Resources and Sustainable Development in the Arctic

Chris Southcott, Frances Abele, David Natcher, Brenda Parlee

• Publisher: Routledge
• Year: 2018
• eBook ISBN: 9781351019088
• Topic: Physical Sciences
• Subtopic: Geography
• Index: Geography

Over the past thirty years we have witnessed a demand for resources such as minerals, oil, and gas, which is only set to increase. This book examines the relationship between Arctic communities and extractive resource development.

With insights from leading thinkers in the field, the book examines this relationship to better understand what, if anything, can be done in order for the development of non-renewable resources to be of benefit to the long-term sustainability of these communities. The contributions synthesize circumpolar research on the topic of resource extraction in the Arctic, and highlight areas that need further investigation, such as the ability of northern communities to properly use current regulatory processes, fiscal arrangements, and benefit agreements to ensure the long-term sustainability of their culture communities and to avoid a new path dependency

This book provides an insightful summary of issues surrounding resource extraction in the Arctic, and will be essential reading for anyone interested in environmental impact assessments, globalization and Indigenous communities, and the future of the Arctic region.

1 Introduction

Chris Southcott, Frances Abele, David Natcher, and Brenda Parlee

As the world economy continues to expand, demand for energy and other natural resources is increasing. Reserves of some resources such as oil are becoming more difficult to replace. Natural resource industries are increasingly interested in new sources of supply in non-traditional yet politically stable regions such as the Arctic.¹ This is occurring at a time when climate change has the potential to make Arctic resources increasingly accessible. The Arctic has the potential to become a major source of commodity wealth in future years.

While northern resources have the potential to produce great wealth for some people in the future, past experience has showed that most Arctic communities have benefited little from resource exploitation. In the case of Canada, northern communities have experienced enormous social and economic challenges over the past half century and these challenges can be closely linked to impacts of past resource exploitation. Resource dependence is seen as one of the most important challenges facing the region. In the past this dependence has failed to produce sustained benefits for northern communities (Berardi, 1998; Berger, 1977; Bradbury, 1984; Duhaime, 2004; M. M. R. Freeman, 2000; Green, 1972; Hall, 1991; Honnigman, 1965; House, 1981; Jorgensen, 1990; Loney, 1987; Lotz, 1970; Niezen, 1993; Osherenko and Young, 1989; Riabova, 2001; Robinson, 1962; Simard, 1996; Waldram, 1993; Watkins, 1977; Weller, 1977). The “resource curse” identified in other regions of the world has been very much present in Northern Canada although in a different version (R. M. Auty, 1994; Banta, 2006; Ross, 2007; Sachs and Warner, 2001; Tynkkynen, 2007). Communities are disrupted to serve the interests of a type of resource development where few jobs go to local peoples and the arrival and departure of migrant workers creates great social problems (Huskey and Morehouse, 1992; Stabler, 1989; Storey, 2010). Added to these issues are attempts by the region’s Indigenous population to ensure that their traditional activities and cultures are maintained in the face of multiple stressors (Duhaime, 1991; Hobart, 1984; Kleinfeld, Kruse, and Travis, 1983; Robbins and Little, 1988).

Resource development has often been linked to an increase in the disruption of these communities, leading to a variety of social and health challenges. Resource production often represents a threat to the northern environment upon which the traditional economy of the region’s Indigenous population still depend. In the past, the region was forced to deal with the negative impacts both during the exploitation phase and the closure phase. Despite attempts to diversify the economy of Northern Canada, communities in the region remain heavily dependent on the exploitation of natural resources. Most projections for the future point to a continued dependence on these resources (GNWT, 2015; GY, 2017; NEF, 2014).

