In a large stockpot over medium heat, saute onion in oil and sherry, until soft. Add carrots, celery, and potato and saute 2 minutes. Add clam juice and cover. Simmer until potatoes are soft (about 15 minutes).
Puree half of the mixture in a blender until smooth, then return to stock pot.
Add tomato paste, cayenne, milk, half and half, shrimp, and scallops. Bring to boil, lower heat to simmer, and cook for 5 minutes. Taste for seasoning and add salt and pepper, if desired.