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When it comes to being the next biggest thing in energy, the Arctic has lost its allure. Twenty-two percent of the world’s undiscovered resources will, for now, remain untapped. The “great game” that once seemed to be the Arctic’s destiny has been thwarted by global oil market forces and complicated by Russian President Vladimir Putin’s interventions in Ukraine and Syria. With the price of oil falling below $28 a barrel and economic sanctions curtailing Russia’s ability to exploit its Arctic claims, the clamor to look north for energy is beginning to quiet down.
Yet for Russia, the Arctic is still a strategic priority—one that many fear Putin will protect by force. A cornerstone of Moscow’s vision to reinstate Russia to its rightful international standing—that of a great power—is energy dominance. Energy provides a financial backbone for state programs, and energy pipelines are a key tool through which the state coerces its neighbors. And if Russia is to continue finding oil to pump through European pipelines, it must look to the Arctic for further exploration.
MUCH TO GAIN
By way of geography, Russia holds the largest stake in the Arctic. The nation shares a border with the Arctic that is over 4,000 miles long. And like the other Arctic Five powers (Canada, Denmark, Norway, and the United States), it maintains a strategy for the vast expanse that hinges on securing its border and modernizing its military installations. By the end of 2015, Russia will have secured military control of its entire Arctic border, although even this military presence will pale in comparison with military levels in the region during the Cold War.
As it secures its borders, Russia will seek to upgrade Soviet-era military hardware. Its restoration of aging hardware and its plans to reopen existing military bases are necessary if it is to meet the needs of growing Arctic activity. In a sense, then, discussions about an impending militarization of the Arctic have always been misleading, since the Arctic is merely returning to historical levels of military installations.
Once Moscow secures its recognized Arctic borders, observers fear that it will inch northward. Here, the country’s annexation of Crimea and its sustained aggression toward Ukraine do not inspire trust. Yet the Arctic is simply a different beast. Russia’s Arctic strategy has a firm international legal foundation—as its 2015 territorial claim confirms the geographic extension of Russia’s continental shelf toward the North Pole. But Russia’s ambitions for the Arctic are far from expansionist, and so, the politics of the Arctic Circle must be isolated from broader global tensions. Russia views its Arctic oil and gas as vital to its future economic prosperity, but it lacks the technological capacity to extract them without Western partners. That will curb Moscow’s ambitions, as it will be forced to play nice in order to succeed.
NO NEED FOR A MELTDOWN
Although it is not known exactly how large Arctic energy deposits are, a 2008 U.S. Geological Survey estimates that the Arctic holds 30 percent of the world’s remaining natural gas and 18 percent of the world’s remaining oil reserves. What’s more, the region is considered a treasure chest of rare earth mineral deposits in the form of iron ore and nickel. Russia’s Ministry of Natural Resources claims the offshore Russian Arctic region possesses twice the volume of oil reserves held by Saudi Arabia. Meanwhile, the melting Arctic icecap will provide easier access to these vast resources.
But clashes over Arctic resources are not inevitable—in fact, they are unlikely. First, up to 80 percent of presumed Arctic resource wealth is actually located in uncontested areas of the Arctic, those territories that are well within preestablished boundaries.
Second, the 2008 U.S. Geological Survey estimation is by no means confirmed. The real amount of resources in the Arctic is still uncertain. Any conception of the Arctic’s hydrocarbon treasure trove is still a highly informed guess. Few states are willing to risk the political and economic capital that would be required in a battle over speculation.
Third, Russia has generally upheld its commitment to the legal architecture of the region and has followed the principles of international law enshrined by the United Nations Convention on the Law of the Sea. The Ilulissat Declaration, signed by the Arctic Five in 2008, prevents any new political orders from governing the Arctic, therefore impeding any state from altering the rules of engagement in the region. Further, the Arctic Five agreed that any overlapping territorial claims would be resolved between claimants diplomatically, rather than through force. For example, Norway and Russia settled their territorial dispute over the Barents Sea in 2010, creating an agreement that allowed both states to explore hydrocarbon drilling in extraterritorial waters.
Although sanctions have frozen various joint ventures with Russia and the West in the energy sphere, cooperation in the Arctic has not been lost. Russia is still participating in various search-and-rescue operations with its Arctic neighbors, and there is still ongoing dialogue on environmental and scientific endeavors in the region. Put simply, there is little reason that the Arctic’s geographic isolation should not provide it with political isolation from other tensions.
Putting a final damper on competition is that resource exploration has slowed as oil prices have plummeted.
The Arctic will continue to see cooperation between Russia and the West—if not by choice, then by necessity. The previously agreed-upon legal architecture remains in place and has kept relations among the Arctic Five civil and cooperative. Global oil prices may have lessened the world’s interest in Arctic energy but have also worked to allow for further exploration to happen in a measured and methodical way. These developments have created more time for the development of a safer operational environment in the Arctic.
And by cooperating in the Arctic, Russia and the West have at least one conduit for communication still open. The West can use the Arctic as a way to maintain dialogue with an assertive Russia. Russia can use it as a potential exit from its current foreign policies. Russia can work through established channels to warm itself to the West, and the West can do the same in turn without losing face or forcing open new channels for communication. And with global energy needs all but certain to rise eventually, the exploration of Arctic oil and natural gas is sure to make a resurgence.