Iceland’s New Era of Offshore Exploration

Iceland Offshore Licensing 2013

Licenses for the exploration and production of hydrocarbons were issued by Orkustofnun (Iceland’s national energy authority) on the 4th of January, 2013.  Both licenses fall within the ‘Dreki Area’ section that is subject to an Iceland-Norway agreement from 1981, and thus Norway was given, and has accepted, the right to a 25% share in the project.  Norway will be participating through the licensee ‘Petoro Iceland AS’ branch, in Iceland.

  • The first license (in purple on the map above) falls within the blocks IS60808/8, 9, 10, 11, and 12 and covers an area of 2,704 km^2.  Faroe Petroleum Norge AS is the operator with a 67.5% share.  Petoro Iceland AS and Islenskt Kolvetni ehf. have a 25% and 7.5% stake respectively.
  • The second license (in blue) includes blocks IS6808/1, IS6809/2, and 3, and IS6909/11, and 12.  This covers an area of 1,119 km^2.  Valiant Petroleum ehf. is the operator with a 56.25% share.  Petoro Iceland AS and Kolvetni ehf. have a 25% and 18.75% share respectively.

Previous concerned posts from 2012;

Economic Development

The developing offshore exploration industry will require new service centers.  The Dreki Area faces the northeastern side of Iceland, and the communities of Langanesbyggð and Vopnafjörður have thus been selected as partners for the creation of a Dreki Area service centre.  The consortium will fall under Dreki Area ltd.

  • Vopnafjörður is the planned initial exploration service centre location.
  • Finnafjörður will likely be the future home to a deep water port due to appropriate water depth and wind conditions.  The area is also seen as ideal for industrial development.
  • Þórshöfn has an airport and heliport.  The airport will be enlarged to accomodate for regional development.
  • Electricity for the servicing industry will be brought in on 220 kW connections via the National Power Network

A National Oil Fund

The president of Iceland, Ólafur Ragnar Grímsson, announced in December, 2012 his intention to set up a national wealth fund.  From IceNews, 20th of December, 2012;

Iceland’s premier has said that Reykjavik is to set up a wealth fund ahead of a potential offshore oil boom to protect the country’s revenues. President Olafur R. Grimsson’s comments came during an interview in London in which he told the media, “Since we look at this resource as a national wealth, there will be a national wealth fund that would be established, but this is more of a general policy at this time,” Bloomberg reports.

This is similar to what many resource-rich countries have done.  In the local area, Norway currently runs a rather impressive fund from oil-related activities, and Greenland was hoping to do the same as it continues to explore offshore.


This news is not going to come lightly to many.  The protests in response to the construction of the Kárahnjúkar Hydropower Plant were widespread, albeit for the implementation of one of the least CO2 intensive energy producing technologies available.  With that, I would assume that the construction of the offshore oil servicing industry will beckon much more.

The advantage for one of the most ably independent and clean countries on earth will be their ‘opportunity’ to eventually become independent of foreign oil sources.  Over 99% of the electricity generated in Iceland in 2011 was Hydroelectric or Geothermal in origin.  (Note that electricity generation does not originate from 100% renewable sources as some sources claim, but Iceland is quite close.  The amount of fuel used, in fact according to Orkustofnun, in electricity generation has been declining steadily over the last 30 years and amounted to only 2 GWh in 2011.)  According to the IEA, the country in 2009 imported 157,000 tonnes of motor gasoline (used for transportation), 114,000 tonnes of jet kerosene, 357,000 tonnes of gas/diesel (for industry, transportation, and fishing), and 96,000 tonnes of fuel oil (for industry, transportation, and fishing).  The thing to note is that all of this must be imported, meaning regular risks of spills into coastal ecosystems upon each import.  What is more, is that the quantities imported each year in both petroleum products, and natural gas are increasing year over year.

From the above, it is clear that risks both exist and are quite frequently ignored.  The issue shares components with that of the Icelandic aluminium smelting industry.  Smelting in Iceland will result in a lesser global CO2 footprint due to the hydro component than would have otherwise been realized had said smelting occurred in a coal-intensive region.  Similarly, oil that is produced and refined (in the future) in Iceland could face greater negative externalities that could have otherwise been realized had said production and refining occurred in a region with an easier-to-access reserve, for example.  It may thus come down to a desire for independence or a desire for economic growth and development, rather than for global efficiency in determining the next stages.  Will Iceland want energy independence not only in terms of electricity, but in gasoline, kerosine, diesel etc.., as well?  They may alternatively take the less strenuous route and simply sell their crude, and continue to import products as needed as they have been.


