Sunday, February 19, 2012

Preventing a Blowout in the Arctic

In September 2011, Vladimir Putin announced a program to begin offshore oil and gas exploration and drilling in the Russian Arctic. Putin is also interested in creating new sea terminals, which he said would rival the Suez and Panama Canals. In 2008, the U.S. Geological Survey (USGS) estimated that 13 percent of the world’s undiscovered oil and 30 percent of the world’s undiscovered gas lay beneath the Arctic Seas. The United States, Canada, Norway, Greenland, and Russia, which make up the Arctic 5, are each interested in tapping these Arctic energy reserves.

Russia, the largest oil producer of the five, gets nearly half of its Gross Domestic Product (GDP) from oil exports, a level comparable to Saudi Arabia. As a result, Putin perceives fossil fuels as vital to Russia’s economy and political stability. However, the extreme Arctic climate, characterized by unpredictable weather patterns, heaving sea ice, sub-zero temperatures, dense fog, and darkness half the year, requires specialized equipment. Russia holds a technological advantage over the other Arctic countries because it has already invested in 20 icebreakers, while Canada has 12 and the United States only one. Russia signed a deal with British Petroleum last month to explore the Arctic. Therefore, Russia is currently leading the extractive assault. Read More