Rushing too fast into exploration of the Arctic could lead to ruined ecosystems, warns insurer Lloyd’s of London.
Their latest report, produced by UK think tank Chatham House, makes them the first major business organisation to join the environmentalists in warning about the huge potential for environmental damage from drilling for oil in the Arctic.
They estimate that during the next decade $100 billion could be invested in the region – with oil and gas, mining and shipping expected to be the biggest drivers.
With many companies already developing plans for off-shore drilling in the region – including Cairn Energy and Shell off the coasts of Greenland and Canada – the report says strong governance and risk management as well as urgent scientific research will be needed to mitigate the region’s challenging and unique risks.
Richard Ward, Chief Executive, Lloyd’s, said: “Risk management clearly has a critical role to play in helping businesses, governments and communities to manage these uncertainties and minimise risks.
“However, to do so effectively requires the most up to date information to analyse and control risks. There is a clear need for sustained investment in Arctic research.”
In Shell’s latest Sustainability Report the company has reaffirmed their commitment to exploring the Arctic, stating they intend to begin exploration in the Beaufort and Chukchi seas off Alaska’s north coast this year.
“As long-term global demand rises, the world will need this energy,” says the report. “But it must be produced responsibly, with the welfare of the environment and communities central to development plans.”
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