With sea ice at a record low, the price of a barrel of oil pushing $100 dollars and border disputes with all of our northern neighbours, the Arctic is far more than an environmental or economic issue – it’s also a security and diplomatic one. Rob Huebert, associate professor and associate director of the Centre for Military and Strategic Studies at the University of Calgary, believes we are in a race we may lose if we do not make greater investments to assert our claim and our sovereignty.

The Arctic is undergoing a period of fundamental change. We may not fully understand the complete nature of the transformation, but there are significant geopolitical developments that portend to the beginnings of a confounding storm about to break upon the entire Arctic region.

First, we are starting to feel the effects of the United Nations Convention on the Law of the Sea on the Arctic. Negotiated between 1974 and 1982, and entered into force in 1994, the convention created new maritime zones of control, including a 200-nautical mile economic exclusive zone and, under article 76, sovereign rights over the continental shelf. Within the context of the treaty, countries have 10 years after ratification to determine their continental shelf, and then resolve the differences with their neighbours. Russia ratified the convention in 1997, which is why they are making so much noise this year. Canada ratified in 2003, Denmark in 2004; the US is not yet a party to the convention (but are making efforts now to become one).

Second, we see a renewed and assertive Russia. This is evident in almost everything that Vladimir Putin has done in the past four years, from his efforts to take control of the resource industry in Russia to the strategic planting of a flag at the North Pole, to the resumption of Russian air force patrols near our northern borders. A much more assertive and aggressive Russia has returned to the Arctic.

And third, we have a growing international concern over climate change. It is now accepted that the impacts of climate change are the most severe in the Arctic. The result is a physical transformation that is affecting every form of life and activity found in the region.

These changes are leading to both the perception and reality of an increasingly accessible Arctic. Ultimately, this points to a confrontation over control of resources and the transportation of energy out of the Arctic.

What are the challenges for Canada? We have border disputes with all of our neighbours – the Americans, the Russians and the Danes. And every one of those disputes is going to be fuelled by the quest for control of oil, gas and gas hydrates (a newly discovered form of fossil fuel). There is an increasing possibility that we may see the shipment of oil and gas as the primary means of transporting resources out of the Arctic.

We think of climate change as making the north more accessible, and that is true from a maritime perspective. But it is the exact opposite from a land perspective. Companies operating in the north are having nightmares. As the land warms, the permafrost is collapsing, and with it the entire land infrastructure system. There is reason to believe the Mackenzie Valley gas pipeline may not go forward; if it does, it may be of limited duration. The existing American oil pipeline in Alaska may need substantial improvement, and may at one point become inoperable because of collapsing permafrost.

That being the case, the Northwest Passage will become critical for Canada-US relations in the context of the shipment of oil and gas.

The sovereignty issue over which we still feel ramifications today involved finding the cheapest way to take oil out of the Alaskan North Slope – by pipeline or by tanker. Ultimately, the Americans opted for the pipeline in the early 1970s. However, the years during which studies were done, 1969 and 1970, were two of the very worst ice years on record. With climate change, ice conditions have obviously improved, and that leads to the next major issue. Will the Americans come to reconsider the possibility of shipping the oil out of Alaska?

For many, the issue around the Northwest Passage is trans-polar shipping, going from Asia to Europe or to the eastern US. However, it will be some time before the major shipping companies are comfortable with this route. It will be still some years before the Passage is ice-free in successive years. And the recent sinking of the cruise vessel in the Antarctic Ocean shows how dangerous even a little bit of ice can be. The more immediate shipping issue for Canada will involve point-destination shipping within the Canadian Arctic and specifically the shipment of extracted natural resources. And the question is, do you go east or do you go west? That is where the crux of the issue lies for Canada and the US.

In the Beaufort Sea, where large oil and gas reserves are suspected, the biggest issue is the dispute over the maritime boundary. Both countries disagree on how to extend the maritime boarder north of the Yukon and Alaska. The disputed zone that is created by this disagreement probably contains substantial resources. This issue is not going to be easy to resolve. Compounding the issue as to who owns these resources, Canada drew up its first northern lands claims agreement along this border with the US. Our land claims agreements are protected by the Canadian constitution. If we are to negotiate, we have to figure out how to address that particular issue.