There is some indication however that the worst aspects of resource dependence can be countered through the introduction of new policies and models of development that increase local control of development and ensure a higher share of resource rents and other benefits are passed on to northern communities (Alcantara, Cameron, and Kennedy, 2012; Baena, Sévi, and Warrack, 2012; Banta, 2006; CGMRBS, 2014; Dana, 2008; Humphreys, Sachs, and Stiglitz, 2007; O’Faircheallaigh and Ali, 2008). In Canada, new land claims agreements, impact-benefit agreements, and co-management boards offer the potential for the development of natural resources in Northern Canada in a manner that increases the benefits of these developments for local communities and helps ensure that development is done in an environmentally sound manner (Coates and Crowley, 2013; Cournoyea, 2009; Dahl and Hicks, 2000; Fidler, 2010; Fitzpatrick, 2008; Fugmann, 2009; Hitch, 2006; McPherson, 2003; Natcher, Davis, and Hickey, 2005; Saku, 2002).

This book is an examination of the possibilities for resource development benefiting the long-term sustainability of northern communities. It is an initial discussion of the past and current relationship between resource development and Arctic communities with a view to better understand what, if anything, can be done in order for the development of non-renewable resources to be of benefit to the long-term sustainability of these communities. The chapters contained in this book are a result of the initial findings of the Resources and Sustainable Development in the Arctic (ReSDA) research project. The main objective of this project is to work closely with communities and stakeholders to conduct research on the best ways of developing northern natural resources in a manner that maximizes benefits to communities and minimizes dangers to the environment.² The initial work of this project was centred around a series of gap analyses of key questions concerning how resource development could potentially contribute positively to the long-term future of these communities and regions and help the people living in the Arctic deal with the many challenges that they face. Following discussions between researchers and community partners a series of 14 reports were prepared which serve as the base for the chapters in this volume. Initially the work has focused on extractive non-renewable types of resource development largely because these are the types of projects that are increasingly present in the region and which are causing the most concern among Arctic communities. Most discussion in this book centres on the situation in Northern Canada but also attempts to include other regions of the Arctic in a comparative perspective.

Extractive industries and sustainable development

Despite earlier suggestions that a post-industrial society would lead to a decrease in the importance of natural resource extraction, over the past 30 years we have seen a continued desire for commodities such as minerals and oil and gas. Increasing need from a number of sources means that many analysts are suggesting demand in commodities will increase further over the next 20 to 30 years (Ali et al., 2017). Production in existing areas will intensify and expand into new areas such as the Arctic (Rudra and Jensen, 2011). Along with the increased demand in commodity production comes an increasing realization among socio-economic researchers that extractive industries are often problematic for producing countries, regions, and communities. Building on earlier Canadian staples theory, researchers have shown that, despite an intuitive belief that natural resource development will increase the wealth, and therefore the well-being of producing regions, a resource curse exists. The paradox of the resource curse is that extractive resource development often leads to a decrease in development possibilities in these regions and produces other problems (Auty, 2002; Collier, 2007; Davis and Tilton, 2005; Sachs and Warner, 2001).

The resource curse findings may have emerged in the 1990s but communities that have had to deal with extractive industries have known about it for much longer. Much of the resource curse work has dealt with cross-national econometric regression analysis but another important, and older, literature exists that has shown the negative aspects of extractive resource development on sub-national regions and communities – most notably Indigenous communities. While the academic impact of this “localist” perspective has not been nearly as great as that of the resource curse, there is no shortage of research, much of it “grey literature”, that has shown the damages inflicted upon communities in Latin America, Africa, Australia, North America, and other regions, by mining and oil and gas development (Bebbington et al., 2008; Berger, 1977; Langton and Longbottom, 2012).

Despite past problems with resource development, there is a great hope that the paradox can be resolved and that extractive industries can actually assist communities and regions to become sustainable. There exists cases where the resource curse has not affected regions (Acemoglu et al., 2003; Davis and Tilton, 2005). A consensus has emerged among the resource curse researchers that the curse can be avoided with the right institutions (R. M. Auty, 2007; Boschini, 2013; Pegg, 2006). “Localist” researchers are detecting new sub-national, national, and international power structures emerging that enable communities to better control aspects of resource development (Bebbington et al., 2008; Caulfield, 2004; O’Faircheallaigh and Ali, 2008). Even industry is realizing that efficiency of production now requires externalities such as environmental damage and socioeconomic problems be controlled (ICMM, 2006).

