Amid all this bad news about the state of the Arctic, the #business opportunities associated with warming were supposed to cheer at least a few. The Arctic is an ocean covered in ice, ringed by land (whereas the Antarctic is a lump of land covered in ice, ringed by ocean). The eight Arctic countries have interests in shipping, fishing and drilling in the region. But finding profits amid the thaw is tough. Prospects look bleaker in many industries than they did five years ago as the risks are better understood.
The Arctic contains more than a fifth of the world’s untapped hydrocarbon resources. But in the North American Arctic offshore drilling was banned in December almost everywhere to protect ecosystems (although Donald Trump may reverse the moratorium). Elsewhere, low prices and the difficulties of operating in the Arctic’s dangerous waters now repel big firms attracted to the region back when oil fetched over $100 a barrel.
In a stunning about-turn, Shell ended operations in the Chukchi Sea in 2015 after spending $7bn on exploration there. It says it did not find enough oil to justify continuing. Russian firms, such as Rosneft, are proving hardier. They have fewer opportunities to invest elsewhere, after all, and Russia needs the money. Low oil prices have taken a toll on an economy which relies on the Arctic for a fifth of GDP and a fifth of exports.
The shipping industry is another for which Arctic promise has drifted away. In theory shipping firms should benefit from access to a more open seaway. Using it to sail from northern Europe to north-east Asia can cut the length of voyages by two-fifths compared with travelling via the Suez Canal. But an expected shipping boom has not materialised. In 2012 only 1m tonnes of goods were shipped through the northern passage, a paltry level of activity yet one not achieved since.
Even in the summer months the Arctic ocean is stormy, making timely delivery of goods impossible to guarantee. Drifting ice also poses a danger. Ships must be strengthened to withstand it, adding to construction costs. And a lack of coastal infrastructure, such as deepwater ports, means that spills of the heavy fuel oil that powers most vessels could wreak havoc on both ecosystems and reputations, because clean-up missions would have to set out from much farther away and would take much longer to be effective.
A new Polar Code from the International Maritime Organisation, which regulates shipping, came into force at the beginning of the year to try to address some of these concerns. It bans sewage discharges in polar waters and ones of oily mixtures. America and Canada, among others, want to go further. For one thing, they want a ban on heavy fuel-oil (as there is in the Antarctic, which has various special protections).
Mining firms, interested in metals such as copper, are eyeing up the Arctic. But most firms do not have the experience to negotiate with indigenous groups over projects on their land (about one in ten people in the region is from such a group). And many of the inhabitants oppose development anyway. In Norway the Sami parliament, which represents Sami people from across the country, is wary. Jon Petter Gintal, who deals with international affairs at the parliament, says blighting the landscape would be foolish. Tourists, keen to see rugged natural beauty, may sustain the Arctic economy in future decades as traditional livelihoods, such a reindeer herding, prove harder to maintain.