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Arctic ice is melting faster than ever expected, according to new data, leading oil companies and northern countries to jockey for position to access newly accessible wealth unlocked by global warming.

Arctic sea ice has shrunk to its smallest level ever recorded, the National Snow and Ice Data Centre (NSIDC) in the US said in a press release issued on Wednesday. “We are now in uncharted territory,” NSIDC director Mark Serreze said in a release. “While we’ve long known that as the planet warms up, changes would be seen first and be most pronounced in the Arctic, few of us were prepared for how rapidly the changes would actually occur.”

In the 1970s a typical summer would see ice covering around 8 million square kilometres. But on Wednesday,ice coverage fell to 3.41 million square kilometres, the lowest summer minimum on the satellite record, the NSIDC reported.

For industry this is a blessing, as the thawing region contains an estimated 22 per cent of the world’s undiscovered hydrocarbons, according to the US energy information administration.

Cold calculations

“The economics of the Arctic are going to be the driving force of how the region is shaped for years to come,” Heather Conley, an Arctic expert at the Centre for Strategic and International Studies in Washington, told Al Jazeera. “Platinum, oil and gas, and rare earth minerals are shaping how the Arctic will develop.”

Environmentalists, meanwhile, are terrified about the prospect of run-away climate change fuelled by the same carbon-based energy sources which caused the ice to melt in the first place.

“What we are seeing in the Arctic is the single greatest sign of climate change on our planet,” Rod Downie, programme manager with the environmental group WWF-UK, told Al Jazeera. “We are not surprised to see a downward trend in Arctic ice. But I think we are surprised at the severity of it, how early we have seen the records breaking and by how much they are falling.”



Arctic wildlife at risk from climate change

In the past four years energy giant Shell alone has spent more than $4.5bn trying to develop offshore fields near Alaska’s sometimes frozen coast.

Peter Wadhams, an expert on Arctic ice at Cambridge University, predicts the waters of the far north could be ice-free during summers by 2016. Warming water could melt the permafrost in other parts of the Arctic, releasing trapped methane and other powerful greenhouse gases, creating what some scientists call a “feedback loop” where global warming melts ice, releasing gases, further increasing global warming.

“Global warming is opening the Arctic to these new sources of oil and gas, that’s the irony,” Downie said. He believes 80 per cent of the fossil fuels that have already been discovered should stay in the ground in order to keep global temperatures from rising more than 2 degrees, a scientific threshold for runway climate change. “Going after new high-risk sources of fossil fuels in the Arctic is absurd,” he said.

There is nothing new about industry and environmentalists coming down on opposite sides of an issue. But the situation is more complicated when it comes to nation states.

“This rapidly transforming Arctic means coastal states have new borders [due to melting ice] they have to pay attention to,” Conley said. “In the past two or three years, coastal states have had to reposition their security forces to be able to protect those borders.”

Laws of the sea

The likelihood of outright conflict over Arctic resources is quite low, experts told Al Jazeera, because operating in northern environments is militarily difficult, and governance institutions are reasonably strong.

The Arctic Council, a body established in 1996 to discuss environmental and policy issues, includes Canada, Denmark, Finland, Iceland, Norway, the Russian Federation, Sweden and the US. Some NGOs, including the World Wildlife Fund, have permanent observer status on the Council. China wants permanent observer status on the council, but it has yet to be granted.

Along with unlocking new resources, melting ice of the Arctic could open up profitable sea routes.

“China has a great interest in northern sea routes being opened for trade,” Christian Le Miere, a maritime security expert in London, told Al Jazeera. “It has built a second nuclear icebreaker, which shows it is looking at Arctic transit and has been making a diplomatic push on Iceland, which it sees as a potential transport hub.”

The 1982 United Nations Convention of the Law of the Sea, ratified by all Arctic countries except the US, is the international framework for resolving competing resource claims in the region.

Under maritime law, countries can assert sovereignty up to 200 miles from their coast line. Article 76 of the UN convention allows states to extend control if they can prove their continental shelves – underwater geological formations – extend further than 200 miles. So far, the battle for unclaimed land has focused more on geological charts, rather than nuclear submarines.

“The technologies required for Arctic exploration are almost exclusively in the hands of western oil companies “ – Christian Le Miere, International Institute for Strategic Studies

“Countries are competing in a co-operative way,” Kristofer Bergh, an analyst at the Stockholm International Peace Research Institute in Sweden, told Al Jazeera. Scientists working for various states are often working together to gather data in the difficult research climate, he said, citing these partnerships as evidence that conflict is unlikely.

A difficult balance

Despite some collaboration, there are obvious tensions. Countries, “Russia and Canada especially”, are using nationalist rhetoric in the far north, but that is likely linked to politicians who want to look tough for domestic audiences, maritime analyst Le Miere said. There are, however, clear moves for states to assert their presence in areas where they previously paid scant attention.

“There are some increases in military capacity” but mostly in patrolling and surveillance, Bergh said. Northern countries are trying to create a “new security state” to manage warming territory, he said adding that the “increase to project power outside of national territory is quite limited”.

One potential flash point could be the Lomonosov ridge, a 1,240-mile underwater mountain range with potential resource riches, claimed by Canada, Russia and Denmark.

Russia, which sent a team of divers to plant its flag 4,000 meters below sea level under the North Pole in 2007, is particularly keen for northern hydrocarbon riches, as its economy and global standing are based largely on oil wealth.

“The technologies required for Arctic exploration are almost exclusively in the hands of western oil companies,” Le Miere said, meaning Russian firms will require western partners.

Past commercial extraction agreements in the far north have often been messy. The BP-TNK partnership between the British energy giant and a consortium of Russian oligarchs, for example, has been fraught with bitter disputes.

“It will be difficult to balance the desire for economic gains with strong environmental stewardship,” Conley said. If one adds in competing claims from rival states and rising sea levels due to melting ice, things in the Arctic are likely to heat up, just like global temperatures.

Follow Chris Arsenault on Twitter: @AJEchris