I’m supposed to be on today to discuss the results of the new United States Geological Survey of fossil resources north of the Arctic Circle:
The assessment, which took four years, found that the Arctic may hold as much as 90 billion barrels of undiscovered oil reserves, and 1,670 trillion cubic feet of natural gas. This would amount to 13 percent of the world’s total undiscovered oil and about 30 percent of the undiscovered natural gas.
As I noted two years ago,
The Arctic has enormous oil resources, but, of course, the burning of oil is one of the principal sources of human-generated greenhouse gases. So If you look up “irony” in some not-so-distant-future dictionary, you may well see a picture of an oil tanker in ice-free polar waters filling up on an Arctic oil well.
I’ll blog more on this later, but here are the key new factoids from the USGS survey:
A third of the yet-to-be discovered oil, or about 30 billion barrels, is off the coast of Alaska. The findings also confirmed the pivotal role of Russia. Nearly two-thirds of the yet-to-be found natural gas resources are in two Russian provinces…
The WSJ reports:
The USGS report, which brings together disparate data held by individual countries as well as new information from geologists working in the field, is the first time anyone has produced a comprehensive, publicly available estimate of the Arctic’s hydrocarbon treasures….
It will not ratchet up global production like a new Saudi Arabia,” said Donald Lee Gautier, a USGS geologist who played a key role in the survey, known as the Circum-Arctic Resource Appraisal. “These are additions that will come over time.”
… But large parts of the Arctic, especially offshore, remain unexplored. Near-permanent sea ice makes it almost impossible to acquire seismic data and drill exploratory wells.
Climate change is opening the region. The Northwest Passage, home to deadly ice floes that can crush ships, was ice-free last summer. Some predict it will turn into a new trade route between Europe and Asia, and a channel that oil companies can use to ferry workers, equipment and supplies around more freely.
And we could well see increasing political disputes:
Oil exploration might also be hampered by rising nationalism. The five circumpolar states — Canada, Russia, the U.S., Norway and Denmark — are scrambling to claim new territory in the central Arctic Ocean. Last August, a Russian submarine planted the country’s flag on the seabed some 14,000 feet under the North Pole. Shortly afterward, Canadian Prime Minister Stephen Harper announced that his country’s military presence in the Arctic would be beefed up.
The rhetoric stems from disagreements over who has sovereignty over the North Pole. Russia rests its claim on the theory that two underwater mountain chains that cross the Arctic Ocean, the Lomonosov and Mendeleev Ridges, are in fact extensions of its continental shelf. Denmark disputes that. A United Nations body that rules on such claims has recommended additional research….
Yet there is little likelihood that much of Russia’s Arctic wealth will be exploited any time soon. The country still has vast untapped fields onshore that are first in line to be developed.
Development would also be hampered by Russia’s likely reluctance to let in foreign companies with experience developing oil and gas riches in hostile environments like the Arctic. Some firms have been allowed in, but only as junior partners of state-controlled Russian entities such as OAO Gazprom.
Andy Revkin provides the bottom line in a good blog post, “Arctic Gas and Oil Bonanza, but No Energy Fix”:
The Arctic energy report, then, perhaps supports the assertions of those saying that the world will not be able to drill its way out of the oil crunch in the long run, and that, with or without considering global warming, we must eventually shift to electrified transportation and renewable farmed fuels for sectors like aviation that can’t plug in.