A history of Scottish shale oil industry
Scotland's shale oil industry operated for more than a century. Its history is a stirring and involved tale of enterprise and invention, triumph and dispair, hard labour and strong communities. It remains a source of pride with a continuing legacy. For those with little prior knowledge seeking a quick introduction to the industry we present:
- A quick history of the Scottish shale oil industry
- A quick history of James Paraffin Young
For others intent in delving deeper
Many consider that the world's first commercial scale oil refinery was at Inchcross near Bathgate in central Scotland. Here from 1851, James "paraffin" Young and his partners produced a range of mineral oils from the local coals, several years before the first oilwell was drilled in the USA. James Young adapted gas-making technology and patented a process in which cannel coal was heated to a specified temperature within an enclosed vessel or "retort" in order to release an oil vapour.
During the 1850's Young and his partners prospered on their virtual monopoly of the mineral oil trade and successfully defended their patents in a number of court cases. Licences were granted to use Young's process in many parts of the world. For a short period, cannel coal was even exported from Scotland to be processed in oilworks on the east coast of the USA.
Young's patent expired in 1862, by which time supplies of cannel coal at Bathgate were close to exhaustion and cheap American petroleum was flooding onto the international market. Many tried to emulate Young's success during the "oilmania" of 1863-4 by opening small oilworks throughout the Scottish coalfields using local cannel coals or other "coal shales". Most were doomed to failure although coal oil continued to be produced into the 1880's, notably in the Airdrie and Paisley areas
Young realised that the future of the Scottish oil industry lay with the use of oilshale rather than coal. This unusual black mineral, very different from coal, was found beneath much of West Lothian and parts of Midlothian and Fife. It was first used to produce oil at works in the Broxburn area in about 1860. Young established "Young's Paraffin Light and Mineral Oil Company" to develop and operate a massive new integrated oilworks, refinery and candleworks at Addiewell. This was one of the largest industrial undertakings in Scotland at that time and was linked to a number of shale mines in the West Calder area and served by the new village of Addiewell. Young retired from the operation of the company in 1870.
Many new shale oil companies were established to challenge the dominance of Young's Oil Company. New patents for the design of more efficient retorts aided the success of the Broxburn Oil Company (established 1878) and the Pumpherston Oil Company (established 1892). There were also notable failures such as the Burntisland Oil Company (1881-1905) and the Linlithgow Oil Company (1884-1904) in which large investments were lost in ill conceived ventures.
The first decade of the 20th century was a period of great prosperity for the six surviving Scottish shale oil companies. A growing market for oil, and for the ammonium sulphate fertiliser produced as a lucrative by-product of the retorting process, allowed the companies to invest in new oil works using the latest electrical equipment and in the construction of good quality workers housing. At the height of the industry in about 1912, over 12,000 were employed and output accounted for about 2% of the world's oil production. Scottish technical expertise played an important role in the development of oil industries throughout the world.
The fortunes of the Scottish shale oil industry changed rapidly during the first world war. A government-supported scheme to develop British oil interests in the Persian Gulf quickly led to the import of cheap crude oil which undermined the viability of the Scottish industry. Government action first created a joint marketing organisation for the Scottish shale oil companies and then oversaw their amalgamation within Scottish Oils Ltd, part of the government backed Anglo-Persian Oil Company. In 1919 a pipeline was laid to carry imported crude oil from Grangemouth docks to Uphall shale oil works, which was used as a testbed for refining imported oils. This experience was then applied to the design of Grangemouth refinery, opened in 1924.
The shale oil industry suffered in the economic uncertainty and labour unrest that followed the war, and eventually management and workforce agreed to an independent enquiry into its future. This found no economic basis for continuation of the shale oil industry and soon led to the closure of many oilworks and mines causing great hardship, particularly in more remote communities. To avoid the disastrous social consequences of complete closure of the industry, a preferential rate of tax on home produced road fuels was introduced in 1929. New cracking plant was constructed at Pumpherston refinery to convert most of the industry's output to diesel and petrol.
There was much new investment to boost shale oil production immediately before the second world war as it was feared that imported oil supplies would be threatened in case of conflict. New mines were sunk and others modernised and a massive new modern crude oil works was opened at Westwood near West Calder in 1941. Following the war most of the older oilworks were gradually closed. Westwood continued to produce crude oil for refining at Pumpherston until the final closure of the industry in 1962.
In about 1946, experiments at Pumpherston led to the production from shale oil of some of the first synthetic detergents. Production was rapidly developed, lately using imported oils. The Pumpherston detergent plant continued until 1993; the last tangible link with the shale oil industry in Scotland.