  • Orkustofnun. Generation of Electricity in Iceland. [ONLINE] Available at: [Last Accessed 13 Jan 2013]
  • Orkustofnun. Iceland issues the first licenses for exploration and production of hydrocarbons in the Dreki Area. [ONLINE] Available at: [Last Accessed 12 Jan 2013]
  • IceNews. Iceland president: government to set up wealth fund for oil revenue. [ONLINE] Available at: [Last Accessed 13 Jan 2013]
  • United Nations. Conciliation Commission on the Continental Shelf area between Iceland and Jan Mayen: Report and recommendations to the governments of Iceland and Norway, decision of June 1981. [ONLINE] Available at: [Last Accessed 13 Jan 2013]
  • Dreki Area. Booklet. [ONLINE] Available at: [Last Accessed 13 Jan 2013]
  • Statistics Iceland. Imports in goods. [ONLINE[ Available at: [Last Accessed 13 Jan 2013]

Statoil and Rosneft show progress in Sea of Okhotsk

North Sea of Okhotsk Licensing Blocks

Rosneft was awarded the (shown above) Kashevarovskiy, Lisyanskiy, Magadan-1, Magadan-2, and Magadan-3 licensing blocks (5 участков в Охотском море – Кашеваровского, Лисянского, и Магадан-1, Магадан-2, и Магадан-3) in December, of 2011.  As mentioned in a post from a year back, A Potential Magadan Oil and Gas Play, Rosneft had shown interest in the area, and the government of the Russian Federation was able to award the firm with the 5 blocks without auction as these were deemed “Blocks of Federal Significance”.

Statoil and Rosneft Cooperate to Explore 3 Licenses in Sea of Okhotsk

This year has shown sizeable cooperation between Statoil and Rosneft.  Several steps have been taken toward the eventual joint implementation and exploration of the Kashevarovskiy, Lisyanskiy, and Magadan-1 licensing blocks of the Sea of Okhotsk along with the Perseevskiy block of the Barents Sea (this article focuses on the Okhotsk licenses).

  • 5th of May, 2012 – Signed a cooperation agreement allowing for the joint exploration of the 3 Sea of Okhotsk licensing blocks (along with the Barents Sea block).  Stipulations concerning Rosneft’s opportunities to participate in Norwegian continental shelf operations.
  • June, 2012 – Both companies signed onto joint bidding for Norwegian continental shelf exploration licenses.
  • 30th of August, 2012 – Shareholder and operating agreements to establish joint ventures for the 3 Sea of Okhotsk licensing blocks (also for the Barents Sea block).

According to the agreement, as it pertains to the control of the individual Russian licensing blocks, Rosneft controls 66.67% and Statoil controls 33.33%.  Statoil is required to fund 100% of the exploration phase which includes the exploration wells expected to be drilled for Magadan-1 by 2016, Lisyanskiy by 2017, and Kashevarovskiy by 2019.

The June of 2012 signing marked the beginning of Rosneft’s pre-qualification process for Norwegian shelf operations.  While Statoil operates across a diverse international platform, Rosneft has come across as more so local to Russia and needs to build on and maintain its international image.  The initiative just announced on the 23rd of November, 2012 between Rosneft and Statoil was a declaration on Russian Arctic Environmental Protection and should help the international community see Rosneft as one that reflects Statoil’s values.  Both Rosneft and Statoil seem to be taking appropriate steps in laying the groundwork for broad future cooperation.


The Northern Sea Route as a Viable Development – Russia’s Fleet of Atomic Icebreakers

The Northern Sea Route (NSR), also known as the Northeast Passage, is the shipping lane that connects the Atlantic and Pacific Oceans.  It can thus be recognized as a potential expedited transit corridor for Europe and Asia.  Vessels transitting from ports in Europe to those in Asia via the Northern Sea Route en lieu of the Suez Canal Route are able to halve transit times, reduce fuel consumption and CO2 emissions, and finally reduce the risk of piracy through the avoidance of regions prone to piracy such as those about the Horn of Africa.  The Northern Sea Route is currently overseen by the Russian authorities through the Northern Sea Route Administration (NSRA) under the Ministry of Transportation.

