Latest revision as of 21:16, 27 May 2017

Summary

With climate change shifting the ability for states, companies, and individuals to access the Arctic, conflicts over who has the rights to the mineral and petroleum resources under its seabed, how such rights are to be governed and exploited, the environmental standards for any exploitation that occurs in the region (if any), and who is responsible for what happens when a chemical or oil spill or other form of pollution occurs are growing. There is a diverse set of actors involved in the exploitation and exploration of mineral and petroleum resources in the Arctic. These include the five littoral states; observer states to the Arctic Council; international government and collaborative organizations enabled through international law, international cooperation, and indigenous group collaboration; research consortiums and informative bodies; companies who seek to operate in the region; and, environmentally-oriented non-governmental organizations.

At this time, there is little overt conflict between national actors in the Arctic, but the potential for conflict will only grow as the United States, Russia, and Norway continue to express interest in exploiting its natural resources. This may be further impacted by increased activity in the region by China. With its existing information sharing and governing bodies, international cooperation over the Arctic is likely to continue. By utilizing a mutual gains approach and the lessons learned from the Arctic Fisheries Devising Seminar, a peaceful, adaptive solution to how to extract the regions many mineral and petroleum resources in a safe manner can be reached.

Stakeholder and Issue Matrix

Natural, Historic, Economic, Regional, and Political Framework

Background

History

Only recently has the Arctic Circle been reachable by sea or air, largely due to the changing global climate, which has resulted in the sea ice sheet rapidly melting and the potential for an annual opening of a northwest passage for shipping. Prior to this opening, Arctic relations have been typified by international cooperation interspersed with military posturing. The majority of the recent cooperation has been through multiparty and bilateral scientific research, search and rescue operations, and pollution mitigation and abatement. Indigenous groups throughout the region have conducted subsistence hunting and fishing and have worked together to gain increased representation on the international stage. Due to shifting sea ice and increasing knowledge about potential mineral resources under the Arctic due to scientific expeditions, the five Arctic littoral states - Russia, Canada, United States, Denmark, and Norway - have begun to explore exploiting the mineral and petroleum resources within their accepted and contested economic and continental shelf zones. As could be expected, such exploration has not been without significant conflict, not only over who has rights to what resources but the right to access and use the Arctic and its many resources in general.

Geology, Geography, and Ecology

Until recently, the Arctic Ocean was largely covered by year-round ice, with seasonal breakup near coastal regions in only a few summer months. Geographically, the Arctic is defined by a latitude line of approximately 66° N. The majority of the area within the Arctic Circle falls within the Arctic region, which is defined by the July 10 °C mean isotherm. Anything within this line has a mean temperature in July of 10 °C and is considered within the Arctic region. As can be expected, the region’s winter is often extremely cold except for along Norway where it is tempered by the Gulf Stream, with it summer getting quite hot. The region’s climate is rapidly changing due to climate change, resulting in significant reductions in sea ice and increasing ocean warmth (National Snow & Ice Data Center). Ecologically, the Arctic is extremely diverse – with much of these ecosystems facing rapid change due to climate change. The region has significant fish stocks and is seasonally home to migrating birds and mammals. The United States Geological Survey estimates that there may be 90 billion barrels of oil, 1,660 trillion ft3 of natural gas, and 44 billion barrels of natural liquid gas in the Arctic – with 84% of this occurring in offshore areas (United States Geological Survey, 2008).

Social, Economic, and Political Context

Scientific cooperation has a long history in the Arctic – with many countries continuing longstanding scientific arrangements even when at military conflict (e.g. Russia and the United States). International cooperation in the Arctic has been relatively animosity-free as the region’s governing bodies are tasked with all but regional security and military governance. For countries and peoples that border the Arctic, the Arctic is intrinsically tied to their national and local psyches. All of the Arctic littoral countries have significant indigenous populations, with the regional economies heavily relying upon subsistence hunting, fishing, and resource extraction.

Legal Context

Three main treaties and international agreements govern the Arctic – the United Nations Convention on the Law of the Sea, the Treaty of Spitzbergen, and the Ilulissat Declaration.

