Canada Needs Three Arctic Ports - Fmr. Canadian Northern Forces Commander

The Hill Times offers this editorial from Pierre Leblanc, former Canadian Northern Forces commander and current President of Canadian Diamond Consultants, Inc., urging Canada to construct three Arctic ports:

Canada needs three ports in the Arctic: on its West Coast, in the centre of the archipelago, and on the East Coast.

There is near-unanimous agreement that the Arctic is warming at about twice the rate of global warming elsewhere. There is also clear evidence that the arctic polar ice cap is fast disappearing. Human activity in the Arctic is increasing exponentially as the Arctic becomes increasingly accessible. Maritime traffic has grown significantly.


The U.S. Coast Guard has reported that commercial maritime traffic through the Northern Sea Route along the Russian Coast increased tenfold between 2010 and 2012. Canada’s Northwest Passage was free of ice in 2007, years ahead of scientific predictions. It has been free of ice every summer since.

There is growing interest in harvesting the natural resources that have been shielded by the permanent polar ice cap. This will naturally lead to further increases in human activity and a greater incidence of search and rescue operations and maritime accidents. Such incidents could lead to an environmental catastrophe, in what is recognised as a very fragile environment with a short vertical food chain. Almost any major accident in the Arctic will affect the “human security” of its inhabitants.

...

Nunavut Premier Eva Aariak has stated that one of the anchors of sovereignty in the Canadian Arctic is having healthy communities. By investing and developing ports such as those proposed, the federal government could put concrete action behind Minister Leona Aglukkaq’s stated desire to develop the Arctic during Canada’s chairmanship of the Arctic Council. It would create a significant number of long term well-paying jobs for the communities in and around those ports. “Build a road and they will come” it is said. In the Canadian Arctic, ports will attract business. In so doing, Canada would also improve greatly its ability to deal with SAR [search and rescue] and marine pollution and meet its international commitments.

NORAD Next: One of the Most Successful, Evolving Binational Security Agreements Charts Out Its 21st Century Role

By Keith Edmund White, Editor-in-Chief

Last week Canadian and American defense and security experts met and took the first step to chart North American Aerospace Defense Command’s (NORAD) 21st century mission. While NORAD failed to get mention in Beyond the Border’s (BTB) first report card, its proof of the benefits that Canadian and American security cooperation yields.

NORAD, a 1958 agreement crafted to defend Canada and the United States Russian nuclear weaponry, has a long history of adapting itself to new times. (Or, perhaps more well-known to readers, NORAD is the organization that tracks Santa’s Christmas Eve globe-tracking flight.)

From Donna Miles at American Forces Press Service, reporting on the recent meeting of the Permanent Board of Defense:

The discussion was a first step toward a broad analysis to identify what threats and challenges the United States and Canada will face in the 2025-to-2030 timeframe -- and what steps need to be taken now to prepare for them,, [Royal Canadian Air Force Lt. Gen. J.A.J. ‘Alain’] Parent said.

NORAD Next is largely a vision at this point, Parent emphasized, and any changes to the binational NORAD agreement would require both countries’ approval. But vast changes in the security landscape have produced broad agreement that NORAD must continually evolve to meet challenges to North America, he said.
…

More than a decade after 9/11, NORAD officials are widening their field of vision yet again as they discuss roles the command could play in addressing threats from a broad array of domains: air, space, sea, land and even cyberspace.  

They also are working to identify what warning systems and processes will be required to address these threats, particularly as the life cycles of many of the current radars expire in the 2020-2025 timeframe.

NORAD has an impressive history of adapting to changing times. From NORAD in 2012 – Ever Evolving, Forever Relevant by Lieutenant-General Tom Lawsonwith Michael Sawler: 

Although there has been little change to NORAD’s fundamental role over the years, there has been a continuous evolution of its mission. As discussed earlier, NORAD’s early mission of deterring, detecting, and intercepting Soviet bombers, soon expanded to missile detection and warning, with the later inclusion of internal air traffic, and, much later, the warning of threats from the seas. The uniqueness of the binational agreement encourages the use of NORAD to address threats of interest to Canada and the United States. One could therefore broaden the discussion to speculate upon what else could fit into the NORAD mission. An area of interest that immediately comes to mind is the Arctic. 

