.

ARCTIC CHALLENGES.

By

EGIL BERGSAGER

FOCUS ARCTIC PETROLEUM POTENTIAL,

DELIMITATION NORWAY RUSSIA, JAN MAYEN AGREEMENT AND SVALBARD “BOX”,

TORE VORREN SEMINAR. TROMSØ. MARCH 18 2015

North of the Arctic Circle

• Total area >21million km2

• 6% of the Earth’s surface

• Land area ~8million km2

• Shelf area (<500m) >7million km2

The Arctic

IBCAO, Martinsson et al 2000

Arctic

N. Africa, Caspian Sea, M. East

25% of World undiscovered resources lie in the Arctic

Source: USGS.

Rest of the

World

from L.P. White, R.S. Bishop and D.L. Gautier, 2005

The Arctic is largely unexplored; Resources are not well understood

NORTHERN PASSAGE. A NEW SHIPPING ROUTE

Barents Sea

1.2 million km2. More than twice the size of the total Gulf of Mexico

New maritime border line

Formal negotiations started in Moscow November 25th, 1974.

Agreement signed in Oslo April 27th, 2010 when D.A.Medvedev visited Oslo.

FORMER DISPUTED AREA I

• AREA AROUND 175 000 KM²

– LARGER THAN THE NORWEGIAN NORTH SEA.

– CONSIDERED VERY PROSPECTIVE

• NEGOTIATIONS SINCE 1974

– THE PRESENT AUTOR ON NORWEGIAN NEGOTIATING TEAM 13 YEARS.

– LOTS OF CHAMPAGNE, BALLET AND CAVIAR. NOT MUCH BORDERLINE BEFORE PUTIN

AND MEDVEDEV

• BOTH NATIONS ARGUED FROM LAW OF THE SEA

– NORWAY: PRINCIPLE OF EQUIDISTANCE. MEDIANLINE.

– RUSSIA: SPECIAL CIRCUMSTANCES

FORMER DISPUTED AREA II

• FAIR DEAL.

– 50% SHARE TO EACH COUNTRY.

– EXPERIENCE THAT THE LARGE NATIONS TAKE THE “BROTHER SHARE”.

• NORWAY-RUSSIA COMMON BORDER MORE THAN 1000 YEARS

– NO WAR

– GOOD BASIS FOR COOPERATION

• OFFICIAL NAME OF THE TREATY:

“MARINE DELIMITATION AND COOPERATION”

JAN MAYEN • FIRST TIME GEOLOGIC CRITERIA ACCORDING TO THE NEW LAW OF THE SEA WAS

APPLIED IN DELIMITATION. – §76. Geologic prolongation

• AREA OF COOPERATION N AND S OF BORDERLINE.

– ICELAND 25% CARRIED INTEREST N OF BORDERLINE. – NORWAY 25% NOT CARRIED S OF BORDERLINE. – EXPLORATION HIGH RISK FOR A SMALL ICELAND ECONOMY NOT RECOMMENDED.

• MAIN NORWEGIAN INTEREST DISPUTED AREA IN THE BARENTS. – NORWAY WAS STRONGLY AGAINST AREA OF JOINT JURISDICTION. – DEMONSTRATED THAT FOLLOWING AN ESTABLISHED BORDERLINE AREAS OF COOPERATION

COULD BE ESTABLISHED.

• JAN MAYEN AGREEMENT STUDIED BY “THE POPE”. – THE PRINCIPLE OF ACCESS TO POSSIBLE RESOURCES ON THE OTHER SIDE OF AN ESTABLISHED

BORDERLINE – THE POPE MEDIATOR BETWEEN CHILE AND ARGENTINA

Barents Sea

1.2 million km2. More than twice the size of the total Gulf of Mexico

SVALBARD BOX I

• SVALBARD TREATY PART OF VERSAILLES PEACE TREATY

– 1920

• ISANDS WITHIN 10E, 74N, 35E AND 81N

– PART OF ROYAL KINGDOM OF NORWAY

• NORWEGIAN ADMINISTARTION ESTABLISHED 1925

• 39 COUNTRIES HAVE SIGNED THE TREATY

• VERY LOW TAX LEVEL

– SHALL ONLY COVER ADMINISTRATION OF ISLANDS

• RIGHT TO EXPLORE AND DEVELOP IF COMMERCIAL DISCOVERIES ARE MADE

• INDIRECT MEASURES, i.e. STRUCTURES DEFINED BY SEISMIC ACCEPTED AS

BASIS OLI AND GAS LICENSES

SVALBARD BOX II

• LEGAL STATUS OF SHELF AREA QUESTIONED

• THE NORWEGIAN VIEW CLEAR:

– THE TREATY APPLIES ONLY WITHIN ISLANDS AND THEIR TERRITORIAL WATERS

• STATED IN TREATY

• KEY NATIONS/ALLIES HAVE “RESERVED THEIR POSITION”

– NO ONE THINKING OF OFFSHORE ACTIVITIES 1920

– UK MOST ACTIVE

SVALBARD BOX III

• NPD WITH EXTENSIVE SEISMIC SURVEYS

• DATA AVAILABLE AND COMPANIES CAN DO SURVEYS ONLY BETWEEN 74ºN-74º30´N

– CREEPING JURISDICTION

• 2 LICENSES ALLOCATED 22 CONCESSION ROUND.

– INCLUDE MAJOR US AND FRENCH COMPANIES.

• NO DATA MADE AVILABLE AND NO COMMERCIAL SURVEYS ALLOWED NORTH OF 74.30 N

SVALBARD BOX IV

IF NORWAY CONTINUES THE POLICY OF NO ACTIVITY

ON THE SHELF AREA WITHIN THE SVALBARD BOX

NORTHE OF 74.30.N, OTHER NATIONS IN AN ENERGY

HUNGRY WORLD MIGHT SECURE THAT THE MINING

LAW OF SVALBARD IS APPLIED

THANK YOU FOR THE ATTENTION