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Balancing the Arctic’s energy and environment
The Arctic is a unique environment inhabited by remarkable animals and home to native peoples whose lifestyles remain tied to nature’s rhythms. But it is also one of the planet’s last energy frontiers, coveted by nations hungry for oil and gas. The challenge is to tap its energy riches while safeguarding the environment.
January 04, 2008
by WENDEL BROERE
The Arctic conjures up images of pristine frozen wasteland, home to generations of indigenous peoples with cultures stretching back thousands of years. The same lands and oceans are home to remarkable wildlife, including the region’s poster child: the polar bear.
At the same time, in an era when nations seek secure sources of energy to keep their economies humming well into the future, the Arctic also looks like a promising, little-tapped source of oil and gas. Indeed, in the summer of 2007, Russia and Canada mounted competing publicity stunts to support claims to the region and its riches. Denmark, Norway and the USA also claim rights to some Arctic territory.
All the jostling is understandable. The U.S. Geological Survey estimates that the Arctic contains 25% of the world’s undiscovered oil and gas. Although some development has already occurred, the region remains one of the last energy frontiers. “In global terms, the Arctic is an important area of unexplored major oil and gas fields,” says Dougal Goodman, chief executive of the Foundation for Science and Technology, an independent, London-based forum for debate on science issues. “Security of energy supply considerations will drive the pace of development in the Arctic.”
The region is one of the most difficult areas in the world to work, due to its remoteness, the extreme cold, dangerous sea ice, fragile environment, and indigenous people wary of disruptions by outsiders. Indeed, the challenge for countries bordering the Arctic will be to find ways to tap its energy while protecting the environment and safeguarding the region’s indigenous cultures.
As big energy companies such as ConocoPhillips, Eni, Shell and StatoilHydro prepare for a renewed push into the Arctic, they are taking steps to ensure they operate safely and responsibly in the region — and trying to convince sceptics that they can. They are working to reduce their impact on the fragile Arctic ecosystem, reaching out to local communities and improving techniques to prevent oil spills, or clean them up if they do occur.
“Since the 1970s, the industry has transformed itself with both advances in technology and growing awareness of the need to be responsible,” says marine biologist Salve Dahle, director of the Norwegian environmental monitoring consultancy Akvaplan-niva.
Petroleum companies first ventured into the Arctic half a century ago. Then the 1970s oil shocks sparked a search for new sources of energy outside the Middle East, prompting a further push into the region. The huge Prudhoe Bay field in the far north of Alaska, for example, was discovered more than 30 years ago and has been a major source of oil for the United States.
Experiences from past Arctic developments show the potential hazards of further exploration there. The arrival of exploration crews on Russia’s remote Yamal Peninsula decades ago led to protests by indigenous people who saw their nomadic lifestyle threatened. In Alaska, unnoticed corrosion and subsequent oil spills at the Prudhoe Bay field in 2006 were a recent reminder of the challenge of operating in the region. Meanwhile, the Exxon Valdez oil spill still makes headlines in regional media almost 20 years on.
Avoiding spills
Oil spills remain a major concern and the industry has taken steps to prevent them. One measure is to transport increasing amounts of oil in double-hulled tankers to reduce the risk that a shipping mishap causes a major spill. Companies are also designing equipment to withstand harsh conditions such as cold temperatures and shifting sea ice that might cause a failure.
Take, for instance, the large integrated oil and gas development headed by Gazprom on Sakhalin Island off the east coast of Russia, and in which Shell is a partner. Once production begins, underwater pipelines will transport oil and gas from platforms offshore to the island. But ice clogs the sea from December to May and ridges of compressed ice in shallow water can carve deep gashes in the seabed and could break pipelines. Moreover, an underwater spill during the winter would only become apparent once the ice melts away. To protect the pipelines, they were buried 4-5 metres (13-16 feet) beneath the sandy seabed. As an extra safeguard, they were fitted with electronic leak detection systems and valves to stop the flow of oil the moment there is a drop in pressure.
“The first line of defence against oil spills really is to prevent them from happening,” says Peter Velez, Shell Exploration & Production Global Security & Emergency Response Manager.
Companies are also taking steps to limit the impact of a spill if one occurs. Because most oil is lighter than water, companies routinely use long floating booms to push spilled oil to brushes that skim it into collection tanks. In the Arctic, however, oil often collects on blocks of ice that are difficult to clean and can tear the booms. A tool developed with the help of Finland’s environmental institute gets around that problem. A metal frame suspended from a ship’s hull dislodges the oil by pushing blocks of ice up and down in the water. Once the oil is separated, a conveyor belt fitted with brushes scoops it up.
This approach works only in some areas, since ice conditions vary greatly depending on location. Several companies and regulators are jointly studying other methods to recover oil in a variety of Arctic conditions and ensure they are widely available. “Being prepared for oil spills is like buying insurance — you hope that the worst will never happen but, if it does, you’d better be prepared,” says Velez.