United Nations Convention on the Law of the Sea – UNCLOS

The United Nations Convention on the Law of the Sea (UNCLOS) is the governing binding international legal framework for the regulation of commerce, use, and security of the open oceans and coastal territories. UNCLOS emerged from the third United Nations Conference on the Law of the Sea (UNCLOS III) in 1973-1974, was signed in 1982, and went into effect in 1994. There are currently 168 countries that have ratified it (including all but one of the Arctic countries), 14 who have signed either the Convention or the Agreement but not ratified it (including the United States), and 15 observer and member states that have neither signed nor ratified the Convention or its attendant Agreement.

UNCLOS III included provisions on navigation, exclusive economic zones, continental shelf jurisdictions, exploitation of undersea resources in deep seabed areas, and the protection of the environment. All parties to UNCLOS must submit claims for contested extended continental shelves and exclusive economic zones to the Commission on the Limits of the Continental Shelf (CLCS). As the United States has not ratified UNCLOS, it is unable to submit claims to the CLCS.

Treaty of Spitzbergen (1920)

Signed in 1920, the Treaty of Spitzergen (also known as the Svalbard Treaty) demilitarizes the Svalbard archipelago and states that any signatory (of which there are currently 45) can use the region to conduct economic and scientific activity. In 2001, a Chinese team raised the Chinese flag at the Yilite-Mornring Arctic Scientific Expedition and Research Station in Longyearbyen, Svalbard. This, combined with treks to the North Pole by Chinese scientific teams, started what has been perceived to be growing interest in the Arctic by China and other non-littoral states (Steinberg, Tasch, Gerhardt, Keul, & Nyman, 2015).

Ilulissat Declaration (2008)

The Ilulissat Declaration of 2008 states that there is “no need to develop a new comprehensive international legal regime to govern the Arctic Ocean” as the five littoral states “will keep abreast of the developments in the Arctic Ocean and continue to implement appropriate measures” (Ilulissat Declaration of 2008). All five major Arctic countries have agreed to the Declaration and have used it to state that they will resolve territorial issues according to international norms and laws through UNCLOS, even though the United States has yet to ratify it.

Governance Context

UNCLOS Bodies

There are two main governance bodies that deal with resource extraction issues in the Arctic that emerged from UNCLOS – the Commission on the Limits of the Continental Shelf (CLCS) and the International Seabed Authority (ISA).

Commission on the Limits of the Continental Shelf - CLCS

Set up in 1982 under UNCLOS’s Article 76, the Commission on the Limits of the Continental Shelf (CLCS) assesses territorial claims made by nations for extended continental shelf zones. It consists of 21 technical members who serve five-year terms and are experts in geology, geophysics, or hydrology. The Commission evaluates information presented by coastal states and recommends to the states whether or not they may lay claim to a larger continental shelf area. Before making a claim to the Commission, the country must ratify UNCLOS and every country has ten years from the date it ratifies UNCLOS to submit claims.

Extended continental shelf proposals take years to compose, as they must include scientific evidence detailing how the continental shelf extensions are actual geological extensions of the shelf itself and not separate features. The CLCS may make a recommendation but it does not have actual jurisdictional authority to decide disputes between states. Countries may only extend their sovereignty if they can prove that the continental shelf of their landmass is connected to the land in question – this is limited to 350 miles from the baseline of the territorial sea and cannot be beyond 2500 meters in depth (Zia, Kelman, & Glantz, 2015). At this point in time, the CLCS is reviewing an updated claim made by Russia and has yet to decide an additional claim made by Denmark. As the United States has not ratified UNCLOS, it has been unable to submit a claim to the CLCS or staff its technical panel with United States experts.

International Seabed Authority - ISA

The International Seabed Authority (ISA) is the intergovernmental body responsible for organizing, regulating and controlling all mining activities in the international seabed area – which is defined as all areas outside of the limits of national jurisdictions (both extended continental shelf claims and extended economic zones). In its yearly sessions, it makes determinations on contracting with private and public organizations to explore and exploit mineral and petroleum resources on or below the seabed. It also maintains the Mining Code, which is the comprehensive set of rules, regulations, and procedures that regulate prospecting, exploration and exploitation of marine minerals in the international seabed area. In order to maintain its function, it also operates a central data authority, a legal database, and runs workshops and seminars.