To get a sense of just how much NORAD has adapted over its over 50-year existence, check out this 1976 speech by Lieutenant Colonel Povilus: 

Let us take a brief look at the Soviet missile threat. It’s a fairly dynamic one. In case you have never seen a Soviet Intercontinental Ballistic Missile being fired, here is a short film clip. The whole family of Soviet ICBMs numbers over sixteen hundred targeted for North America. Some of the older ones are being dismantled in favour of submarine launched missiles. The SS-9 in the middle is the largest intercontinental missile in the world. It’s about 110 feet tall, as high as an eleven-storey building, destined for targets such as Cheyenne Mountain, perhaps, or some of our missile fields, or maybe even the Bank of Montreal…
So while we wait for details on what NORAD Next will and will not do, it’s clear that NORAD has and will continue to play a critical role in Canadian-American security cooperation. Furthermore, even if you don’t read NORAD and BTB in the same press release, the two joint endeavors are closely related and—on the security front—will likely build on one another. 

Here are some ongoing NORAD projects and possible new ventures that may be grabbing headlines in 2013: 

• Cybersecurity. A key part of the BTB Action plan, NORAD and U.S. Northern Command launched a joint cybersecurity division last May.
• Adding Mexico? Jessica Zuckerman at The Heritage Foundation calls for adding Mexico to NORAD.
• Arctic Cooperation. Col (Ret.) Alan Stephenson pushes for a robust NORAD Arctic role, and pushes Canadians not to let Arctic sovereignty concerns get in the way. And it seems that NORAD, along with independent U.S. and Canadian military commands, are doing pushing ahead on Arctic Cooperation. Check out December 2012’s Framework for Arctic Cooperation. 

FP Talks Canada-U.S. Territorial Disputes, Let's Add Some Legal Context

By Keith Edmund White, Editor-in-Chief

12/03/2012 Update:  Josh Keating was nice enough to put up with my good-natured sarcasm to tell me the Moot Court link provide below doesn't work.  Not sure why this is, but http://www.cusli.org/niagara/2010_2011_archive.html is the full site, and it's available through cusli.org.  [Full instructions:  go to cusli.org; put your mouse cursor over "Niagara" on the sites top banner; click "Archives"; and then,finally, click "2011"; at which point, you shall see the materials for the 2010-2011 Niaraga Moot Court Competition involving an Arctic martime dispute between Canada and the United States.]  Sorry for the technical difficulties.

FP's Joshua Keating blogs on outstanding Canada-U.S. territorial disputes.  He correctly notes that while Machias Island may be attracting the NYTimes attention--and that of Stephen R. Kelly of the Center for Canadian Studies at Duke University--that the perhaps issue may be emerging maritime claims between these two strong allies.

Craving more than a Wikipedia listing of disputes, and some legal analysis for how two of these issues may be resolved?  Check out CUSLI's archives for the 2011 Niagara International Moot Court.  It's a fascinating moot case, written by CWRU law professor Michael Scharf, dealing with the legal status of the emerging Northwest Passage and the Canadian-U.S. Beaufort Sea territorial disputes.

P.S.  Law students, take heart, while you can't use Wikipedia as a source, FP bloggers can.  Yes, this should be mocked, especially since spending another 30 seconds Googling would have found this much better graphic and article from The Globe and Mail which is sampled below: 

Colbert Talks Declining Arctic Ice, Arctic Resource Race, and Russia's Consecration of the North Pole

Don't believe China wants to be considered a 'near-Arctic' nation?  Check out Colbert's latest Smokin' Pole installment, a running 'news' segment that explores the Arctic resource race, and the silly geo-political nationalism it has inspired.

Oh, and Arctic ice is melting fast.

Key Colbert-esque turn of phrase:  "moo moo gai panning it."

And, yes, Russia really did consecrate the North Pole via a "holy memorial capsule."

Thanks to staff writer Gene Puerta for the catch.  Check out his recent post on the Arctic race.

The Colbert Report
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The Race for Arctic Resources: American Ambivalence, Russian Rhetoric, and a Canadian Comeback

By Gene Puerta, Staff Writer

The layer of ice that covers the Arctic Circle is melting, causing the nations that border it (Canada, Russia, Norway, Denmark, United States, Iceland, Sweden and Finland; all members of the Arctic Council) to tap the Arctic’s natural resources. But there are other factors at play: For some, this race is partly fueled by national security concerns; and for others, a chance to stake long held territorial claims.  In a race for resources, all of these Arctic nations are doing their best to achieve the pole position by granting companies’ rights in territory already claimed, advancing scientific findings, or by conducting military operations in the Arctic Ocean region. Even China, a nation that does not even border the Arctic, wishes to participate in this race, arguing that the resources under the North Pole are “the inherited wealth of all humankind.”

