Shell May Be Leaving the Arctic, but Norway's High North Is Open for Business
But on the other side of the Arctic Ocean, two fossil fuel projects in Norwegian waters are proceeding.
On Sept. 27, an anonymous source told the Financial Times that oil would start flowing “in a few weeks” at the Goliat drilling platform 50 miles off the city of Hammerfest on Norway’s north coast, despite the project's ongoing technical problems and delays.
The 64-thousand-ton platform is the world’s largest offshore rig, part of an $8 billion joint venture of Italy-based Eni and Norway's state-owned oil company, Statoil, to pull 174 million barrels of oil out of the Barents Sea.
Eni Norge did not immediately return a request for confirmation of the Financial Times' report.
UPDATED October 29, 2015, 10:00 a.m. PT—NRK, the Norwegian public broadcaster, has reported that because of its ongoing operational problems, Goliat will not begin pumping oil before the summer of 2016.
Statoil announced last Monday that the final length of the first pipeline linking southern Norway to the Arctic Ocean had been laid. According to the company, the 300-mile Polarled pipeline will begin pumping gas from the Aasta Hansteen gas field to a processing facility about 370 miles northwest of Oslo in 2017.
If that happens, it won't be Statoil's first productive Arctic energy venture: The Snohvit gas field, 85 miles off Hammerfest, has been active since 2007.
Scientists have confirmed that burning fossil fuels is melting the Arctic and have warned that oil and gas deposits beneath the Arctic seafloor must remain buried if the world is to have any chance of averting catastrophic climate change.
Shell's withdrawal from the Arctic Ocean won't spur second thoughts among drilling supporters in Norway, said Nils Harley Boisen, Arctic program coordinator for World Wildlife Fund Norway, despite how low oil prices on the global market have dropped.
“Shell is really the showcase example of why this doesn't make any sense,” Boisen said. “The costs, currently, for operating in the Arctic—even in the Barents Sea it's not profitable.”
“But Norway's Barents Sea and the Chukchi Sea are literally two different worlds in regards to the degree of development and infrastructure in place,” he added, because Norway's Arctic coastline stays ice-free year-round, thanks to the Atlantic Ocean's Gulf Stream current.
“That's why Norway is trying to open the door as a petroleum producer in the Arctic” by expanding into areas more like those off Alaska, Boisen said.
The government of conservative Prime Minister Erna Solberg pushed that door open in late 2014, when it announced that it was shifting the legal boundary of the polar ice cap northward. Under Norwegian law, the move opened up a vast new swath of the Arctic Ocean to fossil fuel development.
“When there finally came a conflict between ice and oil, they tried to move the ice boundary further north,” said Erlend Tellnes, an Arctic campaigner with Greenpeace Norway.
The Solberg government followed up in January by leasing eight new High Arctic oil and gas drilling sites.
The Norwegian parliament put those leases in doubt in June when it blocked the Solberg government's attempt to redraw the polar ice cap boundary.
“If they do hand out the leases, we will look into bringing a lawsuit to force them to stop Arctic drilling” under Paragraph 112 of the Norwegian Constitution, said Tellnes. That provision states that it is “the responsibility of Norway to take care of the future environment for its citizens.”
In June, a Dutch court ruled in a similar case that the government of the Netherlands had to slash its greenhouse gas emissions by 2020. The decision has prompted activists in Europe and North America to consider similar lawsuits as they try to close as much of the Arctic as possible to energy development.
“The Arctic is the last place where we should be continuing exploration for fuels which we know we should phase out,” Boisen said.
Norway's oil and gas industry has a far better safety record than do American companies. There is no Norwegian equivalent of Exxon's disastrous 1989 oil spill in Prince William Sound, Alaska, or BP's runaway oil well in 2010 in the Gulf of Mexico.
Still, the industry is Norway's single greatest source of climate-warming greenhouse gas emissions, generating 27 percent of the nation's carbon pollution—or around 12 million tons a year.
In winter, sea ice still expands to surround the Svalbard archipelago, a Norwegian island chain high in the Barents Sea that is home to polar bears, ringed seals, narwhals, sea birds, and other Arctic wildlife. But the archipelago is ice-free for more weeks of the year, and the edge of the winter ice cap is now closer to the islands than it used to be, as about 40 percent of Arctic sea ice has vanished in the past four decades.
In mid-September, the United States National Snow and Ice Data Center reported that summer Arctic sea ice had melted back to 1.70 million square miles, its fourth-lowest extent on record.
The great Arctic thaw around Svalbard has put Norway's polar bear population at risk of extinction, Boisen said, in part because during years with late winter sea ice, female bears are getting cut off from their preferred island sites for hibernating and birthing cubs.
“With sea ice in the Barents Sea moving north, the [Norwegian] oil and gas industry want to open up the area,” which may contain as much as 40 percent of the nation's untapped oil and gas, said Boisen. Some coastal communities worry about the harm that an oil spill in the extreme environment of the High Arctic could wreak on Norway's world-class cod, crab, and other fisheries, he said, but “further north, communities want the wealth that oil and gas might bring.”