The Americans are already dividing up the area in terms of where various oil and gas lease sites will be within the disputed zone. While there seems to be a gentleman’s agreement that should a company bid on any of these sites it will be turned down, there is nothing to guarantee that such an “understanding” will continue.

And then there is the Russian claim. The reason the Russians are making so much noise right now is to cement in everyone’s psychology that all claims start and end at “Santa’s workshop” – the North Pole. The North Pole has as much standing in international law as Santa Claus, but it is a mythology that people are buying into. There is nothing in international law that says the North Pole is magical. If you accept the North Pole as the starting point for all claims, then under the Canadian sector theory we actually lose a lot in terms of the area we can claim. If we drew lines from the most northern tip of our lands to the northern tip of the Russians’ islands, and then drew meridian lines, the Danes probably end up with the North Pole. When Canada eventually makes its claim, I fully expect to see it ending somewhere over the North Pole on the Russian side.

New technologies and industry developments are also increasing the probability that oil and gas will be shipped in the Arctic. Ice strengthened vessels that are now designed to operate economically in both open waters and ice covered waters are being built. In South Korean shipyards, two 70,000-tonne vessels and two 120,000-tonne ships are now being built to come into duty around 2009-2011. They will be used to shuttle oil from the Central Siberian oil fields to Murmansk. These smaller vessels, though more expensive to build, are economically viable because of propulsion technology that allows them to go forward when in open waters, and backwards when in up to one-year ice; the stern is an ice-breaking bow.

Should the Mackenzie pipeline fail, that same technology could be used to ship oil and gas out of the Beaufort. If the Americans build the terminal first, then they would have to pass through Canadian waters. So it will come down to an issue of who decides whether the pipelines are going ahead and who builds the first offshore terminal. If Canada is first, a cooperative arrangement can probably be worked out; if the Americans build it and decide to ship from west to east, we are back to 1969 and the resumption of a major sovereignty crisis that does not appear to have an easy resolution.

We are in a four-way race for the North Pole, pure and simple. The North Pole is not significant in international law but it is significant in terms of geopolitics and, more importantly, emotions. This is not a theoretical problem. The Russians have demonstrated that they have the technology today to go to the North Pole. Wealth generation from petro-dollars means they are more assertive and they are looking north. Regardless of what they think of the resources, they are making the efforts to get there. And for the US, increasing demands for non-OPEC oil and gas sources means we can expect greater emphasis on Arctic exploration.

Canada must be more prepared. On every one of our ongoing political disputes with our neighbours, energy is going to add fuel to the fire – metaphor intended. This is no longer an issue we can ignore. Ideally, we should seek a cooperative agreement, particularly with the Americans and the Russians, to deal with these issues before they become entrenched and therefore politically explosive. Once they are entrenched, they are going to become nasty. We cannot avoid the disputes, but the longer we put off action, the more entrenched the issues will become, the more difficult it will be to negotiate and the more nasty the future will look.

Rob Heubert is the co-editor of Breaking Ice: Renewable Resource and Ocean Management in Canada, and a fellow with the Canadian Defence and Foreign Affairs Institute (www.cdfai.org). This article is adapted from a presentation to CDFAI’s conference, “Canada As An Emerging Energy Superpower,” in October.


Sub-ice activity
For the first time since the end of the cold war, Russia is finding the funds to rebuild its submarine force. It took 12 years to build the first Borei-class submarine, but Vladimir Putin has announced steel cutting on three more and says he will build four more once the three are built. Putin has suggested that some of these submarines will be going to the Pacific fleet rather than to the Northern fleet but we are still a few years off from knowing exactly where they are going to be deployed. In all likelihood, it means Russian naval traffic in Arctic oceans is about to increase.

The Americans have also continued with their Seawolf and Los Angles class submarines, and both have under ice capability. And we were reminded this year that the British remain in the Arctic. Through the tragic loss of life on the HMS Tireless, we discovered that the British have been sailing to the Arctic with the Americans since 1986. Furthermore, the Danes and the British have an agreement whereby the Danes will borrow a British nuclear submarine to assist with their claim to the continental shelf.