Greenland has taken one step closer to an oil rush after Edinburgh-based Cairn Energy today announced it had found signs of hydrocarbons in two wells drilled there this summer.
The wells, drilled at a depth of nearly a kilometre about 200 km off the coast of the capital city of Nuuk, reportedly hit Â“reservoir quality sandsÂ” that could hold oil and gas deposits.
This is the second time in two years the company has found evidence of oil or natural gas.
Cairn drilled a total of five wells this summer, but the first three were abandoned after they showed no evidence of oil or gas.
According to the company, it found signs of oil and natural gas in mud that had been forced up through its test well.
The discovery of the hydrocarbons in a 50-metre thick layer of sand is significant, since it means that any oil or gas trapped there would easily be forced to the surface.
Cairn will now attempt to obtain fluid samples from the wells.
This was the second drilling season Cairn has been active off the coast of Greenland. Last yearÂ’s drills also returned evidence of natural gas. Cairn had initially expected to invest 5.5 billion kroner in its Greenlandic drilling activities through 2014, but as of this summer it had already reached that amount. The company, however, said it remained committed to the search for oil in Greenlandic waters.
Both this year and last Cairn was forced to temporarily halt its drilling when activists from Greenpeace boarded drilling rigs. The company received a court order banning the organisationÂ’s activists from approaching its vessels.
Studies show that the Arctic contains roughly 30 percent of the worldÂ’s unproven gas reserves and 10 percent of its unproven oil reserves.
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