Managing the Relationship Between the Offshore Oil Industry and Frontier Regions

Managing the Relationship Between the Offshore Oil Industry and Frontier Regions M. Shrimpton; M. Shrimpton Community Resource Services Ltd. Search for other works by this author on: This Site Google Scholar K. Storey K. Storey Community Resource Services Ltd. Search for other works by this author on: This Site Google Scholar Paper presented at the SPE International Conference on Health, Safety and Environment in Oil and Gas Exploration and Production, Stavanger, Norway, June 2000. Paper Number: SPE-61166-MS https://doi.org/10.2118/61166-MS Published: June 26 2000 Cite View This Citation Add to Citation Manager Share Icon Share Twitter LinkedIn Get Permissions Search Site Citation Shrimpton, M., and K. Storey. "Managing the Relationship Between the Offshore Oil Industry and Frontier Regions." Paper presented at the SPE International Conference on Health, Safety and Environment in Oil and Gas Exploration and Production, Stavanger, Norway, June 2000. doi: https://doi.org/10.2118/61166-MS Download citation file: Ris (Zotero) Reference Manager EasyBib Bookends Mendeley Papers EndNote RefWorks BibTex Search nav search search input Search input auto suggest search filter All ContentAll ProceedingsSociety of Petroleum Engineers (SPE)SPE International Conference and Exhibition on Health, Safety, Environment, and Sustainability Search Advanced Search AbstractThe oil industry is seen as presenting a number of opportunities and threats to the residents of frontier regions when it first shows an interest in exploring off their shores. Based on experience dealing with the socio-economic effects of such activity in such temperate frontier regions as Atlantic Canada, British Columbia, the Faroe Islands, the Falkland Islands and Saint-Pierre et Miquelon, this paper discusses the nature and reasons for initial responses, the learning process, and means of facilitating it. In doing this, it reviews the expectations and responses of various coastal state stakeholders and means by which they learn about the industry, its effects and their management.IntroductionWhen the oil industry first shows an interest in exploring the waters off frontier regions, it generates a range of commonly extreme expectations and concerns onshore. While they evolve and become more realistic over time, they have a significant potential to delay and increase the costs of industry's activities. In extreme cases, they may even lead to a long-term ban on exploration.This requires that, from the earliest stages, oil companies take great care in managing their relationship with people living in such regions. In particular, they must engage in a careful process of expectations management, such that local residents develop a comfort with the likely effects of the industry. This requires that industry personnel involved in such exploratory activity are familiar with both the characteristics and aspirations of frontier regions and the learning process whereby the local government, business community and public come to understand the industry. This can lead to more effective expectations management and a reduction in misunderstandings, delays and associated costs.The Creation of ExpectationsThe oil industry is very challenging to the residents of frontier regions. These are commonly relatively small, intimate, relationship-based economies and societies, isolated from metropolitan centres and the global economy. As such, local people find it quite a shock when one of the world's largest and more powerful industrial enterprises turns up off the coast. This is especially the case because the oil industry is generally seen as both promising major economic opportunities and threatening the local way of life and environment.Such expectations are an understandable result of popular stereotypes of industry. These are of great wealth, whether in terms of the companies or the individuals who work for them (with fact and fiction blurring between John D. Rockefeller, Red Adair, J.R. Ewing, John Wayne and others). It is also an industry associated with social and economic disruption (for example, associated with activities in West Africa) and environmental disasters (with images of the Piper Alpha, Torrey Canyon, Braer, etc.), an industry which is powerful, threatening and, in the eyes of some, not to be trusted.The immediate reactions to exploratory interest are a mix of the positive and negative, in part in response to different individuals' and groups' perception of their power and how they may be affected. While some will see (or emphasize) employment or business opportunities, others will expect such benefits to accrue to only a few highly-specialized or already prosperous individuals and companies. There is also likely to be concern about the effects of industry activity on the local culture, cost of living, traditional economic activities and biophysical environment, as well as the ability of government agencies to manage specific effects or the industry in general.An inevitable and potentially highly-beneficial response to the arrival of the industry is to seek to learn from the experience of others. For example, in the early stages of exploration, Newfoundland politicians, civil servants, business-people, community representatives and media all engaged in comparative research in order to find out how the oil industry might affect them. They consulted articles and magazines about, invited guest speakers from, and visited, other areas with oil industry experience, and especially Scotland, Norway and Alberta. Subsequently, Newfoundland has hosted similar 'fact-finding' tours from such places as the Faroe Islands, the Falkland Islands, Saint-Pierre et Miquelon, Sakhalin and Greenland. Keywords: resident, local context, oil industry, falkland island, personnel, offshore oil industry, society of petroleum engineers, exploration, upstream oil & gas, newfoundland Subjects: Strategic Planning and Management, Information Management and Systems This content is only available via PDF. 2000. Society of Petroleum Engineers You can access this article if you purchase or spend a download.

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