Backfill: Frozen Assets
The discovery four years ago of one of the ships from Sir John Franklin's ill-fated expedition of 1845 reminded Canadians of the long-established drive to explore the country's far north for its undoubted riches.
This 'Backfill' column was originally published in September 2014 by SNL Financial (now part of S&P Global Market Intelligence) and is reprinted with permission.
It is not every day that the Prime Minister of a country takes to the news wires to announce personally the discovery of a sunken ship, especially one that was lost by a foreign nation 169 years ago. But this is no ordinary vessel, and no ordinary location.
On Tuesday 9th, the Canadian Prime Minister, Stephen Harper, announced the discovery of one of the two ships that comprised Sir John Franklin's ill-fated expedition in 1845 to discovery a northwest passage across the top of North America.
The expedition's disappearance, and the fate of the 130 crew, became one of the great mysteries of Victorian exploration. The original 19th century searches helped open up parts of the Canadian Arctic for discovery, but a sea crossing to the Pacific Ocean was only achieved 58 years later, and much further north.
The Canadian government began searching for Franklin's ships in 2008 as part of a strategy to assert the country's sovereignty over the Northwest Passage, which has recently become more accessible to shipping because of melting Arctic ice.
Sonar images from a remotely operated submarine in Queen Maud Gulf show the wreckage of a ship on the ocean floor just off King William Island, within the Arctic Circle (66.5°N). It is not yet clear whether the ship is HMS Erebus or HMS Terror, but there will be no dispute over ownership; Canada declared the ship's resting place a National Historic Site in 1992, and the UK handed over custody of any discoveries to Canada in 1997.
Although Canada did not gain its independence until more than 20 years after the ships foundered, Mr Harper has credited Franklin's expedition with "laying the foundation" of the country's Arctic sovereignty.
The riches to be uncovered promise more than the relics from a Victorian ship or two. The discovery can be expected to boost interest in the whole Arctic region, which encompasses some 20 million km2, representing 6% of the Earth's surface. The Arctic incorporates territories in eight countries: a small island belonging to Iceland; most of Greenland; Nunavut and the Northwest Territories in northern Canada; northern Alaska in the US; northern Russia; and the northern parts of Norway, Sweden and Finland.
Historic northern operations include the Canadian mines of Polaris (75.4°N) and Lupin (65.8°N) in Nunavut, both of which are now closed. The world's most northerly operations are three coal mines at 77.9-78.2°N in Spitsbergen on Norway's Svalbard Islands. The most northerly exploration projects at the moment are Canada Coal Inc.'s exploration at 79.9°N in Nunavut, and base metals exploration by Ironbark Zinc Ltd and Avannaa Resources Ltd at 80.2-83.0°N in Greenland's far north.
SNL Metals & Mining's database lists 329 exploration/development projects in the Arctic, operated by over 100 companies. These projects include 29 at the prefeasibility/scoping study stage (eight of which are in Canada) and 13 at the feasibility study stage (two in Canada). There are four mines under construction in the Arctic and 55 existing mines/plants; however, despite 30% of the documented projects being in Canada, the country has no Arctic mines at the moment.
If the scope is relaxed to above a latitude of 60°N, ie 720 km south of the Arctic Circle, SNL documents 1,603 projects (of which 1,038 are in Canada) and 145 mines (13 in Canada). According to the SNL database, there are 478 companies active in this larger region, with 281 of them reporting activity in Canada above 60°N. Mining at these latitudes is not without its difficulties, both from an operational and an environmental perspective. However, along with the ocean depths, the region represents one of the great opportunities for the mining sector. It is clear that Prime Minister Harper is only too aware of the riches to the north.