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: http://nsidc.org/data/seaice_index/. [Last Accessed 21 Sept 2012]
  • Норильский Никель. Заполярный Филиал[ONLINE] Available at: http://www.nornik.ru/our_products/polar_divisions/. [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 http://www.evosiastudios.com/

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.