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Chapter 1: Part One - Challenging Beginnings; "Heavenly Peated"



Inevitably, the history of Ardbeg distillery is inextricably linked with the overall development of Scottish distilling, and it is therefore informative to look at Ardbeg within the wider context of events beyond the shores of Islay.

It was against this backdrop that, in 1815, John MacDougall of Ardbeg decided to become a legitimate, commercial distiller

By the late 18th century whisky making had become commonplace throughout Scotland, both legally and without benefit of licence. Ironically, the whisky being produced by illicit distillers was often of a higher quality than much of the legal ‘make,’ and was frequently the standard to which the legitimate industry aspired. High levels of duty only served to stimulate the illegal trade.

Islay was no stranger to illicit distilling, which was hardly surprising, considering that the island's first excise officer was not appointed until 1797, a century and a half after excise duty was initially levied on Scotch whisky! By that time, however, a commercial distilling industry was beginning to emerge on Islay. Its development during the next half century owed much to the encouragement received from various members of the Campbell family, who were ‘improving’ lairds of Islay, until their estates were sold off after Walter Frederick Campbell was sequestrated in 1847. The Campbell dynasty on Islay began with Daniel Campbell, who established the town of Bowmore during the 1760s, and possibly the island's first legal distillery in 1779. South-east of Bowmore, on the rugged, southern aildalton' coastline, there were many stories of distilling taking place in the area of Ardbeg, the most notable being the ‘non-commercial’ distilling activities from around 1794 of the MacDougall family, tenants of Ardbeg, Airigh nam Beist and Lagavulin farms.

By the time that Napoleon Bonaparte was defeated at the Battle of Waterloo in June 1815, Britain as a whole was suffering from economic depression, partly caused by the lengthy Napoleonic Wars fought against France. Adverse economic conditions were compounded by more than a decade of extreme weather and famine in some parts of Britain, while on the distilling front there had been notable increases in duty to help finance the war and periods when whisky-making was banned in order to preserve the meagre cereal crops available to feed the people. New legislation ensured that speed of distillation was financially advantageous to distillers, at the expense of quality, and there was a predictable increase in illicit distillation.

There were also concerted attempts to suppress the smuggling trade, and it was against this backdrop that, in 1815, John MacDougall of Ardbeg decided to become a legitimate, commercial distiller, backed by Glasgow whisky merchant Thomas Buchanan Jnr. The following year, Walter Frederick Campbell took over the family's Islay estates, and played a significant part in stimulating the island's distilling industry, most notably by establishing a steamer service between Port Ellen and Glasgow, via Loch Fyne.

1816 not only saw Campbell take up the reins of the Islay estates, but in the same year duty levels were reduced in an effort to encourage legal distilling in Scotland. Additionally, the Small Stills Act removed the fiscal differences between Highland and Lowland distilling on either side of the theoretical Highland Line, as well as allowing the use of stills with a minimum capacity of 40 gallons. These measures had the effect of stimulating Scotch whisky distilling generally, and Islay was no exception, with Lagavulin and the now lost distilleries of Ardmore, Ballygrant, Bridgend, Octovullin, Octomore, Newton and Scarabus all being established—or legalised - soon after the Small Stills Act came into effect.

The 1822 Illicit Distillation Act and the subsequent 1823 Excise Act also made the future appear promising for legal whisky-making operations. The 1823 Act broke the near monopoly enjoyed by large, Lowland distillers and opened the English market to the Highlanders. Duty was halved and legal producers could viably increase the quality of their whisky. On Islay, the 1823 Excise Act encouraged the creation of Lossit, Mulindry, Glenavullen, Port Ellen and Lochindaal distilleries, while Ardbeg became the largest distillery on the island, with an output of 500 gallons per week (65,000 litres per annum) by 1835.

However, the story of the Scotch whisky industry has never been straightforward or predictable and this period of promise was short lived. Although Ardbeg enjoyed a plentiful supply of locally grown barley and had comparatively good access to markets on the mainland, there was a growing problem of surplus whisky stocks throughout the industry. By the 1840s, the Scottish Lowland distillers were benefiting from cheap fuel and improved transportation, making it more difficult once again for the Highland distilleries to compete.

