Arctic Climate Change and U.S. Accession to the United Nations Convention on the Law of the Sea
The United States has basic and enduring national interests in the oceans. These diverse interests—security, economic, scientific, dispute settlement, environmental, and leadership—are best protected through a comprehensive, widely accepted international agreement that governs the varying (and sometimes competing) uses of the sea. Although the United States has lived outside the Convention for 30 years, climate change in the Arctic provides the current Administration with a new and urgent incentive to re-engage the Senate and urge that body to provide its advice and consent to U.S. accession to the treaty at the earliest opportunity. As a nation with both coastal and maritime interests, the United States would benefit immensely from becoming a party to UNCLOS—accession will restore U.S. oceans leadership, protect U.S. ocean interests and enhance U.S. foreign policy objectives, not only in the Arctic, but globally.
On October 7, 1994, President Clinton submitted UNCLOS and the IA to the Senate for advice and consent to accession and ratification, re- spectively. Despite widespread bi-partisan support, the concurrence of all the Federal agencies and departments with ocean interests, and support from the U.S. maritime industries (oil and gas, shipping, telecommunications, marine science, fishing) and environmental groups, the Convention and its Implementing Agreement have languished in the Senate for the past 20 years.
According to a 2008 assessment by the U.S. Geological Survey (USGS), “the total mean undiscovered conventional oil and gas resources in the Arctic are estimated to be approximately 90 billion barrels of oil, 1,669 trillion cubic feet of natural gas, and 44 billion barrels of natural gas liquids.”17 The overwhelming majority of these resources—84 percent—is expected to occur in offshore areas. Over 70 percent “of the mean undiscovered oil resources is estimated to occur in five provinces: Arctic Alaska, Amerasia Basin, East Greenland Rift Basins, East Barents Basins, and West Green- land-East Canada.”18 Similarly, over 70 percent “of the undiscovered natural gas is estimated to occur in three provinces: the West Siberian Basin, the East Barents Basins, and Arctic Alaska.”19 Arctic Alaska, the Amerasia Ba- sin, and the North Chukchi-Wrangel Foreland Basin provinces, portions of which could be claimed by the United States, account for over 40 million barrels of oil, 284 billion cubic feet of natural gas, 6.5 million barrels of natural gas liquids and 94 million barrels of oil and oil-equivalent natural gas.20 The value of these resources is estimated to be in the trillions of dollars.21
Granted, as UNCLOS critics are quick to point out, access to the ECS under UNCLOS is contingent upon payment of royalties to the Interna- tional Seabed Authority (ISBA) for oil and gas development beyond 200 nautical miles (nm).26 However, the royalty framework is relatively insignifi- cant compared to the fee-sharing arrangements for overseas oil and gas development and the enormous economic benefits anticipated from off- shore resource development. Revenue sharing does not begin until the 6th year of production of a particular well or site, starts at 1% of the value of production and increases 1% per year. By the 12th year and remaining years thereafter, the royalty is 7% of the value of production, paid either in kind or in dollars.27 During the 1970s, these revenue sharing provisions were negotiated in consultation with the U.S. oil and gas industry.
Payments are to be distributed by the ISBA to States Parties of UNCLOS in accordance with Article 82(4) on the basis of equitable criteria that take into account economic development factors. Of note, this distribution is distinct from the distribution of revenues generated from deep seabed mining operations under Part XI of the Convention. As a State Party to UNCLOS, the United States would have a permanent seat in the ISBA to ensure both kinds of distributions are made in ways acceptable to the United States—Section 3(15) of the Annex to the IA guarantees the United States a seat on the ISBA Council in perpetuity.28 Any ISBA decision regarding revenue sharing must be approved by the Council.29 Additionally, if distributions are made to a country that is already receiving U.S. foreign aid, the United States could offset aid to that country by the amount of distributions paid by the ISBA, in essence eliminating any increase financial burden to the American taxpayers.