Arctic Council

Founded out of the Ottawa Declaration of 1996, the Arctic Council is an intergovernmental body composed of the eight countries that have territory in the Arctic along with Observer States, Non-Governmental Observers, and Indigenous Peoples. It is explicitly set up to promote cooperation and coordination of Arctic-related environmental and sustainable development issues among the Arctic states, indigenous peoples, and other interested parties. It explicitly does not deal with any matters related to military security. Throughout its operation, it has successfully negotiated and passed binding agreements such as the Agreement on Cooperation on Marine Oil Pollution Preparedness and Response in the Arctic. It operates a variety of task forces and ad hoc groups which include the Scientific Cooperation Task Force and the Arctic Monitoring and Assessment Programme.

Member States: Canada, the United States, the Kingdom of Denmark, Finland, Iceland, Norway, the Russia Federation, and Sweden.

Permanent Participants (have full consultation rights in Council’s negotiations and decisions): Aleut International Association (AIA), Arctic Athabaskan Council (AAC), Gwich'in Council International (GCI), Inuit Circumpolar Council (ICC), Russian Association of Indigenous Peoples of the North (RAIPON), and the Saami Council (SC)

Non-Arctic Observer States: France, Germany, Italian Republic, Japan, The Netherlands, People’s Republic of China, Poland, Republic of India, Republic of Korea, Republic of Singapore, Spain, Switzerland, and the United Kingdom.

Intergovernmental and Inter-Parliamentary Observers: International Council for the Exploration of the Seas, International Federation of Red Cross & Red Crescent Societies, International Union for the Conservation of Nature, Nordic Council of Ministers, Nordic Environmental Finance Corporation, North Atlantic Marine Mammal Commission, OSPAR Commission, Standing Committee of the Parliamentarians of the Arctic Region, United Nations Economic Commission for Europe, United Nations Development Program, United Nations Environment Program, World Meteorological Organization, and the West Nordic Council.

Non-Governmental Observers: Advisory Committee on Protection of the Seas, Arctic Institute of North America, Association of World Reindeer Herders, Circumpolar Conservation Union, International Arctic Science Committee, International Arctic Social Sciences Association, International Union for Circumpolar Health, International Work Group for Indigenous Affairs, National Geographics Society, Northern Forum, Oceana, University of the Arctic, and the World Wide Fund for Nature – Global Arctic Program.

Even though corporate non-state actors have a lot to gain or lose through the Arctic Council’s deliberations, they are often not mentioned or have any role in agreements made under the Artic Council (Duyck, 2015)

Arctic Circle

Founded in 2013, the Arctic Circle is an annual Assembly founded in Iceland by Icelandic President Grimsson. It seeks to build international dialogue and cooperation on the future of the Arctic by actively involving government individuals and agencies, corporations, universities, environmental organizations, indigenous groups, concerned citizens, and other stakeholders. It runs annual Forums to build non-partisan relationships on specific topics: the first one was on shipping and ports while the fourth was on sustainable development. As a part of its operations, it has requested the Harvard Program on Negotiation undertake an Arctic Fisheries Devising Seminar, which is detailed below.

Research and Information Bodies

There are a variety of international and extra-national research and information bodies that operate in the Arctic and on Arctic topics. The International Arctic Science Committee is a non-governmental organization consisting of international science groups that participate in Arctic research. It provides objective and independent scientific advice to the Arctic Council and other organizations on issues of science within the Arctic region. The University of the Arctic is a cooperative network of universities, colleges, and research institutions that look at various research interests and conduct education on the Arctic. Other scientific and information oriented organizations and institutions that operate in the Arctic are Cold Facts, the International Arctic Research Center, the University Centre in Svalbard, and the China-Nordic Arctic Research Center.

