Oil exploration and sea ice projections in the Arctic

Abstract

ABSTRACTThe aim of this study is to investigate how reduction in the sea ice cover may affect oil activity in the Arctic during the next 30 years. The Arctic is divided into 21 oil provinces. A multidisciplinary approach is applied drawing on both the comparative cost techniques as developed in location theory and sea ice cover projections. The comparative cost technique implies a systematic listing of cost differentials by oil provinces. The sea ice projections are based on the NCAR CCSM3 global climate model under the A1B and A2 emission scenarios. The article concludes that the north Norwegian Sea, and south and west Barents Sea will remain the most attractive areas for oil exploration in the coming 30 years. Furthermore, due to sea ice decline, the north and east Barents Sea and north and west Kara Sea will become more attractive. However, most Arctic provinces will remain high cost regions.