A U.S. oil company is delaying its Arctic drilling project following permit discussions and a public rebuke from the Greenland government for moving equipment without authorization.<\/p>\n
Greenland Energy, the Texas-based firm leading the project, had hoped to begin drilling operations as early as October in the Jameson Land Basin in eastern Greenland\u2014an estimate cited there could be up to 13bn barrels of prospective oil resources, but analysts who set that number have called it \u201chighly speculative.\u201d<\/p>\n
That timeline has now significantly changed and the project cannot commence until the winter of 2027, at the earliest.<\/p>\n
The Greenland government on Wednesday issued a statement detailing that the \u201cnecessary regulatory process cannot be completed, and the necessary approvals cannot therefore be obtained before the planned start of drilling.\u201d<\/p>\n
It emphasized that \u201cpreparatory activities cannot be started either\u201d and \u201cseveral parts of the project are under regulatory review.\u201d\u00a0<\/p>\n
Greenland Energy\u2019s venture partner, the British outfit 80 Mile, said the team remains \u201cfully committed to the project and intends to commence drilling as soon as the necessary approvals have been received and the programme can be undertaken safely and responsibly.\u201d Greenland Energy\u2019s share price dropped in the aftermath of the announcement.<\/p>\n
The project has stalled during a time where there is high U.S. interest surrounding Greenland\u2019s oil potential.<\/p>\n
President Donald Trump\u2019s Greenland special envoy Jeff Landry in May, when asked about strategic interests that the U.S. may have in Greenland, honed in on the possibilities surrounding oil.<\/p>\n
\u201cGreenland could be exporting two million barrels of oil a day right now. Think about what that would mean. Think about what kind of pressure that would relieve in the Strait of Hormuz,\u201d he said, referencing the ongoing disruption to the vital trade route. \u201cWe could have those barrels on production within 10 months or so.\u201d<\/p>\n
The U.S. interest comes amid a tense geopolitical backdrop, as Trump has repeatedly threatened to annex Greenland, a semi-autonomous territory of Denmark, since returning to office. Greenlandic and Danish officials have made it explicitly clear this is not something they are open to.<\/p>\n
Greenland stopped issuing new oil licences in 2021. However, Greenland Energy has access as its venture partner 80 Mile inherited a license via its subsidiary White Flame Energy, which acquired the exploration rights to Jameson Land prior to the cut-off date.<\/p>\n
But much more than a license is needed before digging can start. It\u2019s a complex process with various authorization steps that need to be completed along the way. The U.S.-based oil company's project faltered on one of these steps earlier in the summer, leading to a stern warning being issued by the Greenland government and a whole host of discussion.<\/p>\n
Here\u2019s what happened, and what to know about the company spearheading the ambitious oil project.<\/p>\n
In March, Greenland Energy\u2019s executives said they had obtained the rights from 80 Mile and its subsidiary company for licenses attached to the Jameson Land Basin in east Greenland.\u00a0<\/p>\n
The Texas-based oil company described the chance to explore Greenland as \u201ca rare opportunity to unlock one of the largest undrilled onshore basins in the Arctic through a disciplined, environmentally responsible approach."<\/p>\n