The race begins. A recent search for “Winning the Arctic Race” on Google (as of 20 September, 2012) offered just over 68 million results.  Upon investigation, this plethora of search results indicates that there is a race for resources under way in the Arctic Ocean and that, depending on the nationality of the information source, Canada is either in the Arctic Race to win it (by annual displays of military strength) or lags behind Russia and the United States.  The articles vary widely on the state of the race for resources in the Arctic, with Der Spiegel (quoting a USCG Admiral) that the United States is dead last in the Arctic race; while other sources like Forbes's Matthew Hubert, think that the U.S. is in a better position than Russia because U.S. oil companies are “sitting pretty” when the time comes for natural resource extraction.  Moreover, various news articles report that even China, a non-Arctic nation, is clamoring for a spot before the starting gun goes off.

According to a 2011 report by the Wall Street Journal, Canada is warming up for an aggressive display of control over the Arctic Circle.  Canada’s Arctic push, propelled by displays of military capability, is feasible only as long as Canada can back up its intent with the considerable financial resources needed to build infrastructure in the Arctic’s remote and challenging environment.  The economic value of the Arctic Circle can be found by companies willing to venture into an area that requires not only a particular technical know-how, but extensive financial investment as well.  Companies that are willing to undertake such investment have a losing track record when it comes to extracting the various non-renewable resources under those cold waters (just ask Russia’s nationally-owned Gazprom or publicly-traded Shell Oil).  But the Arctic's harsh environment, which offers up polar ice caps that shift dramatically with the changing seasons, sheets of ice that drift along with the tides, and extreme operating temperatures, mean the costs of merely preparing to tap the Arctic's energy resources can go into the billions.  And then there are concerns over the region lacking the major seaports necessary to both spur further Arctic development and contain spills similar in scope to Deepwater Horizon (the most recent oil leak off the coast of Louisiana).

US takes the lead and stumbles.  As of September 2012 the current US efforts have been stalled by ice floes, fall whale hunts, and underwater dome repairs.  Shell Oil has invested a total of U.S. $4.5 billion into developing the Chukchi Sea region (just north of Alaska).  Shell's investment in the American Arctic shows that the United States plans to use corporate partners to take the lead in the Arctic race, even though not one drop of oil has been extracted.

The Russian and Canadian long game.  The view of the Russian Foreign Ministry, U.S. oil companies and the expanding domestic American shale oil market may be beating Russian nationally-owned corporations in the Arctic race.  But Russian claims to significant swaths of Arctic territory matter most, in the long run, to the success of Russia’s Arctic strategy. Russia believes that territorial claims are more valuable than a company exerting its economic actions over an area.  Canada seems to be, literally, left out in the cold with regards to its efforts to develop the Arctic’s remote and challenging climate, efforts which require major infrastructure upkeep costs.  But Canada is trying to make up for this through a beefed up military presence, a noticeable omission from a recent Forbes article written by Matthew Hulbert.  Mr. Hulbert concludes that because the big oil corporations (like Italy’s ENI making its presence known north of Norway) and nationally owned companies (owned primarily by China and Russia) are doing their best to position themselves in the Arctic, the U.S. has the gold, Europe the distant silver, and Asia the bronze in the Arctic race.  Russian claims to the Arctic and Russian Tu-95 bomber flights aside, it seems that Russia owning a bigger share of the circle will not be enough for Putin and Co. to compete in the Arctic race.  Though, in the long run, Canada and Russia may actually have the upper hand.  Russia's icebreakers and territorial claims will likely serve as a force multiplier.  And Canada’s increased military presence will protect any investments in their vast territory of Nunavut.

