It was a joke oath supposedly used by sailors but first employed in writing by Captain Marryat - writer of the 'Hornblower' stories - in 'Jacob Faithful ', published in the 1830s. Robert Louis Stevenson also had his famous character, Long John Silver, use the phrase later in 'Treasure Island'. The idea was obviously a reference to the timbers of a ship, built of wood in those days, being blasted apart - ie broken into 'shivers' or fragments - by enemy shot or collision with rocks perhaps. Anyone who says the phrase obviously means he's devastated, in much the same way as the splintered ship was.
Oh, dear! Any doubts you had were fully justified, Paulz. Of course Forester wrote the Hornblower stories...it was the Midshipman Easy ones that Marryat wrote. What a plonker I am! My apologies to you, too, Kathy, for the misinformation. (The rest of the answer is OK, however. In future, I'll try to get my naval heroes sorted out rather better.)
Indeed, P. Here's an extract from Chapter 6 of 'Mr Midshipman Easy'...
"Nothing pleased Mr. Easy so much as Jack's loquacity.''That's right; argue the point, Jack'argue the point, boy,' would he say, as Jack disputed with his mother."
Thanks for the quote QM, we had a bloke like that here at sunny Gatwick. He'd argue the point till the cows came home, but hardly ever did a day's work in his life - gone off to become a Lawyer [so no change there! - sorry Treaclefight]