The Arctic – Norwegian Policy and International Cooperation

The Minister based his speech at the following moments
Check against delivery

Ladies and gentlemen,

Since my Government took office in 2005, the High North has been a strategic priority in Norwegian foreign policy. We set this priority because this region is vital for our current and future livelihoods. And because we, as an Arctic nation, have a particular responsibility – as well as the ability – to make a difference here.

During my five years as Foreign Minister, I have taken note of the rising political interest in Arctic affairs. The Arctic merits, and receives, increasing attention from many states – for ecological, economic and geopolitical reasons. We welcome this.

Developments in the Arctic have global effects. Global actors have legitimate interests in the region and can make a valuable contribution. That is why we are here today.

Because China is becoming a key player also in issues related to the Arctic, and we have regular meetings with Chinese officials to discuss such issues.

As one of the top five countries in terms of resources allocated to Arctic research, China has impressive capabilities. Your research vessel Snow Dragon set off on its fourth expedition to the Arctic Ocean this summer. On this picture we see the Yellow River research station in Ny Ålesund on the Svalbard archipelago, which is part of Norway. It is the world’s northernmost permanent settlement. The station, which opened in 2003, is another example of China’s pioneering Arctic research activities.

For Norway, our history of polar exploration and research is just one of several reasons for our deep involvement in polar research. Norway is also the only country with territories and maritime areas in both Polar Regions. We are the world’s fifth polar research nation in terms of publications - the third in terms of Arctic research.

Chinese and Norwegian researchers are continuously developing collaboration in this field. On 12 June this year, I addressed the Oslo Conference of the International Polar Year. It was attended by more than 2300 polar researchers from nearly 50 countries – making it the largest polar research conference to date.

More important still is the broader cooperation that the Polar Year fostered. Therefore I am delighted to hear that Norwegian and Chinese scientists will meet again at EXPO 2010 in Shanghai in September to discuss further bilateral cooperation. At this event, the Norwegian Polar Institute and the Polar Research Institute of China will also sign an agreement on polar research cooperation. Such agreements are important tools for developing our mutual understanding of the challenges we are facing in the Arctic. Because at the end of the day these challenges are common to us all.

Turning back to the north, so to speak, I will focus my intervention here today on three main topics:

• the key drivers behind the increased interest in the Arctic region: Russia, climate change and natural resources;
• the fundamentals of the legal and political situation in the Arctic; and
• the main challenges and opportunities ahead of us, and the special responsibility of the Arctic coastal states.

But first, let me say a few words about our relationship with Russia.

Both Norway and China have a border with Russia. And for both of us, Russia has been key to developments in our immediate neighbourhood. It is often said that Russia does not have a neighbourhood policy, but that Russia has many neighbours with whom it pursues different policies. Today I believe there are signs that Moscow is taking a new approach to international relations – if not a reset, at least a more modern approach to certain key issues.

In a historical perspective we – Norway and Russia – are still in a phase of “rediscovering” each other. The border where East met West during the Cold War – Norway was the only NATO country with a border to the Soviet Union – is now an area of increasing cross-border cooperation. Border crossings have increased more than 30-fold these past 20 years – and we are working together with Russian authorities to facilitate cross-border activities even further.

Russia is actively engaged in High North and Arctic affairs. But while we note Russia’s increased level of activity, we also see that the country is complying with established norms and international law.

Whereas our land border has remained fixed for centuries, our border at sea has been disputed – up to now. Earlier this year, we showed the world how good neighbours resolve border disputes: by means of peaceful negotiations firmly based on modern principles of international law. On 27 April, during President Medvedev’s visit to Oslo, we reached agreement on the maritime delimitation line in the Barents Sea and the Arctic Ocean, after 40 years of negotiations.

The agreement we reached, including the delimitation line you see illustrated here, is in full accordance with the law of the sea and international rules and principles for maritime delimitation. Under the agreement, the disputed area of 175 000 square kilometres has been divided into two parts of approximately the same size.  

This will form the basis for determining the Norwegian and Russian zones and their continental shelves in the Barents Sea and the Arctic Ocean. It will ensure clarity and stability with regard to jurisdiction, law enforcement and the management of resources.  The agreement is based on the law of the sea and international rules and principles for maritime delimitation.