An uncertain Arctic finish.  There are several opinions (stretching back to 2009) that predict that the end result in the Arctic has already been decided:  big Arctic players (the United States, Canada, and Russia) have “agree[d] to disagree” about certain boundaries in the Northwest Passage, while the smaller players (Denmark, Norway, and economically, Russia) stake their continental shelve claims to the United Nation’s Convention on the Law of the Sea:

There is no ‘endgame’ in the Arctic. Cooperation – not conflict – is the more accurate paradigm. With the exception of Hans Island, there are no sovereignty disputes over land in the Arctic. The unresolved differences concern a) coastal state jurisdiction over shipping in the Northwest Passage, b) the delimitation of maritime boundaries in the Barents, Beaufort and Lincoln Seas, and c) the extent to which each of the five Arctic Ocean countries has sovereign rights over the continental shelf more than 200 nautical miles from its shore.

There is no great cause for concern. Canada and the US have “agreed to disagree” over the Northwest Passage while cooperating on maritime surveillance and pollution prevention. They – along with Denmark, Norway and Russia – have also agreed that overlapping continental shelf claims will be resolved according to the rules in the UN Convention on the Law of the Sea.

Canadian resolve pushes forth a militaristic footing.  Does Ottawa have what it takes to secure its Arctic claims?  Canadian Prime Minister Stephen Harper thinks so.  His three day “arctic sovereignty tour” is aimed at quelling any Russian claims in the Arctic Ocean.  And just last month, Canadian Foreign Minister Peter Mackay stated Canada's intent to placed in the Arctic race's pole position:

"There is no question over Canadian sovereignty in the Arctic. We have made that very clear. We have established, a long time ago, that these are Canadian waters and this is Canadian property," said Mackay. The Canadian prime minister's trip, which involves stops in half a dozen communities in Canada's far north, is intended to reinforce Ottawa's claim to more than 1.2 million square kilometers of Arctic seabed.

Prime Minister Harper does not intend to lose the Arctic race; rather, he intends to win the Arctic race by using a three prong approach:  (1) making territorial claims according to the UN Convention on the Law of the Sea, (2) highlighting scientific findings that find Canada’s continental shelf extends far into the Arctic Circle and (3) launching Canadian expeditions such as Operation Nanook.  Since 2010, Canada has been participating in annual “sovereignty operations” such as Operation Nanook in the Arctic to show the international community that Canada has an interest in maintaining control over the Arctic Circle, an interest Ottawa has also expressed by not placing a moratorium on oil exploration.

A lumbering start.  For an area of the world that is literally heating up, the marathon race for Arctic resources is off to a slow start.  With non-renewable energy sources becoming more scarce and subject to hikes due to war, demand, and natural disasters, the Arctic Circle has become a focal point for resource hungry nations.  However, the race for natural resources is not without projected environmental risk.  Furthermore, only the nations that are willing to put forth the considerable military, infrastructure, and other financial investments can hope to win the Arctic resources race.  The Russian and Canadian Arctic strategies seem to rest upon how far their continental shelf extends and how many military operations they can execute until they have the capital necessary to fortify their Arctic infrastructure.  This is especially true of Russia, where companies are either experiencing cost overruns or simply waiting to see how Shell performs north of Alaska.  Despite the setbacks experienced by Shell Oil, the U.S. is currently leading the way, albeit by nary a hair, for not one well has been tapped by the U.S.-based subsidiary in the cold waters of the Northwest Passage. 

CUSLI's Big Week & Monday Morning News Round-Up

Happy Monday, readers!  We've got an action-packed week ahead for you:  Arctic races, student loans, the PQ's environmental and energy strategy in Quebec, bad meat, Laurentian consensus (say what?), a CUSLI-Nexus first, and more...

First, an Amazing Week of Original CUSLI-Nexus content:

• The Arctic Race.  A new staff writer will make his premiere by discussing the race for Arctic resources: who's up, who's down, and can there even be a winner?
• Student Loan Discharge, the Canada-U.S. Divide.  Senior Editor Justin McNeil will be looking at the discharge of student loan debt, and why America should probably look at Canada's approach.
• Conversations with CUSLI-Nexus.  A CUSLI-Nexus first!  We'll be launching our first installment of 'Conversations with CUSLI-Nexus' (yes, we're happy to take suggestions on a better title).  What's that mean?  We'll be posting a fantastic interview with a leading voice in the Canada-U.S. bilateral relationship.  Want to know more?  Tune in later this week!
• News-tracker.  And, as always, CUSLI-Nexus will be tracking the best in news and commentary at our Facebook Page and Twitter feed, both of which you should follow--or check out through the blog by looking to your right.   