For a broader picture of the Arctic world and it’s navigability, read, ‘A Future of Arctic Transit – Arctic Sea Ice Record Low Extent‘.

According to Russian law, as of 2013, the Northern Sea Route will begin from the eastern coast of Novaya Zemlya (Kara Gate), and extend through to the latitude of Cape Dezhnev (the easternmost point of the Russian mainland).  Within the law, insurance requirements, shipping fees, and icebreaker assistance fees have been, to some degree, standardized.  Finally, NSR use is limited to those vessels that are of the 1A-ice class.  Many firms that would gain from NSR access do not have this requirement and new A1 class ships are being purchased as a result.

To Yield a Viable Northern Sea Route is to Outsmart the Ice

The future viability of the Northern Sea Route will be a function of several things, most important of which will be the unpredictable, unforgiving, and frozen nature of the Russian Arctic.  Russia’s ability to perform infrastructure development and maintenance within the route, and plan icebreaking operations efficiently and effectively will be correlated with the predictability of and final changes in Arctic sea ice conditions.  With the minimum yearly extent of the Arctic sea ice in yearly recession, even hitting an historic record low on Sept 16 of 2012 (according to the National Snow and Ice Data Center), the NSRA should be and has been able to make significant progress.

Much responsibility will fall upon Russia insofar as the establishment and maintenance of the communication networks, cartographic/hydrographic information databases, and emergency preparedness measures that will be necessary for efficient, and responsible leadership in Arctic conditions.  Much money has been budgeted for these purposes, and activities are already being carried out.

  • By 2015-2016, Russia plans to have sorted out all navigational blank spots, and upgraded all navigation maps with route depth data.  (Клюев. В, 2012)
  • €23.4 million is to be invested in 10 emergency / rescue centers are to open along the Northern Sea Route by 2015.  Main centers include Murmansk (2013), Naryan-Mar (in construction, operational in 2013), Dudinka (2012), and Andyr.  Other subdivisions will be built in Arkhangelsk, Vorkuta, Nadym, , and Tiksi.  (Barents Observer, 2012)
  • Russia has been deploying extra aircraft (10 helicopters, and 8 aircraft) to stations in Murmansk, Novaya Zemlya, Dikson, and Mys Shmidta. (Barents, Observer, 2012)

As Russia intends to protect it’s northern geopolitical interests, it maintains and has been maintaining a strong presence along the NSR through research work, and the pilotage of transit vessels through the use of the Russian national icebreaking fleet under the direction of Rosatomflot.

Russia’s Atomic Icebreaker Fleet

Russia’s atomic icebreaker fleet, under the direction of Rosatomflot, has the mission to;

support the intensification of Arctic [transit] as a key factor [in the] rise and development of the Russian North. (Rosatomflot, 2012)

From this, the fleet of 7 icebreakers are used to patrol the NSR, pilot (break ice for and guide) other transit ships under contract through required route segments, and assist with scientific expeditions.  1 of the 7 icebreakers (Sevmorput) is a container vessel.

A few notes related to specific vessels;

  • Taimyr (Таймыр) – Shallow drift – Designed for shallow water operations such as those in the Kara Sea and the Yenisei River.  (Icebreaking along Norilsk Nickel’s transportation routes)
  • Vaigach (Вайгач) – Shallow drift / Sister ship of Taimyr – Also designed for shallow water operations and maintains Yenisei River during the colder months.
  • Sevmorput (Севморпуть) – Russia’s only nuclear powered container vessel has a deadweight tonnage of 33,900 and is designed to carry up to 74 lighters, or 1328 twenty-foot containers (or the 40 foot container equivalent).  Equipped with cranes that allow for the independent loading and unloading of lighters and some container types.

50 let Pobedy – Russia’s Newest Nuclear Icebreaker (

The Atomic nature of the fleet allows for months of independent navigation which is beneficial in an area of the world that rarely sees ‘outside civilization’.  Inopportune ships that find themselves stuck in thick ice are often rescued by Rosatomflot’s icebreakers.  Atomic fleet vessels have tremendous horsepower and the ability to attach to other vessels, through the use of thick metal cables, to tow them free.  When contracted out, Atomic vessels lead and break ice for paying ships through the entire NSR for a journey that may last weeks.  These vessels are staffed with a variety of professionals allowing them to also serve as lifelines for remote communities or even other ships that may require urgent medical attention.  This is the type of operation that can, under correct policy, provide resonant positive externalities.

