Russia leads race for North Pole Oil

Russia leads race for North Pole oil


The Arctic's untapped resources include huge reserves of fuel and minerals. Now Moscow has raised tensions by dispatching an expedition to annex a vast expanse of the ocean.

Jamie Doward, Robin McKie and Tom Parfitt
Sunday July 29, 2007
The Observer

In the darkest depths of the Arctic Ocean a new Cold War is brewing. American and British nuclear submarines lurk in the shadows, preparing for company.

'Why has Britain been sending submarines into Arctic waters?' asked Rob Huebert, associate director of the Centre for Military and Strategic Studies in Calgary. 'Because it wants to retain its capability to deal with the Russian threat.'

Such talk is redolent of a Le Carré novel. But the battle between the West and Russia over who owns the Arctic has been building for years. Last week it entered a new phase when Russia announced it was sending a miniature submarine, equipped with a team of explorers, to claim a chunk of the Arctic Ocean the size of Western Europe.

The stakes are high. The ocean is home to vast oil and mineral reserves as well as massive shoals of fish and strategically important shipping lanes. 'It could get very ugly,' Huebert said. 'Nobody knows how much oil and gas is down there. Shell, for example, is quite pessimistic, but the likes of Exxon are quite gung-ho. I've seen some people make the case that up to 18 per cent of the world's oil reserves are there - that's getting into Saudi Arabia's league.'

To symbolise its claim, Russia will plant its flag on the sea bed before taking samples it believes will prove the Lomonosov Ridge, which runs underneath the Arctic Ocean, is an extension of the Siberian continental shelf and therefore Russian territory.

The expedition is led by Artur Chilingarov, Russia's most famous explorer. A sturdy 68-year-old with a sweeping salt-and-pepper beard, last week he could be seen pacing the decks of his ship, the Akademik Fyodorov, followed by a posse of state television journalists who filed breathless accounts of the groundbreaking voyage.

'The Arctic is Russian,' Chilingarov told the media scrum. 'We must prove the North Pole is an extension of the Russian coastal shelf. Of course, [the expedition] is important in terms of science, but also in terms of geopolitics as well.'

There has never been a manned journey to the sea bed of the North Pole. 'Who knows, we may even discover some as yet unknown organism,' said Valery Kuznetsov, head of the expedition's oceanography team.

In 2001, Russia made a similar claim to the Arctic Ocean but its evidence was disputed. An official panel of experts backed by the UN has been established to consider claims and Russia is determined to prove its case. A UN convention dictates that countries bordering the Arctic Ocean can exploit resources within a 200-nautical-mile economic zone of their territory. But this can be extended if a country can, as the Russians are attempting, prove the continental shelf beneath the ocean is connected to their land.

So far the US has refused to engage in the debate over extending exploitation rights, a policy throwback to the Eighties when the Reagan administration feared such an action would see large parts of the Arctic handed over to the Soviets.

Meanwhile, Canada and Denmark, through its sovereignty over Greenland, claim that the Lomonosov Ridge is connected to their territories and therefore the ocean is effectively their property. In a sign of how tense the situation is becoming, the Canadian government recently placed a C$7bn (£3.25bn) order for new naval patrol vessels, a move that Prime Minister Stephen Harper said was designed to 'defend its sovereignty over the Arctic'.

But the battle for the Arctic is fast becoming a global issue. Melting ice has meant the opening up of the North West Passage to commercial shipping is now possible in the summer months and, given rising temperatures, a possibility all year round in the future. The opening up of the passage can shorten the distance ships have to travel between Europe and Asia by up to 2,000 nautical miles over the established trade route through the Panama Canal.

Given the area's geopolitical importance, it is no surprise Britain is closely monitoring the situation as part of its commitment to Nato. 'Britain has been sending Trafalgar SSN-class submarines to the Arctic since 1986 because it wants to retain its under-ice capability,' said Huebert, who predicted it would not be long before their sonar registers the presence of an old foe. 'The Russians are rebuilding their navy,' Huebert said. 'They've just launched a submarine for the first time since 1987 and they've placed orders for three more.'

Soaring oil prices have created a new urgency among the countries competing to make their claim. When oil prices were low it was considered uneconomic to tap into the Arctic Ocean's reserves. But with China and India now desperate for energy, oil prices are spiralling. Experts say oil prices of around $70 a barrel makes drilling in the Arctic a viable proposition. In 2004, a joint Swedish and Russian venture proved it was possible to drill into the ocean's floor from a rig secured by three ships.

Nor is oil the only resource that is ripe for exploitation in the thawing north. There are also large mineral deposits and coal beds in the Arctic, for example. In addition, there is the prospect of opening up vast new fish reserves as ice cover disappears over the Arctic Ocean. For several years, British research vessels from Dunstaffnage Marine Research Station, near Oban, have been studying these stocks.

'There is strong evidence that there are still good reserves of fish such as cod and capelin in some regions of the Arctic,' said Prof Graham Shimmield, Dunstaffnage's director. 'However, these are probably the world's last refuges. We should restrain ourselves from catching them on an industrial scale until we learn more about how strong they are. It remains to be seen whether that will happen, however.'

The rush to exploit the Arctic worries other scientists. They point out that the region is important because the effects of climate change are more pronounced here, and arrive earlier, than in any other part of the world. When things go wrong, they are first noticed in the Arctic. But if oil companies and mining firms start pumping out carbon dioxide and other waste as they open up the region, the pristine conditions that have helped scientists make past observations will be destroyed, obscuring our view of our dangerously warming world.

This problem is already an issue in the archipelago of Svalbard where European scientists are studying glacier retreat, carbon emissions and other effects of pollution, but are having their work hampered by the emissions from coal mines dug by the Russians.

Tensions are already running high in the Arctic, it would seem. Nevertheless, hopes remain that a diplomatic conclusion can be achieved to resolve what has been dubbed the 'battle for the North Pole'.

'We must wake up to the fact that the Arctic is going to become a much busier area,' Huebert said. 'And try to produce a solution that will provide an equitable, fair and safe division of resources. We cannot just proceed with the old unilateral approach.'

Observers point to the Antarctic Treaty, which severely limits the exploitation of the land mass around the South Pole. No waste disposal, no mining, no introduction of animal species and no commercial work have been allowed on the continent for more than 40 years. Some diplomats have suggested that a similar set of rules could be agreed for the Arctic. Such a plan is unlikely to succeed, however. 'Countries agreed to the Antarctic Treaty as a way to save money,' said a senior UK official. 'The South Pole is an expensive place to exploit and it was realised that if everyone agreed not to touch it, they could all rest easy about pouring millions into the area. This is not the issue with the Arctic. It is becoming easier and easier to exploit. Nations aren't going to give up on these rich pickings.

Hence the Russian expedition - although this has not gone totally smoothly so far. Last week the Akademik Fyodorov was forced to send out a distress signal and then drifted for several hours because of an engine failure. It has since made good progress towards the pole and the first research dives from the ship are expected to take place tomorrow.

During its journey last week a mysterious aircraft appeared above the Akademik Fyodorov, causing a ripple of excitement among the journalists on board. Russian media widely reported the aircraft to be a Nato spy plane. It may have been paranoia but in the frozen waters around the North Pole one thing is certain: the days of the Cold War are back.

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