Playing with fire in the artic – Oil industry continues to make mistakes

Artificially coloured topographical map of the...

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At the same time that the Germans announced that they will cease nuclear energy operation within a decade because of a disaster happening thousand kilometres away in japan the exploration for oil continues in one of the most environmental sensitive areas of the world.

Cairn Energy is the only producer so far that have been granted permission to drill for oil offshore in Greenland.  A possible discovery will please the oil industry, which has long believed that the Arctic harbours some of the last huge reserves. Analysts estimated there could be over 20bn barrels of oil equivalent in the region.

The find will also delight the local Greenland government (and to a certain extend the Danish as well as they have a huge stake in local affairs), which is desperate to diversify its fragile economy away from a dependence on fishing, tourism and cash hand-outs from Denmark, which still formally has sovereignty over the world’s largest island.

While Cairn Energy has the rights to drill it is considering selling a large chunk of its Greenland oil exploration operations to a company such as Shell or a state-owned producer as it seeks to spread the risk and cost of developing in the Arctic region. However this will lead to less transparency on who has responsibility if some of the risks that the Danish environmental ministry have identified come true. In a environmental impact report that was issues when oil exploration was still being considered it was concluded that:

“The high concentration of oil in accidental spills represents a serious environmental threat, until the oil is diluted and/or degraded. Low temperature, ice and lack of infrastructure will generally make the impact of oil spills in the Arctic longer lasting than at lower latitudes. The spreading, fate and impact of oil spilled in different habitats differ, with the marine spill having the potential to impact large areas and resources far away from the spill site, while terrestrial spill are generally confined to limited areas.” Danish Environmental Ministry

In the analysis it was stressed that the increased traffic that oil exploration would in it self constitute a danger to local environment even though no accident occurred. Basically there would be spills of oil and other chemicals just from the ship traffic and other activity.

“The ocean is stressed by a myriad of chemicals of anthropogenic origin, oil being one. The major sources of anthropogenic oil and oil-derived compounds are chronic ones, such as tanker operations, sewage outfalls, urban runoff, and atmospheric outfall. In the 1980’s it was estimated that an average of 3.3 million metric tons of oil enter the ocean each year (Steering Committee for the Petroleum in the Marine Environment, 1985 National Research Council, Washington DC, p. 82). 45% of this input is believed to enter the ocean as a result transportation related activities with at least 22% intentionally re- leased as a function of normal tanker operational discharges. Only 12% enters directly from tanker accidents. Another 36% come from runoff and municipal and industrial wastes including oil refineries and 8% is believed to be from natural sources such as oil seeps. Atmospheric outfall and offshore oil production account for the remainder of the annual input.”

But this would only put further pressure on an already fragile artic environment. “Oil exploration in the Arctic may present serious environmental hazards if a major oil spill occurs, particularly if the oil spill coincides with the occurrence of concentrations of ecologically important and vulnerable species in the ice or at the coast.”

And even though there are some concerns and unknowns about how this impact should be calculated there a wide consensus that we need to gather as much information as possible and make artic oil exploration as transparent as possible. There for it is of concern when Greenpeace in a effort to draw attention to the area is not granted access to basic information from the rig in operation. As a spokes person from Greenpeace puts it.

“We have met with the drill manager and requested a copy of the oil spill plan, which we assume he has on board, yet once again we have been refused even sight of it. What is Cairn Energy trying to hide? We have phoned, written, faxed, emailed and now even paid a visit to the rig to get a plan that should be in the public domain and should be subject to independent verification and public scrutiny.”

Based on the poor ethics record of the oil-industry in general they should know better than to keep such information to themselves particularly in a area were the attention of NGO, Governments and the media is so intense. And one should think they could afford some a fairly good system of information and transparency when they look at making around 2340 Billion USD in turnover in a best scenario case.


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