As US exploration of the Arctic lags behind, other nations are discovering just how mineral-rich the region can be. On Sunday, Russia’s state oil company, Rosneft, announced the discovery of a massive new field off the Arctic coast of eastern Siberia. The new field, in the Laptev Sea’s Katanga Bay, is the latest discovery in a rush for Arctic resources by companies in the waters of Norway and Russia. Norway also made strides in the region this week as its oil ministry offered up a record number of leasing areas for exploration..
The Russian field is the largest to date in the waters above Eastern Siberia, and could be the largest along Russia’s entire Arctic coast. The full extent of the field has not yet been confirmed, but RT reported that core samples the Tsentralno-Olginskaya-1 exploratory well showed high oil saturation dominated with light oily fractions at depths of 2305-2363m.
US companies have been largely left behind in this scramble for Arctic resources due to a combination of restrictions on US companies doing business with sanctioned Russian firms, and US restrictions on drilling in our own northern waters. The sanctions, levied in response to the Russian invasion of Ukraine in 2014 and recently expanded, have severely curtailed US involvement in the region.
Though President Donald Trump recently lifted the Obama Administration’s moratorium on Arctic drilling, time-consuming obstacles remain in the form of a two year review process for the current five year Outer Continental Shelf (OCS) leasing plan and a host of possible legal challenges. Meanwhile, in the Norwegian Arctic, the oil ministry offered up 93 oil and gas exploration blocks in the Barents Sea this week, an increase of 21 from the previous round.
Both Norway and Russia view their Arctic regions as the best chance for new oil and gas discoveries in an era of fewer new finds globally and both are encouraging exploration. Norway in particular offers strong incentives and risk mitigation subsidies for companies willing to explore in the Arctic, a far cry from current and past US policies. Russia has also pushed ahead with energy infrastructure development in the region, despite the prospect of a second round of punishing sanctions and a weak economy.
When it comes to Arctic energy, the US is at risk of being left behind. Though the Trump Administration’s executive action is a promising step forward, there remain serious regulatory and financial obstacles to overcome before the US taking advantage of its own Arctic resources. The Administration must keep its forward momentum going in order to encourage development, mitigate risk, and build infrastructure in the Arctic.Without new Arctic policies and lease sales, the US risks spending decades on the sidelines while other nations reap the rewards of Arctic energy development.