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Arctic Futures: Changing Ice Means Changing Economics
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"The green shift discourse in Norway opens for a new era of industrial development onshore, which could provide a boost for mining."

"In Greenland, mining is first and foremost seen as a potential for economic independence from Denmark and a future source of income and basis for jobs and development."

Someone was kind enough to invite me to an APEGA event this week, where Dr. Mark Nuttall (no relation to Eric, AFAIK...) from the University of Alberta's Department of Anthropology discussed the time he has spent conducting research in Greenland, Alaska, Finland, and Nunavut.

The presentation was very informative and for those that are invested - or have considered investing - in resource extraction there, I thought I would share some of the details he discussed. I was rather surprised to discover that the people of Greenland are largely supportive of the mining industry, as they seek to improve economic conditions and increase their level of independence from the Kingdom of Denmark.

I made note of a number of the slides used in the presentation so that I could include them in this post.

Dr. Nuttall began by highlighting the areas that define the Arctic region:

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Fun fact: you can actually walk from Canada to Denmark!

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On June 14, representatives of Canada, Denmark and Greenland gathered at 50 Sussex Drive, the Ottawa headquarters of the Royal Canadian Geographical Society to sign a treaty settling a longstanding territorial dispute over Hans Island, a small uninhabited island in the Nares Strait between Ellesmere Island and northern Greenland. The bloodless conflict became known as the “Whiskey War” because, beginning in the 1980s, Canada and Denmark took turns staking their claim to the island by planting flags and bottles of liquor — whiskey from Canada, schnapps from Denmark.

The historic accord divides the 1.2-square-kilometre island roughly in half, creating a land border between Canada and Denmark (Greenland, or Kalaallit Nunaat, is an autonomous country within the Kingdom of Denmark) and the world’s longest maritime boundary at nearly 4,000 kilometres. It also ensures Inuit in both countries will be able to move freely about the island and surrounding ice and waters, an important hunting ground since the 14th century.
After signing the treaty alongside Greenland’s Prime Minister Múte B. Egede, Canadian foreign minister Mélanie Joly and Danish foreign minister Jeppe Kofod exchanged bottles of alcohol for the last time.

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Dr. Nuttall provided a number of examples to demonstrate how melting sea ice is impacting the Indigenous people's traditional way of life in the Arctic. I found this one regarding the shifting show crab fleet particularly striking.

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The Arctic Council is a high-level intergovernmental forum that addresses issues faced by the Arctic governments and the indigenous people of the Arctic. At present, eight countries exercise sovereignty over the lands within the Arctic Circle, and these constitute the member states of the council:

United States

Other countries or national groups can be admitted as observer states, while organizations representing the concerns of indigenous peoples can be admitted as indigenous permanent participants.

  • Dr. Nuttall mentioned that the Arctic Council is largely in a state of paralysis since the start of the Russia-Ukraine conflict.

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Shipping is by far the most international of the world's industries. Each and every day, ships of different sizes and capabilities carry huge quantities of cargo and a very large number of passengers cost effectively, cleanly and safely. Maritime transport is essential to the normal functioning the world's economy as over 90% of the world's trade is carried by sea and this mode of transport is, by far, the most cost- effective way to move goods and raw materials en masse around the world. The retreat of the ice caps opens up new areas and routes for navigation.

The Northern Sea Route (NSR) connects the Atlantic with the Pacific Ocean, crossing the eastern part of the Arctic Ocean. The great majority of this route runs along the northern Russian coastline and is therefore "controlled" by Russian authorities. It is regarded as an alternative to the traditional route from Asia towards Europe through the Suez Canal and is actually 40% shorter compared to the one crossing the Indian Ocean.

If climate change proceeds according to the latest scientific predictions, the current very infrequent use of the waters near the Pole will be transformed into a regular and rather heavily-used traffic route directly through the North Pole, even though icebreaker capacities will remain essential. This route would be the shortest possible connection between the American and Europe- Asian continents and, of course, their respective markets.

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China has been eyeing lucrative mineral resources as well as potential new shipping routes in Arctic regions, as ice caps recede as a result of rising temperatures.

It released a white paper in 2018 highlighting its plans to create new freight routes linking Asia and Europe via the Northeast, Northwest and Central Passages of the Arctic, raising concerns about the fragile environment of the region.

At the end of 2020, China announced plans to launch a new satellite in 2022 to track shipping routes and monitor changes in sea ice in the Arctic.

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“The local perspective on mining activities depends heavily on historical and cultural relations to mining”, says Berit Skorstad, professor at Nord University in Bodø.

Perceptions vary across geographical spaces, but also based on history, current viability of local communities and regions, and prospects for the future. One has to add though that all Arctic countries have a positive attitude to mining initiatives as a basis for their High North or Arctic strategies, but not all communities. Institutional frameworks in Greenland, Russia, and Norway all seek to make sure the mineral sector can play a vital role in their respective regions.