Added Bonus:  A Monday Morning News Round-Up:

• Our friends at Beyond the Border Observer, as usual, have some great stuff you should check out.
• Conservatives had a tough week with the XL Meat Crisis in Alberta.  From MedicineHatNews.Com:

"When a senior civil servant speaking on the biggest food recall in the country's history is gagged — in a way that was likely humiliating to himself — it should be noted."

• Today's Canadian Thanksgiving!  To our Canadian readers, welcome back to the work-week!  For our American readers, learn more courtesy of Detroit Free Press.
• Oh, wait:  Let's not forget Columbus Day:  the day Columbus proved the world was round by discovering America...or...the day Columbus landed in Venezuela; thought it an island; and proved affirmed educated European's belief in a round planet! 
• Hello Post-Laurentian Conservative Consensus!  No idea what that means?  Check out this iPolitics article by Zach Paikin.  What?  Too busy sipping the morning java or tea?  OK, OK, we'll give you a crib sheet:

• Laurentian Consensus:  "From the time of Confederation until quite recently, the direction of this country was determined by the political, academic, cultural, media and business elites in Toronto, Ottawa, Montreal and other cities along the St. Lawrence River or its watershed."  (Source:  Globe and Mail's John Ibbitson, Literary Review of Canada, Dec. 2011.)   
• Two nerdy side-notes:  (1) John Ibbitson and U of T political scientist David Cameron take "joint ownership" of the term--such a Canadian solution!; (2) Laurentian refers to the Great Lakes region, you can learn the geological aspect of the term here--and even learn about its linguistic nuance here!

• Post-Laurentian Consensus:  The Grits, smelling the westward shift, (i.e. the Liberal Party) are now moving right and westward themselves, according to Zach Paikin.  "Slow growth projected for years to come only makes it more likely that a future Liberal leader will look right and not left — as Michael Ignatieff did — for votes."

• Is Zach right?  Well, maybe, unless--of course--the NDP wins the next federal election.  Also, Canada's three consecutive Conservative Harper governments are the result of two opposition parties whose supporters aren't against them running as a coalition.   (Though, it seems no such deal, for now, is in the cards.) But, hey, now you can throw around 'Laurentian Consensus' when having high tea.

• Anne-Catherine Boucher and Charles Kazaz map out the energy and environment platform of the new PQ government in Quebec.  The PQ has new ideas on land rehabilitation, GHG, and mining royalties; wants to shut down shale gas development; and we're still waiting for "the PQ's vision for Plan Nord...."  Overall, industry is not thrilled; but, the PQ's minority status makes compromise the name of the game.
• And, finally, whether you love or hate his political leanings, Gerry Nicholls's humor is anything but dry.  His victim last week?  Justin Trudeau:

Justin Trudeau campaign itinerary:

Oct. 8 – Thanksgiving Day – Visit farm near Montreal -- raise turkey from the dead.

Harper's Northern Development Strategy: Too One-Sided for Success?

by Keith Edmund White

Is Harper's Northern Strategy sustainable?  CUSLINexus quickly recaps three articles that question whether the Harper government is jeopardizing Canadian sovereignty and long-term Arctic development to meet short-term cuts to government spending.

The HillTimes reports on the trade-offs Harper is making to develop Canada's Arctic. While pushing billions of dollars in energy development, other government funding is being cut. The National Post last week reported on delays in the construction of a Northern scientific facility and the Nanisivik port, not to mention the Post's May 2012 article reporting on the budget-busting price of of Radarsat satellites and plans for a dozen nuclear powered subsubmarines and the world's largest ice-breaker being scrubbed.

And now the HillTimes (a fantastic resource--and definitely worth, at least, signing up for a free trial) reports on another Harper cut to government services in the North. Mining Watch coordinator Ramsey Hart discusses the closure of the National Aboriginal Health Organization:

“I think a really big concern about the way that this government is treating resource development in the North is with its reliance on economic development as a way to deal with significant social issues that are found in the North,” Mr. Hart said.

He cited the elimination of the National Aboriginal Health Organization in the last budget as an example of an important federally funded program that could not be replaced by resource development. With an annual budget of $4.4-million, the NAHO produced health studies on aboriginal communities in the North. The organization ceased its operations at the end of June.

