Arctic Yearbook 2012
Shipping and Resources in the Arctic Ocean
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Canada’s Arctic region is rich in oil and gas development opportunities. As much as 1.7 billion
barrels of oil and 880 billion m³ of gas have been discovered of potential resources of 8.4 billion
barrels of oil (discovered plus
undiscovered) and 4.3 trillion m³ of gas. This represents about 25 per
cent and 33 per cent respectively of Canada’s remaining resources of conventional crude oil and
natural gas. Some exploration activity is now underway. In 2008 six companies received permits to
explore the Beaufort Sea and the Mackenzie delta for oil and gas, but it will take a fairly long time
before new finds reach the stage of production (Østreng et al., 2012: Ch. 3).
As far as other minerals are concerned, the most promising cargo potential is to be found in the
development of an iron ore project at Mary River on Baffin Island. This is expected to be operational
by 2020 and to generate shipment levels of about 12 million tonnes per year. Assuming 200 000 dwt
vessels, there would be about 60 loads in destination shipment per year through the eastern part of
the NWP. Other mining developments could require shipping services but the quantities are likely to
be relatively small due to the nature of the minerals that are being exploited. In some cases no more
than 6-12 vessel transits are expected during an extended season. Some, like the output of gold,
diamonds, and uranium in some places, are more readily flown out by aircraft that are already a part
of the supply chain (CASA, 2007).
The North Slope of Alaska holds about 4.2 billion barrels of US proved oil reserves or about 20 per
cent of US total proved reserves. This oil is transported southward by pipeline to Valdez on the
Pacific from where it is transported southward on keel. The same mode of transportation is planned
for the petroleum resources off the Alaskan Arctic coast, which is supposed to hold at least 27
billion barrels of oil and 1 trillion m³ of natural gas (Østreng et al., 2012: Ch. 3). Thus, Alaskan
petroleum does not add much to destination sailings in the western section of the NWP.
In terms of logistics, the NWP has no adequate ports with the necessary facilities to support the
growing amount of commercial traffic along the northern slope of Alaska and throughout the
Canadian Archipelago. Several ports have been proposed, but it is unclear if these ports will have the
necessary facilities to meet the demand of increased shipping along the NWP. Currently, there is also
a lack of adequate communication systems in the area. The United States have made few
contributions to the development of adequate communication systems and services, while Canada
operates with seasonal systems. The Canadian Coast Guard (CCG) is the primary agency along the
NWP relative to rescue, safety and environmental response. Since the CCG icebreakers leave the
Arctic in the end of October there is a lack of emergency response along the NWP on a year-round