Drill Baby Drill... in the Arctic!
Donald Trump has a point: In the Arctic, it's it's all about oil. And gas. And gold. And copper. And Zinc. And REEs.
This is Pt. 3 of āItās Getting Hotter in the Arcticā series. For the first part of the series, click here, and for the second part click here. Ice guaranteed! š§
andā¦ as always, donāt forget toā¦
āMan, life at sea was tough, but this isnāt much betterā you think to yourself as the drill is trying to break through thousands years of iceš§, getting stuck every couple of minutes. Not too long ago, you were the captain of a Polar-Class 1 ship, the āJeez Itās Coldā (she was a beaut!), but life at sea babysitting cargo ships was just not what you wantedā¦
You heard a couple of sailors talk about some weird metals they found along the Bearing Sea, and thought to yourself āhey, I like moneyš°, letās give it a go.ā So on to the Permafrost you went, thinking itās the Gold Rush all over again.
I hate to admit it, but Donald Trump has a point.š
Itās been a few weeks since the 47th President of the United States threatened to invade Greenland, and many are left to wonder: Really, Greenland?
Yes. Greenland (which, contrary to what the name suggests, isnāt green at all)
Now, Iām not in favor of the US invading Greenland. Iām not in favor of anyone invading anyone for that matter. But thereās a method to the madness, a madness that will be the focus of this deep-dive.
Itās hard to say exactly why President Trump set his sights on Greenland, but one can easily guess it has something to do with the fact that Greenland has much more than just iceš§.
The story of Greenland is complex and holds many elements to it, but it is a good segway into todayās topic: Natural resources.
We started our voyage into the Arctic tundra by focusing on geopolitics and exploring how the Arctic is starting to play an bigger role in countriesā national security doctrines than it used to. We also explored shipping lanes as one of the reasons for that uptick. Now, itās time to set our sights onto another aspect of the Reconfiguration: plain ole competition for resources.
The Arctic is not only a better gateway between continents (at least, when itās ice-free), but it is also a wild land (and sea) rich in natural resources and hidden treasures that have been frozen from time immemorial. And now, with climate change altering the Arctic, nation states and companies are making plans to take advantage of whatās hidden beneath the permafrost.
That is why we will now pack up our drills and go to the remote permafrost of the Arctic!ā
The Permafrost and Natural Resources
The permafrost is the large layer of rock and sediment frozen for long periods of time that covers about 24% of the soil in the Northern Hemisphere, ranging from Siberia to Alaska (but the long way around). The permafrost ranges from 1 meter thick to 1,500 meters and exists in more than one form. Climate change is creating meaningful changes to the permafrost, causing accelerated thawing and an increase in the active layer, the layer that thaws and refreezes annually.
Climate Change Accelerates Permathaw
The acclerated rate of thaw in the permafrost is directly caused by climate change and the rise of temperatures:
Permafrost temperatures have risen between 1.5 to 2.5Ā°C in the last 30 years
25% of permafrost surface is expected to be lost, if the current pace of climate change stays the same (and we all know itās getting worseā¦)
Even if emissions are curbed, 40% of permafrost surface is expected to be lost by 2100
The accelerated pace of permathaw is generally bad news for everyone, with risks ranging from destabilizing existing infrastructure to turning the permafrost from a carbon sink to a ācarbon holy crapā. The destabilization of the permafrost harbors many risks and generally raises concerns and alarms, and we may explore them at length in later parts of this series, but for now we will set our sights to natural resources.
Natural Resources in the Permafrost
Underneath all the iceš§, by the virtue of many natural processes, many types of materials got stuck and became frozen in time.
The permafrost includes:
Oil & gas: About 90 billion barrels of oil and 44 billion barrels of liquid natural gas (yeah, thatās a lot!)
Minerals:
Rare earth minerals (lots of stuff youāve probably never heard of, but that are important for a range of applications)
Metals (lead, iron, nickel, zinc, gold, silver, etc.)
Lots of mercury
Timber (though not frozen)
Wildlife
Natural resources, as we can see, can be found in abundance across the Arctic region, from Siberia to Greenland to Canada. Natural resources in abundance are worthā¦ well, lots of money.
The Race Is On
Itās not working so great for you, you figure the fifth time that drill gave up on you. Your friends arenāt doing so hot either. Who knew life on the Permafrost looking for goldšŖ was so hard. Except, literally anyone but you. If you only bothered to ask (or do a little bit of reading), they would have told you that Arctic drilling of any kind is not easy.