These groups act as informal or formal forms of joint-fact finding between state actors, institutions, universities, scientists, advocacy organizations and indigenous peoples. They have been instrumental in developing long-term relationships between researchers and scientists across the Arctic and highlight the importance of international and bilateral cooperation throughout the region.

Issues and Stakeholders

Major Stakeholders in Mineral Resource Extraction in the Arctic

There are numerous governmental, non-governmental, indigenous, intergovernmental and inter-parliamentary organizations, and corporations that have expressed major interest in the Arctic Circle, either through seeking participation as observers or members of the Arctic Council or through direct actions in the region.

Arctic Littoral States There are currently eight states within the Arctic Circle: Canada, Russia, the United States, Norway, Denmark (Greenland), Iceland, Finland, and Sweden. The first five of these are littoral – they control significant Arctic coastal territory and have laid formal claims to Exclusive Economic Zones and Extended Continental Shelves within the circle. All of these countries except the United States have ratified UNCLOS and all are member states of the Arctic Council.

Other Stakeholder Countries In addition to the eight Arctic states, there are twelve approved non-arctic countries who are Observers to the Arctic Council: France (2000), Germany (1998), the Netherlands (1998), Poland (1998), Spain (1998), the United Kingdom (1998), the People’s Republic of China (2013), the Italian Republic (2013), Japan (2013), Republic of Korea (2013), Republic of Singapore (2013), and the Republic of India (2013). Two states are currently waiting for Observer Status with the Arctic Council: the European Union and Turkey.

Indigenous Groups Six multi-national indigenous groups have Permanent Participant status with the Arctic Council: the Aleut International Association, the Arctic Athabaskan Council, Gwich’in Council International, Inuit Circumpolar Council, Russian Association of Indigenous Peoples of the North, and the Saami Council. As Permanent Participants to the Arctic Council, these groups represent approximately 500,000 indigenous peoples and have full consultation rights in the Arctic Council’s decisions, negotiations, and working groups. In other Arctic governance bodies, their rights and powers vary.

Environmentally-Focused Organizations There are a wide variety of environmental organizations and groups operating within the Arctic and on Arctic concerns. Among those who are approved observers to the Arctic Council are the World Wild Fund for Nature – Global Arctic Program, the Association of World Reindeer Herders, and the Circumpolar Conservation Union. Another major environmental group operating in the Arctic is Greenpeace, which is very critical of mining and drilling operations throughout the entire region and the impact climate change will have on the indigenous groups who live there.

Major Petroleum and Extraction Corporations Mining and drilling will only occur in the Arctic if it is found to be profitable and in the best interest of both countries and companies. Both Russia and Norway operate state-owned oil companies, with Russia owning the majority of Rosneft and Norway owning the majority of Statoil ASA. In addition to these, Exxon Mobil and Shell have both expressed interest or have had rights to explore and drill in the Arctic.

Although there is scientific evidence of extensive natural gas and petroleum resources in the Arctic (United States Geological Survey, 2008), not every initiative to explore for petroleum in the Arctic has been successful. In September 2015, Royal Dutch Shell announced that they would stop all offshore drilling operations in the Arctic after spending $7 billion to explore a single well. This was due partly to uncertainty over oil prices and that the potential reserves of oil and gas present at the site were “not sufficient to warrant further exploration” (Barrett, 2015).

United States exploration and extraction of petroleum from the Arctic is further compounded by the uncertainty in the United States political establishment over mining and drilling in the areas claimed by the United States in the Arctic. In late 2016, President Obama banned oil drilling in the Arctic through the Outer Continental Shelf Lands Act, which was coordinated with a similar announcement by Prime Minister Trudeau of Canada (Eilperin & Fears, 2016). Yet, recently President Trump has pushed to expand offshore drilling in the Arctic through requiring the Department of the Interior to review President Obama’s regulations on Arctic drilling (Martinson, 2017).

Who has a right to the mineral and petroleum resources of the arctic?