The agreement will have to be ratified by both the Norwegian Parliament – the Storting - and the Russian Duma before it enters into force. We aim to submit the agreement to the Storting for approval as soon as possible. I take this as a signal of the more modern approach we are seeing in Russia’s relations to its partners.

The second driving force in the High North is climate change.

The Arctic is experiencing some of the most rapid and severe effects of climate change in the world, and the rate and severity of these changes is expected to increase. Melting ice in the Arctic will affect the rest of the planet through increased global warming and rising sea levels. Changes in the Arctic will also affect the weather and ecosystems all over the globe, such as the Asian monsoons. And agriculture in this country may be directly affected by developments in the Arctic climate.

Last December, together with former US Vice President Al Gore, I presented a report to the climate conference in Copenhagen on the melting of snow and ice and its global consequences. Chinese researchers made important contributions to this work.

In the report we showed that Arctic sea ice is retreating at an alarming rate. As you can see from the map here, in 2007 the sea ice cover of the Arctic was nearly 50 per cent less than during the 1950s and 1960s. And in June this year, the sea ice cover fell below the level recorded in June of 2007. The Greenland ice sheet is melting, and snow cover and permafrost are also being reduced. The same thing is happening at the world’s “third pole” – as it is sometimes called – in the Himalayas.

The Arctic is not where the consequences of climate change will be most severely felt, but it is where they are first seen. The Arctic offers front row seats in the global theatre of climate change. The region is therefore very important for climate change research.

But the melting ice in the Arctic Ocean is also making resources more accessible and opening up new transport routes – developments that we may call the third driver for change in the Arctic.

There are important renewable and non-renewable resources in the Arctic. The prospect of developing the Arctic petroleum province is perhaps the main reason for the increasing interest in the Arctic over the past few years.

Some estimates indicate that the region may have significant petroleum deposits – perhaps more than 20 per cent of the world’s total undiscovered resources. However, there is great uncertainty attached to these estimates, as they are based on probabilistic assessments and geological scenarios rather than technical field data.

At the same time, there is general agreement that much of these undiscovered resources are likely to be in the form of natural gas and to be found mainly in the West Siberian Basin and East Barents Basin, on both the Russian and the Norwegian side, as you can see on this illustration here.

Of course, significant petroleum production is already taking place in the Arctic, primarily onshore in Russia, but also in Norway and in several of the other Arctic states. Norway’s field called Snow White [Snøhvit] in the Barents Sea is the world’s northernmost offshore gas field, and the LNG processing facility on the Melkøya Island off the northern coast of Norway is the first – and so far only – plant for liquefied natural gas in the Arctic region.

In Norway we have over 40 years of offshore experience in the petroleum sector. We are the world’s third largest exporter of gas, and the fifth largest exporter of oil. The activities on the Norwegian continental shelf have given us expertise and industries capable of pursuing activities also in the Arctic waters.

And we certainly do need expertise and know-how in these waters. Because exploiting energy resources in the Arctic areas is very demanding, both in technical and economic terms. The case in point is the vast Shtokman field north of Russia - the largest offshore field of natural gas in the world - where the Norwegian company Statoil will develop the field together with Total and Gazprom. New technical solutions have to be found that can withstand the harsh Arctic climate. A higher level of investment is needed than in other petroleum provinces.

It should be noted that there are considerable differences within the Arctic region. The Norwegian part of the Barents Sea is one of the least challenging areas, both technically and commercially. Norwegian petroleum production has already moved north with success. Nevertheless, given the magnitude of the investments needed, companies will have to think twice about starting operations in the region.

Meanwhile, the Government will have to maintain its focus on developing sound policies and management plans that balance concerns related to oil and gas production, fisheries and environmental protection. We are also engaged in establishing common health, safety and environmental standards for the Barents Sea together with our Russian partners.

The melting of the ice is opening up new opportunities for international shipping. For countries that are particularly dependent on imports and exports, like China, South Korea and Japan, the prospect of new shipping lanes in the Arctic is naturally of great interest.

There may be substantial commercial implications. The journey from Shanghai to Hamburg via the Northern Sea Route, which runs along the coast of Russia, is 6 400 kilometres shorter than the route via the Strait of Malacca and the Suez Canal, saving time, fuel and money. The northern route would also make it possible to avoid bottlenecks like the Suez and Panama canals, and there are security benefits entailed in avoiding the Gulf of Aden.

However, there are also substantial costs linked to Arctic shipping. The seas are stormy and navigation will be difficult due to fog, ice forming on the deck, and the need to pass through narrow, shallow straits particularly along the “inner” Northern Sea Route along the Russian coast. The sea ice conditions will also vary from year to year, both in time and place. This means that regular commercial, cost-efficient logistics will be difficult, at least in the near future.

For the time being, ships going through the Northeast Passage are reliant on ice breakers. This represents a considerable cost, but still we are seeing more ships attempting this route. Next week, the cargo ship Nordic Barents, carrying 41 000 tonnes of iron ore concentrate, will depart from Kirkenes in the north of Norway bound for China. The ship will sail through the Northeast Passage, accompanied by two icebreakers from the Russian company Atomflot.

Knowledge is essential for addressing the important challenges that Arctic shipping entails. The keyword is safety of navigation. It is especially important to establish search and rescue services in such a large and, at times, hostile sea area.

We also need regulations and standards for the design and equipment of ships operating in the Arctic, as well as clear guidelines for the training of personnel. Norway is working actively through the International Maritime Organization (IMO) to develop a mandatory polar code for ships operating in the Arctic region. I appreciate China’s support in this regard.

These are the key drivers for change in the Arctic.

Let us now take a look at the geographical realities. The Arctic – unlike Antarctica – is an ocean surrounded by national states with sovereign rights to sea areas off their coasts in accordance with international law.

The five Arctic coastal states – Canada, Denmark/Greenland, Norway, Russia and the US – also enjoy sovereign rights and have jurisdiction over maritime zones and continental shelves in accordance with the law of the sea.

The five Arctic coastal states agree that an international legal framework is already in place, namely the UN Convention on the Law of the Sea (UNCLOS). All the Arctic coastal states abide by the Convention’s provisions, including the US, although the Convention has yet to be ratified by the US Senate. The policies and mechanisms that are already in place will ensure that the Arctic continues to be a stable and peaceful region with good neighbourly relations.

The Arctic is also home to one of the world’s most innovative and successful forums of regional cooperation – the Arctic Council.

The Arctic Council is made up of the five coastal states surrounding the Arctic Ocean, and the other Nordic countries. The Council has proven itself to be an efficient instrument for developing guidelines, best practices and knowledge. This cooperation has been consolidated and updated over the last few years, and I believe it is important to strengthen this work further.

In recent years, there have been extensive discussions on the role of observer states in the Arctic Council. It is Norway’s view that the Arctic Council will benefit from having officially sanctioned observers. Formalisation of the status of observers strengthens the undisputed role of the Arctic Council as the leading circumpolar Arctic body.

Norway supports the application from China and hopes that consensus will be reached among the Arctic Council members. We also hope that China will continue to take active part in the work of the Council in its present status as an ad-hoc observer. I believe China can make an important contribution to the Arctic Council’s working groups.

Ladies and gentlemen,

Before I conclude, I would like to show you this map because it is a gives a different perspective on the High North – with the North actually in the centre. These are key areas for my country, and for my country’s interests.

The Arctic has been and is today a peaceful region. We speak of “High North – low tension”. Our first priority is to ensure that this continues to be the case despite the changes that increased human activity – due to climate change – is bound to entail. Greater interest in the region is not threatening or conducive to conflict. The fact that one state undertakes an activity does not prevent other states from doing the same, on the contrary. This is not a “zero-sum game”.

The policies and mechanisms that are established in the region will ensure that cooperation – not confrontation – will continue. The UN Law of the Sea is one of the most comprehensive sets of intergovernmental regulations in the world. It clarifies the rights and responsibilities of the coastal states. Yes, we need supplementary regulations in accordance with the UN Convention on the Law of the Sea. We are working on this through organisations such as the IMO. But my main point is this: There is no race for the Arctic. And through international cooperation based on international law we – the Arctic states together with key states like China – will keep it that way.

Thank you.