Youāre kind-of miserable here. Thereās no sun for a big portion of the year, and it never gets warm enough toā¦ actually it just never gets warm enough. Being an Arctic sea captain doesnāt look that bad nowā¦
The accelerated pace of the permathaw is changing something fundamental in the economic opportunity that exists within the permafrost. Until now, much of the Arctic drilling and the efforts to extract resources was expensive, limited in duration, and just generally hard to do. Itās not that until recently no extraction was done, far from it, but extracting resources from the Arctic was remarkably costly and limited. To give you an idea of why, consider the cold: There is only a limited window of time that is available to conduct different operations before itās too cold to drill and extract. Weāre not talking ātake a coat lest you catch somethingāāļø cold, weāre talking āequipment failureā coldāļø.
If thatās not enough, the remoteness of the Arctic requires infrastructure, including ports, railways, housing, electricity, and other basic conditions to sustain operations. The harsh conditions make building and maintaining infrastructure pretty tough. Think about the last time your flight got delayed due to ice conditions, and multiply that by a gazillion (yes, thatās the exact figure!).
These, and more, are making the costs of resource extraction projects to be waaaay more expensive than their equivalents in warmer climates (sometimes, even 50-100% more expensive).
But now, with climate change and the accelerated permathaw, itās starting to change.
Changing Fortunes on the Permafrost
The changing climate and the acclerated pace of thawing reduces some of the challenges and costs to extracting resources:
Reduced ice-cover and warmer temperatures mean that there are longer windows of time for getting work done in the Arctic, with equipment less likely to fail
Construction of new infrastructure can be easier. Even though, the jury is out on this one, as thawing permafrost is generally bad for existing infrastructure
Reduced coverage means that some of the resources that were heretofore inaccessible (as they were, well, frozen) are easier to access and require less effort to extract
Indeed, there is a visible upward trend in just how much exploration for resources in the Arctic there is. There are many players that are seeking to take advantage of the permathaw. Letās take a look at what some of them are doing:
Norway:
Gearing towards opening up its seabed to mining exploration, approving a large plan in 2024, and granting new licenses for oil & gas exploration in the Barents Sea
Equinor, Formerly known as Statoil, is a Norwegian company that has been a pioneer in Arctic oil exploration. Their SnĆøhvit field in the Barents Sea was the first offshore development in the Arctic, demonstrating the potential for responsible resource extraction in this sensitive region.
Russia:
Commenced operation of the LNG2 project, though with limited success due to sanctions
Gazprom, the Russian energy giant, has been actively developing the Yamal LNG project, one of the world's largest and most complex LNG projects. Despite challenges posed by the harsh Arctic environment, Gazprom has managed to extract and export significant amounts of natural gas.
The race for Arctic resources isn't just about economic gain; it's reshaping global politics. As nations vie for control over these newly accessible treasures, we're seeing a new form of 'Cold War' emerge ā one that's ironically getting hotter by the year
Itās important to note that itās not all sunshine and roses for natural resource hunters and gatherers in the Arctic (though, less ice means more sunshineā¦). Not everyone is convinced that Arctic oil drilling is worth it. For example, oil major ExxonMobil has recently expressed disinterest in drilling in the Arctic for lack of economic viability. Arctic resource exploration and extraction is difficult and complex, and there is no simple, unidirectional reality. It is likely that as we progress, we will see a mixed bag of activities.
Back to Greenland
I know, I know. You want to know how Greenland fits into all of this. After all, opening with Greenland and not discussing it later in the text is just bad writing.š¤·āāļøāļø
So, the deal with Greenland is pretty simple. Remember all the resources we outlined above?āļø Greenland has all of it, in spades. I mean, a lot of spades. A factory of spades.
Out of the 90 billion barrels of Oil & Gas, Greenland is home to about a third of those barrels.
25 out of 34 minerals considered by the EU to be critical raw materials can be found in vast amounts in Greenland, including Rare Earth Minerals (REEs), graphite and others
Fisheries are also an important resource available in Greenland, that is likely to become ever more important with the growing impacts of climate change.
About 20% of the worldās freshwater is tucked in Greenlandās iceš§ sheet.
