Opportunities Abound in the Arctic

March 10, 2016 in Global Opportunity

Energy development in the Arctic has a rich, global history that stretches back over a century. The American energy industry has been operating in the Arctic for over 80 years. It’s unfortunate that recent political statements and regulatory slowdowns have distracted the broader public from what’s really important in the Arctic. The truth is there’s still massive energy development potential in the Arctic, which can be done safely and in coordination with local communities.

The USGS estimated that there are 90 billion barrels of undiscovered, recoverable oil and another 44 billion barrels of natural gas liquids in the Arctic. Those mammoth numbers represent 13 percent of the world’s undiscovered oil. The majority of this undiscovered oil in the Arctic lies offshore. These estimates quantify the massive energy development opportunities that lie in the Arctic – both for America and the rest of the world.

The Arctic is often thought of as a frigid, barren place with very few inhabitants. While it is indeed a cold region of the world that does not mean it doesn’t house a sizeable population. Today, a total of four million people reside in the Arctic, with about 10 percent of those people belonging to indigenous groups. These population numbers represent an incredible opportunity for collaboration – both in energy development and the inclusion of traditional knowledge; a regional understanding of the environment. The energy industry has a strong record of working with Native populations to ensure that the goals of both groups are met when drilling projects occur. Leaders of the Native groups in Alaska have been an invaluable resource to drillers across the North Slope, thanks to their extensive knowledge of the area and their understanding of the needs of their communities.

Despite the harrowing headlines of late, there are still operators who are pushing forward with drilling projects in America’s far north. ConocoPhillips (who has an impressive track record of partnering with Alaska Natives) began producing in the National Petroleum Reserve Alaska (NPRA) last month. Conoco saw promising results when it reached first oil, and will continue to move forward with projects in the NPRA.

Exxon Mobil is another example of an energy company moving forward with Arctic operations. In fact, they have been active in the state of Alaska for over 90 years, through a combination of onshore and offshore projects in Alaska’s North Slope. Exxon’s Point Thomson project is one of their most recent examples of success in the challenging climate of the North Slope. Production is expected to begin this year, and the company estimates that it will produce up to 10,000 barrels a day of natural gas condensate, which will then flow through the Trans Alaska Pipeline System.

The opportunities across the Arctic are extensive, and they should not be overshadowed by activist hyperbole or regulatory red tape. Arctic Operators have a long and successful record of safe operations in the region. Nations and communities across the globe should take advantage of the immense resources and partnerships the far North has to offer.