A Thawing in the Arctic

The ice caps are melting and the environmental changes in the Arctic Circle may lead to disaster in the future Today, they present an economic opportunity. Furthermore, the Arctic has been an area of quiet cooperation between the US and Russia. Recent developments in the Arctic, while largely ignored, have revealed a region with both economic and political promise.

Over the last half century, the Arctic has been warming at twice the rate of the rest of the globe. This has led to disproportionately fast environmental transformation. Since 1980, the Arctic has lost more than half of its mass and three-quarters of its area of sea ice. Climate scientists predict a completely iceless Arctic summer within the next decade.

These changes have led to one significant result: for the first time in maritime history, for the first time ever, the Northwest Passage is open to non-icebreaking ships during warmer months. This long sought after shipping route from the North Atlantic to the North Pacific is thousands of miles shorter than the Panama Canal route. Furthermore, the Northwest Passage is significantly deeper than the Panama Canal. Both of these factors will soon allow shipping companies to send more cargo faster and cheaper year round.

In late 2014, the MV Nunavik became the first cargo ship to traverse the Northwest Passage solo. Prior to that, ships needed icebreaking capacity or an icebreaking escort in order to reduce the risk of striking free floating ice, which made such journeys prohibitively expensive. In the late summer and early autumn of last year, however, more than a dozen unshielded container ships traversed the passage.

A melting Arctic presents other significant economic opportunities alongside more efficient shipping. For example, Crystal Cruises is sending the first ever cruise ship through the Northwest Passage later this year. Indeed, as the region becomes more navigable, tourism and associated revenues are expected to increase rapidly.

An industry with similar promise is oil and natural gas extraction. The US Geological Survey estimates that that at least 90 million barrels of untouched oil and 1,670 trillion cubic feet of natural gas lie inside of the Arctic Circle. This could represent more than a fifth of the world’s total undiscovered oil and about 30% of the undiscovered natural gas. These reserves were under so much ice as to make any attempt to extract them unprofitable. In 2008, the Russian state-owned company, Rosneft cancelled several drilling projects in the Arctic due to their cost. However, since 2013, oil companies have invested almost $30 billion USD in the exploration and extraction of Arctic oil and natural gas. If anything, this is a sign of the new feasibility of these projects as a result of melting sea ice.

Despite the short boom of the last four years, low oil prices and recent sanctions preventing the sale of offshore drilling equipment to Russian firms have slowed or stalled many Russian drilling projects. This slowdown in drilling does not signal a retreat for Russia; President Putin still maintains the Arctic as a strategic economic priority. This focus has contributed to further cooperation between Russia and the West in Arctic politics and law.

Increasing tensions between Russia and the West due to the conflicts in Ukraine and in Syria have led to a deteriorating relationship between the two camps. In the Arctic, however, multilateral cooperation has increased. While there is still competition, particularly over territorial boundaries, shared economic interests have won out in most cases. For example, American and European oil companies such as Exxon Mobil and Royal Shell have standing deals with Russian-owned Rosneft to drill in international Arctic waters. Additionally, many of the aforementioned territorial disputes have been resolved through standing intergovernmental institutions, such as the UN Convention on the Law of the Sea and the Ilulissat Declaration. The Arctic is the only region in which Russia and the West have been able to cooperate to this level in recent years.

In spite of these successes, many analysts have pointed to an increased Russian military presence in the Arctic as an example of increased tensions. Recently, however, the Russian military began to pull troops and aircrafts out of its Arctic bases to concentrate on the escalation in Syria. Russia’s Arctic military presence is at its lowest level in years, signaling President Putin’s commitment that “there are no problems in the Arctic that would require military solutions”.

Politically, long-expected tensions in the Arctic have failed to materialize. When the US assumed chairpersonship of the Arctic Council (the intergovernmental forum of Arctic states) last spring, other members of the Council anticipated a deadlock as Russia moved to block all American actions. Instead, the Council is more active than ever, and the US and Russian delegates to the Council have released several joint statements that assert that Russian-American cooperation on Arctic issues has been “very good”.

All of this cooperation points to the Arctic becoming a region of quiet cooperation between the West and Russia, rather than just another arena for geopolitical antagonism. While complications elsewhere could spell an end for these warm relations, the Arctic will hopefully remain a stable and peaceful zone for all of its neighbors.

No Comments Yet

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>