The majority of the current conflict over mineral and petroleum resource rights in the Arctic is due to competing Extended Continental Shelf claims with the Commission on the Limits of the Continental Shelf (CLCS) and the United States’ refusal to ratify UNCLOS. There is also growing fear that other states will attempt to conduct mineral resource extraction in the Svalbard area under the Treaty of Spitzbergen and in the few unclaimed international areas of the Arctic Ocean as defined under UNCLOS and is determined by the International Seabed Authority.

Complicating Issue 1: United States & Non-Ratification of UNCLOS

At this point in time, four of the five littoral states have ratified UNCLOS and submitted claims to the CLCS for extended continental shelf rights in the Arctic and elsewhere – the United States will be able to do the same during the first ten years following their ratification of UNCLOS (Zia, Kelman, & Glantz, 2015). Furthermore, by not ratifying UNCLOS, the United States is not required to follow the Mining Code, the International Seabed Authority’s rules and procedures governing the exploration and exploitation of undersea mineral resources in the international seabed area not claimed by countries. As such, the United States could potentially exploit mineral resources contained under the seabed in the few parts of the Arctic unclaimed by any of the five littoral states without formal ISA approval.

The United States, as one of the few countries to not ratify UNCLOS, was unable to do so due to strong opposition from Republican members of the Senate. Even though the UNITED STATES Navy favors ratifying UNCLOS, the Heritage Foundation argues that doing so would expose the UNITED STATES “to specious environmental claims” and require it “to transfer royalties generated from oil and gas development on the U.S. continental shelf to the ISA for redistribution to the ‘developing world’” (Groves, 2011). Were the Republican Party to continue to hold onto a significant minority of the Senate (two-thirds are required to ratify a treaty), it is unlikely that the United States will ratify UNLCOS anytime soon.

Complicating Issue 2: Extended Continental Shelf Determinations

Without the United States ratifying UNCLOS, uncertainty will remain over who has extended continental shelf claims to certain parts of the Arctic seabed. If the United States ever ratifies UNCLOS, it will have the opportunity to submit an extended continental shelf claim to the CLCS within ten years. Until that point in time, it has no standing within the body and cannot make official objections to the body about other countries’ claims except through a demarche (Borgerson, 2009). By not ratifying UNCLOS, the United States cannot submit counter-claims to those made by other countries nor can they have a voice in proceedings for areas they contest. They will only have the opportunity to do so after the UNITED STATES ratifies UNCLOS, which may never happen. The uncertainty stemming from this makes it hard for any country, state or business actor to put significant resources into the extraction of resources in offshore regions of the Arctic as the United States could challenge any development or plan if it ratifies UNCLOS.

Who is responsible for determining proper pollution mitigation and prevention guidelines and how will these be maintained?

At this point in time, all members of the Arctic Council are party to the binding agreements made under the Arctic Council, primarily the 2011 Agreement on Cooperation on Marine Oil Pollution Preparedness and Response in the Arctic. Furthermore, all of the same parties but the United States are party to various UNCLOS guidelines, procedures, and rules on pollution prevention, particularly Article 194 which says that “States shall take, individually or jointly as appropriate, all measures consistent with this Convention that are necessary to prevent, reduce, and control…pollution from installations and devices used in exploration or exploitation of the natural resources of the seabed and subsoil, in particular measures for preventing accidents and dealing with emergencies, ensuring the safety of operations at sea, and regulating the design, construction, equipment, operation and manning of such installations or devices” (United Nations Convention on the Law of the Sea).

How legitimate is the Arctic Council and what does this mean for the extraction of mineral/petroleum resources in the Arctic?

An underlying issue in many negotiations related to Arctic governance is the oft-perceived illegitimacy of the Arctic Council and its associated bodies. Even the five Artic littoral states that have worked to jointly solve scientific challenges through the Arctic Council have sought to work outside of it, as can be seen in the drafting and agreement to the Ilulissat Declaration in 2008 during the five-party Arctic Ocean Conference (Pedersen, 2012). This Declaration stated that there is “no need to develop a new comprehensive international legal regime to govern the Arctic Ocean” as the five states “will keep abreast of the developments in the Arctic Ocean and continue to implement appropriate measures” (Ilulissat Declaration of 2008).

