by Lotta Numminen
Arctic stakeholders have demonstrated their interest in peaceful, sustainable development of the region, but the real challenge is recognising local priorities and integrating them into natural resource management efforts.
Rapidly melting ice is creating new opportunities for offshore oil and gas exploration, shipping, industrial fishing and onshore mining industries throughout the Arctic. While much attention has been paid to “resource conflicts” between the coastal states of the Arctic Ocean during the 2000s, the 2010s have shown no immediate risk of traditional inter-state conflicts. This does not mean that there are no tensions related to the new resource reserves to be found under the seemingly peaceful surface of Arctic waters. There are major differences of opinion on how to approach on-going environmental change and especially the consequences of increasingly enabled Arctic economic development, especially of hydrocarbon reserves.
A stable Arctic
The Arctic is and has been stable for decades. The region has strong traditions of international cooperation, especially on environmental issues. Its countries are stable societies seeking neighbourly cooperation rather than conflict. Most cooperation takes place in the Arctic Council, a ministerial-level intergovernmental forum among the eight Arctic States and indigenous peoples’ organizations. Although criticized as being weak, the Council has fulfilled its purpose as a soft-law instrument by increasing trust between Arctic States through environmental cooperation.. The Council also managed to establish its very first legally binding agreement in 2011, when members signed an agreement on Arctic search and rescue. Indigenous representation in the Arctic Council is, moreover, one of its unique characteristics..
Peaceful Arctic development is supported by the UN Convention on the Law of the Seas (referred to here as UNCLOS) whichestablishes common guidelines for natural resource management in the world seas, and defines state rights and responsibilities. Four of five Arctic coastal states - Russia, Canada, Denmark/Greenland and Norway, have ratified UNCLOS, which under specific conditions allows them to extend the outer limits of their offshore Arctic continental shelves, expected to contain huge oil and gas deposits. The U.S. is not a party to UNCLOS, but the country applies provisions of customary international law relating to use of its maritime zones, which are quite similar to those established in UNCLOS. All the five states thus play with similar rules, which stabilize development. UNCLOS only defines general rules for maritime resource management, which actually benefits the coastal states by giving them room to negotiate details of the UNCLOS provisions quite freely.
The Arctic coastal states have held meetings about Arctic resource development and asserted their commitments to peaceful, orderly settlement of possibly overlapping territorial claims in the Arctic Ocean. They have also managed to sign bilateral agreements on the development of Arctic resources, such as Russia’s and Norway’s Barents Sea agreement, signed in 2010, that divided up the Barents Sea between the two countries and allowed oil and gas exploration in the region.. All of the coastal states have highlighted their natural resource reserves in their own national Arctic strategies, indicating a willingness to use those reserves in the future (some are already in use). Cooperation is also strengthened by the fact that conditions in the Arctic are extremely harsh and all projects must be planned carefully. The use of resources is very much dependent on how well the states are able to cooperate in terms of scientific research, technologies and finances. It will most certainly take years and a great deal of financial investment and common effort, before large-scale offshore Arctic oil and gas extraction becomes viable. .
The Arctic states have clearly shown that they are willing and able to solve the resource management questions in a peaceful manner and they notably emphasize the sovereignty of states in the region. What is worth noting here, however, is that amid growing geopolitical interest in the Arctic, other voices have been raised. that suggest that the rapidly changing Arctic is not just a matter for states. Some of those voices are concerned about climate change and the consequent melting of Arctic sea ice, glaciers and permafrost, which will inevitably have planetary consequences. Other voices call for use of Arctic oil and gas reserves as oil demand continues to rise in. The ice is melting, paradoxically, because of fossil fuels, including, now,Arctic oil and gas.
Stakeholder priorities and perspectives
Many people who live outside the Arctic consider the region a pristine, untouched, natural environment - a unique region that needs to be preserved. Those who live in the Arctic experience it as a dynamic, living region inhabited by people trying to survive and thrive just like people in other parts of the world. The Arctic is also not a single, undifferentiated area, and local conditions, people’s livelihoods, landscapes, flora and fauna differ greatly from one part of it to the next. Different groups, it should come as no surprise, perceived Arctic environmental change in distinct ways.