Mr. Hart said the NAHO was one of the few programs that focused on issues such as the impact of resource development on community health.

“To just assume that these projects will address social issues is really naive and runs the risk of further exacerbating some of the social issues in the North,” he said.

Taken together, these three articles suggest that concrete steps to Canada increasing its footprint to the North are falling behind ready-to-move mining operations.  While this approach is understandable, it may jeopardize attempts of Canada to assert sovereignty over the Arctic's emerging waterways and future Arctic economic development.

And does Canada need the Harper government's spending cuts?  Not according to the Canadian Centre for Policy Alternative--though, it seems unlikely that any major Canadian party would champion this group's progressive tax and government investment strategy.

Canada's Arctic Strategy

By Keith Edmund White

The development of Arctic Canada could generate mineral, fishing, and tourism revenue to the tune of $1 billion dollars.  Furthermore, Canada's sovereignty and control of the emerging waterways through the Arctic is a source of national pride.  So it's no surprise that Prime Minister Harper has made developing the North a key initiative of his government.  But, when it comes to economic development, will the high costs of developing the Arctic--in combination with other countries own newly appreciated energy finds (read:   North American natural gas) require an Arctic rethink?  In any case, simply developing the North--without carefully planning of each infrastructure and energy project-- could result in Canada actually losing money on its Arctic gamble.

Last week, Canadian Prime Minister Stephen Harper kicked off his seventh trek to the Arctic. If you want to learn more about his schedule, check out this informative Montreal Gazette article. Of more interest, to me, is where Canada’s Arctic strategy stands in 2012.

Press Takes on Harper’s Trek

The Calgary Herald, unsurprisingly, comes out in favor of Harper’s Arctic policies. It highlights the Prime Minister’s push to develop and cement Canadian claims to the Arctic. But, to its credit, the article highlights the current costs of developing its Northern region: totaling $2.9 billion for 112,000 people, and funding 77 – 90% of revenues for Canada’s northern territories (the Yukon, the Northwest Territories, and Nunavut. Of a particular note to me is the article’s mention of opposing U.S. and Canadian claims on the Northwest Passage or Canadian Archipelago—with the US claiming the emerging waterway as an international strait, while Canada would naturally prefer these to be Canadian waters. (For those wanting an exhaustive look at Canada’s Arctic claims, check out the 50+ page Sovereignty & Security In Canada’s Arctic, an interim report by a Canadian Senate Committee).

The National Post used Harper’s Arctic tour for discussion on the Polar Bear, probing two questions: (1) whether the polar bear should replace the beaver as Canada’s national symbol, while (2) delving into how Canada patrols its frontier region:

The roughly 4,700 Rangers — sprinkled in 178 communities across the North — are the backbone of the military’s presence in the region.

They conduct patrols across the vast frozen wasteland and are equipped with Lee-Enfields, bolt-action, magazine-fed rifles that were standard issue during the first half of the 20th century.

The Winnipeg Free Press provides a useful counter-weight, highlighting the failure of the Mackenzie Valley Gas Pipeline, a project that has found itself falling prey to the Arctic’s “obvious economic handicaps” of remote from other Canadian industrial centers. Read the section below, or the article, to learn a few more details of the project and the project’s impact of Canadian environmental policy, but the economic message can be summed up in short: Developing the energy-rich Arctic is expensive, and with Canada just one player among many, costly infrastructure projects can go belly-up without careful planning. 

From the Winnipeg Free Press:

The Mackenzie Valley Gas Pipeline project of Imperial Oil and others is one of Canada's greatest unbuilt infrastructure projects. After years of investigation and litigation over aboriginal title and further years of environmental review, the project won National Energy Board approval in 2010. It is not being built, however, because U.S. oil and gas exploration companies have found ways of extracting great volumes of natural gas that were previously not recoverable. In the present glutted natural-gas market and low natural-gas prices, the expense of the Mackenzie Valley line is difficult to justify.

Northerners eager to see the Mackenzie Valley line built believe it was killed by too much environmental review. The Harper government agreed and changed the National Energy Board Act to allow itself to set limits to environmental review and speed up approval. The three-member panel studying Enbridge Inc.'s proposed Northern Gateway gas pipeline from Alberta to the Pacific Coast is now operating under the government's tighter timeline.