Transit in Numbers

On the subject of the development of the Northern Sea Route, the Russian Minister of Transportation, Maxim Sokolov (Максим Соколов), estimates that in the near future there could be from ‘3 to 5 million tons of cargo […] transported using the [Northern Sea] Route.’  The route, Sokolov says, is something that ‘can be used by all states and all companies’, but ‘Japan, Korea, and Singapore [would see the greatest benefits as these are] countries that have a large amount of cargo shipped by sea.  ‘These countries would see transit times of 23 days instead of 46.’  (Sokolov. M, 2012)  Transit numbers have already increased exponentially from 2010.  The following trends can be observed;

  • 2010 – 4 vessels with 111,000 tons
  • 2011 – (29 June – 18 Nov) 34 vessels with 820,000 tons
  • 2012 – (late June – current) 749,706 tons as of Sept 12, 2012

Nordic Bulk Carriers A/S – A Pioneer in Arctic Transit

In 2010, the first ever bulk carrier of a foreign flag, operated by the Danish firm Nordic Bulk Carriers A/S, transited the official Northern Sea Route with 41,000 tons of iron ore headed for China.  The MV Nordic Barents, owned by ‘Investerings Gruppen Denkark’ was escorted by two of Rosatomflot’s icebreakers.  Fuel savings amounted to roughly USD 180,000 (avoiding the Suez Canal Route).  This was an important step in the development of the Northern Sea Route as a commercially viable trade route.

In 2011, the Japanese owned MV Sanko Odyssey, under the operation of Nordic Bulk Carriers A/S, transited the Northern Sea Route with 70,000 tons of iron ore destined for China.  MV Sanko Odyssey is the largest ice class bulk carrier in the world.  Fuel savings amounted to approximately 750 tons.

In August of 2011, the SCF Group (Sovcomflot) transited the NSR with over 120,000 tonnes of gas condensate from Murmansk to Map Ta Phut, Thailand.  Vladimir Tikhonov, a 160,000 tonnes deadweight tanker, was the first of it’s size to transit the NSR, setting a speed record to boot, showing yet again that the Route is both navigable and economical.  Escorting was done by 50 Let Pobedy and Yamal.

2012 has seen the following along the NSR (starting in late June);

  • Murmansk Shipping Company – ‘Indiga’ and ‘Varzuga’ – Diesel to NSR settlements
  • Nordic Bulk Carriers A/S – ‘Nordic Odyssey’ and ‘Nordic Orion’ – Iron ore concentrate to China
  • Novatek – ‘Marilee’ and ‘Palva’ – Gas condensate to South Korea
  • ‘Stena Poseidon’ – Kerosene from South Korea to Finland
  • ‘Vengeri’ – Tugboat
  • Chinese Icebreaker ‘Xuelong’ – Arctic expedition

Concluding Remarks

The incentive to serve as a northern lifeline is both large and commensurate with Rosatomflot’s, and thus Russia’s stated mission.  The intensification of the Northern Sea Route transit will depend on Russia’s ability to portray an image of Arctic dominance.  This is meant in the sense of trust and punctuality, as opposed to that of military strength.  This has, for the most part, been satisfied.  The United States, for example, has only 2 icebreakers that will often be insufficient in accommodating the search and rescue needs of the Alaskan north.  Canada has a fleet of icebreakers, 2 of which are rated as heavy icebreakers, but none of which would be able to reliably and independently perform the type of Arctic rescue operation that may be required.  With such stark contrasts, plans to construct yet more powerful nuclear icebreakers, and ambitious development plans for NSR emergency / rescue centers Russia will, at least into the foreseeable future, continue to discover and advance the Arctic world.


