Greenland suspends oil exploration

·2-min read

The left-leaning government on Greenland which could be sitting on vast oil reserves, has decided to suspend all oil exploration off the the world's largest island, calling it is "a natural step" because the Arctic government "takes the climate crisis seriously."

No oil has yet been found in the waters of Greenland which had ambitions that hydrocarbons would be crucial to help Greenlanders realise their long-held dream of cutting the annual subsidy of 3.4 billion kroner ($A725 million) from Denmark that currently rules out full independence.

Global warming means that the retreating ice could uncover potential oil and mineral resources which, if successfully tapped, could dramatically change the fortunes of the semi-autonomous Danish territory of 57,000 people.

"The future does not lie in oil. The future belongs to the renewable energy and in that respect we have much more to gain," the Greenland government said in a statement.

It "wants to take co-responsibility for combating the global climate crisis."

The decision was made on June 24 but made public on Thursday.

The US Geological Survey estimates there could be 17.5 billion undiscovered barrels of oil and 148 trillion cubic feet of natural gas off Greenland, though the remote location and harsh weather have limited exploration.

When the current government led by Inuit Ataqatigiit took office following April's parliamentary election, it immediately began to deliver on election promises and stopped plans for uranium mining in southern Greenland.

The government's decision to stop oil exploration was welcomed by environmental group Greenpeace that called the decision "fantastic."

"And my understanding is that the licences that are left have very limited potential," Mads Flarup Christensen, Greenpeace Nordic's general secretary told weekly Danish tech-magazine Ingenioeren.

Greenland has four active hydrocarbon exploration licences, which it is obliged to keep active for as long as the licensees are actively investigating. They are owned by two small companies.

Copenhagen still decides on foreign, defence and security policy, and supports Greenland with the annual grant that accounts for about two-thirds of the Arctic island's economy.

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