Under the United Nations Convention of the Law of the Sea, five nations have the legal right to exploit the Arctic's natural resources within their exclusive economic zones: Canada, Russia, Denmark, Norway, and the United States (though the U.S. has yet to ratify the treaty, it considers the treaty to be customary international law and abides by it).
[1] A Brookings Institution summary reported: By the mid to late 2000s, interest in offshore hydrocarbons had surged owing to receding sea ice making more of the region accessible, rising global energy demand, U.S. Government estimates of large undiscovered oil and gas reserves throughout the Arctic, and a more politically stable investment climate relative to other global regions with large hydrocarbon resources.
[3] In Greenland, retreating ice caps revealed deposits of rare-earth metals and other minerals, sparking a race between Europe and China over access to this resource.
A December 2015 meeting of these states, plus an additional five cooperating nations, "reaffirmed that, although commercial fishing in the high seas area of the central Arctic Ocean appears unlikely to occur in the near future, the state of currently available scientific information needs to be improved in order to reduce the substantial uncertainties associated with Arctic fish stocks.
[19] On December 20, 2016, U.S. President Barack Obama and Canadian Prime Minister Justin Trudeau issued a joint statement indefinitely banning drilling in the Arctic, which will be reviewed every five years based on a climate and marine science life-cycle assessment.
[21] The Kingdom of Denmark has expressed interest in resource exploitation, but has stressed the need to do so in a manner that respects the Arctic's nature and environment.
In its Arctic strategy report, Denmark acknowledged the importance of practicing the "highest international standards of safety, health, environment, preparedness and response" when extracting resources in the region.
The report also included the nation's intent to "seize the many opportunities in the Arctic to create more growth and development" and acknowledged that it needed to realize the region's economic potential.
[29] One month later, in a joint statement with Canadian Prime Minister Justin Trudeau, President Barack Obama used his authority under the Outer Continental Shelf Lands Act of 1953 to extend the protections permanently.
During his presidential campaign, Trump repeatedly denied climate change, called for an energy policy focused on fossil fuels, and pledged to repeal environmental regulations.
[30] Adding to the uncertainty of this issue is the fact that under this new administration, U.S. Secretary of State and former CEO of Exxon Mobil, Rex Tillerson, was on the U.S. Chairmanship of the Arctic Council.
In terms of environmental degradation, the negative effects of resource extraction in the Arctic region are not limited to the borders of the countries in which they originated.
[37] For example, melting polar ice caps contribute to sea level rise, which threaten coastal regions and low-lying countries such as Bangladesh and the Netherlands.
[40] In 2016, China indicated that it planned to ship cargo through the Northwest Passage, setting up a conflict with Canada, which asserts sovereignty over the area.
[41] In addition to China, 11 other non-Arctic nations have observer status in the Arctic Council: France, Germany, the Netherlands, Poland, Spain, United Kingdom, Italy, Japan, South Korea, Singapore, and India.
[40] Accelerated climate change in the Arctic- as a direct result from resource exploitation and increased anthropogenic activity in the region- will drastically alter the livelihoods of indigenous people in this Arctic.
However, relocation is proving difficult because there is no governmental institutional framework that exists for the aid of climate refugees in the United States.
[citation needed] The Sami people live primarily in north Sweden, Norway, Finland, and Russia and have survived for generations fishing and hunting.
[43] Increased anthropogenic activity in the Arctic region, attributed to the resource race, has contributed to the threat of indigenous displacement: as the climate changes in the region, local animals’ normal patterns are disrupted, affecting the communities’ food supplies; melting permafrost and erosion has damaged local infrastructure, including homes, buildings, sewage systems, etc.
However, it is important to note that increased shipping in the region will contribute to Arctic environmental degradation and will severely impact indigenous communities.
Pollution from the offshore drilling industry can damage marine animals and disrupt their migratory patterns, destroy flora and fauna, and interfere with subsistence lifestyles of indigenous communities.
In 2013, the U.S. Environmental Protection Agency fined Shell $1.1 million for air quality violations on several offshore drilling vessels in the Arctic.
The gases that have a role in the greenhouse effect are mainly carbon dioxide, methane, nitrous oxide, and chlorofluorocarbons (CFCs).
For example, in Denmark the retreating of the ice caps has exposed mineral deposits, such as rare-earth metals, that can be extracted and used for technologies like cell phones or military guidance systems.
Other effects can also include diminished rainfall in many parts of the world, leading to desertification in many areas and a decline in their ability to sustain agriculture.
More direct effects of the degradation of the Arctic include significant rise in global sea levels, which will displace low coastal areas around the world and result in loss of agricultural lands.