The European Unionis involved with the Arctic through three of its member states, Denmark, Finland and Sweden, and has clearly shown interest in Arctic affairs. Since the European Commission’s communication on Arctic governance (published in 2008), less weight has been put on foreign policy and attention has increasingly moved towards cooperative efforts in issues such as climate change and sustainable management of resources. EU involvement in Arctic matters, interestingly, remains contentious, and its application for Permanent Observer status in the Arctic Council has been rebuffed by Arctic States skeptical of EU motives, . Some also claim that the EU is too far away and ill-informed about important Arctic issues. For example, there have been tensions between the EU and Canada relating to the European Parliament’s decision in 2009 to ban trade in seal fur . For the indigenous population of the Canadian north, the decision had a significant and deleterious impact on traditional livelihoods. The European Parliament itself has no consensus on the question of whether Arctic oil and gas should be used or not: the parliament's environment committee was willing to introduce a moratorium on offshore oil and gas drilling in the Arctic in 2012, but the Parliament’s industry committee rejected the idea.
The most visible international environmentalist organizations with programs specifically focused on the Arctic are the World Wildlife Fund (WWF) and Greenpeace. WWF, on one hand, focuses on protection of the most vulnerable areas and points out major gaps in environmental governance and management regimes, and has drafted a comprehensive, legally-binding framework that would seek to establish “ecosystem-based ocean management” both in territorial and international waters of the Arctic Ocean. The aim of the framework is to create protocols for shipping and resource development and a network of marine protected areas throughout the Arctic Ocean, ensure commercial compliance with approved environmental practices, and require polluters to pay for cleanup efforts. WWF emphasises sustainability by integrating human activities into environmental conservation, so that the welfare of indigenous communities and local people’s livelihoods are not neglected.
Greenpeace, on the other hand, has launched a “Save the Arctic” campaign. Its focus is the creation of a a regional, legally binding agreement to protect the uninhabited ocean area close to North Pole, and to ban offshore oil drilling and industrial fishing in the Arctic.Greenpeace has demonstrated its opposition to oil drilling in Arctic waters. In 2010 and 2011, Greenpeace activists attempted to prevent ships from drilling for oil in the waters off western Greenland, drawing significant criticism from among local inhabitants. The organization has had major problems with its reputation and the methods it uses to protest against Arctic fishing, as well as whale and seal hunting, in the region. Greenpeace campaigns against Arctic seal hunting, for instance, have caused great economic hardship for Inuit hunters, almost destroying their livelihoods, and precipitating major social fall-out.. Such actions still influence Inuit attitudes towards Greenpeace, and in the current climate could lead to indigenous support for oil companies that promise economic wealth and other benefits..
Two questions define how the interests of local inhabitants of the Arctic should be perceived. The first is why the Arctic’s natural resourcesshould not be extracted and managed just as they are anywhere else in the world, thereby creating wealth for local communities. The second is why decisions about any of this should be decided by outsiders. . Generally, Arctic states with indigenous communities prefer sustainable use of resources instead of environmental protection or moratorium. Just as the Arctic is not a monolith, neither are its people, their interests, and how they express their concerns. Arctic indigenous peoples are On the contrary, they have mixed views and needs depending on where in the Arctic they live. More, local communities are not only inhabited by indigenous populations, but also by what amount to expatriate workforces and other inhabitants coming from the south, such as those involved with offshore oil industries .
The Inuit Circumpolar Council (ICC) represents Inuit in Greenland/ Denmark, Canada, Alask in the US, and Chukotka in Russia. According to the ICC, the Inuit “welcome the opportunity to work in full partnership with resource developers, governments and local communities in the sustainable development of resources of Inuit lands.” According to Aqqaluq Lynge, “Resource development must benefit Inuit, involve Inuit at every step, and avoid causing social and environmental damage or ‘an overwhelming influx of outside labour’ from coming into Inuit lands”. Lynge’s notion indicates one of the major questions that many Arctic communities have to contend with. Oil and gas are extracted by large, multi-national companies. To what extent are local communities involved in the process and to what extent (if at all) do they benefit from it? . Industrial activities involve risk of environmental catastrophes and accidents, risks borne directly by indigenous workforces. If many of the workers are commuters rather than locally educated and hired workers, the community will not enjoy any of the traditional economic benefits derived from income taxes. Communities shoulder the risks, in other words, with no guarantee of equitable payout from multinational oil companies.
