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Last Updated: Tuesday, 25 October 2005, 11:10 GMT 12:10 UK
The Arctic's new gold rush
By Paul Reynolds
World Affairs correspondent, BBC News website

A predicted thaw in the Arctic ice cover combined with a search for energy supplies is leading to a new "gold rush" in the high north, bringing diplomatic problems in its wake as five countries vie for access to resources.

Nasa photo showing ice cover in September 2005 and as it was in September 1979
Then and now: Nasa photo shows ice cover in September 2005 and as it was in September 1979

There are disputes involving all of the five - the United States, Canada, Russia, Norway and Denmark.

The US and Canada argue over rights in the North West Passage, Norway and Russia over the Barents Sea, Canada and Denmark are competing over a small island off Greenland, the Russian parliament is refusing to ratify an agreement with the US over the Bering Sea and Denmark is seeking to trump everyone by claiming the North Pole itself.

"It's the way the geography works," said Peter Croker, an Irish government petroleum expert who is also chairman of the UN's Commission on the Limits of the Continental Shelf, a body set up to arbitrate on how far a country's coastal rights extend.

"It's the only place where a number of countries encircle an enclosed ocean. There is a lot of overlap. If you take a normal coastal state, the issues are limited to adjoining states and an outer boundary. In the Arctic, it is quite different," he told the BBC News website.

The ice thaw is predicted by a team of international researchers whose Arctic Climate Impact Assessment suggested last year that the summer ice cap could melt completely before the end of this century because of global warming. If the ice retreats, it could open up new shipping routes and new areas where natural resources could be exploited.

In any event, the hunt is on for oil and gas. The US Geological Survey estimates that a quarter of the world's undiscovered energy resources lies in Arctic areas.

'Pitching for action'

Dr Rob Huebert, of the Centre for Military and Strategic Studies at the University of Calgary in Canada, said that during the Cold War, security around the North Pole had to do with nuclear submarines and who was sending them.

"Now everyone is pitching for action. Climate change is reshaping the Arctic. The issues are energy, fish and shipping lanes," he said.

"It is going to get worse before it gets better. We could create an interim regime which could paper over the sovereignty disputes, but there would need to be compromise."

These are the main disputes:

The North Pole

Under Article 76 of the Law of the Sea Convention, a state can claim a 200 nautical mile exclusive zone and beyond that up to 150 nautical miles of rights on the seabed. The baseline from which these distances are measured depends on where the continental shelf ends.

At the moment, nobody's shelf extends up to the North Pole so there is an international area around the Pole administered by the International Seabed Authority from Kingston, Jamaica.

To get round the issue of the international area around the Pole, the five countries are pushing for one of two other potential ways of sharing the region, in which all the sea would be divided between the five nations.

The median line method, supported by Canada and Denmark, would divide the Arctic sea between countries according to their length of nearest coastline. This would give Denmark the Pole itself but Canada would gain as well.

The sector method would take the North Pole as the centre and draw lines south along longitudes. This would penalise Canada but Norway and, to a lesser extent, Russia would gain.

The North West Passage

This is the fabled northern route across the Americas, the exploration of which cost many lives. The route is open only during a brief few weeks in the summer. But it could become commercially important if it remained open for longer. Ships could transport goods to Churchill and then onto railways to take it south, for example.

Or there could be a new route between the Atlantic and Pacific Oceans, avoiding the need for larger ships to go round Cape Horn.

However, the United States does not recognise Canada's sovereignty over the Passage. It has in the past sent its ships on unannounced voyages in order to maintain its claim that the waters are international.

It argues that waters between two open seas have to be open to all shipping. Canada claims this as a unique case. There is now an agreement that the US will notify Canada of such transits but that Canada cannot stop them.

Another Canadian-US dispute is over the Beaufort Sea, which has implications for oil and gas exploitation.

There is also a potential dispute about the so-called North East Passage along the north Russian coast. Here the US feels that Russia is claiming too much territorial water.

Hans Island

This is a mouse that roared. Canada and Denmark both claim this tiny lump of rock 100 metres or so wide in the Nares Strait between Canada's Ellesmere Island and the Danish territory of Greenland.

Danish sailors with flag on Hans Island
Hans Island: is it Danish...
In 1973 the two countries settled their line of control in the Strait, except for Hans Island. Its possession could influence exploration and exploitation rights.

Government ministers from each side pay rival visits and landing parties from both navies raise their national flag and leave whisky and brandy as signs of their visit - and perhaps as an offering to the opposing side.

To help it police the High North, Canada is having to invest in new equipment including better ships and aircraft.

"Canada does not want to be seen to be weak," said Rob Huebert.

The Barents Sea

Canadian forces raise flag on Hans Island
..or is it Canadian?
Here, the problem goes back to Stalin, who simply drew a line from the northern Russian port of Murmansk to the North Pole and declared it to be the Soviet Union's polar territory.

During the Cold War, in which Norway played a key role in Nato (it shares a frontier with Russia), not much happened.

But now commerce and capitalism are the way forward. Already vast deposits of gas have been found under the sea.

There needs to be a solid long-term arrangement, as there has been among the states encircling the riches of the North Sea.

Bering Sea

In 1990, the United States and the then Soviet Union signed an agreement dividing this sea which separates Alaska from Siberia.

However the Russian parliament has refused to ratify it, saying that it had taken 50,000 square kilometres away from Russia. This, it is said, would deny Russia 200,000 tons of fish as well as rights to other resources.

No 19th Century grab

According to Peter Croker of the UN Commission on the Limits of the Continental Shelf, the Arctic sea grab is not a repeat of the 19th Century imperial land grab.

"People have bought into the mechanism for settling disputes and to some extent we will be used," he said.

The Commission recently ruled on a Russian submission, turning down the initial Russian demand for greater Arctic rights and telling it to reconsider and resubmit its claim.

But the Commission deals only with continental shelves and cannot rule on the other disputes.

Another complication is that states have to make claims under the Law of the Sea Convention within a time limit and the United States has not ratified the Convention. This is because of opposition from some senators who are concerned at giving away US sovereignty. Thus a major player is left on the outside.

The Arctic "gold rush" is not as chaotic as the one in California, but it is not all plain sailing either.

Paul.Reynolds-INTERNET@bbc.co.uk

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