A recent article in the venerable Arctic policy blog Cryopolitics, which discussed the failed attempt [paywall] by a Chinese construction firm to invest in the planned refurbishing of key airports in Greenland, suggested that this incident was but a minor setback in Beijing’s overall economic diplomacy in Nuuk, as well as the Arctic as a whole. This week, that view appeared to be further vindicated when it was announced that two major Chinese energy firms were expressing interest in investing in oil and gas surveying in Greenland when the island’s government begins to receive bids for licences to explore onshore blocks as of 2021. The blocks in question would be situated in the regions of Disko Island (Qeqertarsuaq) and the Nuussuaq Peninsula, both located on Greenland’s west coast.
According to Mr Aqqalu Jerimiassen, Greenland’s Industry and Energy Minister, both the China National Petroleum Corp. (CNPC) and China National Offshore Oil Corp. (CNOOC) had expressed early interest in bidding for the right to explore the regions, suggesting that Beijing has not given up its interest in jointly developing fossil fuels in parts of the Arctic beyond Russia. Thus far, China’s energy diplomacy has largely been centred on Siberia, including the Yamal liquefied natural gas (LNG) projects, but Chinese firms were less successful in the case of Iceland. In 2013, CNOOC had agreed to partner with an Icelandic and Norwegian firm to survey the Dreki region in the Atlantic-Arctic for oil and gas, but disappointing findings prompted the Chinese firm to withdraw from the project in January of this year.
In Alaska, another Chinese energy corporation, Sinopec, along with the Bank of China, and a division of the China Investment Corp (CIC), all reaffirmed their interest in developing LNG pipelines in the state, although it remains to be seen whether the intensifying Sino-American trade war may delay or even scuttle that agreement, which was first mooted in late 2017.
It has been estimated that the waters off of Greenland could contain significant fossil fuel deposits, with one 2010 study suggesting as much as fifty billion barrels of oil. However, previous surveys by European firms, including Cairn Energy of Scotland and Norway’s Statoil (now Equinor), recorded negligible supplies in the region. If the bids by CNOOC and CNPC do go forward, these would be the first [In Danish] such investments in oil and gas surveys in Greenland waters by Chinese companies.
The collapse of global energy prices after 2014 brought intense speculation about a ‘resource scramble’ in the Arctic to a near-halt. Yet oil prices have been inching upward, albeit erratically, this year, and the financial services firm Goldman Sachs suggested this week that global petrol prices might return to the US$80 per barrel mark by the end of 2018.
As well, there are short-term foreign policy challenges emerging which may adversely effect global prices and supply chains, including souring relations between the West and Saudi Arabia over the death of journalist Jamal Khashoggi, as well as a new set of US economic sanctions on oil-rich Venezuela which were announced this week by the Trump administration. Although a short-term return to the US$100-a-barrel period of five years ago is unlikely, (but not impossible), even a milder uptick in international energy prices could make the Arctic once again attractive for future oil and gas exploration, and Chinese firms have long expressed its interest in such endeavours.
The story does not end with Greenland oil, as Mr Jerimiassen had also suggested this week that Chinese firms have expressed interest in purchasing fresh water [In Danish] from Greenland’s melting glaciers, given ongoing Chinese demand for bottled drinking water and the high purity level of meltwater from the island’s ice stores.
This ‘oil and water’ news from Greenland further demonstrates that the island remains a key part of Beijing’s growing Arctic economic diplomacy. However, with both the US and Denmark continuing to be wary of Chinese investment in Greenland, it remains to be seen whether the island’s vast emerging resources will become a growing source of geo-strategic competition.
The Russian Arctic has begun to take on greater international visibility of late, for a variety of reasons. These include recent moves by the government of Vladimir Putin to re-establish a stronger military presence along its Arctic coast, as well as the growing economic interest in the region, most notably in regards to potential fossil fuels as well as the shipping potential of the Northern Sea Route (NSR), which has the potential to better connect Asian and European markets in the coming decades. However, the security and development of the Russian Arctic has always been a challenge due to the region’s size and geography. Russia’s Arctic coastline is the largest in the world, (at about 24,000 km), and was a challenge to monitor even during the height of the Soviet era.