Protecting wildlife
Arctic energy projects must also take care to protect ecosystems and wildlife. On land, the effects of industrial pollution can linger for decades, according to a 2006 report by the Arctic Monitoring and Assessment Programme. The impact cascades down the Arctic’s fragile food chain. Arctic vegetation is both sensitive to pollution and slow to recover. Damaged plants affect birds and small mammals because they have less food and cover.
Offshore drilling, dredging and other industrial operations can affect sea life. For example, western gray whales, a species brought to near extinction by commercial whaling, feeds in the waters off Sakhalin Island. The ice-free period when crews could construct offshore equipment for the island’s oil and gas project coincided with the whale’s summer feeding season. The World Wildlife Fund and other environmental organisations feared noise from building the offshore pipeline and the risk of collision with construction vessels posed a potential danger to the whales.
In 2005 the project’s joint venture operating company, Sakhalin Energy, took advice from independent experts on protecting the whales and re-routed the pipeline around the feeding area. With help from the World Conservation Union (IUCN), Sakhalin Energy also created the Western Gray Whale Advisory Panel, an independent panel of scientists. Following the panel’s advice, engineers reduced noise from pipeline construction and guarded against collisions by such measures as setting speed limits for ships and placing observers on vessels. The panel will monitor the situation over a five-year period.
Shell recently signed a broader collaboration agreement with the IUCN to gain access to advice on social and environmental issues for future projects in sensitive areas such as the Arctic.
Wary indigenous peoples
Social issues also loom large in the Arctic. Many native peoples, who number about 400,000, maintain their traditional subsistence culture, relying on the Arctic ecosystem for shelter, nutrition and their cultural identity. While local communities can benefit from jobs and development associated with oil and gas operations, many indigenous people also feel threatened and live in uneasy coexistence with oil and gas companies.
One example is Russia’s Yamal-Nenets region, home to Nenet nomadic reindeer herders. The Nenets migrate with their reindeer and use the animals for everything from food to the skin they lay over long wooden poles to make dwellings, called “chumy”.
The region, which is one-and-a-half times the size of France, changed considerably after the arrival of oil and gas companies in the 1960s. Heavy tracked vehicles used to transport people and equipment over the tundra damaged large areas, reducing the pastures suitable for reindeer grazing, says Florian Stammler, an associate of the Scott Polar Research Institute at the University of Cambridge, and senior researcher of the Arctic Centre at the University of Lapland. The willow shrubs reindeer eat in springtime recover slowly after they have been damaged, and lichen – their main winter food – need some 50 years to grow back. Pipelines in some cases blocked access to pastures, until herders negotiated with companies to build sand ramps for their reindeer or to raise the pipelines above ground. Some of the dogs brought to the tundra as pets by industry workers turned wild and now prey on reindeer. Migrating animals are sometimes injured on rusting industrial debris abandoned by workers.
At the same time, the arrival of petroleum companies brought opportunities. Herders found new customers for their meat. A joint venture of LUKOIL and Conoco-Phillips, for example, bought around 20,000 kilogrammes of reindeer meat last November, as food for staff. Some companies, such as Sibneft-Noyabrskneftegaz, hire herders to monitor pipelines and report damage. Herders use mobile phones to photograph or film damage. Some companies provide GPS units to help pinpoint the location of problems. In payment, herders receive money or equipment such as snowmobiles and generators.
Worries about traditional culture and animal migration are often at the heart of friction between energy companies and indigenous peoples. Indeed, in the summer of 2007 fears that noise could disrupt the migration of bowhead whales led to a delay in Shell’s government-approved plans to drill exploratory wells in the Beaufort Sea off the north coast of Alaska. Shell took steps to allay concerns by hiring Inupiat observers to collect scientific data on the behaviour of the bowhead whales the community hunts each year. It also agreed not to drill during the 2007 hunt and prepared to put 16 specialist ships on permanent watch, ready to react immediately in the unlikely event of an oil spill. The local community, however, remained concerned that exploration would drive migrating bowhead whales out of reach of indigenous hunters. The borough joined forces with environmental groups and the Alaska Whaling Commission to block exploration in court until more detailed environmental analysis was carried out.
“In an age of increasing impacts from climate change and expanding industrial activity on the North Slope, we need more caution — not less — for the sake of habitat and marine mammals in the Arctic,” Edward Itta, Inupiat mayor of Alaska’s North Slope Borough wrote in an open letter in a local newspaper in August 2007. “I don’t want to stop development. My goal is to make sure that development is preceded by genuine scientific analysis of the risks to wildlife, subsistence activities and human health.”
Oil and gas companies have learned to be more sensitive to the concerns of native peoples. But cultural and environmental issues are often complex and managers need to fully understand and address them early on in the planning phase of projects. “There is a pattern of engagement beginning too late and a lack of cultural understanding on the part of project operators,” says Emma Wilson, a senior researcher at the London-based International Institute for Environment and Development.
The world’s accelerating demand for energy means the desire to tap the Arctic’s oil and gas riches will likely grow. However, the challenges to operating responsibly in the region also mean the oil and gas industry will be asked to show indigenous peoples, environmentalists and governments that they are up to the task.
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