Norway to offer record number of Arctic oil and gas exploration licences

Norway on Tuesday said it plans to offer a record number of gas and oil exploration blocks in the Arctic, with environmental NGOs condemning an "aggressive" promotion of fossil fuels.

Pictured are two offshore oil platforms.
The Norwegian governemnt will offer exploration permission in "mature" zones. File photo photo: The oil platforms named Ellen (L) and Elly (R) are seen off the southern California coast. (Photo by Frederic J. Brown / AFP)

The Scandinavian nation — Europe’s primary natural gas supplier and a major oil producer — proposed 92 exploration blocks, including an unprecedented 78 in the Barents Sea in the far north. The other 14 are in the Norwegian Sea near the Arctic Circle.

“New discoveries remain necessary to continue to develop the Norwegian plateau” and are important for Europe, Oil and Energy Minister Terje Aasland said in a statement.

The announcement is part of the annual granting of oil licences in so-called “mature” zones that have already been widely explored. The centre-left government, lacking a parliamentary majority, reached an agreement with the Socialist Left party last year to forbid prospection in unexplored areas by 2025.

The government’s propositions sparked outrage among environmental organisations. Truls Gulowsen, head of the Norwegian branch of Friends of the Earth, condemned an “extremely aggressive” cycle of concessions presented as the United Nations and the International Energy Agency discourage further oil exploration to achieve climate goals.

The NGO said the proposal would violate the commitment not to explore virgin territory as some blocks were to be located far from existing infrastructure.

The right-wing opposition, a fervent defender of Norway’s oil sector, said the move was a “tactical game” by the government to give itself bargaining chips to use in future negotiations with the Socialist Left.

Oil industry body Offshore Norge welcomed the fact that “attractive areas” would be opened to prospection.

The proposals will go to a public consultation. Oil companies must submit their applications later this year and licences will be granted in January 2024.

The Barents Sea has long been seen as a productive area for the energy sector, but oil and gas extraction is so far only taking place at two sites in Norwegian waters.

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Norway’s high court confirms Norwegian control of Arctic resources

Norway's highest court confirmed on Monday the Norwegian state's exclusive right to natural resources on the continental shelf around the strategically important Svalbard archipelago in the Arctic.

Norway's high court confirms Norwegian control of Arctic resources

The case sets a precedent with major potential repercussions. The 15 judges of the Supreme Court unanimously rejected a lawsuit brought by the Latvian fishing company SIA North STAR, which had demanded the right to fish for snow crab on the continental shelf around Svalbard.

At the heart of the dispute are different interpretations of the Spitsbergen Treaty, the 1920 legal document governing the Svalbard archipelago. Beyond the question of snow crab — considered a delicacy in Asia — the case was seen as an important test to determine who would control other lucrative resources thought to lie beneath the continental shelf, like oil and gas or minerals.

Norway has long insisted it has exclusive rights. The Spitsbergen Treaty recognises “the full and absolute sovereignty of Norway” over Svalbard, but also allows nationals from other signatory countries to “enjoy equally the rights of fishing and hunting in the territories”.

As a result, Russia is able to maintain a mining community in the archipelago, located halfway between Europe’s mainland and the North Pole, in a region its Northern Fleet transits en route to the Atlantic.

But the wording of the treaty limits its geographic scope to the archipelago’s land and “territorial waters” — a concept that today denotes a maritime zone of 12 nautical miles but which was not specifically defined in 1920.

Treaty interpretation

According to SIA North STAR, the spirit of the treaty indicates that equal rights should apply to the entire continental shelf, a much wider zone, and a concept that also did not exist legally when the treaty was drawn up.

The Supreme Court found in favour of the Norwegian state, ruling that the wording of the treaty could not be subjected to an “extensible interpretation”.

“There has been no development in international law which would result in the notion of ‘territorial waters’ today including areas beyond territorial waters,” it wrote in its verdict.

Contrary to most other treaty signatories — more than 40 states, including Latvia, France, Russia, the United Kingdom and the United States — Norway is almost the only one that uses a restrictive interpretation of the treaty. The issue has never been brought before an international court.

“We are disappointed but we are not really surprised by the verdict, this case has a lot of legal and political aspects,” the lawyer for the Latvian company, Hallvard Ostgard, told AFP.

He said he would like to see the case brought before the International Court of Justice, which only reviews cases brought by states. The Norwegian state said it was “satisfied” with the ruling.

“It’s an important national clarification for a question that has been raised on several occasions in Norwegian courts,” Foreign Minister Anniken Huitfeldt told AFP.