RUSSIA: Putin triggers Arctic energy rush. The Hunt for Red Gas

In an operation straight out of a Jules Verne novel, Russia has planted its flag on the ocean floor under the North Pole staking its claim to a territory which may contain large energy deposits, particularly of natural gas.

Russian President Vladimir Putin congratulated by telephone the Russian explorers who descended to a depth of 4,000 metres in two mini-submarines and planted the one-metre high titanium Russian flag on the sea bed on August 2. After all, this politically charged symbolic gesture to claim the rights to the sea bed is also backed by scientific proof enabling Russia to claim at least part of the Arctic shelf.

The North Pole may contain substantial amounts of oil and gas that could become accessible as the Arctic icecaps melt. Following preliminary geological studies done in the areas of the Arctic, there are strong indications that there could be large deposits, particularly of natural gas. The fact that a field such as Russia’s Shtokman in the Arctic has gas reserves estimated at 3.2 trillion to 3.7 trillion cubic metres has encouraged a lot of geologists who hope there are more of this type and size of fields in the Arctic region. Therefore, from a purely energy and economic prospective, staking a claim to those regions is obviously very important. Clearly, that’s why Russia is doing this now.

Timing could not be better.

As Russia becomes more globally assertive, planting the Russian flag on the North Pole makes a strong statement on the international stage. Putin’s Russia has become stronger over the last few years and has almost outmanoeuvred Europe’s attempts to build an alternative gas pipeline system. “We have definitely seen Russia becoming more assertive, sort of stronger, and it continues to build this role it sees for itself as a strong international player,” Chris Weafer, chief strategist at Alfa Bank told New Europe telephonically from Moscow on August 2.

The move makes a strong statement also on the domestic stage ahead of the Russian parliamentary elections this December and the presidential elections in March 2008. “Planting the Russian flag in the North Pole is a very powerful, nationalistic-type of statement that plays really well to the domestic audience at this time where the political season is about to start,” Weafer said.

An equally important reason why Russia decided to stake its claim now is that the window of opportunity for it might well close in the next couple of years as the US adapts more environmentally-friendly proposals and therefore does something about the United Nations Convention on the Law of the Sea.

The US Senate has failed to ratify the 1982 Law of the Sea since Ronald Reagan was president. The treaty creates rules for the world's oceans and their resources. Russia worries that democratic candidates during the US presidential election next year will push a much more environmental-friendly agenda and therefore it is quite possible that the US could actually move to sign that Law of the Sea treaty. “The window of opportunity for Russia to stake a claim in the Arctic may well close in the next year or two if the US compromises with the UN on the Law of the Sea. Russia is very keen to get in there while the opportunity is still available and to stake their claim,” Weafer said.

But the flag-planting expedition alarmed Russia's neighbours, who also have their eye on the vast energy deposits that could lie under the Arctic area. Norway, Canada, the USA and Denmark are the other countries that have potential claims. “Clearly they are not going to sit idly by it and let Russia just stake a claim for this,” Weafer said.

The US and NATO closely monitored the Russian Arctic expedition. "We have seen a low flying four-engine plane, which seems to belong to the United Nations. My assistants said that our experiment is being closely watched from the other side of the Arctic Ocean, in particular, by NATO reconnaissance planes," the president of the Association of Russian Polar Explorers and expedition supervisor, Artur Chilingarov, was quoted as saying by Interfax on August 2.

"It is not accidental that they urgently sent the Oden icebreaker to the North Pole. There are 30 members on their expedition team, while we sent 100 scientists onboard two vessels. We reached the North Pole first," Chilingarov said.

Putin has thrown down the gauntlet for the Arctic energy race. But this time around Russia is playing a more clever game. “Planting the Russia flag on the North Pole on the sea bed, that’s just theatrics ... but Russia is actually making very serious scientific efforts to prove that its continental shelf does extend out substantially into the Arctic,” Weafer told New Europe.

It will be very difficult for Russia to prove this claim but it is building a strong case. “They will perhaps use this strong position to work out some favourable deal with the other countries, particularly with Norway and Canada, and then come up to some sort of division of the Arctic region. This is going to be a long game,” the Moscow-based energy strategist said. “At the end of this process, the Arctic will be divided based on negotiation rather than flag-thinking.

And the Arctic icecaps will be melting!

Via: NewEurope
Kostis Geropoulos