While there is an increased belief that, properly managed, extractive industries can actually contribute to sustainability, there is still no coordinated effort by researchers on how exactly to do this. How can resource extraction be best used to create successful societies? What are the best ways to avoid the staples trap/resource curse? How can resource extraction best contribute to the well-being of producing regions and communities? What institutions best ensure that producing regions and communities benefit from resource extraction? Because Canada is a country that has been largely built on, and continues to be dependent on, extractive industries, these questions are important for this country. At the same time, these are complex questions that represent a challenge of global importance.

Finding answers to these questions is the reason behind the formation of the ReSDA project. Funded from 2011 to 2018 by the Social Sciences and Humanities Research Council of Canada as a Major Collaborative Research Initiative, the project is a partnership of Arctic communities and over 50 researchers from 29 institutions and all eight circumpolar nations. As the Arctic is increasingly the site of extractive industry interest, the ReSDA network is looking for ways to increase the benefits of extractive industry developments to communities and to mitigate negative impacts. This is an opportune time to undertake this endeavour. New commodity pressures, the current state of the resource curse debate, the search for new global standards, a seemingly more concerned industry, increasing Indigenous control of decision-making in the region, and the fact that various levels of government in the Arctic are looking for new answers means that there is currently a great opportunity for progress on this question.

Researchers are starting to find answers to many aspects of the central questions. What is surprising is that this is being done largely in isolation from one another. There is little comparative work. While the resource curse literature has had a significant impact on international research discourses, other findings are limited to much more localized discussions. Many researchers are more focused on responding to the immediate needs of communities they are working with and, as a result, are isolated from the larger research discussions. This book is a first attempt to try and tie together the research that is being done around extractive resource development and the sustainability of Arctic communities and regions.

The Arctic and resource development

While most of the attention given to resource development in the Arctic has occurred starting in the twentieth century, the history of this relationship starts much before this. Archeological research suggests that about 2,000 years ago, the ancestors of the modern day Inuit were heavily involved in the iron trade between China’s Han Empire and other northern peoples (McGhee, 2005: 119). McGhee suggests that the arrival of the early Inuit into North America was tied to the discovery that iron was available in the Eastern Arctic and that this iron would be valuable for trading. Indigenous peoples in the region periodically gathered minerals to use in fashioning tools used in subsistence hunting and gathering and for trade.

While the search for renewable resources such as fish, furs, and whales was responsible for the initial interest of Europeans in the Arctic, the possibility of discovering precious metals was a factor present in some incursions into the region (Vaughn, 2007: 247). It was not until the industrial era however that the Arctic started to be viewed as a potential source of extractive resource wealth. By the nineteenth century, the entire circumpolar region was divided by colonialism into northern peripheries of national states. Under colonialism, these northern peripheries were used to increase wealth in the national centres. Industrialism served to intensify this role. Under industrialism, the circumpolar world became increasingly important for those nations that had a piece of it. This region became the storehouse of those natural resources that were required by industrialism. For most of these nations, during the nineteenth and twentieth centuries the future of the entire nation was increasingly linked to the ability of the north to supply those resources required by industrialism.

Due to the transportation costs involved in accessing mineral resources in the Arctic, initially interest was shown in only those resources that had a high value, such as precious metals, or were easily accessible. Gold mining existed in the Yenisey and Lena river basins of Siberia in the 1840s but most of the exploitation was done by hand using primitive mining techniques and an unskilled labour force (Armstrong, 1965: 95). By the 1860s artisanal gold mining extended itself to Finland and other areas of the Arctic. Iron mining had existed in Northern Sweden since the 1600s but this activity became much more intense when railroads were built into the region in the 1880s (Eilu, 2012). Coastal deposits that were easily accessible by ship were some of the earliest non-precious mineral mines to develop in the Arctic such as the cryolite mine in Greenland and the coal mines in Svalbard.