This resulted in a dramatic fall in the overall number of distilleries operating in Scotland, but Ardbeg was one o f the survivors, and some 20 years after its formal establishment, the distillery was being run by John MacDougall's younger brother, Alexander, a ‘stout and loyal clansman’ who had changed the business name to Alexander McDougall & Co by 1838. However, within twelve years, the day to day management had become the responsibility of Colin Hay.

While consumption of whisky in England grew through the 1850s, it was principally the Lowland distillers who benefited. The Highland distillers' market was predominantly in Scotland, where consumption had fallen by 25 per cent, largely due to successful temperance campaigns and a sluggish economy. Despite Islay and Campbeltown whiskies commanding a higher price than many others, the number of distilleries on Islay had fallen from 28 to 16 by 1854, reflecting the situation throughout the Highlands and islands.

Traditionally, most whisky was sold and consumed straight from the still, and did not enjoyed the luxury of maturation in wooden casks

The following year, duty was raised again and malt duty and drawback (the rebate of some tax paid by producers) were abolished. Excise duty between England and Scotland was also equalised, and the existing difference now disappeared. These measures had the effect of causing more hardship for many of the smaller Highland distillers. Ardbeg was far from immune to these problems, and by 1857 the business was making heavy losses. It had been owned by Alexander MacDougall's sisters, Margaret and Flora since 1851, but as a result of the losses incurred they had little option but to sell a greater share of the distillery to their financial backer and fellow partner, Thomas Gray Buchanan. During the next decade, the steady decline in the number of distilleries continued, as did the consumption of whisky in both England and Scotland.

Traditionally, most whisky was sold and consumed straight from the still, and did not enjoy the luxury of maturation in wooden casks. This resulted in considerable inconsistency at best, but under the provisions of the Forbes Mackenzie Act of 1853 vatting of malt whiskies from the same distillery while ‘under bond’ was permitted by law for the first time, resulting in a more consistent product. Seven years later, William Gladstone's Spirits Act went a radical stage further, by allowing malts and grains ‘under bond’ to be blended for the first time, and together these two pieces of legislation were to have far reaching affects on the future of the Scotch whisky industry.

Blending malt and grain whiskies produced a more consistent product than had previously been available, and it was also less assertive and more suited to a wider range of palates than most malt whisky. Consequently, the 1860s proved a boom time for whisky distillers, and by the end of the decade production was at an all time high. Although blended whisky was becoming popular, ‘self’ whiskies, as single malts were usually known, began to benefit from periods of maturation sometimes in excess of five years, and often in former Sherry casks, which helped to give them, a more rounded and mellow character.

At Ardbeg, Colin Hay was fully managing the distillery and was made a partner in the business with Thomas Gray Buchanan's son, Alexander Wilson Buchanan, in September 1872. Five years later Scotch whisky output was running at a record level. Islay malts were highly prized by the blenders as their strong character allowed them to use a higher percentage of grain whisky, which was considerably cheaper than malt spirit.

Ardbeg was particularly sought after and in 1879 the merchant James Fleming of Glasgow stated that "I will blend your cask and some old Campbeltown together and hope to send you a superior article."

Due to the popularity of Ardbeg for blending, and perhaps because it was owned by a blending company, its proprietors appear to have neglected its promotion as a single malt, even in rapidly developing markets such as Australia and South Africa, where Islay whiskies were particularly appreciated. During this period, various whisky associations were established, including a society for Islay distilleries, and in 1877 the Distillers Company Limited (DCL) was formed, while numerous new distilleries were also built. These included Bruichladdich and Bunnahabhain, which were founded on Islay in 1881.

With four floor maltings in operation and a work force of 60 people, Ardbeg continued to have a higher level of output than any other Islay distillery

1884 brought another economic depression, and as a consequence more amalgamations and takeovers took place within the whisky industry. Numerous Islay distilleries were acquired by major firms in order to guarantee supplies of malt for blending purposes, but Ardbeg remained staunchly independent. Despite the difficulties of this time, Ardbeg was producing 250,000 proof gallons when Alfred Barnard visited the distillery in 1886. With four floor maltings in operation and a work force of 60 people, Ardbeg continued to have a higher level of output than any other Islay distillery.

