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Arctic oil, gas on hold from lawsuits, economy

By Cassie Fleming THE WASHINGTON TIMES

The global recession and lawsuits from environmental groups have slowed the scramble for previously unattainable oil and gas reserves and shipping routes in the Arctic caused by climate change, and have provided a window to resolve complicated ecological and security concerns, specialists say.

Many major international oil and gas companies have put large-scale projects on hold, said Alexander Braun, a specialist on Arctic change and sea dynamics at the Arctic Institute of North America at Canada's University of Calgary in Alberta.

American companies active in the Arctic have historically had to watch the economy and commodity prices closely because of the higher cost of operating there.

Richard Ranger, senior policy adviser at the American Petroleum Institute, an industry lobbying group, said direct legal challenges are also slowing exploration and production off Alaska's coast.

The Center for Biological Diversity, a nonprofit conservation group, is the principal party behind Arctic litigation, Mr. Ranger said. The group has filed lawsuits with the federal Minerals Management Service to halt the issuing of air quality permits to Royal Dutch Shell, asserting, according to the center's Web site, that the oil giant has not adequately assessed how exploratory drilling would affect wildlife and native populations.

Shell announced earlier this week that it was withdrawing its 2007-2009 drilling plan in the Beaufort Sea and would submit a new plan for 2010.

The U.S. Court of Appeals for the 9th Circuit in San Francisco blocked the company from oil drilling in July 2007.

The center was also responsible for several lawsuits that led to last year's listing of the polar bear as a threatened species under the Endangered Species Act.

In addition to the United States, major countries including Russia, Canada, Norway, Iceland and Denmark via Greenland are vying for investment in the Arctic. The area is warming faster than any other region and will be ice-free in the summer by 2013, according to a new report by the Carnegie Endowment for International Peace, Dartmouth College and the University of the Arctic in Canada.

"The present global economic slowdown provides a much-needed hiatus in Arctic commercial pressures during which important Arctic powers could work on developing coordinated rules and best practices by which to govern Arctic resources," the report said.

Melting ice has allowed for expanded oil and gas production, mining, fishing, shipping and cruise ship tourism, but it also causes safety and environmental concerns such as moving glaciers, sea rise and coastal erosion, Mr. Braun said. To assess and manage these consequences, he said, governments must use this window to establish a monitoring network for the Arctic by using technology that is already in use for other continents and oceans.