The U.S. Geological Survey estimates that the Arctic could hold as much as 90 billion barrels of crude oil, or 13 percent of the world’s undiscovered oil reserves, as well as 47.3 trillion cubic meters of natural gas. With Russia controlling more than half of the Arctic along its border, it seeks to exercise dominance in the region where $35 trillion worth of wealth is likely waiting. Clearly, Russia is one of the main players of this Arctic chessboard, but can it hold off the United States and China?
Russia’s Arctic policy can be found in its 2008 strategic priorities, when then Russian President, Dmitry Medvedev inaugurated a new strategic plan for this region by signing and validating a report titled: Strategy towards Arctic until 2020 and beyond. With a third of Russian boundaries located north of the Arctic Circle, it is reasonable for Russia to have an increased interest in the region. The timing of the Russian claims in the Arctic began in the early 20th century when the Russian navy conducted exploration and mapping of the North-Eastern Route. During the early Soviet period, many exploration missions took place in the area to establish polarized research stations, while at the same time dominating the area, exploiting its mineral and non-mineral resources.
One of the decisive periods in the history of the Arctic Ocean was the period of the Cold War and the intense rivalry between the United States and the Soviet Union. The area was a field of intense confrontation of the submarine fleets of the two opposing forces, due to the technical difficulties of identifying their locations under Arctic ice. Since 1958, however, a new period has begun in which the Soviets were trying to create an Arctic arcade ‘without nuclear weapons’, culminating in the year 1987 under Mikhail Gorbachev. He announced a series of policy actions on the demilitarization of the Arctic Ocean region, the establishment of an international peace zone, a nuclear-free zone and was ready to host Arctic cooperation in the areas of economic activity, scientific research and environmental protection. The ‘‘Murmansk Initiative’’ as it was known, also marked the end of the Cold War in the Arctic.
In October 1987, Gorbachev underlined the main strands of Soviet Arctic policy in a speech in the city of Murmansk, outlining six clear goals:
- Establishment of a nuclear-free zone
- Limiting military and aeronautical activities in the regions: Baltic, North Norway, and Greenland. Promoting Confidence Building Measures (CBM) in the region
- Cooperating on the exploitation of Arctic resources, including the exchange of technology and know-how between Arctic partners
- Organizing an international conference to coordinate scientific research in the Arctic and lead to the creation of an Arctic Research Council
- Collaborating in the management and protection of the environment
- The opening of the North Sea Passage
This speech was the “foundation stone” of establishing the Russian strategy around the Arctic, although it was treated with skepticism by the other Arctic nations. However, after the dissolution of the Soviet Union, Russian strategic priorities shifted towards redefining the country’s relations with the West and the former Soviet bloc, while its Arctic aspirations went to a second stage. But the ratification of the UNCLOS by Russia under Boris Yeltsin in 1997 seems to have rekindled Russian interest in the Arctic Circle. So, reaching out to our days, on December 20, 2001, Russia presented its first official claim to the Arctic, by submitting a proposal to extend the Continental Shelf beyond 200 nautical miles to the relevant UN Commission (CLCS) as provided for in UNCLOS.
Russia’s strategy in the Arctic rests on two dominant pillars, served by two policy orientations, which at first reading would seem opposite but not mutually exclusive. On the one hand, there is a real political direction with patriotic/national structural elements, including in its rhetoric concepts such as exploration, conquest and sovereignty. In comparison with realistic political dialectics, however, the other, liberal-style policy focuses on international law and international regimes, uses concepts such as negotiation, cooperation and consortium. The objective of the Russian Arctic policy is as follows: the exploitation of Arctic energy and non-mineral resources in order to secure and subsequently preserve the primacy of Russia as a global energy superpower.
As the ice melts, Russia is looking for the possibility of building a new commercial shipping route between the European, American and Asian continents with the logic of saving resources and capital, while increasing the profitability for the global shipping industry. Russia can benefit financially by serving the merchant ships through the creation of ports, issuing transit passes, creating a parallel land-based traffic network merchandise etc.
As far as the Russian energy companies Gazprom and Rosneft are concerned, they lack the technology and experience of oil and gas extraction under extremely difficult arctic environment. Additionally, the recent western sanctions against Russia have canceled any effort to acquire know-how through partnerships with Western energy companies. In the same way, sanctions imposed on Russia have reduced the lending capacity of the country’s banks from Western financial institutions, thus affecting investments in the Arctic. However, the worst impact is the low oil prices worldwide. According to the IEA, the majority of Russian investments in the Arctic will not yield any profit if the oil price remains below US $120 a barrel.
If the Kremlin is ahead of the dilemma, it will continue to fund its Arctic strategic investment plan at the expense of the country’s economy. High inflation in Russia and a fall in the state capital, suggests suspending plans until further notice. Another strategy, if not more realistic is the revival Chinese-Russian co-operation, hoping to fill the gap left behind by the stagnation and suspension of Western-Russian partnerships. Russia has long hoped to diversify its energy markets and increase its energy clientele beyond Europe. The question that arises is, whether maintaining Western sanctions against Russia will be an inhibiting factor of its strategic planning for the Arctic. It seems that the sanctions are forcing Russia to engage in a strategic partnership with China.
The strategic imperative of Russian policy for the Arctic is to guarantee Russia’s position as a global energy superpower. In the Arctic strategy, it has become clear that the ultimate goal of Russia’s policy in the Arctic is to make use of the Arctic zone of the Russian Federation as a strategic resource base. The primary objectives are to protect the national borders of the Russian Federation in the Arctic region and to maintain armed forces in the region. In addition, the strategy also includes an ambition to reach agreements with other Arctic coastal states on the division of territory under UNCLOS rules, but also to ensure and enhance cooperation with other Arctic states outside UNCLOS.
The author is an officer in the Hellenic Army (Major). He also holds an M.A. in Strategic Studies and International Politics.