Clinton tours Arctic as big powers vie for resources

TROMSO, Norway Fri Jun 1, 2012 10:25pm EDT

U.S. Secretary of State Hillary Clinton smiles during a townhall forum with students at The Black Diamond in Copenhagen, Denmark May 31, 2012. REUTERS/Saul Loeb/Pool

U.S. Secretary of State Hillary Clinton smiles during a townhall forum with students at The Black Diamond in Copenhagen, Denmark May 31, 2012.

Credit: Reuters/Saul Loeb/Pool

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TROMSO, Norway (Reuters) - Secretary of State Hillary Clinton boards a research ship on Saturday to tour the Arctic, where big powers are vying for vast deposits of oil, gas and minerals that are becoming available as the polar ice recedes.

The top U.S. diplomat took the unusual step of visiting Tromso, a Norwegian town in the Arctic Circle, to dramatize U.S. interests in a once inaccessible region whose resources are up for grabs as the sea ice melts with climate change.

"From a strategic standpoint, the Arctic has an increasing geopolitical importance as countries vie to protect their rights and extend their influence," Clinton told reporters in Oslo before making the nearly two-hour flight north to Tromso.

"We want to work with Norway and the Arctic Council to help manage these changes and to agree on what would be, in effect, the rules of the road in the Arctic, so new developments are economically sustainable and environmentally responsible," she added.

The U.S. Geological Survey estimates that the Arctic holds about 13 percent of the world's undiscovered conventional oil and 30 percent of its undiscovered natural gas.

Beyond the energy resources, as the ice melts Arctic sea passages are opening for longer periods each year, cutting thousands of miles off trade routes between Europe and Asia.

On an eight-day trip to Scandinavia, the Caucasus and Turkey, Clinton is the latest high-profile visitors to the Arctic as it enjoys unprecedented political and economic power.

While energy development costs could be twice as high as those of conventional onshore resources, that has not stopped of the oil industry's top players from moving in.

Exxon Mobil is working with Russia's Rosneft to develop blocks in the Kara Sea, off Siberia, despite the presence of sea ice for up to 300 days a year.

Russia's Gazprom is also working with Total of France and Norway's Statoil on the 4-trillion-cubic-metre Shtokman gas field 550 km offshore.

But the rush for oil and gas has brought condemnation from environment campaigners and those who say the rights of local people risk being trampled.

Environmental activists say the Arctic challenges require much more aggressive action on everything from fishing quotas to international standards for oil and gas development in a pristine, delicate region.

Only about 4 million people live in Arctic areas, leaving local interest groups weak and creating a risk of uncontrolled development, a challenge for the Arctic Council, the advisory forum of eight nations formed in 1996 to promote cooperation.

The council includes the United States, Canada, Russia, Norway, Finland, Iceland, Sweden and Denmark, which handles foreign affairs for Greenland, as well as groups representing indigenous people directly affected as ice and snow retreat.

(Additional reporting by Balazs Koranyi; Editing by Anthony Boadle)

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