Why the US should strive for a Holistic Regional Framework on Sustainable Offshore Natural Resource Development
Over the weekend, the US assumed the two-year rotating chairmanship of the Arctic Council, an intergovernmental forum, at the conclusion of the 2015 ministerial meeting in Iqaluit (Canada). The US has outlined a policy agenda with a focus on addressing the effects of climate change; on improving ocean stewardship, the marine environment and maritime safety (given the prospect of opening shorter shipping routes via the Arctic); and on improving the well-being for those who live north of the Arctic Circle.
For more on this issue, see Breaking Energy’s extensive Arctic coverage here.
In March 2015, US Senator Maria Cantwell (D-WA) reminded the audience in her opening statement at a hearing held by the Senate Energy and Natural Resources Committee intended to evaluate Arctic opportunities, that’s it’s important for the US “to build on its status as an Arctic nation for the betterment of the nation and those who live in the Arctic.” Cantwell also asserted that climate change needs to be correctly understood as a “threat multiplier,” thereby quoting former Secretary of Defense Chuck Hagel.
It is in this sense that Defense Secretary Hagel characterized the effects of climate change on the world’s security environment in October 2014 while unveiling the Defense Department’s plan to meet that challenge at a Conference of Defense Ministers of the Americas in Peru. “Our supply chains could be impacted, and we will need to ensure our critical equipment works under more extreme weather conditions,” he stressed.
Senator Cantwell summarized in her statement the threat impacts, which include impacts to installations from sea level rise; “access to natural resources, including our fisheries”; and the potential impact on food security. The reference to “fisheries” is almost buried in this statement and yet it is so crucial when thinking about and devising a strategy for sustainable development of Arctic natural resources – i.e. a side-by-side development of offshore oil/gas reserves and fisheries.
Why should both policy areas be addressed in tandem by the US chairmanship?
First, because they naturally promise a high degree of cooperation among all littoral Arctic states with a common interest in setting up a management framework and they are logically linked. In the US case, this genuine link is underscored by the Bureau of Safety and Environmental Enforcement (BSEE) and the Bureau of Ocean Energy Management’s (BOEM) recent release of proposed Arctic-specific regulations with sole focus on offshore exploration drilling operations within the Beaufort Sea and Chukchi Sea Planning Areas.
The proposed regulations state clearly:
“Reducing the risks of Arctic offshore operations is particularly important because of the unique significance to Alaska Natives of the fish and marine mammals in the lands and waters around the Arctic OCS; those resources are critical components of the Alaska Natives’ livelihood, and they rely on fishing and hunting for traditional cultural purposes and for subsistence. (…) Thus, the impact of a catastrophic oil spill, while a remote possibility, would have extremely high cultural and societal costs, and prevention of such a catastrophe would have correspondingly high cultural and societal benefits.”
Meanwhile, Bradley Klapper of the Associated Press reported over the weekend that the US, Russia and other Arctic countries seem to be ready to look past current geopolitical tensions “vowing to cooperate on preventing oil spills near the North Pole and combating climate change in a region warming faster than any other.” According to Klapper, the Russian government is equally well aware that a cleanup of an oil disaster “would be a logistical nightmare.”
The second reason why the Arctic Council member states also need to take a lead on the management of fisheries in the Arctic is the proliferation of applications for permanent observer status to the Arctic Council and the appointment of Ambassadors for the Arctic by non-Arctic countries. Of the current 32 ‘observers’ to the Arctic Council 12 are non-Arctic states.
Permanent Observers to the Arctic Council
Source: House of Lords, Select Committee on the Arctic
Note, the EU, an ‘ad hoc’ observer since 1998, is also allowed to observe Arctic Council proceedings while a final decision on the implementation of its latest application (2013) is pending. The latest application to become a permanent observer has been submitted by Switzerland.