Ardbeg was commanding one of the highest prices for its spirits 

In 1888 Alexander Wilson Buchanan and Colin Hay signed a new lease for Ardbeg Farm with John Ramsay. This document was witnessed by David Campbell Lawson, an employee of the Gray Buchanan's company. In time, his family would become major players in Ardbeg's history. Ramsay was the dynamic former business partner of Walter Frederick Campbell, and licence-holder at Port Ellen distillery from 1836. He had acquired the Kildalton section of the former Campbell estates in 1855, thereby becoming the owner of several Islay distilleries.

The 1890s were one of the greatest boom eras ever experienced by the Scotch whisky industry, and Ardbeg was commanding one of the highest prices for its spirit. Plans were drawn up for a railway line to run from the pier to the distillery, although this never materialised. More distilleries were being constructed and output increased, though the eventual outcome was to be another bout of over-supply, and a serious recession. While the good times lasted, export markets for Scotch whisky were being enthusiastically developed in the USA, South America and Germany, and at the same time bases were being set up in the more established colonial countries of Australia and South Africa.

Throughout this period, Colin Hay appears to have done a good job o f running the distillery and had established a commendable reputation as a decent and generous man. He did much for the thriving and close-knit village community of around 200 people, complete with a school, shops and even a choir. His sister had married into the MacDougall clan and her son would later manage Ardbeg for a period, restoring the MacDougall's direct involvement with Ardbeg, albeit for a comparatively short time.

Faced with an uncertain future, many companies looked to The Distillers Company Ltd for support

Alas, the success of the Victorian heyday for Scotch whisky peaked in 1900, ushering in the decline which started another long period of instability. Faced with an uncertain future, many companies looked to The Distillers Company Ltd for support, and this support often took the form of DCL acquiring shares or entire companies during the next few decades. Many of the distilleries purchased by DCL were subsequently closed down, bringing criticism from some quarters, though others recognised DCLs ability to anticipate future demand for whisky and produce spirit in line with that demand, thereby safeguarding the longer term interests of the industry.

The latter years of the 19th century had already seen Islay malts falling out of favour with some blenders and being replaced by mellower and more floral Speysides, and the shift away from the heavier style of whiskies to smoother blends using malt from Speyside continued. It was during these troubled and changing times that due to poor health Colin Hay resigned his part of the partnership to his two sons, Walter and Colin Elliot Hay, and to David Lawson, in 1896. Colin Elliot Hay took over the day to day running of the distillery in 1904, but he already had a reputation as a weak man who had grown up living off his father's good nature and success.


Excerpt from "Export Guardian," December 1912.

A Famous Highland. Distillery;

An Ideal Site and an Idea Product.

THE reputation which Scotland has so long held for the manufacture of high-class whisky to a certain extent hinders our friends overseas from realising the care and skill which are exercised in the preparation and distribution of the national beverage. The habit of association has done not a little to imbue unthtinking minds with the vague idea that Scotch whisky is almost as natural to the country as Scotch mist. That this is far from being the case is made very evident by taking a tour through one of our modern distilleries. For instance, let us go to the famous Ardbeg Distillery and see there what are the conditions under which whisky is made, and in some degree we will realise how it is that there is no whisky in the world to compare with that which comes from the


It is in the romantic and beautiful island of Islay that we 
find Ardbeg Distillery, situated in a sweet secluded spot close to the verge of the great Atlantic Ocean. Over these 
broad waters come the invigorating breezes which give the countryside that fresh and healthy atmosphere which makes the landscape stand out in such clear and bold relief. In
front of Ardbeg the sea is studded with many rocks, making 
the coast dangerous to the inexperienced pilot, but near the
 land is a fine bay providing a safe and pleasant anchorage. The making of whisky is no new thing in the district, for long before the time of the vigilant. Excise authorities and licensed trading the place was noted for its whisky, and in later times the smuggler and illicit distiller haunted the caves and glens of the neighbourhood.

