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Opportunities in the Arctic: An increase in Greenhouse Gases has already been of tribulation for decades. In the quest for minerals and other resources of greater economic benefit, countries are increasing their resource stockpile.
A new cold war
As military armaments and nuclear stockpiling increased, the Cold War between nations is exacerbated.
But today, countries are foraying into a new dimension of engaging in a cold war. These new dimensions are causing geopolitical instability. The countries pose dominance by controlling or increasing their respective shares in the extraction of minerals, and rare earth metals. This in turn enables the countries to be powerful stakeholders in drafting policies in various councils and bodies.
One such council is The Arctic Council.
What is the Arctic Council?
The Arctic Council is a leading high-level inter-governmental organization promoting cooperation in Arctic. The organisation addresses issues faced by Arctic nations and the indigenous people living there.
This council has eight permanent members whose interests are directly affected and some observer nations who claim that the cause of climate change in their countries is a subject to melting of the Arctic.
Permanent members include, Canada, Denmark (represents Greenland), Finland, Iceland, Norway, Russia, Sweden and the United States.
The observer nations as of 2021 include, Germany, Netherlands, Poland, United Kingdom, France, Spain, China, India, Italy, Japan, South Korea, Singapore, and Switzerland.
The North Pole has seen a reduction in ice cover due to rising global temperatures. Melting land ice is exposing land buried under ice for centuries to millennia but could now become a potential site for mineral exploration.
India's Arctic Policy
An ‘Arctic Policy’ document that was officially unveiled some time ago mentions that India is keen on having a permanent presence, with more research stations and establishing satellite ground stations in the Arctic region.
Read more here: Union Minister Dr. Jitendra Singh releases India’s Arctic Policy
Scientists are interested in the arctic as the weather there influences the Indian climate. The rise in sea waters and depletion of ice layers are altering the temperature of the arctic and thus should be monitored by our scientists.
India presently has a single station, Himadri, in Ny-Alesund, Svalbard, a Norwegian archipelago, where research personnel is usually present for 180 days. India is in the process of procuring an ice-breaker research vessel that can navigate the region.
Through its existing network of satellites, India aspires to capture more detailed images to “assist in the development of the Arctic region.”
India has been increasing its cooperation with Russia via the Act Far-East policy, where India is looking for major business opportunities alongside Russia.
Complete document here: India's Arctic Policy
“These opportunities include exploration of natural resources and minerals in the Arctic, identifying opportunities for investment in Arctic infrastructures such as offshore exploration, mining, ports, railways, information technology, and airports. It also expects Indian private industry to invest in the establishment and improvement of such infrastructure”
India Arctic Policy 2022
Opportunities for the USA
During Trump’s rule, Greenland, a major Arctic site was thought of as a real estate deal. But now, under Biden, the US government is working in tandem with Greenland to mine valuable resources. This exploration would be helpful in power energy transition.
The fact that the snow is melting the billionaires of the US; the likes of Jeff Bezos, Bill Gates, and Michael Bloomberg are funding a massive treasure hunt in Greenland. Billionaires-backed Californian startup Kobold Metals is in search of nickel and cobalt deposits. Kobold has partnered with Bluejay Mining to find the rare and precious metals in Greenland. The metals that are necessary to build electric vehicles and massive batteries to store renewable energy.
Opportunities for china
China is involved in Greenland via its two deposits: Isua and Kvanefjeld. In Greenland, Isua is a proposed iron mine.
A 30-year mining license and an exploration license were awarded to London Mining in 2005 and 2013, respectively. But the company declared bankruptcy in 2014. The license was acquired by General Nice Development, a Chinese commodities company. The Isua project became the first Arctic project to be fully owned by a Chinese company.
In contrast, Kvanefjeld is said to be the world's second-largest rare earth oxide deposit, as well as the world's sixth-largest uranium deposit. Rare earth is forecast to generate over 80% of the project's revenue, with more than a billion tonnes of mineral resources identified. Shenghe Resources is part-owner of Greenland Minerals, which is developing the deposit. Developing a rare earth deposit as large as Kvanefjeld could benefit China's rare earth monopoly significantly.
Conclusion
The shortage in semiconductor chips is an absolute example of how the global supply chain can be disrupted when there is a single monopoly or not much competition in the mining of these elements. China has long been considered a major player as it captures most of the market(~11.5%). Nations like the US and Russia are opting to limit their supplies from china due to rising geopolitical tensions. At the same time, are now in search of alternatives to increase their market share. One such alternative is the Arctic, and the opportunities it presents define the value of all the tensions.
Also Read
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- Hydro Fuel Market: India’s current scenario and the future ahead
- From where does India get its CNG fuel?
- What is Green Hydrogen? Could it change energy in South Asia?
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