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Energy and Minerals in Greenland Governance, Corporate Responsibility and Social Resilience

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Energy and Minerals in Greenland Governance, Corporate Responsibility and Social Resilience Energy and minerals in Greenland Governance, corporate responsibility and social resilience Emma Wilson Published by IIED, 2015 Wilson, E. (2015) Energy and minerals in Greenland: governance, corporate responsibility and social resilience. IIED, London. Cover photo: Kulusuk, Eastern Greenland Photo: Tim Wilson http://pubs.iied.org/16561IIED ISBN 978-1-78431-001-1 Printed on recycled paper with vegetable-based inks. Designed by SteersMcGillanEves 01225 465546 Edited by Holly Ashley Lay out by Regent Typesetting International Institute for Environment and Development 80-86 Gray’s Inn Road, London WC1X 8NH Tel: +44 (0)20 3463 7399 Fax: +44 (0)20 3514 9055 Email: [email protected] www.iied.org @iied www.facebook.com/theIIED Download more publications at www.iied.org/pubs Disclaimer: This paper represents the views of the author and not necessarily those of IIED. Executive Summary Energy and minerals in Greenland Governance, corporate responsibility and social resilience Emma Wilson Table of Contents Chapter 1: Introduction 4 Chapter 2: The changing face of Greenland 8 Chapter 3: Greenland’s mineral and energy resources 31 Chapter 4: Addressing key social issues 44 Chapter 5: Future Greenland 68 References 76 Personal communications 87 Acronyms 89 1 Acknowledgements I would also like to thank Geoff Wilson for providing a generous donation towards my travel The field research for this report was undertaken costs for my visit to Greenland. Further travel thanks to a one-month ‘sabbatical’ granted by costs were covered by IIED’s support for the the International Institute for Environment and sabbatical. I am very grateful to the institute for Development (IIED) in 2012. In particular I would having provided this opportunity. like to thank Mark Nuttall and Birger Poppel from the University of Greenland, for hosting me and Publication of this research was supported by sharing their knowledge and experience. Many UKaid from the UK Government. The views thanks also go to Anne Mette Christiansen of expressed in the report do not necessarily CSR Greenland, Rasmus Bertelsen of Aalborg reflect the views of the UK Government or those University, and Ian Welsh (independent) of the other supporters of this publication. for making several valuable introductions The publication was also supported by the Árran and to Steen Hansen of Arctic Base Supply Lule Sami Centre, Norway, as part of the project for providing useful insights, contacts and Indigenous Peoples and Resource Extraction invaluable help with accommodation. I would in the Arctic: Evaluating Ethical Guidelines, also like to extend my thanks to all the people funded by the Norwegian Ministry of Foreign who gave their time to talk with me during Affairs. This project brings together a team of my visit and subsequently. A list of ‘personal international specialists to analyse and evaluate communications’ is in the back of this report. ethical guidelines for extractive industries in the High North in territories inhabited by I am also very grateful to Anne Merrild Hansen indigenous peoples. (Aalborg University) and Mette Frost (WWF Denmark) for providing thoughtful and insightful The publication was also supported by Tim reviews, and to Jon Burgwald (Greenpeace), Wilson Associates1, a consultancy supplying Hans Kristian Olsen (Nunaoil) and two advice and support to organisations seeking representatives of Shell for providing additional to engage in constructive dialogue with useful comments on late drafts of the paper. I governments and regulatory structures at have also greatly appreciated the assistance UK, EU and international levels. Tim Wilson of the editor Holly Ashley and publication joined me for the initial part of my sabbatical co-ordinator Laura Jenks in producing the trip and provided some of the photographs for final report. this report.2 1 See www.twcentral.co.uk 2 More of his Greenland photographs can be found here: www.flickr.com/photos/timw50014/ sets/72157631666299204 2 About the author Dr Emma Wilson is an independent researcher and consultant. Prior to May 2015 she was a principal researcher at IIED and the Energy and Extractive Industries Team Leader. Her research focuses on responsible practice in the extractive industries and the ways that enterprise and investment can be directed towards sustainable use of energy for development. Emma has over 18 years’ experience of working on issues related to the oil and gas industry, community relations and corporate responsibility. Her current work relates to transparency and sustainability, company–community relations (including free, prior and informed consent and grievance mechanisms), responsible contracting chains and access to sustainable energy for all. Emma has worked in Russia, Kazakhstan, Azerbaijan, Nigeria, Ghana and Qatar. Emma can be contacted at: [email protected]. Produced by IIED’s Sustainable Markets Group The Sustainable Markets Group drives IIED’s efforts to ensure that markets contribute to positive social, environmental and economic outcomes. The group brings together IIED’s work on market governance, environmental economics, small-scale and informal enterprise, and energy and extractive industries. 