Europe Rejects Ban on Arctic Oil Drilling

Europe rejects ban on Arctic oil drilling

Moratorium on offshore drilling in the Arctic rejected by European parliament vote amid intense lobbying by oil industry

Greenpeace activists prepare to occupy Gazprom Arctic oil platform

Greenpeace activists prepare to occupy Gazprom Arctic oil platform. The EU has rejected a moratorium on drilling in the Arctic. Photograph: Greenpeace

The European parliament’s industry committee has rejected attempts to introduce a moratorium on offshore oil and gas drilling in the Arctic, overruling a contrary vote by its environment committee last month.

The key vote in the industry committee yesterday (9 October) instead proposed a new directive to ensure that companies have “adequate financial security” to cover the liabilities that could be incurred by any accidents.

Drilling companies would also have to submit to national authorities a safety hazard and emergency response report at least 24 weeks before the planned start of operations.

A plenary vote in December will now consider one surviving amendment from the environment committee vote, which would impel member states to refrain from licencing drills unless an effective accident response can be guaranteed.

The European Commission had initially proposed a binding EU-wide regulation, but the industry committee’s vote instead plumped for a directive, which member states can choose how to enforce according to their regional standards.

“Questions have been raised about the significant revocation and amendments of existing equivalent national legislation and guidance [a regulation] might entail,” said the parliamentary rapporteur, Ivo Belet (European People’s Party).

“Such redrafting would divert scarce resources from the safety assessments and inspections on the field,” he added.

British oil industry representatives used similar arguments, according to minutes of a stakeholder peer review meeting at the European Commission’s Joint Research Centre.

“Implementing the Regulation would tie-up considerable resources in both industry and regulators … taking them away from the ‘front line’ where the hazards are,” representatives of Oil and Gas UK said.

After that meeting, the head of the European Commission’s coal and oil unit, Jan Panek, invited the Oil and Gas UK representatives to a separate bilateral meeting on the legal instrument and requirements in the regulation, which took place in April 2012.

Tip of the iceberg

Environmentalists suspect that this was the tip of a lobby iceberg. “This vote had the fingerprints of oil lobby all over it,” Greenpeace spokesman Joris den Blanken told EurActiv.

Amid intense industry lobbying, EurActiv has learned that the oil giant Chevron offered MEPs on the committee a free trip to its offshore Alba platform on 12-14 July, involving two nights stay in an Aberdeen hotel, helicopter trips to the platform, and several briefings.

But a Chevron representative informed EurActiv that the trip had not in fact gone ahead, due to “organisational reasons” on which she declined to elaborate.

Ivo Belet’s office said that he had “had the intention” of going on the package, but instead visited a platform in the Netherlands on a paid-for trip to GDF Suez’s K12B gas-producing platform which utilises carbon capture and storage techniques.

In March 2011, another shadow rapporteur on the committee, Vicky Ford (European Conservatives and Reformists), who tabled more than half of the 642 amendments on the report, visited a rig off the coast of Aberdeen paid for by the oil company ConocoPhillips.

Such trips are considered necessary and educational for legislators, and may not be luxurious, but environmentalists are wary of undue influence when MEPs adopt positions close to the industry’s interests.

A spokesperson at Ford’s office said that she had registered her trip on her European Parliament online declaration of interests but it was not mentioned there at the time of writing.

Camel operations in the Sahara

Oil producing countries such as Norway also pushed hard for the proposed regulation to be transmuted into a directive, because of the “massive administrative burden” and “complicated legal questions” it could raise, according to a Norwegian position paper, seen by EurActiv.

Norway’s deputy oil and energy minister, Per Rune Henriksen, went further, arguing that for the EU to claim jurisdiction over the Arctic by banning drills there “would almost be like us commenting on a camel operations in the Sahara.”

The EU sees itself as an actor in the Arctic because three EU countries have territory in the Arctic – Denmark, Finland and Sweden – while Iceland is an EU candidate.

The EU has in return applied for an enhanced observer seat on the Arctic Council, partly because climate change is a transboundary issue, affecting European weather patterns and fish stocks alike.

Gustaf Lind, the Arctic Council’s current chair, told EurActiv that “of course, as we have EU members, we can all say that we’re positive, very positive [towards the EU’s application] but we try to avoid reviewing specific applications in the media.”

Arctic resource race

The EU’s application comes as the continent’s ice has melted to its lowest level ever, carving the pristine region open for a resource race.

The US Geological Survey says that the region could be home to 13% of the world’s undiscovered oil reserves and 30% of its undiscovered gases, and gold and diamond mining companies also view its prospects with relish.

Arctic nations often bemoan a perceived southern hypocrisy that would prevent them from enjoying the same economic benefits from fossil fuel production that others have done.

Oil extracted from the Arctic emits no more greenhouse gas than that produced anywhere else but the region’s remote and hostile terrain could make rescue operations treacherous in the event of an accident.

Arctic futures

Gunnar Wiegand, a director at the EU’s External Affairs Action Service, told an Arctic Futures Symposium in Brussels on 4 October that he hoped EU legislation could inspire Arctic nations to firmer environmental legislation.

“The acquis [accumulated legislation] in the Arctic Council doesn’t go as far as any of the environmental legislation of the EU,” he said.

Maria Damanaki, the EU’s maritime commissioner, told the same conference that as the continent’s ice thawed, new opportunities could arise.

“Offshore drilling in the Arctic now becomes a viable option for big oil companies,” she said. “Arctic reserves could hold enough oil and gas to meet global demand for several years. This is a need the world economy has.”

“Though we may be greening the world economy, oil and gas remain vital for us and will do for some years,” she added.

Scientists are more concerned that the Arctic ice melt could raise sea levels, accelerate global warming by reducing the region’s ice reflectivity of solar heat, and change Gulf Stream currents.

If the Arctic’s summer ice melts completely, some scientists fear that methane hydrates currently frozen on the seabed could be released, causing a runaway and unstoppable greenhouse effect.

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