Hundreds of Jobs at Risk from Inaction at Sullom Voe Terminal

Karen Turner, Abdoul Karim, Antonios Katris and Paulina Gonzalez-Martinez

This research asks the question of what will happen to jobs and income generation at the Sullom Voe Terminal (SVT) and across the local Shetland supply chain if oil processing activity winds down with no action taken to transition to low carbon fuel production. We investigate using our Shetland Economy Model (SEM) computable general equilibrium (CGE) model of the Shetland economy and industry projections for the decline of oil and gas extraction activity in the East and West of Shetland oil fields.

This policy brief concludes that, depending on whether the Clair filed expansion goes ahead or not, taking no action to transition SVT could ultimately cost up to 234 jobs across the Shetland economy by 2036 (80 jobs within SVT and 154 jobs across other local sectors), with the total job losses  climbing to 402 by 2050. The job losses come alongside a sustained drop of Shetland’s gross regional domestic product (GRDP) of £30 million per annum by 2050.

A timely transition is necessary both to avoid skilled workers and their families leaving the islands and in unlocking new economic opportunities, including shifting from export-focussed fossil fuel processing to the production of low carbon fuels in ways that sustain high quality jobs and income generation while meeting more of Shetland’s energy requirements locally.