Americans Continue to Try to Find Oil in Eastern Greenland
The privately owned Texas-based Greenland Energy Company hopes to find 13 billion barrels (approximately 1.77 billion to 1.79 billion metric tons) of oil in Jameson Land in East Greenland this summer. If drilling results confirm these estimates, the oil field could become the third largest in the Arctic, after Yamal and Alaska’s Prudhoe Bay Oil Field.
BACKGROUND
The Texans plan to conduct exploratory drilling and commercial oil production on land, rather than on offshore platforms, at 70° latitude, where ice persists for up to 280 days a year. Further north, oil production is conducted only on one Norwegian offshore platform in the Barents Sea, in an area washed by the Gulf Stream.
Yesterday, the CEO of Greenland Energy Company gave a lengthy interview to a leading Greenlandic publication, in which he stated that the company will submit a final application this week to conduct exploratory drilling with two drilling rigs.
Subject to permit issuance, drilling will be carried out to a depth of 3.5 kilometers by the end of this year or early next year. Drilling each well will take up to six weeks.
There are conflicting opinions about the presence of commercially significant oil reserves in this area: from an optimistic 13 billion barrels, enough to meet the world’s needs for 130 days, to just over 325 million barrels.
If a large oil field is discovered, the company’s CEO promises to care for the environment and local residents, some of whom will be employed.
Commercial development of the field will increase government revenue for the autonomous Danish island, and a national oil fund, similar to Norway’s, may be established.
The North Observer will monitor the situation and report on significant news as it emerges.
Greenland Energy CEO rejects criticism of the oil project in Nunap Qeqqa. CEO Robert Price rejects discrepancies and says the company is working within applicable regulations. The final application is expected to be submitted this week, according to the American oilman.
Greenland Energy Company denies that there are discrepancies between the company’s announcements in the US and the permits it has received in Greenland for oil exploration at Nunap Qeqqa (previously referred to as Jameson Land, ed.).
The CEO of the American oil company, Robert Price, says in an interview with KNR that the company is working within applicable regulations, and that the final application for the planned activities is expected to be submitted this week.
“There is no discrepancy. Our application can still be submitted within the applicable deadline,” he says.
In addition to the latest application, the director emphasizes that the company has the necessary permits for the planned exploration activities during the summer and autumn, including for the landing of equipment at the drilling site.
“It is about the Greenlandic people, it is about the license they have given us, and we are working within their framework. When we have submitted this final application, it will be a fair application. It has been worked on for many months and strictly follows all applicable rules and regulations,” he says.
First, There Must Be Exploration
If the latest application is approved by the self-government, Greenland Energy Company is still planning two oil wells near Ittoqqortoormiit in October.
According to Robert Price, the project is promising. He bases this on the fact that the geological conditions are similar to those of the North Sea and Prudhoe Bay in Alaska, as well as previous studies of Nunap Qeqqa by GEUS and the company ARCO, which at one time investigated whether there was oil in the area.
However, the crucial question remains whether oil is found in commercial quantities.
“Only when the drilling is completed can we determine whether there is enough oil for extraction. If that is the case, we will enter into a dialogue with the Greenlandic Government and Ittoqqortoormiit about responsible development and extraction,” he says.
“And I would like to emphasize that it all depends, of course, on the oil actually being there,” Robert Price tells KNR.
He expects the first drilling to take 30–45 days and be completed before the end of the year, while the second is expected after the New Year. Both drillings will be around 3,500 meters deep.
Disagreement Over Schedule
Greenland Energy Company rejects the assessment from Jørgen Hammeken-Holm that it could take around ten years before any oil production can start.
“I don’t know where he got the ten years from. If you disregard the approval process, it could go much faster—perhaps within one to two years,” says Price.
However, he emphasizes that the schedule depends on regulatory approvals.
According to Robert Price, this is a very general remark made by the Ministry of Mineral Resources.
“When working on a mining project, the process is different. Oil can—provided that the necessary permits are granted—come to market much faster,” says Robert Price.
Can Coexist With Nature
The project has met with criticism from local hunters in Nunap Qeqqa, who use the area for hunting.
Robert Price says that the concerns were one of the reasons why he recently visited Ittoqqortoormiit to hold a citizens’ meeting.
He believes that oil activity can occur side by side with nature and refers to experiences from the United States.
“I know that oil production in many places in the world can coexist with nature. We have oil pumps here in the United States, and they operate side by side with nature,” he says.
Again, he emphasizes that it will only be relevant if oil is found in commercial quantities.
“We don’t know if there is oil. I think there is oil, based on the reports I have read.”
The Greenlandic government said in 2021 that they do not want new oil projects for environmental reasons. Do you feel that you are going against their wishes, and if so, why are you doing it?
“After that, we received a letter from the Department confirming our permits and saying that they were ‘grandfathered in’ (i.e. still valid under the old rules). So I cannot comment on what the government’s intentions are. I know that the original ban, as far as I have heard, was largely about offshore drilling and protecting the oceans. Here we operate on land, and we have a valid permit,” says Robert Price.
Promises Local Investments
Greenland Energy Company plans to establish a local fund and employ up to ten people from Ittoqqortoormiit, the director says.
“We will work with both the Greenland government and the local community to establish more funds, including a state wealth fund that will cover the needs of the local community.”
And if oil is found, the company will enter into a dialogue with the Greenland government and the local community about further investments.
“This could be a way to increase income for Greenland,” says Price, pointing, among other things, to Norway’s oil fund and oil revenues in the North Sea, from which both Norway and Denmark have profited greatly.
Sorry for the Choice of Words
In the interview with KNR, Robert Price retracts an earlier statement in which he referred to Greenland Energy Company as the ‘owner’ of Nunap Qeqqa.
The director said this last week in an interview with TV host Dr. Phil.
“I want to be very clear: We do not own the area. We have a license to explore for oil. I am aware that the word ‘ownership’ can be offensive in Greenland, and therefore I would like to apologize for using that word. What we have is a permit to search for oil.”
Robert Price says that dialogue with the Greenland government, the municipality and local residents is a priority, and that he is willing to talk to anyone.
“My goal is to do what is best for both the company and the Greenlandic people.”
Still Uncertain
Whether oil is found in commercial quantities is still unclear and crucial for the future of the entire project and all the discussions surrounding it.
But if it turns out to be the case—that there are solid quantities of high-quality light and low-sulfur crude oil, as is the case in the North Sea—he has no doubt that it will be beneficial for Greenland.
“It could be a really positive development, but it’s not up to me to decide what’s best for the Greenlandic people,” says Robert Price.
“What I can do is familiarize myself with the rules and submit the necessary documents. But the result could ultimately be really positive for the Greenlandic people.”
Source: KNR (in Danish)
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