Although the actual borders of the Russian Arctic, in relation to the rest of the country, have been often been open to political interpretation, the region is assumed to have a population of two million, including Arctic cities such as Murmansk (300,000) and Arkhangelsk (350,000). However, the Russian Arctic has also traditionally been looped into parts of the greater Siberian Federal District (Сиби́рский федера́льный о́круг) with 19.2 million persons, and the Russian Far East (RFE), with a population of 6 million people and including the Sakha Republic (also known as Yakutia) with a population of about 950,000. The Sakha Republic is also the largest sub-national government in the world by area.
Other parts of the Russian Arctic closer to Western Europe include the Republic of Karelia (Респу́блика Каре́лия) on the Finnish border. In addition to Russians, the Russian Arctic includes indigenous populations including Yakuts, Komis, and Karelians and Nenets. Just as Russia is a member of the Arctic Council, the Russian Association of Indigenous Peoples of the North (Raipon) represents Russian indigenous Arctic peoples on the Council.
While the Arctic was a major arena for cold war rivalries, the first decade after the collapse of the USSR in 1991 saw Arctic policy in Russia downgraded in importance under the government of Boris Yeltsin, as well as a certain degree of overall decentralisation of the Russian peripheral region which only began to reverse itself when the presidency was transferred to Vladimir Putin in 2000.
During his first two terms as president (2000-8), the Arctic was one of the main components of Putin’s ‘re-centralisation’ of political authority within the entire Russian Federation. The desire by the new government to bring the Arctic region back to greater central authority was reflected in the 2001 Arctic White Paper [In Russian] issued by the Russian government, as well as growing concerns about the security situation in the overall Arctic Ocean.
The 2001 paper included calls for strengthening Russian naval power in the Arctic, and to counter military activities by other major Arctic players including Norway, Canada, Denmark/Greenland and the United States. As the Russian Federation emerged from the USSR, the Arctic continued to be seen as an essential part of not only Russian interests, but also its overall identity. The 2009 revised Russian White Paper on the Arctic [In Russian], signed by then-President Dmitri Medvedev, was more conservative in tone, noting that Moscow’s primary interests in the Arctic were: a) the use of the Arctic as a strategic resource base; b) maintaining the Arctic as a zone of peace and cooperation; c) preserving the Arctic environment; and d) development of the Northern Sea Route/NSR as a communications and transportation conduit. A follow-up government document [In Russian] released in 2013 expanded on these ideas, calling for an integrated security system to protect people and assets in the Russian Arctic.
Moscow’s major concerns in its ‘re-engagement’ of its Arctic territories over the past decade were based on wishing to once again be seen as a key Arctic Ocean power, to ensure access to Arctic resources, and to reverse a depopulation trend in the Russian Arctic. In the years immediately after the collapse of the USSR the central government was unable to economically support peripheral regions, and much Arctic research ground to a near-halt.
Growing Russian concerns about the security and stability of its Arctic realms have taken place in the midst of two larger international trends. The first is the melting of the Arctic ice cap, which has opened up large parts of the region to economic activity, including mining, drilling for fossil fuels and shipping in the Arctic Ocean. The second trend is a worsening relationship between Russia and several Western governments, including the United States and major states within the European Union. Russian concerns about Western military aims, and concerns about NATO encroachment into Moscow’s perceived sphere of influence, coupled with the diplomatic aftershocks of the Crimea/Ukraine crises after 2014, prompted the Putin government to seek out other partners for Arctic development, most evidently China. Although the Arctic remains a zone of relative peace, security concerns have started to seep into the region, with much of it directly tied to growing Russia/Western rivalries.
As Russia specialists have argued, the country’s Arctic policies have often been torn between the desire for security and the desire for cooperation, especially in the area of economic development of Russian Arctic lands. Although there are many cases of these two policies conflicting with each other, there is also much overlap.