The Inuit see climate change and offshore oil and gas are seen as both risky and beneficial. Greenland, for example, is banking on a scenario in which exploitation of oil and gas will become sufficiently profitable to replace the block grant, the yearly economic transfer from Denmark - thereby enabling not only economic but also political independence. The prospect relies on a significant increase in Arctic-related economic activity and traffic; a ban on offshore oil drilling would severely compromise such a goal.
Despite divergent stakeholder views about oil and gas development, there is agreement in one area: that there is a real risk of industrial or shipping-related environmental disaster. Oil extraction represents the most severe threat to the Arctic environment and to the traditional livelihoods of Arctic peoples. Harsh conditions, including extreme weather and temparatures, winter darkness and icebergs make Arctic oil spills extremely dangerous and difficult to deal with. More, the Arctic Ocean lacks adequate infrastructure, a situation complicated bythe region’s remoteness. Even a small oil spill could develop into a much larger one due to demanding conditions and lack of proper equipment.
A way forward
Tensions surrounding Arctic oil and gas development must contend with divergent priorities and perspectives – of Arctic states, of course, but also between non-state stakeholders such as individual politicians, indigenous peoples and environmentalists. Points of contention are many: whether and how to use resources in the future, how; where, and to what extent environmental protection should take place; whether it is safe to extract oil and gas in such demanding conditions;- and who has a say in this issue. Stakeholder perspectives on these key issues are currently so disparate that it is difficult to envision any near-term convergence of interests. . Meanwhile, ice will continue to melt, the Arctic will continue to change, and Arctic stakeholders will still have to find ways to adapt.
The demand for oil and gas continues, and the Arctic, as a potential new source of supply, is unlikely to be exempt from new exploration and extraction activities. Arctic States, the region’s central decision-makers, have indicated that oil and gas reserves will be developed, and developed according to the highest environmental standards. Meanwhile, the Arctic is not free of human presence, and the northern peoples who live there need to find new economic activities to cope with their changing Arctic reality. Despite their differences, they agree that the Arctic environment should be protected. that the risk of environmental catastrophe is real, and that it should be avoided.
A ban on Arctic oil and gas extraction will not resolve the real problem of climate change induced ice melt. The problem is not Arctic oil and gas extraction, but rather patterns of global hydrocarbon consumption. Economic development is vital for local Arctic communities. A big question for their future is how local interests can be integrated into new economic activities, how their cultures can be strengthened and economic and social development promoted. For continued Arctic development to proceed in a way that is constructive and beneficial rather than extractive and destructive, the focus of debates needs to be adjusted from putative clashes of national interest among Arctic States on to how best to cope to with environmental, social and economic shifts in a rapidly changing region.
About the author: is a Researcher at the Tampere Peace Research Institute, (TPRI) University of Tampere, Finland. A specialist on Arctic issues, her research interests include political and governance development in the Arctic, Finland’s Arctic policies, security implications of climate change, and environmental cooperation in peace-building. She has authored numerous reports on these and other subjects.
About Thesigers: Thesiger & Company (‘Thesigers’) is a London-based research and advisory firm, providing a wide range of services to clients whose interests and activities demand in-depth knowledge of emerging and frontier markets. Current Intelligence is Thesigers’ quarterly bulletin of current affairs.
Company registered in England and Wales.
Company registration number: 07234402.
VAT number: GB 135658985
Email: email@example.com | Web: thesigers.com
© THESIGER & COMPANY LIMITED (‘THESIGERS’) 2010-2012. All rights reserved. No reproduction of this essay is authorized without prior permission of the publisher. Permission to republish in whole or in part will be considered on a case-by-case basis, and may require payment of a licensing fee.