The US ignores this cold war at its peril

During the Cold War, leaders recognized that a robust energy supply was a sign of power, economic strength and prosperity. But now, two decades on, there appears to be an unquestionable sign of ‘change’ – and it’s not necessarily change for the better for the US.

The contrast is stark. Barack Obama – proponent of quirky alternative energies that may never materialize and if they do will take decades, avowed adversary of the hydrocarbon industry – imposed a prolonged moratorium on well established deepwater drilling as a result of the BP Macondo spill. Russia’s Vladimir Putin, who appears to be running circles around European leaders, is pushing for a new energy frontier – the Arctic. This very visible difference in approach and attitude towards energy has dangerous consequences for America’s international competitiveness. For Russia, what Brezhnev and Khrushchev were not able to do with nuclear weapons, Putin has been able to do with oil and gas, regaining Russia’s power, this time more real and more lasting, following the traumatic collapse of the Soviet Union.

Although the UN’s Department of Oceans & Law of the Sea has yet to confirm it, at least 60% of the Arctic is acknowledged as Russian territory. It is no surprise then that, during a two-day conference sponsored by the Russian Geographical Society in Moscow in September, with many Arctic Council members in attendance, Putin was rubber-stamped as the de facto chairman of all things Arctic.

As Peter Glover observed, the first part of the conference paid homage to the politically-correct concerns about the Arctic ecosystem. Putin advisor Alexander Bedritsky, the Research Council of Norway’s Olav Orheim and Jan-Gunnar Winther, director of the Norwegian Polar Institute, all offered their views on global warming, the state of current scientific data and the effects of climate change on Arctic sea ice. Suffice to say, if ‘climate-gate’ was not the elephant in the room for many of those present, it should have been.

But after this litany of environmental pronouncements, the rest of the conference became a very different affair. This was not unlike many Chinese conferences I have attended, where, after all the pomp and circumstance is out of the way, the discussion turns to the heart of the matter, namely, the exploitation of energy resources and, in this case, the Arctic region’s mineral resources, particularly hydrocarbons.

Leopold Lobvosky of the PP Shirshov Institute of Oceanology put the size of the issue in perspective, arguing that ‘100 billion tons of oil equivalent’, or more than 700 billion barrels worth of oil, are present in Arctic waters. ‘Russia and its partners [have] to work together to fund the high cost of exploration and drilling.’ According to Lobvosky, these Arctic hydrocarbon reserves could be ‘compared in extent to those in the [Persian] Gulf’

Clearly the exploitation of the Arctic energy sources would not be a trivial effort. It will take massive investment and face even bigger technological challenges that need to be overcome, exactly the traditional realm of the US with its cando attitude and intellectual prowess. But America’s competitiveness abroad is being put to the test. While the White House continues to restrict access to domestic hydrocarbons in the Gulf of Mexico, Russia is venturing full speed ahead to unlock new opportunities in other resource-rich waters.

Even if couched in politically correct rhetoric, Russia is clearly poised to play a commanding role in the Arctic and will develop the valuable resources there with the support of other members of the Arctic Council.

Unlike Obama, Putin, bristling with confidence on the future of energy resources, was ready to be magnanimous for the Arctic. His message to the 400 scientists and politicians at September’s The Arctic: Territory of Dialogue conference in Moscow was unequivocal. There will be no ‘battle for the Arctic’ and its potentially vast mineral resources.

He stressed that the exploitation of the Arctic’s continental shelf and deepwater deposits should be carried out preserving the region as a ‘zone of peace and cooperation’ by ‘uniting forces for genuine partnership’. The resolution of territorial disputes can, he insisted, be achieved ‘in a spirit of partnership through negotiations and on the basis of existing international law’. Indeed, all Arctic development ought to be in accordance with the most ‘stringent environmental requirements’.

America has a choice either to be increasingly rendered a mere bystander, letting ideological environmentalism and political correctness usurp progress or to emerge from the shadows of its super-power status and take a firm stand in the international energy arena.

It is high time that the current US administration changes course and begins to take international competition seriously. Russia is not waiting to enhance its energy and economic security. Neither should the US. OE

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