  • Arctic Info. Minister of Transportation: Use of the Northern Sea Route is our Specialty.  [ONLINE] Available at:–use-of-the-northern-sea-route-is-our-speciality. [Last Accessed 28 Sept 12]
  • Barents Observer.  Northern Sea Route without Murmansk.  [ONLINE] Available at: [Last Accessed 28 Sept 12]
  • Barents Observer.  К Новому Рекорду на Севморпути.  [ONLINE] Available at:  [Last Accessed 28 Sept 12]
  • Barents Observer.  Arctic emergency center opens in Murmansk in 2013.  [ONLINE] Available at:  %5BLast Accessed 28 Sept 12]
  • Barents Observer.  Russia deploys 18 emergency aircraft to the Arctic.  [ONLINE] Available at:  [Last Accessed 28 Sept 12]
  • Canadian Coast Guard.  Icebreaking Program.  [ONLINE] Available at: [Last Accessed 28 Sept 12]
  • Единая Государственная Система Информации об Обстановке в Мировом Океане.  Морской Транспортный Флот, Зарегистрированный в Российском Международном Реестре Судов.  [ONLINE] Available at:  %5BLast Accessed 28 Sept 12]
  • National Ice Center.  Daily Ice Analysis Products.  [ONLINE] Available at:  [Last Accessed 29 Sept 12]
  • Nordic Bulk Carriers A/S.  NRS PROJECT.  [ONLINE] Available at: [Last Accessed 28 Sept 12]
  • RZD-Partner.  Slow Start on the Northern Sea Route.  [ONLINE] Available at: [Last Accessed 29 Sept 12]
  • Rosatomflot.  [ONLINE] Available at: [Last Accessed 28 Sept 12]
  • Russian Maritime Register of Shipping.  Symbols and Abbreviations Used in the Register of Ships.  [ONLINE] Available at: [Last Accessed 28 Sept 12]
  • РиаНовости.  Ледоколы Росатомфлота начинают новый цикл работ в Арктике.  [ONLINE] Available at: [Last Accessed 29 Sept 12]
  • РиаНовости.  “Белые пятна” с гидрографических карт Севморпути исчезнут к 2016 году.  [ONLINE] Available at: %5BLast Accessed 28 Sept 12]
  • Север-Наш.  Атомоход “50 лет Победы” пробудет в Финском заливе до ухода льда.  [ONLINE] Available at: %5BLast Accessed 29 Sept 12]
  • The Maritime Executive.  Tanker Vladimir Tikhonov Completes Successful Northern Sea Route Transit in a Week.  [ONLINE] Available at: [Last Accessed 28 Sept 12]


A Future of Arctic Transit – Arctic Sea Ice Record Low Extent

*Click on the map above to see full extent*

Arctic Sea Ice

On Sept, 16, 2012, according to the National Snow & Ice Data Center in Boulder, Colorado, the Arctic sea ice extent broke through it’s previous record minimum from Sept, of 2007.  Satellites began to track the Arctic sea ice in the late 1970s, and have found the ‘six lowest seasonal minimum ice extents to have occurred within the last 6 years (2007 – 2012).’  (National Snow and Ice Data Center, 2012)  The data used in the map above is from the previous year’s minimum ice extent (Sept, 11, 2011).  This can be compared with the median minimum ice extent calculated from 1979 through to 2000.

  • The Arctic sea ice extent typically reaches it’s yearly minimum in the month of September.

What a Melting Arctic Means for Transit

Under historical conditions, icebreakers would have been required to break Arctic Sea Ice ahead of most transit vessels.  Due to melting, unassisted transit is now possible through several of the summer months.  Major Arctic routes are present in the above map.  These have been color coded and are interpretable by means of the legend.

Read ArcticEcon’s, ‘The Northern Sea Route as a Viable Development – Russia’s Fleet of Atomic Icebreakers‘ for a comprehensive analysis of the development of the Northern Sea Route,

  • The Northern Sea Route (NRS), also known as the Northeast Passage, is the shipping lane that connects the Atlantic and Pacific Oceans.  It can thus be recognized as a potential expedited transit corridor for Europe and Asia.  Vessels transitting from ports in Europe to those in Asia via the Northern Sea Route en lieu of the Suez Canal Route are able to halve transit times, reduce fuel consumption and CO2 emissions, and finally reduce the risk of piracy through the avoidance of regions prone to piracy such as those about the Horn of Africa.  The Northern Sea Route is currently overseen by the Russian authorities through the Northern Sea Route Administration (NSRA) under the Ministry of Transportation.
  • Northwest Passage – Connecting the Atlantic and Pacific Oceans via the Canadian Arctic Archipelago, the Northwest Passage stands to serve as a potential alternative to the Panama Canal Route.  The passage falls under the definition of an international strait by some countries.  Canada, on the other hand, views the route as internal.
  • Norwegian and Greenland Traffic Routes – Heavily used general transit routes.

