Discovery of Gas off Greenland's Coast Sparks Greenpeace Reaction

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When Scotland’s Cairn Energy PLC announced in August that it had found gas off the west coast of Greenland and believed that its finding might lead to sizable reserves of oil, Greenpeace International was not enthused.  Instead activists from the environmental group made their way to the Arctic seas in their ship, Esperanza, arriving near Cairn’s oil rig.  Four Greenpeace members actually climbed onto the oilrig, called the Stena Don, but strong winds and frigid temperatures forced the four to leave the rig, where Danish police detained them.  A Danish warship is currently protecting the oil rig.

Although Greenland gained some autonomy from Denmark last year, the country’s population of Inuit and other ethnic groups is still financially dependent on Denmark.

Cairn has been drilling off Greenland’s coast just west of Disko Island in the Baffin Bay Basin last July. In August the company was granted government permission to begin drilling at two additional deepwater wells off Greenland.  The discovery of gas confirms Cairn’s “belief in the exploration potential” but the company did not say how much oil and gas had been found. 

This discovery alone is expected to spark a renewed interest, or arctic oil rush, in drilling in the Arctic.  Mainstream oil companies including Exxon Mobil and Chevron have already bought exploration licenses.  And according to a 2009 U.S. Geological survey the Arctic region may be home to approximately 30 percent of earth’s undiscovered natural gas reserves and 13 percent of its undiscovered oil.

Greenpeace spokesperson, Ben Stewart was quoted in a CBS news story as saying that Cairn should have followed the example of U.S. and Canadian oil companies that immediately suspended offshore drilling after the BP oil spill in the Gulf of Mexico.  The Arctic area is particularly sensitive as the glaciers and icebergs there are melting as a result of global warming, and the climate crisis will only be exacerbated if more drilling occurs.  And, according to U.S. Geological survey, drilling for oil in the Arctic could cause toxins including arsenic, lead, and mercury to be released into ocean waters.

While there are at least 400 known gas and oil fields located north of the Arctic Circle, many governments have declined to drill offshore.  Canada has banned any new deepwater drilling in the area until at least 2014.   Interestingly, as of last March the Canadian Pension Plan Investment Board owned 158,000 shares in Cairn and close to a half million shares in its sister company, Cairn India.

Six oil wells were drilled off Greenland back in the 1990s, but they failed to find oil or gas in significant quantities.  But oil companies are hoping that more modern technology will enable them to find large reservoirs.  Drilling in the region resumed in 2001, but this is the first discovery of gas.

Cairn deputy CEO, Mike Watts, said that the company is doing everything in its power to protect the environment, including boats to manage ice, special equipment, and a comprehensive oil spill response plan.

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  • Posted on Sept. 20, 2010. Listed in:

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