Carson Walker/Staff Reporter
Why is Russia ok with losing money on a coal mine? For over 100 year’s Russia has been losing money on one very specific mine. The Barenberg mine sits on the west coast of an island called Svalbard. Svalbard is one of the world’s most important places when it comes to its geological placement as it sits in the Arctic circle.
Svalbard is an archipelago that is a part of Norway but with claims by over 50 countries. The reason that lots of countries want to have a piece of Svalbard is to make sure that as the Arctic starts to melt, they can not only profit from the trade routes that will open but also the oil and natural gas that is there.
Russia and a select number of other countries border the Arctic circle giving them have the best access and chance to claim those resources.
Russia has put in claims that their continental shelf goes out to almost the center of the pole where they have placed a flag in the ocean. A continental shelf is a part of the country that is underwater most of the time. In this case, the continental shelf is no more than 600 ft under the water.
The reason this land is so sought after is because of all the oil and natural gas that is in the Arctic. The Arctic holds almost 90 billion barrels of oil and 1,668.66 trillion cubic feet of natural gas.
That is about 30% of the world’s undiscovered oil and 13% of the world’s undiscovered natural gas. There is no other reason these countries are in the Arctic other than for the resources it holds.
One of the other major reasons that the Arctic is important is that trade routes are opening because of the ice melting. Trade routes can be a big money-maker for a country. Just look at the Suez Canal. Egypt made $5.61 billion from trade fees just last year, so it is so important that a country has a city or town on the coast where ships pass.
The counties that will profit the most from the ice melting are the countries that have their borders on the Arctic. Those countries would be Canada, Russia, Greenland (territory of Denmark), Norway, Iceland, United States of America (Alaska).
Russia currently has a population of around 2 million people that are stationed or living in the Arctic. This would mean that if the trade routes started to open Russia would have the biggest jump in GDP out of any country and the population to support it.
The reason that Russia put a coal mine on Svalbard is that when UNCLOS has a meeting about what countries should have a claim on a part of the Arctic, Russia would be at the table. Russia does not make any revenues from the mine but loses money, but it is so important to a future claim they maintain the mine.
In the last couple of years, the workers and the people in the village have no longer wanted to work and support the mine but move towards a tourist destination. The move to more of a tourism town means that they can potentially start making a profit from the town.