The list above reveals why it is not all about oil and gas reserves in the Arctic in terms of natural resources and the US needs to proactively address the future issue of fisheries in the central Arctic Ocean before fishing there becomes possible. China – describing itself as a “near-Arctic state” – South Korea, and Japan are lined up and ready to pounce. The fisheries sector is one of the most globalized and given Asia’s huge demand for fish products, it is predictable that the fate of the central Arctic Ocean will hinge particularly on China’s future behavior. A case study by Tabitha Mallory of Princeton University published by The World Bank discusses China’s distant-water fishing (DWF) activities and shows that China accounts for over 30 per cent of global DWF catch.
Source: Dr. Tabitha Mallory (Princeton University)
Dr. Mallory writes: “Although official sources report that China’s DWF industry produced 1.223 million tons of catch valued at $2.17 billion in 2012, some fisheries experts have estimated that the real amount and value of DWF catch may be as high as 4.604 million tons valued at €8.93 billion per year. The high-seas share of this catch has been increasing and stood at 52.8 percent of overall catch in 2012. (…) [E]vidence suggests that Chinese DWF vessels are active in 93 countries. The DWF industry has strategic importance to China for employment and business opportunities, food security, reducing pressure on China’s resources, technological development, and safeguarding China’s rights and interests globally.”
So, neither the US nor Russia would like to see an uninhibited Chinese ‘invasion’ into the Arctic. Note, while the sovereign littoral Arctic states are responsible for both development and environmental protection in their respective territories – i.e. their exclusive economic zone (EEZ) of about 200 nautical miles offshore where they have the right to explore, exploit, conserve and manage natural resources (including fisheries) of the waters as well as seabed – the central Arctic Ocean is considered “high seas.” High seas make up “about 60% of the 364 million square kilometres of global oceans” according to Professor Reg Watson and the high seas are internationally shared as “global commons” pursuant to the United Nations Convention on the Law of the Sea (UNCLOS).
Source: House of Lords, Select Committee on the Arctic
The US is still not a party but treats the Convention as customary international law. Consequently, any discussion of how to manage fisheries in this area – to prevent overfishing – is per se an international issue and cannot be regulated by the littoral Arctic states alone. Nevertheless, those states need to show leadership on this issue – as a House of Lords report also suggests.
The UK’s House of Lords Arctic Committee advocated in a report published in February 2015 the appointment of an Ambassador for the Arctic and advised to follow in the footsteps of countries such as Japan, France, Singapore and Poland. The rationale is explained as follows:
“As changes expose potential opportunities and threats, international interest in the region has increased. Recent years have seen a significant expansion in the number of observers to the intergovernmental Arctic Council, with Asian states such as China, India, Japan, Singapore and South Korea becoming increasingly active in the region. The continued growth of international pressure for influence on the Arctic is inevitable, and the UK must respond accordingly.”
Note, the UK has been an observer to the Arctic Council since 1998. Interestingly, the Committee refers to the UK in the report as “the Arctic’s nearest neighbour” and criticizes the current “too hesitant and cautious” approach calling for the UK “to be more strategic, better co-ordinated, and more self-confident and proactive, or the UK risks being outmanoeuvred by other states.” The Committee’s report, “Responding to a changing Arctic”, concludes that it is only a matter of time before the Arctic will be “substantially free of sea ice in the summer” given that “temperatures there [are] rising twice as fast as the world average (…) [resulting in] a massive impact on the region’s environment, ecosystems and people”. The report also makes the following prudent recommendations:
- Establish a moratorium on fishing in the high seas area of the central Arctic Ocean while pushing for an agreement on a “recognised management regime for the area”.
- Comprehend the recent slide in world energy prices as a “window of opportunity for gaining increased clarity on whether oil and gas extraction in ice-affected Arctic waters can be achieved safely and responsibly“ and “for considering whether any international standards on where drilling can be undertaken in relation to sea ice can be agreed.”
- Make every effort to “insulate Arctic co-operation from non-Arctic disputes” in other parts of the world given the global interest in protecting this fragile environment.
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