According to a Global Data report oil and gas capital expenditure (capex) would increase by 13.4% this year as compared to the $916 million of 2011. This precipitous rise in investment in oil and gas exploration is not only owing to increasing demand-supply disparity of energy resources in the world, it is also the logical corollary of the presence of untapped (or at least not fully tapped) zones like the Gulf of Mexico, offshore Brazil and the one creating the most hullabaloo: Arctic Circle, which has 22 percent of the global untapped oil and gas resources underneath the ice.
As the black gold-rush heats up in the Arctic, it’s obviously Russia that has the upper hand if any military conflict were to surface in the region. For, not only is it by far the strongest militaristic presence in the area, it is also the only nation scrambling for the Arctic that is a nuclear power. Even so, NATO has been making noises about a possible charge towards the North Pole in case the aforementioned scramble goes pear-shaped and brims over.
The deadline for countries to file claims with the United Nations (UN) for “the right to exploit the seabed beyond their coastlines” has passed. This should logically mean that this race that is under discussion to carve out the region, or slice out the cake, so to speak has already begun. However, what needs to be kept in mind – something that Pavel Baev, a Russian expert on the Arctic Circle recently said on a TV show “Spotlight” – is that the center part of the Arctic, which is completely covered with ice isn’t exactly a promising prospect as far as the resources being sighted are concerned. It is the area near the coastline that is actually promising, which is why the whole ‘race for oil’ might just be a misnomer, for what in all honesty could be a peaceful division of the area in synchrony with the countries and their stake-holding sectors.
There is the “Russian shelf”, which legitimately belongs to Russia and hence no one else can stake a claim to that region, like no one else can stake a claim to the opulent oil zones in offshore Alaska but the US – even though Washington has a pretty weak legal position apropos Alaska since it hasn’t as yet ratified the UN convention and hence any nation can pick up their tools and start digging there and no one would be breaching any clause of the International Law.
There are talks about a joint submission by Canada, Russia and Denmark to the UN Commission, and hence peaceful cooperation between the five Arctic states is definitely not off the table. If anything it seems like the more likely course of action, considering the imbalance of militaristic wherewithal in the region, the varying stakeholders of the respective nations, lack of ambiguity with regards to the demarcation of oil zones and most importantly the fact that mutually cooperative exploration would not only be beneficial for the entire Arctic zone, but also for the world as a whole. Maybe this race for Arctic riches is one where the participants are collaborating and driving each other on instead of opting for a callous competition for regional and economic supremacy.