Now that we know whatās inside the icebox that is Greenland, Trump's interest in it suddenly makes some more sense. Buying Greeland would have given the U.S. strategic control over a significant portion of Arctic resources, potentially shifting global power dynamics. I mean, if it was for sale, anyway (there are plenty of other ways to get the strategic benefit without buying Greenland, but hey, itās not like Iām in the business of giving advice to world leaders. I wish I was, but thatās between me and my therapist)
Oh, the Irony
Youāve been drilling for months. Itās cold. You miss your ship. You havenāt seen your wife/husband/take your pick for months on end, and all you have is that damn drill that isnāt working!!! And to make matters worse, the Iceš§ you stand on keeps on moving. You bumped your head a couple of times.
Just as you're contemplating a career change to tropical beach bartending, your drill hits something that's definitely not ice. Suddenly, you're staring at a vein of minerals so rare, they make diamonds look like pennies. You couldn't pronounce their names if your life depended on it, but the company suits that hired you are practically salivating through the satellite phone. The bleak Arctic wasteland transforms before your eyes into a glittering treasure trove. As you survey the frozen landscape with newfound appreciation, you can't help but think, "Maybe there's more where that came from." For the first time in months, the biting cold feels less like punishment and more like the price of admission to the world's most exclusive mineral club.
Going Green
While we tend to think of oil & gas when we think of Arctic natural resources, a critical piece of the story lies in rare earth minerals, and their importance in the transition to low/no carbon economy. The short of it is:
Many of the available natural resources, including lithium, zinc, copper and others, are vital components in the renewable energy supply chain, used in anything from windmills to electric vehicles to solar panels
Rare earth elements that are used in renewable energy are available in the Arctic in sufficient amounts to rapidly accelerate the transition to a low carbon economy, and demand is expected to grow significantly in coming decades
The Arctic holds the largest deposits of gold, zinc, nickel, cobalt, palladium, and iron, materials used for many industrial uses, and particularly for renewable energy
See the irony? No? Let me tryā¦
The growing availability of resources in the Arctic, caused by climate change, gives us the resources we need toā¦ mitigate climate change.
We seek to prevent climate change by transitioning to renewable energy and wean off fossil fuels, but there is a cost. The resources needed come at a heavy environmental and climactic toll:
Jeopardizing biodiversity
Carbon and methane release
To be clear, I am not saying we should avoid mining at all costs. The risk of not transitioning can be greater than the risk to local ecosystems due to mining. But the irony here is, as the young fry say, šÆ.
Ok, who cares?
As always, we try to end with the question: why should you care? After all, you are not an Arctic explorer (at least, I hope not), and letās face it, unless you are building wind turbines in your backyard, itās not easy to see how this is important to our daily lives.
Except that it is.
The natural resources that are hidden in the Arctic have the potential to improve our lives and even make many things cheaper for some of us. They can impact our geopolitics and change balance of powers. For centuries, they were, at best, opportunities closed behid frozen doors. Now, with the climate changing at neck breaking speeds, they become accessible and suddenly beckon upon us, and itās not entirely clear that we can resist their call. The only question is: What will it cost us?
The vast riches of the Arctic region, and their specific use for clean, renewable energy, show just how complex the world we live in is, and how difficult the choices we have to make are: extract resources to power the green energy revolution, stick to fossil fuels or tone down modern life (not many are excited about this option, I think).
Are there other choices? Probably. But itās not for certain that they are any better.
Other than telling us a tale as old as time about human nature and the quest for resources and the hunger for exploration, the race for Arcticās natural resources shows just how quickly the global systems that make up our lives adapt to make the most of impacts of climate change. Slowly, then very quickly, global markets will inject natural resources frozen in time into our global beltways and into our homes in the form of the energy we use and the products we buy.
In a way, the story of the Arcticās natural resources is the story of the Reconfiguration. We should all care because we all stand to benefit and lose from every choice - as individuals, as societies, as humanity. In a way, thatās the story of the Arctic.
And so, we come full circle to Donald Trump's seemingly outlandish proposal to buy Greenland. While his approach may have been characteristically blunt, it inadvertently highlighted the growing importance of Arctic resources in global affairs. As we navigate this new frontier, balancing economic opportunities with environmental stewardship, we're all becoming Arctic explorers in a sense. The decisions we make today about these frozen treasures will shape not just the future of the Arctic, but the future of our planet. So the next time you hear about melting ice caps or rare earth minerals, remember: what happens in the Arctic doesn't stay in the Arctic. It affects us all, from the halls of power to our own backyards.
If you liked this deep-dive, make sure to share this with your friends, so they can try to buy Greenland as well: