Low oil prices and sky-high development costs notwithstanding, Russia’s Minister of Natural Resources says works on the Arctic shelf must be intensified.
“There is no alternative to the fields on the shelf”, Minister Sergey Donskoy underlines. “Even the socalled shale revolution in the USA has not stopped the companies’ urge, with support from the state, to extract Arctic oil”, he argues.
In a Facebook comment about the recent U.S. decision to let oil company Shell back in the American Arctic waters, Donskoy signals that offshore oil will remain a key issue for all the Arctic nations.
The Arctic can deliver necessary raw materials to the Russian economy, and also help bolster the country’s technology industry, Donskoy argues. For Russia, the development of Arctic oil is comparable with the Soviet space program of the 1960-1970s, the minister writes in the social media post.
Donskoy’s positive view on Arctic drilling is however in contradiction with the serious current crisis in the Russian offshore oil and gas program. Both state companies Rosneft and Gazprom have major problems with meeting their drilling and exploration obligations in the region.
As previously reported, Rosneft will this year not conduct any well drilling in the Kara Sea, nor in other parts of the Arctic. In addition, the company has requested government for a two years extension of license terms in 12 offshore Arctic projects.
In 2014, Rosneft together with ExxonMobil completed a unique drilling operation at the University-1 structure. The drilling revealed 130 million tons of oil resources and the well was subsequently named “Pobeda” (Victory).
Related stories from around the North:
Canada: Canada ponders exceptions to relief well rule for Arctic oil drilling, Alaska Dispatch
Finland: Finns still sharply divided over wind power, Yle News
Greenland: Arctic oil and gas must stay in ground to restrict warming to 2°C says study, Blog by Mia Bennett
Iceland: From Arctic Circle 2013-2014, a big drop in the price of oil, Blog by Mia Bennett
Norway: In Arctic, Norway steps on the gas, Barents Observer
Russia: Russian Arctic regions of Murmansk and Yamal widen cooperation, Barents Observer
Sweden: Lower electricity bills for Swedes, Radio Sweden
United States: Alaska senator wants more offshore oil leasing, revenue sharing, Alaska Dispatch News