Russia’s security concerns in the Arctic have been demonstrated by ongoing plans by the Putin government to reopen military sites in Siberia, as well as build and move military assets into the region. Arctic strategy building has factored greatly into Moscow’s reforms to the Russian armed forces. One of the most visible examples of this policy has been a newly completed ‘trefoil’ base established on Franz Josef Land, but facilities are also being established in the New Siberian Islands, Wrangel Island in the Chukchi Sea, and on Cape Schmidt in the Russian Far East. However, much of this infrastructure build-up has been framed by Moscow as the need to monitor expected increases in traffic along the Northern Sea Route (Северный морской путь).
Russia has also been seeking to clarify is Arctic Ocean maritime boundaries, especially in the case of the disputed Lomonosov Ridge which is also claimed by Canada and Denmark (via Greenland). The ‘Foreign Policy Concept’ published by the Putin government in November 2016 specifically stated ‘Russia intends to delimitate the outer limits of its continental shelf in accordance with international law so as to create more opportunities for the exploration and extraction of minerals.’ The planting of a titanium Russian flag in the waters underneath the North Pole by a Russian submarine in 2007 was seen as the first salvo in a potential ‘scramble’ for Arctic resources.
Russia has also been prioritising the building of new icebreakers for the Arctic. At present the country has more than forty icebreaking ships, including nuclear powered ships and three more advanced LK-60Ya-class icebreakers expected to go into operation starting in 2019. This has led to American concerns about an ‘icebreaker gap’, given that the US has only two functional icebreakers.
However, despite the growing concerns about the militarisation of the Arctic, there is still the tendency to view the region as ‘high north, low tension’, and Russia is in agreement with the other Arctic states that the region should be kept peaceful, with a focus on scientific endeavours, environmental concerns and economic cooperation. Russia has shown little sign of wanting to challenge governance norms in the Arctic. For example, Moscow has been supportive of the 2008 Ilulissat Declaration [pdf], and the 2017 Polar Code [pdf], which serves to regular civilian ship activity in the polar regions, as well as the more recent Central Arctic Ocean fishing moratorium, (Moscow was represented at signing of the agreement along with Chukotka Inuit representatives). Russia also signed a maritime border demarcation agreement covering the Barents Sea with Norway in 2010 in spite of predictions that the negotiations would be complicated and rancorous.
Russian Arctic interests have also supported cooperation for foreign energy firms. Despite the general trend towards disengagement of energy firms in the Arctic after fossil fuels prices began to drop in 2014, which led to major energy concerns like Shell withdrawing from the region, Russian firms have doubled down on Arctic oil and gas. The Shtokman Field is still seen as a future source of natural gas, but much of the attention has shifted eastward to Yamal, which features an LNG project which came online in December last year amid hopes for large scale gas exports both East Asia and Europe. China is a major financial backer of the project, and it was also announced this week that Saudi Aramco was also interested in potential investment. Russia seems to be a taking a long-term view in its Arctic energy policies, betting that prices and demand will rise in the near future.
Russia is also very upbeat about the medium-term potential of the NSR as an emerging trade conduit between Europe and Asia, and all of the main Northeast Asian economies, including China, Japan and South Korea, have expressed interest in developing increased Arctic trade using the route. The recent NSR voyage of the Danish ship Venta Maersk is the latest feat which has advertised the opportunities of the NSR. Beyond shipping, there has also been discussion about developing railways, deep-water ports and even a fibre optic link. However, all of these projects will require foreign assistance, including for funding.
Cooperation with China has proven to be essential for many Russian projects involving the Russian Arctic, and greater Siberia and the RFE, as the sluggishness of the Russian economy, ongoing weaknesses of the rouble, and the post-2014 economic sanctions have resulted in a closer Sino-Russian partnership. Joint projects have included the Yamal LNG project, a potential deep-water port at Arkhangelsk, possible railway links between China and Northern Europe, and other potential infrastructure. Although the Putin government had begun to ‘pivot’ to Asia as early as 2012, the Ukraine crises accelerated that process, buoyed by a closer personal relationship between President Putin and Chinese President Xi Jinping.
Thus, there are several ways of looking at the future of Russia’s Arctic strategy. However, there are many variables to consider before making predictions, including future Russia-Western relations and changes in commodity prices which might make the Arctic more attractive as a resource base. To paraphrase a quote from Charles Dickens, Russia is trying to create a spring of hope, while avoiding the winter of despair, in its Arctic realms.
