The oil and gas industry has demonstrated the ability to drill and develop offshore oil and gas resources in first year sub-Arctic ice and in shallow water high Arctic environments. However, development in deep water (water depths exceeding 100m) remains a formidable challenge due to small, unpredictable open water windows and high environmental loads from multi-year ice features. This paper provides an overview of recent projections of undiscovered Arctic hydrocarbon resource potential and the geographical distribution of the resource potential thought to lie in deep water. The unique environmental conditions are summarized along with their impact on the cost of supply outlook for Arctic resources relative to other hydrocarbon supplies. The key technical challenges facing deep water high Arctic development are reviewed along with the current industry efforts aimed at meeting the challenges.
According to a 2008 Circum-Arctic Resource Assessment by the USGS (Bird et al, 2008), the Arctic could hold about 22% of the world's remaining undiscovered hydrocarbons. It is frequently described in the press as "the final true frontier for hydrocarbon exploration." Resource projections such as these, coupled with diminishing supplies of conventional oil resources and higher oil prices have resulted in intensified acreage acquisition and exploration activities in the Arctic. Arctic exploration is expanding well beyond the shallow water depths of current industry production experience, which is limited to bottom founded structures and gravel islands in depths less than 40 meters. The expanding search into "deep water" Arctic is to some extent underpinned by industry confidence that the necessary enabling technology will emerge if the prize is large enough. Such confidence is supported by industry's long-standing record of overcoming major technology hurdles to safely and economically produce large hydrocarbon accumulations in harsh environmental conditions around the globe.