The passing of those wild days brought a change, and nearly one hundred years ago a distillery was founded at Ardbeg. This was in the year 1815, and the founders were the MacDougalls of Ardbeg, an old Islay family, the last survivor of whom was Alexander MacDougall, whose name, as a good Highland representative one, is still retained in the firm.

All the distillery workers, and those on Ardbeg Farm, connected therewith, are comfortably housed, and form a little village of about 150 inhabitants. There is a good school close to the village, and with an ample water supply the comfort, cleanliness, and general wellbeing of the inhabitants has always been a notable feature. Most of the employees have been born and bred about the place, and naturally take a keen interest in the welfare of Ardbeg and, all matters connected with the advancement of the district.

In the olden days all the Islay distilleries were small, and seventy years ago Ardbeg, though among the larger works, had only a capacity of about six hundred gallons per week, and since that time it has increased more than tenfold—a proof of its high appreciation by blenders and the Trade generally. The water used in distilling, etc., is obtained from two lochs, situated some three miles above their works among heathery hills, and runs over rocky cascades and through peat mosses till uncontaminated it falls into the distillery reservoir.

The pure peaty softness of the water is admirably adapted for distilling purposes, and, doubtless, helps to give the whisky its recognised character and flavour. Finest Scotch barley (malted and entirely kiln-dried with peat on the premises) is alone used ill manufacturing the product. A large quantity of peat is required annually, and from May onwards till the month of August considerable labour and expense are incurred in cutting, drying, and storing the peats, which are of a specially good quality for malt drying, being free from sulphur or other offensive mineral, and have for many years back been cut from the same mosses.

With the expansion of the demand for “Ardbeg," the entire buildings and plant have from time to time been added to, improved and renovated, so that in labour-saving and other machinery, management, and storage of malt, drying of draff, warehouse accommodation, etc., the distillery, with its electric light throughout, compares favourably with the most modern equipped work of the kind. The warehouses (eight in number) have storage room for over 17,000 casks of various sizes, equal to 1,002,00 gallons. There is a quay of well-built masonry about six hundred yards from works, at which vessels of large tonnage can load and unload whisky and other goods, and at which MacBrayne's goods steamer makes a weekly call. This quay was erected some thirty years ago almost entirely at the firm’s expense.

The present plant is capable of producing over 6000 bulk gallons a week. “Ardberg,” on account of its high quality, haracteristic flavour, softness and bouquet, commands the highest price of the “Islay Malts,” and for its “covering” and other properties is much in request by blenders, being extensively used in most of the higher class brands now on the market. Among connoisseurs, who have acquired a taste for a single distinctive flavoured malt whisky, "Ardbeg" is considered to be at its best about eight years old.

To suit family arrangements, the firm was converted into a private limited company over ten years ago. The firm are distillers from malt only, not dealers or merchants otherwise. Mr. Colin E. Hay, son of the late managing partner, Mi. Colin Hay (who for over fifty years resided and managed at Ardbeg), is chairman and managing director of the company and is also resident there, supervising the practical work of manufacture.

The controlling agents for sale of “Ardbeg”—(United Kingdom and foreign) are Buchanan, Wilson & Co., Ltd., 162 St. Vincent Street, Glasgow, which firm have been closely connected with and have held the sole agency for “Ardbeg” for the last seventy five years.

From the fine half-tone illustrations which have been supplied to us through the courtesy of the firm, a good idea may be got not only of the splendid buildings and their equipment, but also of the various processes of manufacture which the whisky has to pass through ere it is sent to the markets where' it continues to maintain that high reputation for excellence of quality which has since the earliest days been associated with the products of Ardbeg Distillery.



Written by Gavin D Smith & Graevie Wallace


The text is an excerpt from "Ardbeg: Heavenly Peated" (pp. 11 - 20), written by Gavin D Smith & Graevie Wallace, published 2018 by Hogback Publishing.