But it is just as reasonable to conclude that the Mackenzie Valley line is a technically good project that just has to wait until somebody needs the gas badly enough to pay for construction of the line. Environmental review didn't kill a good project -- it delayed an unnecessary project. If the Mackenzie Valley line was reaching completion today, it might stand idle for want of buyers for the gas. The investors would be stuck with an engineering marvel that lacks, for the moment, an economic purpose.

Some Arctic Basics & Grading Canada's Arctic Push 

First, just so readers can be hip to Canadian political lingo, Harper announced, in 2009, a four-pillar strategy for Canada Great White North: (1) asserting sovereignty, (2) protecting the environment, (3) promoting social and economic development; and, finally, (4) improving and devolving Arctic governance. The main focus on this posting is on that third aspect—economic development.

Canada is making serious investments in Arctic infrastructure. As detailed in a 2011 Library of Parliament research paper, Canada has spent over $720 million to procure icebreakers; gotten new patrol ships; spent $17 million to establish commercial fisheries in Nunavut; and $100 million “to establish a deepwater port in Nunavut” for its security forces. These are the backbone projects of Harper’s push to develop the Arctic. Should these projects continue and be completed, they could begin the long process of making the Northern territories closer to self-sufficiency (though, Canada should probably use U.S. subsidization of Alaska as a more attainable goal). 

So, without getting into the weeds, how is Canada doing in its Arctic project? Well, according to YahooNews, not that great: “While Prime Minister Stephen Harper and Defence Minister Peter MacKay continue to insist Canada is no slouch in the Arctic, other countries’ Arctic strategies seem to be bigger, stronger and faster.” Reporter Andy Radia then points out that the United States is revving up submarine patrols of the Arctic, Russia is spending over $100 billion on 16 new nuclear submarines, some of which will be patrolling the Arctic, and Sweden and Norway may be in on the Arctic gig too.   

But this focus on whether certain waterways in the Arctic will be Canadian waters or international waters misses the (snowy) forest for the trees.  Canada will never out-militarize Russia or the United States, but Canada has already turned the land and waters of the Arctic into an emerging hotbed of economic activity.  The question is, is even further development worth the public infrastructure costs--let alone the costs of providing security to a no-longer mythical Northwest Passage.

There are three key areas where Canada can develop oil and natural gas: the Mackenzie Valley, the Arctic Islands, and the Mackenzie Valley/Beaufort Sea. A 2012 Lloyd’s of London report found that there’s possibly $100 billion to be made in the Arctic for minerals, fisheries, shipping, and tourism. But the report notes that the extreme weather requires strong public infrastructure investment, effective regulatory control, and greater data-collection on the dangers and benefits of Arctic development. 

The U.S. Energy Information Administration (E.I.A.) sums up the "goods news, bad news" of Arctic economic development:

The Arctic presents a “good news, bad news” situation for oil and natural gas development.  The good news is that the Arctic holds about 22 percent of the world’s undiscovered conventional oil and natural gas resources, based on the USGS mean estimate.  The bad news is that: (1) the Arctic resource base is largely composed of natural gas and natural gas liquids, which are significantly more expensive to transport over long distances than oil; (2) the Arctic oil and natural gas resources will be considerably more expensive, risky, and take longer to develop than comparable deposits found elsewhere in the world; (3) unresolved Arctic sovereignty claims could preclude or substantially delay development of those oil and natural gas resources where economic sovereignty claims overlap; and (4) protecting the Arctic environment will be costly.  The high cost and long lead-times of Arctic oil and natural gas development undercut the immediate importance of these sovereignty claims, while at the same time diminishing the economic incentive to develop these resources.

...

The bottom line for Arctic oil and natural gas potential is that high costs, high risks, and lengthy lead-times can all serve to deter their development in preference to the development of less challenging oil and natural gas resources elsewhere in the world.  Also, the less abundant Arctic oil resources will be more readily developed than the Arctic’s natural gas resources.  Thus, while the Arctic has the potential to be a more important source of global oil and natural gas production sometime in the future; the timing of a significant expansion in Arctic production is difficult to predict.       

Conclusion:  Canada and the Arctic

Undoubtedly, the Arctic holds great economic potential for Canada, as well as other Arctic nations. But if Canada fails to push prudent development, it may find itself paying for extensive Arctic infrastructure while finding the promise of Arctic profits a mirage.