More information and data to come shortly…


  • National Snow & Ice Data Center. Sea Ice Index. [ONLINE] Available at: [Last Accessed 21 Sept 2012]
  • Норильский Никель. Заполярный Филиал[ONLINE] Available at: [Last Accessed 21 Sept 2012]

Greenland Maritime Boundary / Oil and Gas Licenses 2012 Update

Greenland Maritime Boundary Active License Map

Since my previous post in Dec, of 2011, Greenland Exclusive Economic Zone / Oil and Gas Licenses, not much has been seen in terms of eventful exploration results.  In spite of this, Greenland is in continuance with it’s plans to open up Greenland Sea licensing blocks to applications.

Greenland Sea Licensing Rounds – 2012/2013

  • Pre-qualification Round – Paying KANUMAS Group members (see below) will have the opportunity to apply for 11 special licensing blocks (view pre-qualification blocks on above map) ahead of non-members.  Applications for pre-qualification as operators were due in March, of 2012.  Those for exploration and exploitation are due in Dec, of 2012.
  • Regular Round – Regular applications for the 8 remaining blocks, along with those not acquired in the pre-qualification round, will open in June, of 2013.  Applications for pre-qualification as operators will be due in July, of 2013.  Those for exploration and exploitation will be due in Oct, of 2013.

KANUMAS members were among those that partook in preliminary seismic studies for the regions of northwestern and northeastern Greenland starting in late 1989.  Members included Exxon, Statoil, BP, Japan National Oil Corporation (JNOC), Texaco, Shell, and NUNAOIL A/S (Greenland’s state oil company).  Project members were granted preferential position in any future licensing rounds comprising the northeastern region of Greenland.  Today, paying members include ExxonMobil, Statoil, BP, Japan Oil, Gas and Metals National Corporation (JOGMEC), Chevron, Shell, and NUNAOIL A/S.

Exploration Progress and Results

  • NUNAOIL – Greenland’s state oil company, NUNAOIL, currently holds a 12.5% minority stake in all but one of Greenland’s offshore hydrocarbon license operations.  NUNAOIL holds an 8% minority stake in the southern Salliit license block.
  • Cairn – Cairn has since completed it’s first phase of exploration for offshore Greenland.  8 exploration wells, seismic surveys, and other data were collected in 2011/2012.  As of yet, only indications of oil seeps have been discovered in both western (Pitu) and southern Greenland license blocks.  Despite $1.2 billion in losses from 2011 Greenland operations, chairman Sir Bill Gammell seems poised to press onward.  Shareholders voted down Gammell’s share options package valued at £2.5 million as a result.
  • Statoil – Since having received a 30% farm-out stake in Cairn’s Pitu license block in Jan, of 2012, (read Cairn spreads out the risk – Farms out shares to Statoil) seismic studies have been completed.
  • Korean KORES – Sept, 10, 2012 – Although unrelated to offshore hydrocarbons, State Korean company has been looking at joint mineral operation opportunities in Greenland.


An Icelandic Time-lapse – An Incentive to Recycle your Aluminium

Having visited Iceland in 2011, I would have argued that the available promotional material was insufficient in doing the country justice…. until now.  I would thus recommend the following 13 minute time-lapse film to anyone that is weighing the pros/cons of an Icelandic visit, or has a particular affinity for scenery.

Film from

The film connects with economics as it brings more information to the individual pertaining to the cost/benefit analyses made prior to our recycling decisions.

Aluminium – Brief Economics of Recycling

I have published various materials relating to the energy-intensive Aluminium smelting operations that exist in Iceland.  If the information below falls insufficient, read “Aluminium Smelting in Iceland – Alcoa, Rio Tinto Alcan, & Century Aluminum Corp.

In short, the energy requirements for the smelting process lead multinational firms to places like Iceland that offer low electricity prices and untapped hydroelectric dam potential.  I am unsure about the exact figure (I will attempt to locate a credible study), but it is estimated that the energy requirements to recycle (smelt) used aluminium products make up roughly 10% of the energy requirements for the traditional source smelting of alumina for the production of aluminium products.

If aluminium demand reaches the level sufficient to strain existing production capacity related to, specifically, energy availability, there will be that much more of an incentive to build out the world’s remaining hydroelectric capacity in places like Iceland.

