What does Greenland’s halt of oil production plans mean? | Polarjournal
Greenland’s nature is unique, as the world’s largest island stretches several thousand kilometres in a north-south direction. However, this uniqueness is threatened by climate change, which is further fuelled by the consumption of fossil fuels, among other things. Picture: Michael Wenger

Greenland is one of the most resource-rich regions of the Arctic. On and around the largest island in the world, the largest untapped deposits of crude oil and natural gas are believed to exist. This potential wealth had led to licensing and exploration attempts, but also to much criticism from environmental groups. Now the new Greenlandic government under Múte Bourup Egede has imposed a stopp on all oil activities in Greenland.

In a press release, the government announced that the current oil strategy will be suspended and all future production of oil in Greenland will be halted. The government cites not only the climate crisis as the reason for this. “The Naalakkersuisut (government) takes the climate crisis very seriously. In addition, the decision was also made for the sake of our nature, of our hunting and fishing and to focus our business to actual and known potentials,” the message says. The environmental consequences of oil exploration and production are too great and the resources used could be put to better use elsewhere than “maintaining the dream of an oil adventure”, explains Naaja H. Nathanielsen, the minister responsible for raw materials.

The map shows the areas already open for production licensing (light green) and the regions still planned (dark blue). The grey areas are protected areas. Interestingly, the Greenlandic government had already secured several licence areas (yellow-orange) in East Greenland. Map: Oil and Gas Department, Government of Greenland

Other government officials who were directly or indirectly affected by the oil development plans also spoke out in the press release. Of particular interest in this regard should be the statement of Pele Broberg, Minister for Economic Affairs, Foreign Affairs and Climate. ” I also note that international investment in the energy sector in these years is moving away from oil and gas and into renewable energy. It is therefore natural that we arrange our business life on the opportunities of the future and not on the solutions of the past.” But in fact, until recently, efforts by the government were underway to better quantify the amount of oil around Greenland. While assessments had been completed for the West Greenland/East Greenland area, where oil production had already taken place, they should have been completed next year in the East Coast regions, which are presumably equally rich in oil. The aim was to use these figures, plus attracticve tax conditions and increased marketing efforts, to further stimulate international interest in drilling for oil in Greenland waters by 2024. According to experts, the largest untapped reserves of fossil fuels are located around Greenland. Up to 18 billion barrels are said to be stored on the West Coast alone. An earlier study suggested similar large quantities for the East.

Greenland’s economy, which is primarily dependent on fishing and mining, could of course have used the additional revenue from oil production. But a low oil price for years, the potential risks to the environment and livelihoods, and its own market being too small have been stronger arguments. Picture: Michael Wenger

On the one hand, the Greenlandic economy is heavily dependent on oil imports. Because the ships, boats and all land vehicles, the planes and helicopters need fuel. Oil is also used as a heating medium. Therefore, its own extraction and production of oil would have made perfect sense. But the collapse of oil prices and the huge risks for the environment and especially for the important fishing regions, coupled with the economic problems (unprofitable domestic market, production costs too high for good competitiveness), have simply been too strong arguments for the government. The government now wants to build more strongly on the expansion of renewable energy sources.

Greenland’s nature has won with the government’s decision against further oil production. But the threat continues unabated, thanks in no small part to its “dear” neighbors. Whether ice will still be found on the coasts of Greenland for a long time therefore remains to be seen. Picture: Michael Wenger

It is doubtful, however, whether this decision will have a signal effect on other Arctic nations to rely more on renewable energies and to make their development “Arctic-compatible”. Countries like Norway, Canada and Russia depend too much on the sale of black gold. Even in Alaska, where the battle over the extraction of oil in the Arctic National Wildlife Refuge between the federal government in Washington DC and the government in Fairbanks, Alaska continues to rage, the last word has not been spoken and extraction in all of the regions continues unabated. Therefore, the decision from Nuuk is certainly welcome and commendable. But it only gives Greenland breathing room from the onslaught of oil lobbyists. The problem remains that the ground beneath its feet continues to melt, not least thanks to the continued sale of fossil fuels by its Arctic neighbours.

Dr Michael Wenger, PolarJournal

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