means death to one of the world’s few unspoilt environments.

  8. Scotland is far from being a ‘Nordic Country’. We would have to be predominantly ‘Nords’ for a start. Nobody could argue that we are not an Arctic Country. It was Scots that discovered there was no North West Passage and charted the Magnetic North Pole.

  9. I thought an affordable paperback edition of the atlas was in preparation – is it published yet? If not, any info on when we can expect to see it?

  10. The container terminal in Orkney was studied/proposed by Prof. Baird/Napier Univ for the ex naval base at Lyness on Hoy. The operator of the Malta transhipment hub (Mariner Invest) was willing to take a lease on the site and develop the terminal there. But the Orkney Council and HIE screwed things up by investing in and making the ex naval base a terminal for wave energy – for Pelamis which has just gone bust.

    Scotland’s public sector (OIC and HIE) is the main problem – they are totally inept.

    • @Darien – your comment is so completely wrong that I do not know where to start.However here we go:-

      Firstly Alf Baird was employed by HIE in 2000, with the support of OIC, to develop the concept of the transhipment terminal. The public agencies then built a consultancy team around Alf, which undertook the environmental, planning, and consenting process that allowed a business case to be developed. The site chosen was not Lyness (which is far too small and far too shallow for the Panamax + ships the project was aimed at) but the whole North Coast of Flotta – from the Oil Terminal to the Calf of Flotta. Panamax Container ships are almost 400m long these days, and draw nearly 15m. Lyness is 9 deep and 150m long.

      The cost at that time was around £150m and it was clear that a major shipping partner or port operator was needed to invest. None of the Scottish players (Forth and Clyde Ports) were interested, as it would be a direct competitor to their Grangemouth and Hunterston operations, and none of the big UK Ports were interested as it would kill the business case for new investment ports like Southampton and Felixstowe, and as it would have been a direct threat to the major public owned Dutch and German ports they actively worked against it.

      So, the HIE and OIC teams tried to sell the concept to the major players in the far East, Hong Kong, Taiwan and China, who could have had a disruptive influence by investing in a new Scottish port, Alas they did not bite, as it would have meant that they would have had to change their business models completely, and invest in a new fleet of smaller “feeder” container ships that would have shuttled back and forth from Orkney to the rest of Europe. Ports like Rotterdam and Felixstowe were investing in new deepwater quays to accommodate their new super ships, so why would they invest in a new port themselves, even though the Orkney model was a cheaper solution in the long term.

      But not cheap enough to make them invest,

      15 years on, the scale of vessel that the Orkney project was aimed at has arrived, but they are docking at Felixstowe where the port has invested £300m in creating a new deepwater quayside for them. That sort of investment is way beyond a Council with 20,000 people, or a development agency like HIE with an annual budget of £60-70m. And imagine the fuss from Forth and Clyde ports, if the Scottish Government had invested in a direct competitor to them!

      The Orkney Transhipment Container port is a superb example of where a great concept, supported by strong Academic research, just fails the real world business case. It is/was just to disruptive to the established players in the industry, both ports and operators. EU state aid rules meant that the public sector just could not take that entrepreneurial lead and kill the business of commercially run ports, even if the political will had been there (and remember this was the very early years of the Scottish Parliament).

      A wee postscript. Since 2000, Orkney has benefited from being the global centre for the testing of Marine Energy devices, through it being the home the European Marine Energy Centre (EMEC). 300 folk are employed in the islands in the wave and tidal supply chain, more than as would have been employed by a container terminal. OIC invested £3m in doing up the Lyness pier, and its the home to a number of companies testing wave devices. Pelamis was just one of these, and employed three people in Orkney. Other major players at Lyness include Fisher Marine and Wello, the Finish wave business testing in Orkney.

      Its unfortunate that Pelamis went into administration, but its important to note that that HIE has bought the assets of the company, so that IP and expertise of the business is captured and remains in Scotland. But Lyness was never a Pelamis only port, and never the location for a transhipment terminal.

      • The 2000-2002 Flotta scheme you mention was proposed by an architect who knew nothing about ports, and who took the basic transhipment idea. OIC and HIE bought into it. That grandiose and very costly scheme (actually £1bn, not £150m) was never going to attract shipping lines. What you do not seem to know is that around 2006/7 a new approach was taken to develop the old naval base at Lyness as a container port, with limited dredging allowing for sufficient draft. This lower cost option attracted the Maltese container terminal firm Mariner and certain lines who wanted to lease the site. However OIC/HIE decided not to offer the site via tender (as required to access EU funds) , and did not take forward any planning or EU support options – so the container terminal was not developed as a result. It was their choice (i.e. the public agencies), not the markets. Instead the council/HIE decided to use Lyness for marine renewables. This flawed focus on marine renewables essentially squeezed out a revised low cost container terminal proposal (2006-7) which had demonstrable investor interest.

        On the general issue of marine renewables and related ports infras investment, it is very likely that the vast majority of costs and related jobs you mention in the sector in Orkney are ultimately publicly financed via grants, subsidies etc. And many of these jobs are not local. This would not be the case with a container terminal. EMEC is basically a state owned entity too. I do not share your enthusiasm for HIE in taking forward the bankrupt assets of Pelamis.

  11. I’ve been thinking along entrepot lines for Scotland (with many, many others) for the past twenty five years, or so. In my wee model, It was those many deep-water inlets on the West coast that I identified as being potential sites for the establishment of container/redistribution bases to Europe and the world.

    I envisaged this initially as a means of repopulating/revitalising our North-Western sea-board, i.e. by redistributing our post-industrial population concentrations in the central-belt in the direction of real jobs in a real economy. Given the new climatic realities to the North, I guess The Orkney Islands may now have trumped those potential locations further to the South.

    You can be sure of one thing, Graham, if Scotland doesn’t take advantage of this new reality, most likely the Norwegians with their oil-fund and imagination will.

    • “if Scotland doesn’t take advantage of this”

      Norway and Iceland are both looking into options. In contrast the Scottish public sector has a long history of making the wrong calls on major investment projects. So you can be virtually certain they will not take advantage of something as good as this. One of the reasons local ‘officials’ dropped the Orkney container terminal project was that they knew they would need to build lots of houses, new schools etc for the influx of workers and their families. That would have created more work and pressures for officials, many of whom go to work for rural and island authorities to have a nice easy quiet life. Local officials also tend to be of the green/liberal variety, opposed to industrial development (though evidently highly amenable to frivolous public investment in renewables R&D). The absence of ‘national’ leadership and vision is of course another issue to ponder when considering developing a major international transit port with enormous trading implications; such a project would generally be expected to be led by national government/ministries, not left to one of the smallest local authorities and their officials to ultimately decide its fate, as was the case in this instance. Wha’s like us!

  12. Just a quick question. What scope would there be for a Joint Venture with Norway in Orkney or another location?

  13. There must be some opportunities here for Scotland but I can’t see the commerical viability of a large container port in Orkney. Serving whom? Or what? The other locations mentioned – Rotterdam, Felixstowe, etc., are all close to large population centres with good landward transportation links. Therefore close to markets and distribution networks. Being a further 500 miles closer to the Arctic is not really relevent when sea transport is involved. But I would have thought a stronger naval presence in the area will be certainly required to police the increased shipping activity and to protect North sea oil installations.

  14. The only thing Arctic/Nordic about Scotland is the challenging climate. Socio-politically the country is poles apart from the so-called Nordic states whose leaders in fact show little interest in the idea of our independence much preferring the anglocentric status quo. We are creatures of our unique history. A couple of gay marriages don’t make an arctic summer.

    • What you say of Nordic countries current governments’ attitude to the indyref is probably true: their political and diplomatic relationships are with UK and as most are also NATO members their governments’ official position is that they would not wish to alienate or weaken an ally. Therefore official support for the indyref was muted. That official position is hardly to be wondered at and does not indicate an unwillingness to co-operate with a future new state of Scotland had we voted Yes.

      But public interest in the indyref was high. As a person of mixed Scottish-Norwegian heritage I visit Norway regularly and I was in Norway at the end of September after the referendum. Older people in the west of Norway still remember the Shetland bus, and that King Haakon 7 found sanctuary in a large country house near Dumfries where he established a court in exile.

      I found my neighbours and relatives in Norway interested and sympathetic. They can remember being under the Danes and the Swedes. One said: ‘You should come into a union with us, in Norway! That way between us we would control all of the oil in the North Sea!’

      But your wider point is well-taken: the UK is well-respected in the wider international community, and in seeking to obtain self-government we must be mindful of that when presenting our case internationally and avoid the perception of being anti-British.

  15. Too far away from London, The City and the South East for them to be interested – for them the world’s flat and Luton’s the drop off point.

    • No, sorry. Container ports serve a hinterland. There is no point having one in a remote, thinly populated area with very limited transport infrastructure. They need to be close to major centres of population with good links.

      • You have evidently never heard of ‘transhipment’ ports. Transhipment is the fastest growing sector of the container shipping business. The local market is less important than you think. For transhipment port location, intermediacy is more important than centrality.

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