With that said, large-scale increases in aluminium recycling can strongly reduce the propensity to build additional energy-generating structures in areas that would have otherwise not required them.

The Fiercely Contested Russian NGO Bill – Russia

On the 13th of July, 2012 a Russian draft law, setting out to label all politically affiliated NGOs with activities funded from abroad as ‘foreign agents’, passed through the State Duma with barely any opposition.  Russian activists are now in strong opposition along with foreign governments.  Said NGOs would have to register as foreign agents and include this label on all publications and web-portals.  Apart from being labelled ‘foreign agents’, NGOs would be subject to frequent audits and spot checks.

Many human rights proponents insist that such a bill would work to suppress opposition to the current Russian state of affairs.  The bill now needs to be passed through the Federation Council, and then onto the Russian president’s desk for Putin’s signature.

Those in Favor of the Bill

Putin’s party, United Russia or Единая Россия,  finds the bill to be inline with democratic standards as it forces NGOs to be open about their sources and funding.  The party advocates that such openness will be in the best interest of citizens.  Those that favor the bill also recognize the current social-network and NGO movements as forces that often override the opinions of Russian citizens.  It is quite true that much of the social-network publicity concerning the December elections has been strongly opposed to the current Russian state of affairs.  These views were also often projected as the views of the overwhelming majority whether or not that was actually true.  Coincidentally, this mechanism does not work in Putin’s favor.  It is worth adding that last year, Putin accused foreigners of funding those NGOs in Russia that were in opposition to his party.

Many in Opposition to the Bill

The General Secretary of the Council of Europe, Thorbjørn Jagland, former prime minister of Norway, found the NGO bill to be reminiscent of the Stalin era.  Jagland elaborated on the term ‘foreign agent’ and it’s historical use in defining those that were executed during the [Joseph] Stalin era.  He found the term to be ‘unfair [and] inappropriate [in that there is no use for such a term] in modern lawmaking [and that] it belongs to the past and does not belong [in] a democratic society.’  He went on to say that the term is also ‘often used in other authoritarian regimes against everybody that has different views.’  (Jagland)

From a U.S. Department of State press briefing, spokesman Patrick Ventrell spoke on the topic of the Russian NGO legislation.

[T]he United States is deeply concerned by the Russian Duma’s consideration of legislation that would potentially limit the activities of Russian nongovernmental organizations receiving foreign financing. The legislation would require NGOs engaged in civil society activities broadly defined as political to register as foreign agents. It differs from U.S. foreign agent – it differs from the U.S. Foreign Agents Registration Act, because registration would be required regardless of whether an NGO works directly on behalf of a foreign entity or not.  Unlike under US legislation, where [some US personnel] are actively working on behalf of a certain government register as foreign agents, which means that they disclose their funding source, NGOs that may be nonpartisan and receive funding from all sorts of different sources and are working in a transparent and nonpartisan manner are being asked to register all as foreign agents. … [The United States simply wants] NGOs to be allowed to ‘work in a nonpartisan fashion and work with members across the political spectrum in a number of different countries’. (Ventrell)


In an objective sense, it is true that the youth can be impressionable, if not more-so than can be the older age groups.  The youth tend to have the strongest influence over social-media.  More so, many advocate-web-portals contain purposefully subjective views with a lack of balance in terms of subject material (in either direction).  A democratic society strives to encompass the views of all age groups, but the spill-over of Russian social-media into other countries presents the world with an image that could potentially only be representative of the younger generations.  This effect then has the ability to feed-back into Russia with the support of foreign youth.  Older groups in opposition may not find this process to be economical for them, and may require alternative mechanisms (data that I do not have would be required to verify this).  The same issue is, naturally, present within other countries including the United States, for example as social media has at times been, collectively, in opposition to the views of the majority.  With this said, one can still be suspicious of any law put into place by a party that the law then serves to benefit.  This could be akin to the American ‘Super PAC’ regulations that may coincidentally benefit the party that worked to put them (said regulations) in place.

On the note of NGO funding, some Canadians could be sympathetic to Putin’s approach due to the way in which the Canadian NGOs in opposition to Canadian oil sands activities were being funded by foreign sources.  Funding was supported by those that were in opposition, but was found to be undemocratic by those that were in favor of the oil activities.

Arctic Economics does not set out to be a proponent of any particular stance, but has the intention to analyze on an objective level.