3 1 Introduction Greenland is perceived globally as an ice- 1.1 Purpose of the report bound wilderness where climate change is escalating, opening up new frontiers for In September and October 2012 I visited – often controversial – energy and minerals Greenland thanks to a one-month ‘sabbatical’ development. We hear much less about social granted by IIED. This report is an extended trip change in Greenland and the complexity of report from my ‘sabbatical’, with analysis of decisions that the citizens of this sparsely material gathered following my return. There are populated country have to make about their many bigger experts than me on Greenlandic future development. The country is facing a issues, but IIED’s regular stakeholders rarely get period of social change and instability, not only the opportunity to read about the Arctic. While due to climate change but also because of my own personal experience includes Arctic its aspirations towards greater economic and and Northern research (mostly in northern and political independence from Denmark. far-eastern Russia), this is not a key focus region for IIED. Greenland’s economic model is based on very high levels of employment in the public sector I felt it was important to produce an IIED and dependency on two main sources of publication exploring some of the key issues income – the fishing industry and a block grant for new audiences and applying some of IIED’s of subsidies provided every year from Denmark. global experience to Greenland’s situation. With the granting of self-government in 2009, Despite obvious differences in circumstance Greenland now needs to generate sufficient and geography, Greenland is facing similar revenues to ‘buy’ itself full independence from challenges to the new hydrocarbon provinces Denmark. The Greenlandic government aims to of East Africa, for instance, which also need do this is by developing the country’s valuable to be thinking carefully about the path of their mineral, oil and hydropower resources. Can future development before launching into full- Greenland do this without succumbing to the scale exploitation. Similarly IIED’s international so-called ‘resource curse’, which has seen experience on extractive industries from more other mineral-rich countries fail to generate mature oil and mineral-producing countries, prosperity, security and social well-being from from Nigeria to Kazakhstan, is valid to share in their resource wealth? Indeed, can the country this context. generate a reliable income at all from its natural The report is based on interviews, public resources, given the volatility of commodity meetings and informal meetings (including markets? The drop in oil and mineral prices with students, shopkeepers, waiters and dog- in 2014 has had a considerable impact on walkers) during my ‘sabbatical’ in Greenland, Greenland’s prospects. along with analyses of written materials and a follow-up post-visit with a range of different stakeholders. In total I engaged with 30 people who are recorded at the end of this report as 4 Introduction Figure 1. Map of Greenland Source: Map of Greenland ©iStock.com 5 Introduction ‘personal communications’, which were formal 2,530 as of 2014) (Statistics Greenland, 2014), interviews, informal discussions and/or email where I met with the local administration to correspondence. Not all my meetings were discuss a planned aluminium smelter project recorded under ‘personal communications’ as close to their settlement – a former centre of they are not referred to in this report. the fish-processing industry, but now with few economic prospects apart from the proposed It was difficult to find time to complete the report smelter and a potential mine project. following my return, due to other work priorities. Moreover, a series of convulsive political events I was impressed by the efforts of civil society to in Greenland, closely related to the energy promote greater understanding of the impacts and extractive industries sectors, have made of large-scale resource projects through it difficult to set a cut-off point for the story. research, information sharing and promoting So I have continued to work on the report and better public consultation. This includes periodically included updates on the rapidly work by researchers based at the University changing situation in the country.
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