The natural resources of the Arctic are the mineral and animal resources within the Arctic Circle, which include major reserves of oil and natural gas, large quantities of iron ore, copper, nickel, zinc, phosphates and diamonds.
Potential of the Arctic natural resources:

• Marine resources: The Arctic has a a significant stock of living marine resources and is one of the most productive fishing grounds in the world. For example, the Bering Sea contains numerous fish including shrimp, scallops and many more.
• Oil and gas reserves: The Arctic supplies the world with roughly 10 percent of its oil and 25 percent of its natural gas mostly from onshore sources. It is also estimated to hold 22 percent of the Earth’s undiscovered oil and natural gas reserves.
• Rich minerals: The Arctic is rich in minerals, such as coal, iron ore, nickel and copper ore. Mineral resources also include gemstones and rare earth elements, which are key to the electric vehicle and renewable energy revolutions.
• Ecosystem services: The Arctic region supports a wide array of ecosystem services that are necessary for the well-being of people living in the Arctic as well as globally. For example, the Arctic tundra supports reindeer populations, which in turn provide food and income for hunters and their families.

Due to the availability of vast natural resources, the economic potential of the Arctic is enormous. If exploited and utilised optimally, it could create significant economic opportunities for the nations having access to the Arctic as well as the local communities of the region. It would further enhance job creation owing to the development of infrastructure as well as industries such as mining. However, exploitation of these resources can lead to various impacts, such as:

• Environmental impacts:
  • Oil exploration, mining and deep-sea drilling are cost-intensive and may pose environmental risks, such as air and marine pollution, particularly from oil spills, Persistent Organic Pollutants (POPs), heavy metals, radioactive substances, etc.
  • Increase in economic activities in this region will further speed up the process of melting of the Arctic ice. This will lead to release of GHGs stored under permafrost regions resulting in more extreme weather, flooding, drought and poor health.
• Social impacts:
  • Indigenous populations of the Arctic heavily depend on the resources provided by their environment for their subsistence. The receding ice sheets may impact the livelihood and food security of the region.
  • Economic development will generate increased competition between the outsiders and the indigenous population for access to resources, as well as geo-political conflicts among the Arctic nations. For example, there is competition between subsistence fishing and offshore oil and gas extraction in Alaska.

On a positive aspect, Arctic trade routes will decrease global GHG emissions from shipping because these routes would be much shorter than the current routes. However, the sustainability factor would depend on the actual choices made by the Arctic countries and industries for economic development.