At the same time, these similarities are paired with significant differences, not least because of the history of mining and the geopolitical situation. Whilst Russian mining in the Kola Peninsula is deeply rooted in recent history, in Greenland mining is first and foremost seen as a potential for economic independence from Denmark and a future source of income and basis for jobs and development.

In Norway, potential mining in some small and rural places accompany well established mining sites like Kirkenes and Mo I Rana. This makes for a complex overall picture, where the influence of mining on local, regional, and national viability differs significantly.

According to Dr. Nuttall, sea ice conditions previously provided reliable transportation conditions from October to May, but climate change has shortened the season to a December to March time frame. These changes make it increasingly clear to many Arctic communities that their traditional way of living has become less sustainable, and they will need to adapt and consider alternatives like extractive industries in order to improve economic conditions.

In closing, Dr. Nuttall left attendees with a thought that should give everyone nightmares - and yet again utter the serenity prayer. As humans across the globe rush to impose the necessary changes to stop the implications of climate change, one of the largest concerns of those working in the Arctic relates to melting permafrost. There are serious concerns about the burial of radioactive waste from the Cold War, and toxins and pathogens that will likely be released.

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In 1733, an Inuit boy and girl who had been sent to Denmark for the king’s coronation 2 years earlier sailed back home to Greenland. Both were in a “sickly state of health” during the trip, according to an account written a few decades later by a missionary, and the girl died on the way. Shortly after reaching his native land that September, the boy also died, of “a cutaneous disorder.” He had brought smallpox with him, and the disease raced around the island, killing Inuits and Europeans alike. Another missionary wrote of “houses tenanted only by the corpses of their former occupants, and dead bodies lying unburied on the snow.” The outbreak lasted until at least June of the next year, killing maybe half of Greenland’s already sparse population.

In the summer of 2022, a team of researchers visited Greenland to take soil samples from heaps of human and animal waste, or middens, dating from the smallpox epidemic and before. Their goal is to assess the risk that, as the Arctic warms and the permafrost thaws, long-frozen soil could release dangerous pathogens. Such “zombie viruses” are fodder for Hollywood, but they are not science fiction. Temperatures in the Arctic are rising twice as fast as in the rest of the world. And viable pathogens are clearly lurking in the soil, says Marion Koopmans, a virologist at the Erasmus Medical Center who runs a European consortium dubbed the Versatile Emerging infectious disease Observatory (VEO) that’s studying how northern-latitude warming might influence infectious diseases. “What you see now is studies that find infectious viruses from permafrost.”

If the VEO team does find dangerous pathogens, Greenland could close certain areas to tourists and stop archaeological excavations, Aarestrup says. “I don’t think something will happen, but I do think that it’s good to be prepared for it,” he says. “You should never say never.”

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Many changes in the Arctic are ominous, and some of the most troubling are occurring beneath the surface, in the permafrost. Permafrost is a layer of frozen soil that covers 25 percent of the Northern Hemisphere. It acts like a giant freezer, keeping microbes, carbon, poisonous mercury, and soil locked in place.

Now it’s melting. And things are getting weird and creepy: The ground warps, folds, and caves. Roadways built on top of permafrost have becoming wavy roller coasters through the tundra. Long-dormant microbes — some trapped in the ice for tens of thousands of years — are beginning to wake up, releasing equally ancient C02, and could potentially come to infect humans with deadly diseases. And the retreating ice is exposing frozen plants that haven’t seen the sun in 45,000 years, as radiocarbon dating research suggests.

The danger here is not from the slow thawing of the permafrost itself. That is, if the permafrost melts, and we leave the land alone, we’re unlikely to come into contact with ancient deadly diseases. The fear is that the thawing will encourage greater excavation in the Arctic. Mining and other excavation projects will become more appealing as the region grows warmer. And these projects can put workers into contact with some very, very old bugs.

The threat is tiny. But it exists. The big lesson is that even viruses thought to be eradicated from Earth — like smallpox — may still lurk frozen, somewhere.

“We could actually catch a disease from a Neanderthal’s remains,” Claverie says. “Which is amazing.”

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Permafrost, or permanently frozen land, covers around nine million square miles. The majority of Arctic permafrost dates up to around one million years ago.

In addition to microbes, it has housed a diverse range of chemical compounds over millennia whether through natural processes, accidents, or deliberate storage. However, up to two-thirds of the Arctic’s near-surface permafrost could be lost by 2100 due to climate change, the report states.

I left the Arctic Futures presentation feeling rather positive about the future of mining and investing in the Arctic. However, as someone who struggles with insomnia, I can't say the thought of zombie viruses emerging from thawing permafrost will help me sleep any better at night...

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Companies for you to consider doing some DD on, none of which are currently in my PF but that I have written about previously on CommonStock & remain on my watchlist:
$SPC.V & $BMV.V (nickel assets in the Muskox Intrusion)

As always, please don't hesitate to ask me questions - I'm happy to help wherever I can!
The Independent
Melting Arctic ice could release Cold War radioactive waste
One academic called the Arctic a “ deep-freezer for a range of harmful things”

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