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September 2010

Vol. 15, No. 39 Week of September 26, 2010

Canada gets chilly reception

Insists it has scientific data to back UN case over settling Arctic territorial claims with US in Beaufort, Russia over Lomonosov

Gary Park

For Petroleum News

Canada, despite its aggressive stance, finds itself out in the cold, sharply at odds with Russia and lagging behind other Polar nations as resource-rich offshore territories start to get carved up.

Critics are firing barbs at the Canadian government for failing to resolve its Beaufort Sea boundary dispute with the United States and settle its rival sovereignty claims for the Lomonosov Ridge, the undersea mountain range that stretches 1,500 miles from Ellesmere Island to Russia’s New Siberian Islands and which Russia estimates contains billions of tons of fuel deposits. Denmark is also bidding for a slice of the ridge.

For all of Canada’s moves to bolster its military presence in the Arctic and assert its sovereignty claims and fend off frequent threats of incursions into Canadian airspace by Russian military planes, it is facing a prolonged standoff over who controls the seabed riches.

Russia, Norway sign on Barents

Instead, Russia has pointedly bypassed Canada and resolved a 40-year dispute with Norway by dividing in half the 68,000 square mile Barents Sea, which has an estimated reservoir of 40 billion barrels of oil.

The pact, signed Sept. 15 by Russian President Dmitry Medvedev and Norwegian Prime Minister Jens Stoltenberg, left Canada as the only country with a share of two unresolved boundary issues.

“The parallels (between the Beaufort and Barents sea claims) are quite close,” said Michael Byers, who is chair of global politics and international law at the University of British Columbia.

He told the Globe and Mail that Canada is the laggard at a time when other nations are sorting out their differences.

The Barents Sea agreement used the same sector principle that the Canadian government has applied in drawing maps showing a large triangle of Canadian territory, with its apex at the North Pole.

Following the Barents’ signing, Russia’s Natural Resources Minister Yuri Trutnev said the most optimistic timeframe for development of the region could be 10 to 15 years away.

“Once the agreement is made law, there would be exploration and geological studies for around seven to 10 years before development of the reserves can begin,” he said.

Trutnev said initial studies have identified up to 10 structures, which could be of large or even giant scale.

Agreement needs ratification

Stoltenberg said his country was in no hurry to start exploration, adding that mapping work would have to await ratification of the agreement by the Russian and Norwegian parliaments.

Trutnev said slow progress in developing Russia’s offshore projects makes a strong case for joint ventures to utilize the experience available on the global market.

That gives special hope to Norway’s Statoil and France’s Total, which are partners in Gazprom’s Shtokman gas project, which has been postponed by three years to 2016.

Making progress on the Beaufort and Lomonosov issues will be a “top priority,” Canada’s Foreign Minister Lawrence Cannon said in August.

But it seems that Canada and Russia are pinning their hopes on submitting their scientific data to adjudication by the United Nations.

Russia has reportedly tried to persuade Canada to make a joint Arctic claims submission to the United Nations, which is scheduled to rule on competing claims.

Submission due in 2013

Canada’s submission is due in 2013, but observers are predicting that resolving the dispute could take more than 20 years.

In a meeting Sept. 16 in Moscow with Russian Foreign Minister Sergey Lavrov, Cannon gave no hint of willingness to compromise.

He reminded Russia of Canada’s “unwavering commitment to protecting (its) sovereignty and emphasized that our territorial integrity remains non-negotiable.”

He said Canada is now satisfied that it has gathered the scientific data, based on aerial and ship-borne mapping of the Arctic seabed, necessary to underpin its claim to the Lomonosov.

Lavrov told a joint news conference he expects the United Nations Commission on the Limits of the Continental Shelf will validate Russia’s assertions, which were part of a claim filed in 2001, although the United Nations said it required more supporting evidence.

University of Ottawa law professor Donald McRae said the United Nations commission currently has such a backlog of work that it could take 10 to 20 years to get a ruling.

He said the judgment will be based on the scientific information and “how far you want to push the Russians.”






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