Arctic oil reserves

How thick is the ice cap at the North Pole? Will it melt within our lifetime, or will it take a century? Will its major oil and gas reserves become available for exploitation? These are the questions which may be answered by the Vanco Arctic survey, due to take place between February – June next year.

Arctic.bmpA blog reader has kindly sent me details of the proposed expedition. It will aim to resolve, via a 1000 mile survey, current scientific controversy over the precise thickness of the ice. This has apparently proved impossible to assess either by submarine or satellite till now. Then we will know whether the ice will melt within 15 years, at current rates, or within 100 years.

As and when the ice cap melts, global warming is expected to accelerate. The Arctic covers almost 3% of the Earth’s surface, and reflects approximately 80% of the incoming solar energy. If it disappears, the newly exposed ocean could cause a 70% increase in energy absorption, and an additional 0.4-1.0m rise in sea level through the inevitable thermal expansion of the ocean.

On the positive side, the Vanco organisers claim it will enable us to reach new sources of oil and gas, accounting for 25% of the earth’s known reserves. These are already the subject of claims, and counter-claims, by Russia, Canada, Denmark, Norway and the US. 10 billion barrels of oil are thought to be at stake. The new northern ocean will also offer much shorter trading routes.

Will investment bankers one day be preparing their prospectuses for potential new Arctic petrochemical plants?

About Paul Hodges

Paul Hodges is Chairman of International eChem, trusted commercial advisers to the global chemical industry. He also serves as a Global Expert for the World Economic Forum. The aim of this blog is to share ideas about the influences that may shape the chemical industry and the global economy over the next 12 – 18 months. It looks behind today’s headlines, to understand what may happen next in critical areas such as oil prices, China and Emerging Markets, currencies, autos, housing, economic growth and the environment. Please do join me and share your thoughts. Between us, we will hopefully develop useful insights into the key factors that will drive the industry's future performance.


2 Responses to Arctic oil reserves

  1. Snowblind 27 November, 2007 at 11:19 am #

    Should they use 10% of the energy recovered from under Arctic ocean to make titanium dioxide which could be painted over large sheets a the poles and which could then help to reflect solar energy…

  2. john richardson 5 December, 2007 at 2:02 pm #

    Always happy to read about a boost for our friends in the inorganic chemicals industry.

    As the investment bankers eye the arctic oil reserves, and maybe petrochemical plans also, the rest of the world could be in the midst of more wars (to follow Darfur) caused by climate change.

    Bangladesh will probably have disappeared as will, perhaps, where I am sitting now – Singapore.

    But, as the father of an 11-month-old boy, give me more SAP plants please – in the arctic if necessary.

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