Greenland has ended its decades-long pursuit to become an oil-producing nation after announcing 16 July it would stop granting oil and gas exploration licenses, adding that “the future does not lie in oil.” Oil exploration began for the country in the 1970s, with several major operators coming in to test the area’s prospectivity. Exploration for hydrocarbons in Greenland peaked between 2002 and 2014, when more than 20 offshore licenses were granted. Those companies that drilled walked away empty-handed.
“There’s no doubt that our subsoil is rich in oil resources,” the government said in the 16 July press release. “But oil extraction won’t only have positive effects on our society, it will adversely affect our nature and environment, and may adversely affect fisheries as well as contribute to the worsening global climate crisis.”
A recent study from the Geological Survey of Denmark and Greenland estimated that there could be $2.9 billion in de-risked barrels of oil on the west coast of Greenland. Large deposits are also expected to lie below the seabed on the east coast of Greenland.
However, the Greenlandic government believes that the price of oil extraction is too high. This is based upon economic calculations, but considerations of the impact on climate and the environment also play a central role in the decision.
“International investments in the energy sector in recent years are moving away from oil and gas and into renewable energy,” said Pele Broberg, Greenland’s minister for business, trade, foreign affairs, and climate. “It is therefore natural that we emphasize business on the opportunities of the future and not on the solutions of the past. The decision to halt oil exploration is also the story of a population that puts the environment first.”