Arctic oil - the battle begins

09/06/2010 09:34 am ET | Updated May 25, 2011
  • Michael Jacobs Michael Jacobs is IPPR’s Associate Director for Energy and Climate Change

The dramatic occupation by Greenpeace campaigners of an oil rig in the freezing seas off the coast of Greenland last week marks the first skirmish in a critical environmental battle. On the one side, a multinational oil industry desperate for new drilling fields to meet the world's insatiable demand for fuel. On the other, a global environmental movement anxious to find a new front on which to fight its stalled campaign against climate change.

The desire of the oil industry to find new reserves in the Arctic is not hard to understand. Increasingly locked out of developing countries whose governments now prefer to control their own oil sectors, and plagued by political instability from Nigeria to Iraq, global oil companies view the prospect of finding oil in the Arctic - governed by the stable democracies of the US, Canada and Scandinavia - with enthusiasm. They are already investing heavily in the high-carbon tar sands of Canada; the US Geological Survey estimates that the Arctic's technically recoverable offshore reserves could amount to around 90 billion barrels, or around 7-10% of currently estimated 'proven' reserves.

But the environmental case against exploration is even more powerful. Home to millions of migratory birds and many species of marine mammal including whales, bears, walruses and narwhals, the Arctic has a fragile ecology already under pressure from the warming seas and fracturing ice masses caused by now-occurring climate change. With low temperatures, lack of sunlight and thick ice inhibiting the breakdown and dispersal of spilled oil, the environmental impact of an oil leak here could dwarf the BP disaster in the Gulf of Mexico. It is now more than 20 years since the Exxon Valdez ran aground in the Gulf of Alaska; despite the huge clean-up operation, local populations of marine mammals have yet to recover and some are nearing extinction.

And the Arctic Sea is a spectacularly inhospitable place for drilling. Following the Deepwater Horizon disaster in the Gulf of Mexico President Obama imposed a moratorium on drilling at a depth of 152 metres or more. But the well being drilled by Cairn Energy from the occupied rig off Greenland is at a depth of more than 300 metres. Cairn's ships are literally having to tow icebergs out of the way to avoid them colliding with it. Drilling in this area is only possible for a few months between July and early October; for the rest of the year the sea-ice becomes too thick to allow vessels to operate. That means that should a leak occur it may be impossible to drill a relief well until at least the following year, allowing oil to flood into the Arctic waters for months. Industry experts warn that there are no methods yet developed to recover spilled oil trapped underneath ice. According to the US Minerals Management Service, the chances of a major spill over the lifetime of a block of exploration leases in Alaska is as high as one in five.

And what will be the reward for such an environmental risk? Even if all the estimated Arctic reserves can be exploited, they would provide less than three years of global oil consumption at present rates. For here lies the central problem. The oil industry is right to point to the continuously rising global demand for oil; but the answer cannot be an ever-expanding supply produced in ever more hazardous ways. And the reason is climate change.

Figures from the International Energy Agency (IEA) make this clear. If the growth of energy demand continues on current trends, oil consumption will expand by a quarter from current levels by 2030, a level inevitably requiring new discoveries. But these same trends, and their resulting greenhouse gas emissions, will lead to global warming of a catastrophic five or six degrees Centigrade, well beyond the capacity of human society to adapt. By contrast, if the global temperature rise is to be held to a just-tolerable 2 degrees, global oil consumption would have to be only just above current levels by 2030, and already falling. Such levels of consumption can be met from within existing reserves. But more importantly, as the IEA shows, they will require a significant development of alternatives to oil.

Such alternatives are beginning to become viable, notably in the development of electric vehicles and second and third generation biofuels. Electric and hybrid vehicles in particular are now under commercial production by all the big car manufacturers. But the incentive for their development is the prospect of increasingly scarce and expensive oil, and this will only be retarded by the continued focus on developing new supply.

So Greenpeace's demand for the banning of Arctic drilling is justified on both climate change and ecological grounds. It will not easy to achieve. Yet prohibiting resource use has been done before - indeed, many of environmentalism's greatest advances have taken this form. The bans on whaling, prohibitions on cutting down ancient forests, the creation of National Parks, the protection (just) of Antarctica, all provide precedents. They have required protracted public campaigns to pressurise governments and the companies involved, but in the end have succeeded.

So a global campaign to prohibit exploitation of Arctic oil looks set to become a new focus for environmental concern. The deep anxiety and backlash against the oil industry caused by the BP disaster in the Gulf of Mexico provides a huge opportunity for the environmental movement. Yet in putting pressure on the US, Canadian, Danish, Norwegian and Russian governments it will meet fierce resistance from an oil industry with deep pockets and even deeper contacts in the upper ranks of governments and legislatures. For a movement which has struggled to mobilise public opinion on the scale required to combat climate change, this will be a huge challenge. But in every generation one issue comes to symbolise the wider battle over humankind's exploitation of the natural world. The confrontation just witnessed in the cold winds of Baffin Bay marks the next frontier.

(Originally published in Inside Story) (