A more detailed discussion of the mining history of Northern Canada is found in Chapter 2 of this volume but undoubtedly the Klondike Gold Rush at the end of the nineteenth century did much to bring the potential mineral wealth of the Arctic to the attention of the world. Spreading quickly into Alaska, this rush immediately demonstrated that precious metals such as gold could be found in the Arctic and, despite problems with accessibility, could produce great wealth for some.

The main factors underlying the exploitation of other types of mineral resources in these northern regions was the relative availability of these resources closer to home and a satisfactory transportation system to exploit these resources. Industrialism brought with it new forms of transportation to the circumpolar world. The construction of railways at the end of the nineteenth and beginning of twentieth centuries in Canada, Siberia, and Fenno-Scandia helped to integrate this region with the more central regions and allow for the more intensive utilization of the resources of the north.

As the twentieth century progressed, increased access to the Arctic led to increased resource exploitation. The development of the iron mines of Northern Sweden are very much linked to the construction of a railway but also an increasingly important vision of the north as the source of future national wealth and power (Sörlin, 1988). In Alaska, the building of a railway to the sea allowed the development of the Kennecott copper mines in 1911. In Canada, exploitation of silver and lead mines in the Yukon during the 1920s and 1930s was made possible by a river-based shipping system combined with a railway from Whitehorse to the Pacific port of Skagway. In a similar fashion, in the Makenzie Valley region, oil developments at Fort Norman in the 1920s and radium and gold mining in the 1930s were all facilitated by the existence of a seasonal river-based shipping system based in Fort Smith (Armstrong, Rogers, and Rowley, 1978: 84).

The greatest resource development expansion occurred in the Russian Arctic. The southern area of Siberia experienced some development following the construction of the Trans-Siberian Railway but its impact on the more northern areas was limited until the Soviet period. The extension of the railway system to Murmansk also provided opportunities for industrial expansion in the north but these too were primarily developed during the Soviet period.

Almost all of the large-scale industrial exploitation in the Russian north was developed initially by the Soviet Union. The development of natural resources in Northern Russia under the Soviet Union was done to provide the materials necessary for an isolated Soviet Union to industrialize (Armstrong, Rogers, and Rowley, 1978). Mining was the most important new activity to occur in the Soviet north. The need for reliable national sources of minerals meant that the new Soviet Union had to create new mining centres relatively quickly. The railway extension to the Kola Peninsula allowed the easiest access to new northern deposits. Communities were created to mine apat...

Table of contents

• Cover
• Half Title
• Title Page
• Copyright Page
• Table of Contents
• List of illustrations
• List of contributors
• 1 Introduction
• 2 The history and historiography of natural resource development in the Arctic: the state of the literature
• 3 Social impacts of non-renewable resource development on indigenous communities in Alaska, Greenland, and Russia
• 4 Northern environmental assessment: a gap analysis and research agenda
• 5 From narrative to evidence: socio-economic impacts of mining in Northern Canada
• 6 Measuring impacts: a review of frameworks, methodologies, and indicators for assessing socio-economic impacts of resource activity in the Arctic
• 7 Resource development and well-being in Northern Canada
• 8 Resource revenue regimes around the circumpolar north: a gap analysis
• 9 Regional development in the circumpolar north: what else do we need to know?
• 10 Knowledge, sustainability, and the environmental legacies of resource development in Northern Canada
• 11 Impact and benefit agreements and northern resource governance: what we know and what we still need to figure out
• 12 Normalizing Aboriginal subsistence economies in the Canadian North
• 13 Traditional knowledge and resource development
• 14 Gender in research on northern resource development
• 15 Resource development and climate change: a gap analysis
• 16 How can extractive industry help rather than hurt Arctic communities?
• Index