Critics suggest accession to UNCLOS is not required in order for the United States to claim an ECS, since the 1958 Continental Shelf Convention and the 1945 Truman Proclamation already support a unilateral U.S. claim. Although that may be true, the metric for determining the outer extent of the ECS is more generous in UNCLOS than in the 1958 Convention or the Truman Proclamation, both of which rely on an “exploitability criterion” to identify the outer limit of the ECS.30 More importantly, the U.S. oil and gas industry believes that unilaterally claiming an ECS outside UNCLOS may be challenged by other nations in courts throughout the world, and has therefore repeatedly argued that legal certainty/security of tenure to explore and exploit the resources of the ECS can be obtained only through UNCLOS.31 The bottom line is that U.S. industry will not invest in offshore oil and gas production in the ECS unless the United States is a party to UNCLOS.32
In May 2013, five Asian nations—including China—were granted ob- server status in the Arctic Council, and China has stated it does not intend to be a “wallflower” in the forum.33 Beijing has expressed an interest in developing new shipping routes through the Arctic that will connect China with its largest export market—the European Union. To that end, in August 2013, a Chinese merchant vessel loaded with heavy equipment and steel set sail from Dalian en route to Rotterdam via the Arctic’s Northern Sea Route (NSR).34 China has also expressed an interest in developing Arc- tic resources. In March 2010, Rear Admiral Yin Zhou of the People’s Liberation Army Navy stated at the Eleventh Chinese People’s Political Consultative Conference that “under . . . UNCLOS, the Arctic does not belong to any particular nation and is rather the property of all the world’s people” and that “China must play an indispensable role in Arctic exploration as it has one-fifth of the world’s population.”35 Officials from the State Oceanic Administration have similarly indicated that China is a “near Arctic state” and that the Arctic is an “inherited wealth for all humankind.”36 As a party to UNCLOS, the United States could claim an ECS in the Arctic and forestall any encroachment of U.S. ocean resources by China or any other nation.
U.S. freedom of navigation interests in the Arctic would be bolstered by joining UNCLOS. Both Russia and Canada have maritime claims in the Arctic that are inconsistent with the rules contained in the Convention. Russia37 and Canada38 draw excessive straight baselines in the Arctic and restrict the right of transit passage in various international straits in the Arctic, including the Northeast Passage, the Northwest Passage and vari- ous straits located within Russia’s Northern Sea Route (NSR)—the Demitri, Laptev and Sannikov Straits. Russia’s straight baselines closing the NSR straits and Canada’s straight baselines around its Arctic Islands do not meet the legal criteria contained in Article 7 of the Convention.39 According to UNCLOS Article 5, the correct baseline for these areas is the low-water line. UNCLOS Article 38 also provides that the right of transit pas- sage through international straits cannot be suspended or impeded by the bordering States. Use of straight baselines by Russia and Canada to close these international straits is therefore inconsistent with the Convention. Furthermore, under UNCLOS Article 8(2), all nations enjoy at least the right of innocent passage in areas within newly drawn straight baselines. The United States has diplomatically protested and operationally challenged these excessive straight baseline claims under the U.S. Freedom of Navigation Program, citing the provisions of UNCLOS and customary international law.40 However, the U.S. legal position would be on better footing if the United States was a party to the Convention.
The United States has historically been the world leader in protecting the common interest in navigational freedom and the rule of the law in the oceans. However, America has temporarily lost that leadership by its continued non-adherence to UNCLOS. U.S. accession to the Convention will restore that role and advance U.S. leadership in Arctic Ocean issues.
Joining UNCLOS will put the United States on an even footing with the other Arctic nations, as America assumes the chairmanship of the Arctic Council from Canada in 2015. All of the Council’s member States (except the United States) and its 12 observer States are parties to the Convention. Moreover, in 2008, the five Arctic coastal States (Canada, Denmark, Russia, Norway and the United States) declared at Ilulissat that the law of the sea, as reflected in UNCLOS, is the legal framework that governs the Arctic Ocean, and there is no need for a new legal regime to govern the Arctic Ocean.53 Therefore, U.S. participation in the Arctic Council recognizes UNCLOS as the governing framework in the Arctic
However, as a non-Party to UNCLOS, the United States lacks standing to challenge other nations’ excessive claims in the Arctic citing the provisions of the Convention. The same is true in other regions of the world. China, for example, continues to pursue an aggressive posture in the South China Sea and routinely criticizes the United States for not being a Party to UNCLOS—“the U.S. insists that China must base its [South China Sea] claims solely on the 1982 UNCLOS although the U.S. itself has not ratified it.”60 Similarly, when Iran signed UNCLOS in 1982, it filed a declaration indicating, inter alia, that “only states parties to the Law of the Sea Convention shall be entitled to benefit from the contractual rights created therein, [including] the right of Transit passage through straits used for internation- al navigation.”61 Thus, Iran argues that the United States does not enjoy a right of transit passage through the Strait of Hormuz because that right is contractual in nature. Joining the Convention would put the United States on solid legal ground to conclusively “put to bed” these assertions.