This year’s Arctic Circle conference, one of the largest events dedicated to the comprehensive study of the circumpolar north, featured a diverse set of subjects ranging from hard science to complex political policies, as well as talks by specialists from across the professional spectrum.
An estimated two thousand attendees from over sixty countries, (including from as far away as New Zealand and the Pacific Islands), met to compare notes on the rapidly changing shape of the Arctic, not only in terms of regional climate change but also because of the growing international visibility of the region. As in previous years, there was much discussion about the ‘Global Arctic’, (including from the conference’s founder, former Iceland President Ólafur Ragnar Grímsson), and what that concept represents. However, among the well-worn slogans were many new ideas and concepts, demonstrating that the region is not going to be declining in importance at any time soon.
The Arctic Circle took place at the Harpa Opera House in Reykjavík, and this year’s artistic displays included an exhibition of Inuit art sponsored by the Cerny Inuit Collection in Bern. Efforts to make the conference more environmentally friendly were clearly apparent, including efforts to reduce plastic waste via the sales of reusable water bottles, as well as a paperless schedule offered as a mobile app for the first time.
Echoing a similar display at the Conference of Parties (COP21) environmental conference in Paris in December 2015, two large slabs of ice were positioned outside of Harpa in order to provide a demonstration of ice erosion, and despite the windy weather in Reykjavík that week, the ice blocks had melted considerably by the time the conference came to a close.
As with previous conferences, non-Arctic governments were prominently featured at the event, with Japan taking the lead this year with a keynote speech by the country’s Foreign Minister, Mr Taro Kano, as well as participation from the Tokyo-based Arctic Challenge for Sustainability (ArCS) project.
In his speech, Mr Kono stressed the need for deepening cooperation with major Arctic stakeholders, including a focus on understanding environmental change, promoting sustainable economic activities in cooperation with the indigenous peoples of the region, and advocating for the rule of law in the region. He also noted more specific projects which Japan was undertaking in the region, including the study of the effects of black carbon pollution in the Arctic in partnership with Finland, cooperating with China and South Korea in Arctic trilateral dialogues on research cooperation, and promoting Hokkaido as an emerging maritime gateway to the Arctic Ocean.
Mr Kano also announced closer Japanese cooperation with Russia in the energy sector, pointing to a memorandum of understanding signed between the Japan Oil, Gas and Metals National Corporation (JOGMET) and Russia’s Novotek energy firm, as well as the potential for joint liquefied natural gas (LNG) development in Siberia.
China was also well represented at the conference, and there was much talk about the country’s policies in the Arctic in the wake of the first governmental White Paper on the region which was published in January this year. In addition to a presentation by keynote speaker Mr Fu Chengyu, former chair of the Chinese energy firm Sinopec, there were specific panels dedicated to the role of the Arctic in Beijing’s emerging Belt and Road (yidai yilu 一带一路) trade initiatives, as well as a ‘China Night’ which featured cultural events and speeches by Chinese officials including Beijing’s Arctic Ambassador, Mr Gao Feng, on the country’s expanding Arctic interests.
It was also confirmed during the event that the first Arctic Circle breakout forum of 2019 is to be held in Shanghai likely in May of next year, with France among other governments, also interested in hosting a forum. In December this year, it will be South Korea’s turn, with an AC Forum to be held in Seoul.
There was much talk from the Chinese delegation about ‘respect, cooperation, win-win and sustainable development’ (Zunzhong, hezuo, gongying, ke chixu 尊重、合作、共赢、可持续), as the cornerstones of Chinese Arctic policy, but the question remains as to how Beijing will implement the policies laid out in the paper. The country’s second icebreaker will officially begin operations next year, and it was announced last month that another phase of Sino-Russian Arctic cooperation would begin with a joint exploratory mission [In Chinese] in the Russian Arctic Ocean region. This is to include research into maritime conditions, such as geology and marine life.
