Arctic oil industry
In the Arctic, the oil industry remains one of the most important economic sectors. Historically far and dangerous for human travel, the discovery of oil in northern Alaska and other parts of the Arctic has driven economic development, making it easier to extract oil in dangerous locations. The improvement of the technology to do is spurred. Arctic oil exploration and extraction is expected to increase in the coming decades as climate change makes the Arctic Ocean more navigable.
Although Arctic oil exploration is primarily concentrated in Alaska, significant reserves of oil and natural gas have also been discovered in Canada, Greenland and other Arctic regions. Below is an overview of the history of oil extraction in the Arctic.
Arctic oil industry
The Arctic consists of 19 geological basins, half of which are under exploration for oil and gas resources. A 2008 study by the U.S. Geological Survey estimated that the Arctic contains 90 billion barrels of extractable oil, representing 13% of the world’s oil supply, and 44 billion barrels of natural gas. I was. More than half of these oil and gas reserves are believed to lie in three basins: Arctic Alaska, the Amerasia Sedimentary Basin (which includes Russia and Canada), and the East Greenland Rift Basin. Additional oil reserves are believed to exist in the East Barents Basin and the West Greenland-East Canada Basin.
Oil exploration in the Arctic has traditionally been limited by cost and technology. The Arctic itself was not traversable by ship until recently due to inadequate shipping technology to survive in the vast amounts of sea ice in the Arctic Ocean. These technical limitations made oil exploration and drilling impractical. Moreover, the cost of extracting oil in the Arctic is so high that unless oil prices rise above a certain level, the effort will be costly.
The history of oil extraction in the Arctic dates back to the 20th century. In the 1970s and 1980s, Petro Canada, Dome Petroleum and many others embarked on oil exploration in the Canadian Arctic. The 176 wells created resulted in mining companies discovering 1.9 billion barrels of oil, which were too few to justify continued drilling, so the wells were blocked and abandoned. I was. Due to the complex geological characteristics of the Canadian Arctic, where much more natural gas than oil is extracted because of tectonic pressure, and oil leaks into the sea due to tectonic fracturing, continued Exploration was blocked.
In 2007, Russian geologists embarked on the Arktika–2007 expedition to explore the Lomonosov Ridge, an undersea ridge that stretches from the Russian eastern Arctic to Ellesmere Island in Canada. Geologists have revealed that the Lomonosov Ridge is physically connected to Russian territory, providing the basis for Russia’s territorial claims to the region. According to these scientists, the Lomonosov Ridge contains more than 10 billion tons of oil and natural gas reserves.
Greenland is also believed to have Arctic oil and natural gas reserves. In 2001, the U.S. Geological Survey estimated that the waters of the Greenland Sea, located off the northeast coast of the United States, may contain as many as 110 billion barrels of oil. This coastal exploration was carried out by Nunaoil, a state-owned company owned by the Danish and Greenlandic governments. Greenland also conducts oil exploration on the west coast, but this area is considered more desirable because it is relatively ice-free, making oil extraction less expensive and less dangerous.
Norway, which has developed offshore oil resources for decades, also claims ownership of the Arctic’s oil reserves. In 2012, Norwegian oil company Statoil (now Equinor), majority-owned by the Norwegian government, signed a contract with Russian government-owned oil company Rosneft to explore for oil in the Arctic territories. In contrast to other countries, Norway is considered a world leader in oil extraction technology and is uniquely positioned to deal with safety and spill issues.
The United States has the longest history of extracting Arctic oil reserves. The discovery of Alaska’s Prudhoe Bay oil field in 1968 brought a long period of economic development to the region. Construction of the Trans-Alaska Pipeline System in the 1970s made it possible to transport oil safely and cheaply from Prudhoe Bay to Valdez on Alaska’s south coast. Construction of this pipeline was inspired by the vast sea ice that forms along Alaska’s North Slope County. Due to the lack of infrastructure in the region, shipping oil by sea was expected to be expensive and dangerous.
The opening of the Trans-Alaska Pipeline System has revitalized Alaska’s economy and transformed Fairbanks, the closest major city to Prudhoe Bay, into a regional economic hub. Concurrently, the Dalton Highway connected Prudhoe Bay to the North American road network beyond Fairbanks, further benefiting the region. The United States has also considered oil drilling in the Chukchi Sea, which separates Alaska and Siberia.
Arctic oil development has stagnated over the past decade due to low global oil prices. The commercialization of hydraulic fracturing technology has made it possible to extract oil reserves in the continental United States and elsewhere, making Arctic development even more expensive and less of a priority. . The ensuing oil glut also removed the incentive to drill for Arctic oil, at least in the United States and Canada. Environmental concerns are also playing a role. Conservationists fear that excessive oil exploration will further harm Arctic ecosystems already affected by global warming.
However, given that global reserves are being depleted elsewhere in the world, Arctic oil exploration will remain on the policy agenda for Arctic countries for the foreseeable future. Improvements in ship technology and declining Arctic sea ice levels have made continuous exploration more economically feasible. A struggle for Arctic resources between the United States, Russia, Canada and Denmark could intensify oil exploration in the region and, in turn, drive up the cost of oil extraction.
Oil extraction has become an important and growing part of the Arctic economy. Because the world depends on oil to function, the Arctic’s oil reserves are too important a resource for governments and businesses to ignore. The recent oil oversupply has dampened potential profitability and slowed the pace of development somewhat, but due to technological improvements, climate change and other factors, oil remains an important part of the Arctic region. It is certain.