Can Norway develop the Arctic without drilling for oil? Politicians say probably not

arctic-ice-melt1 Glacial melt. Credit: Still from Obama Administration White House video

KIRKENESS ­– Norway intends to forge ahead with oil exploration in the Arctic despite the country’s commitments to international and domestic climate policies, but will support clean energy technologies while it does so, said officials at a conference here in this city.

The 10th Kirkeness Conference was wide-ranging, including discussions of Arctic cooperation in the border area between Russia and Norway, development in the northern territories, and plumbing arctic resources in a balanced fashion.

Norwegian Foreign Minister Børge Brende opened the conference by extoling Arctic opportunities.

“Norway’s north is a stable and harmonious region,” he said. “Unemployment is going down and industry is developing. But we must be the best in the world in depth of knowledge and scientific study in the Arctic because only that will make us competitive on the world market.”

Brende said it was possible to wed economic growth to environmental preservation.

He added that the Norwegian government would unveil an economic plan focused on exploiting ocean resources – widely assumed to include oil drilling in the Arctic – in the spring.

Hovering over his remarks were several licenses to drill the Barents Sea issued by the Norwegian government last year. The licenses drew loud condemnation from environmentalists, who in turn, filed suit against the government.

Despite that, Ingvil Smines Tybring-Gjedde, Norway’s Petroleum and Energy deputy prime minister, said the government would likely expand the number of blocks to lease before the next round of awarding them. And Tybring-Gjedde said business was booming.

“The oil and gas industry has successfully adapted to the situation on the world oil market: It’s costs have gone down and its competitiveness has improved,” she told the conference. “We are now observing good activity in exploration and exploitation of new sites,” she said, adding that new leases would soon be on offer.

According to Tybring-Gjedde, at least half of the Norwegian Arctic continental shelf remains untapped even after a quarter of a century of exploration. Most of these reserves are in the northern parts of the Norwegian and Barents Seas.

Naturally, the policy was supported by Siri Espedal Kindem, Statoil’s regional director for projects and drilling, who highlighted the company’s new North Sea field. She said this year that Statoil would drill 30 new test wells this year, three of which will be in the North Sea. She described these exploration wells as “promising,” and said the project was inexpensive.

“The fields in the Barents Sea are far from land, but their profitability depends only on their resources, not on how far the fields are situated in the Barents or Norwegian Seas,” she said.

She added that development in the oil sector wasn’t preventing development in other sectors like Tourism, or fisheries. And she had faith in oil’s long-term profitability through 2030, despite wavering oil prices.

But not all Norwegian politicians support this policy of continued and aggressive drilling and exploration. Kari Elisabeth Kaski, a secretary of the Socialist Left party, said that while Norway was dependent on oil and gas prices, that shouldn’t dictate all policy, and questioned whether pushing more oil drilling in the Arctic was wise.

“If we continue far into the Barents Sea, we’ll experience a climate catastrophe,” she told the conference. She suggested ecological growth should be tied to oil industry growth – and that Norway should stop handing out leases.

“Norway has a historic climate commitment in the Arctic, and we must develop clean technologies,” Kaski said. “The future must be founded on a clean environment, without environmental threats or climate challenges – let’s develop renewable resources and suggest them to the world.”

Hildegunn Blindheim, the climate and environment director for the Norwegian Oil and Gas Association, also cast doubt on oil and gas drilling in the Barents Sea in an era when Norway is facing climate change related questions.

“If resources are discovered on these leases that warrant development, then it would take five to ten years preparing the sites, and then companies would have to find principally different, more ecologically responsible approaches to working these areas,” said Blindheim.

She added that before 2050, the Norwegian Oil and Gas industry will have to confront the issue of significantly lowering its own emissions, which will demand using the full potential of renewable energy, not gas turbines.

“Modern industry has disproven the myth that wind energy would never be competitive with traditional energy sources,” Blindheim said. “New technologies and types of energy are already in service in the oil and gas industry and that is just a beginning.”