Other prominent speeches by representatives from outside of the Arctic region included Mr Sam Tan Chin Siong, Minister of State in Singapore, who commented [video] extensively on the environmental dangers facing the Arctic and the need for a global response to them, adding that ‘something is not quote right in the Arctic’. He also explained that Singapore, despite being geographically far from the Arctic, nonetheless had specific roles to play, including in debates concerning sustainable development.
Scotland, which is seeking to enhance its Arctic policy credentials, was represented, including via a speech by Ms Fiona Hyslop [video], Member of the Scottish Parliament and the Cabinet Secretary for Culture, Tourism and External Affairs. Another non-Arctic government, Italy, highlighted its past and present Arctic scientific acumen, including on the subject of regional climatology.
These speeches, however, did not relegate the Arctic states to a back seat at the conference. Keynote speaker Katrín Jakobsdóttir, Prime Minister of Iceland, not only called for [video] more effective environmental policies in the region but also for the Arctic to eventually become a weapons-free zone [In Icelandic]. This statement was telling, given the massive NATO military manoeuvres taking place in the Nordic Arctic region, primarily in Norway but also including in Iceland, this month under the title Trident Juncture 2018. These exercises, the largest of their type since the 1980s, took place shortly after Russia held its own massive military manoeuvres in the country’s Far East and Siberian regions with participation from the People’s Liberation Army.
Russia was represented at this year’s conference with a keynote speech [video] from Senator Sergey Kislyak, former Russian Ambassador to the United States, who was critical of the NATO exercises as he described Russia’s positive contributions to the Arctic. He also joked that the issue of new Arctic ports would be eliminated simply by constructing a tunnel between Alaska and Siberia, but also described the economic potential of the Northern Sea Route in the Arctic Ocean as well as the possibility of new icebreakers which would operate on natural gas. Senator Lisa Murkowski (R-Alaska) spoke [video] about her state’s contributions to regional technology, including green energy and monitoring tools, but also the social problems in the state such as suicides and substance abuse.
During the conference, two major building openings took place. One was the official dedication of the China-Iceland Aurora Observatory (CIAO), in Karhóll, northern Iceland. The facilities, supported financially by China and jointly operated by the Icelandic Centre for Research (RANNIS) and the Shanghai-based Polar Research Institute of China (PRIC) officially opened the day after the Arctic Circle officially concluded, with the project being touted as an example of Beijing’s growing science diplomacy in the Arctic. The building’s cornerstone was officially laid in October 2016, but budget and logistical issues delayed the formal opening until this month.
The second event was the official opening of Greenland’s Representative office in downtown Reykjavík, joining like offices in Brussels, Copenhagen and Washington, (another office in Beijing is reportedly in the works). These offices represent Greenland’s increasing interest in developing a distinct foreign policy from Denmark at a time where Nuuk is facing many questions regarding greater political and economic sovereignty from the Danish Kingdom. In August of this year, Mr Jacob Isbosethsen was chosen to be the first Greenland representative in Reykjavík.
Unlike at previous conferences, there were no major policy announcements from any of the government delegations, but there was an expanded array of scientific and environmental issues discussed at the event, with the United Nations Intergovernmental Panel on Climate Change (IPCC) report [pdf] released earlier this month, which suggested that the planet has a dozen years to stave off global warming effects which would include an increase in average temperatures of approximately 1.5ºC. A dedicated panel at the conference described the specifics of the report with responses from Arctic actors including the Sami community in the Nordic Arctic region.
Among other topics representing the physical sciences were discussions on the growing threat of plastic waste, changes in the cryosphere, the roles of both fossil fuels and renewable resources such as wind power, as well as various aspects of climate change. There was also a greater focus on business opportunities in various parts of the Arctic, as well as a discussion of the obstacles facing journalism in the Arctic. Social issues which were explored in the breakout sessions included in the fields of local education, culture and gender studies in addition to indigenous affairs, with politics not far from the debates, including the status of the Arctic Council and the difficult questions of regional security.
Over the past five years, the Arctic Circle has established itself as one of the largest and most comprehensive regional conferences. Although it is technically a Track II (sub-governmental) event, in reality it is closer to being a ‘Track 1.5’ process given the growing number of governmental representatives, including high-level policymakers, who attend the conference in the hopes of better connecting with the growing body of Arctic expertise in numerous disciplines. The conference has also played a part in educating the international community about the Arctic, its potential and its challenges.
Addendum: The China-Iceland Aurora Observatory was renamed the China-Iceland Arctic Science Observatory during in inauguration, reflecting an expanded mandate to include research in atmospheric studies, glaciology, and related fields.
[The editor would like to thank Mingming Shi for her assistance with the writing of this post, and the organisers of the Arctic Circle conference for inviting him to participate in the event this year.]
The sixth annual Arctic Circle conference will commence next week in Reykjavík, at a time when the region is yet again back in the news as a result of growing concerns about the effects on climate change and melting ice. This month has already seen a bombshell report from the United Nations which detailed the drastic changes in global weather patterns, including in the Arctic, as a result of temperature rises which could take place in as little as a dozen years from now.
There was also a paper released this week by NASA’s Jet Propulsion Laboratory (JPL), which tracked changes to ice in the Arctic since the late 1950s, concluding that older, multiyear ice was being steadily replaced in the far north by younger, thinner ice which could be more vulnerable to warmer summer temperatures. As with previous years, the Arctic environment, and threats to it, will likely dominate much of the dialogue at this year’s event.
Among the keynote speakers announced for the Arctic Circle this year are former Iceland President Ólafur Ragnar Grímsson, who founded the event in 2013, as well as current Iceland Prime Minister Katrín Jakobsdóttir and Mr Taro Kono, Foreign Minister of Japan. Japan’s Arctic scientific interests will also be discussed at a panel organised by the Tokyo-based Arctic Challenge for Sustainability (ArCS) project. Also among the keynote speakers will be US Senator Lisa Murkowski (R-Alaska) and Ms Ségolène Royal, France’s Arctic and Arctic Ambassador. Mr Sam Tan Chin Siong, Singapore’s Minister of State, will also hold a standalone dialogue on his country’s unique Arctic role.
China is also well-represented at this year’s conference, including the former chair of Chinese energy firm Sinopec, Mr Fu Chengyu, Mr Huigen Yang, Director of the Shanghai-based Polar Research Institute of China (中国极地研究中心), and China’s Arctic Ambassador, Mr Gao Feng. As China released its first governmental White Paper on Arctic policy in January this year, and is seeking to be accepted as a polar partner [pdf] in the region, there will also be discussion on the role of the Arctic within Beijing’s swiftly developing Belt and Road trade route networks.
The European Union, which will likely be making another bid to join the Arctic Council as a formal observer next year, will be represented by Mr Karmenu Vella, European Commissioner for Maritime Affairs and Fisheries, as well as a panel on EU scientific projects in the region. Also on the subject of the EU, Scotland, which this month called for a second referendum on the ‘Brexit’ process before its scheduled competition next year, given strong Scottish support for remaining in the Union, is also well represented at the Arctic Circle this year. The Scottish government of Premier Nicola Sturgeon has been seeking to burnish its Arctic credentials in recent years, will be represented by Ms Fiona Hyslop, Member of the Scottish Parliament and Cabinet Secretary for Culture, Tourism and External Affairs.
Among the scientific areas under discussion this year are combatting pollution, (including the growing danger of contamination from plastic refuse), aquaculture, sustainable energy including wind power, space science, changes in the Arctic cryosphere, and regional green technology. Russia’s Arctic scientific prowess will be especially highlighted this year, including via a panel hosted by the Russian Academy of Sciences [In Russian] (Росси́йская акаде́мия нау́к) in St Petersburg.
Beyond hard science, there will be panels on indigenous affairs, gender studies, law, the future of the Arctic Council, and political cooperation. As with previous conferences, the economic potential of the Arctic will also be showcased, including in the areas of fossil fuels, shipping, alternative energy, and data infrastructure. There will also be events related to arts and culture as well as journalism and research practices, so this year’s conference is shaping up to take an even more holistic approach to the Arctic.
OtC, in addition to being represented on a panel about Arctic identity-building, will also be featuring reports from the Arctic Circle over the next week.