About Greenland
Greenland has been inhabited since prehistoric times. In 1933, the Permanent Court of International Justice, ruling in a dispute between Denmark and Norway, awarded Greenland to Denmark, which had claimed the island since 1776.
Despite being the 13th largest nation in the world, Greenland has a population of 56,000 – more than three-quarters of whom are Inuit – and a GDP (in 2007) of $2.2 billion. Today, Greenland's economy is largely dependent on subsidies from Denmark, tourism and the fishing industry.
Despite being part of Denmark, Greenland left the European Union in a disagreement over fishing rights and was granted home rule in 1979. 30 years later, in June 2009, Greenland received Self Government from Denmark.
Greenland's Energy Potential
Although there is a growing trend toward generating power from renewable sources, these sources are not yet sufficient to meet the world's growing energy needs. According to the International Energy Agency, 80% of global energy consumption will still be derived from fossil fuels by 2030 and the International Energy Agency estimates that demand for oil beyond 2009 will grow at between 0.4% and 1.4% per year.
To meet this rising demand for energy, the oil and gas industry continues to search for and develop new sources of hydrocarbons. The extensive Arctic continental shelf may, according to the United States Geological Survey, "constitute the largest unexplored prospective area for petroleum remaining on earth".
A 2008 report by the United States Geological Survey suggested that 90 billion barrels of oil, 1,669 trillion cubic feet of natural gas and 44 billion barrels of natural gas liquids may remain in the Arctic, of which 84% is expected to occur in offshore areas. A later assessment suggested there were a potential 17 billion barrels of oil equivalent (boe) yet to be discovered in the West Greenland–East Canada basin, 31 billion boe in East Greenland and 3.3 billion boe in Northern Greenland.
Hydrocarbon exploration in areas offshore West Greenland owes its beginnings in part to the dramatic rise in oil prices in the early 1970s. During this period, comprehensive seismic surveys were carried out. In 1975, six groups headed by Amoco, Chevron, ARCO, Mobil, Total and Ultramar, were granted licences.
In the following two years, five exploratory wells were drilled, but exploration was discontinued in late 1978 after all wells were declared dry by the operators. Re-investigations of the well data in 1997 by the Geological Survey of Denmark and Greenland (GEUS) suggested many areas had been abandoned prematurely. A further unsuccessful well was drilled in 2000 by Statoil.
Many Greenlanders see the development of the country's mineral and hydrocarbon resources – and the income stream they could provide – as a key goal in moving towards full political independence and ending the country's reliance on Danish subsidies.
Three years ago, in 2007 the Greenlandic government invited international oil and gas companies to once again explore for hydrocarbons offshore Greenland. As a company with a proven track record of successfully exploring for hydrocarbons around the world, in challenging environments, Cairn was one of many companies to register an interest. Subsequently a number of exploration licenses were awarded, with Cairn, EnCana, Exxon Mobil, Chevron, DONG, Husky Energy, Shell, Statoil, GDF, Conoco-Phillips and Maersk among the successful bidders. Cairn currently has an interest in 11 blocks offshore Greenland, covering an area of approximately 102,000 square kilometres.