Furthermore, internal fissures have grown as additional observer states, particularly China, have been added, resulting in the perceived growing weakness of the indigenous peoples organizations that represent a single indigenous people who reside in more than one Arctic state and are Permanent Participants to the Arctic Council (Breum, 2013). As various observer and participant bodies seek to gain a voice in determine how mineral and petroleum extraction should occur and be overseen in the Arctic, concerns over the legitimacy of the Arctic Council will only continue to grow. The longstanding tradition of establishing ad hoc task forces and working groups within the Arctic Council may also be a weakness, as it jeopardizes the inclusiveness of the Council’s general operations (Duyck, 2015). Nevertheless, there is a trend towards institutionalization within the Arctic through the development and acceptance of the Arctic Council among Arctic states as well as the adoption of more formal agreements related to the Arctic (Duyck, 2015).

Presence of Enabling Conditions

The perceived conflict over arctic mineral and petroleum resources has a few significant enabling conditions that would help the parties achieve collaborative agreement.

First, and foremost, there is a longstanding tradition of scientific cooperation between all of the Arctic littoral states. Through this, all five of the littoral countries have explored mutual scientific interests and have already created options for mutual gain including bi-lateral scientific expeditions and general sharing of scientific data through existing organizations and various symposia and workshops.

Second, all states within the Arctic Council have reached general agreement on the importance of limiting pollution within the Arctic as well as the Agreement on Cooperation on Aeronautical and Maritime Search and Rescue in the Arctic. This means that at least some level of political will and cooperation already exists between the major stakeholders at play.

Third, the five largest littoral states have already agreed to the creation of the Arctic Council, have funded and staffed it with generally adequate resources, have met annually since its founding, and have used this as a mechanism to address many rising problems that a party to the Council has seen through the development of task forces and working groups.

These three enabling conditions show that agreement can be reached on who should have the right to extract mineral resources from the Arctic, how it should be governed, and what risk mitigation measures will be required.

The Arctic Fisheries Devising Seminar – A Framework for Arctic Mineral and Petroleum Exploitation Stakeholder Assessment, Cooperation, and Agreement

International cooperation on a contentious Arctic Ocean issue has recently occurred through the Arctic Fisheries Devising Seminar, held at the Harvard Law School at the request of the Arctic Circle. This seminar brought together 23 individuals from a variety of stakeholder groups, including high-level government actors, scientists, industry experts, and activists – all of whom acted throughout the seminar as individuals and not in their official capacity. This seminar gained was able to further explore seven main questions and themes related to Arctic fisheries, gaps in scientific knowledge, indigenous rights, and oil spill/pollution prevention (Program on Negotiation at Harvard Law School, 2014). This seminar can act as a template for a future Devising Seminar on Arctic Mineral Resource Extraction and Pollution Mitigation and Management.

The Water Diplomacy Framework and Managing the Exploitation of Mineral and Petroleum Resources in the Arctic

Through applying a mutual gains approach highlighting the shared dangers to all parties from uncontrolled drilling and expansive pollution and by promoting adaptive co-management, especially through the already existing mechanism of the Arctic Council, the major littoral states and all who claim observer status in the Arctic Council may come to a flexible agreement and structure for managing the extraction of mineral resources in the Arctic and the environmental and social dangers such extraction posses. The existing Arctic Council agreement on Pollution in the Arctic shows that there is already regional cooperation and a willingness to work within the existing Arctic Council framework to solve conflicts over the resources of the region.

Analysis, Synthesis, and Insight

No ASI articles have been added yet for this case

Key Questions

Transboundary Water Issues: What considerations can be given to incorporating collaborative adaptive management (CAM)? What efforts have the parties made to review and adjust a solution or decision over time in light of changing conditions?

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Power and Politics: To what extent can international actors and movements from civil society influence water management? How and when is this beneficial/detrimental and how can these effects be supported/mitigated?

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Tagged with: Climate Change Natural Resource Extraction Arctic Sea Ice First Nations/Indigenous Tribes Petroleum Extraction

References

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