Glossary

4.3 Resource extraction and the global distribution of resources

7 min read•august 15, 2024

Resource extraction shapes the global distribution of wealth and power. This topic explores how natural resources are categorized, where they're found, and what factors influence their extraction and trade.

From renewable forests to finite , resource availability impacts economies worldwide. We'll examine how technology, politics, and market forces determine which resources are extracted and how they're distributed globally.

Natural Resources: Types and Distribution

Categories of Natural Resources

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  • Natural resources are materials or substances found in nature that can be used for economic gain
  • The three main categories of natural resources are renewable, non-renewable, and flow resources
    • Renewable resources can regenerate and sustain their supplies over time if managed properly (forests, water, fish stocks)
    • Non-renewable resources are finite and cannot be replenished once extracted (fossil fuels, minerals)
    • Flow resources are continuously available but require technology for capture and conversion (solar radiation, wind, )

Distribution of Renewable and Non-Renewable Resources

  • Renewable resources are distributed based on climatic and ecological conditions
    • Forests are found in regions with suitable temperature, precipitation, and soil conditions (Amazon rainforest, boreal forests of Canada and Russia)
    • Water resources are influenced by the hydrological cycle and the presence of rivers, lakes, and aquifers (Great Lakes, Nile River)
    • Fish stocks are dependent on ocean currents, nutrient availability, and ecosystem health (North Atlantic cod fisheries, tuna in the Pacific Ocean)
  • Non-renewable resources are determined by geological processes and historical tectonic activity
    • Fossil fuels are concentrated in sedimentary basins, with major reserves in specific regions
      • reserves in the Middle East (Saudi Arabia, Iraq, Kuwait)
      • deposits in North America (Appalachian Basin) and China (Shanxi Province)
      • fields in Russia (Siberia) and Iran (South Pars/North Dome field)
    • Mineral resources are found in specific geological formations
      • deposits in Australia (Pilbara region) and Brazil (Carajás Mine)
      • reserves in Chile (Escondida Mine) and Peru (Antamina Mine)
      • deposits in South Africa (Witwatersrand Basin) and the United States (Carlin Trend)

Potential for Harnessing Flow Resources

  • The potential for harnessing flow resources varies based on geographic location and climatic conditions
    • potential is highest in regions with abundant sunshine and clear skies (Sahara Desert, Atacama Desert)
    • potential is greatest in areas with consistent and strong wind patterns (offshore locations, mountain passes)
    • Geothermal energy potential is associated with tectonic plate boundaries and volcanic activity (Iceland, New Zealand)
  • Technological advancements in renewable energy systems have expanded the feasibility of harnessing flow resources in various locations

Resource Extraction: Location Factors

Physical Characteristics of Resources

  • The physical characteristics of the resource determine the feasibility and profitability of extraction
    • Quality: The grade or purity of the resource affects its value and processing requirements (high-grade iron ore, sweet crude oil)
    • Accessibility: The ease of accessing the resource influences extraction costs (shallow oil reserves, surface coal seams)
    • Concentration: The abundance and spatial distribution of the resource impact the scale and efficiency of extraction (large, contiguous mineral deposits)

Economic Factors Influencing Resource Extraction

  • Economic factors influence the viability of resource extraction projects
    • Market demand: The level of demand for the resource affects its price and the incentives for extraction (increased demand for for electric vehicle batteries)
    • Commodity prices: The global market price of the resource determines the profitability of extraction operations (fluctuations in oil prices affecting project viability)
    • Transportation costs: The proximity of the resource to markets and the availability of infrastructure impact the cost of delivering the resource to end-users (remote operations requiring extensive transportation networks)

Technological Advancements in Resource Extraction

  • Technological advancements can make previously uneconomical resources viable for exploitation
    • Exploration methods: Improved techniques for locating and assessing resource deposits (seismic surveys, remote sensing)
    • Extraction methods: Innovations in , mining, and processing technologies (hydraulic fracturing for shale oil and gas, deep-sea mining equipment)
    • Processing methods: Advancements in refining, smelting, and purification processes (solvent extraction and electrowinning for copper production)

Political Factors Affecting Resource Extraction

  • Political factors can either encourage or hinder resource extraction activities
    • Government policies: Supportive policies, such as subsidies, tax incentives, and streamlined regulations, can promote resource extraction (favorable tax regimes for oil and gas exploration)
    • Geopolitical stability: Political stability and the absence of conflict in resource-rich regions attract investment in extraction projects (stable governments in Australia and Canada)
    • Resource nationalism: Government control over resource industries, through nationalization or export restrictions, can impact the global supply of resources (nationalization of oil industries in Venezuela and Mexico)

Global Resource Trade: Shaping Distribution

Comparative Advantage and Specialization in Resource Trade

  • drives specialization and trade in resources
    • Countries with abundant resources can export them in exchange for other goods and services (Australia exporting iron ore to China)
    • Differences in production costs and resource endowments encourage specialization (Chile's specialization in copper production due to its vast reserves and low extraction costs)
  • Resource trade allows countries to access resources they lack domestically and to export surplus resources

Global Supply Chains and Trade Networks

  • Global supply chains and trade networks facilitate the movement of resources from extraction sites to end-users worldwide
    • Transportation infrastructure: Ports, pipelines, and shipping routes enable the efficient transport of resources (Suez Canal for oil tankers, Strait of Malacca for coal shipments)
    • Processing and refining facilities: Intermediate processing stages transform raw resources into usable products (oil refineries, metal smelters)
    • Interdependencies and vulnerabilities: The interconnectedness of global resource markets creates dependencies and potential supply disruptions (impact of geopolitical events on oil prices)

International Trade Agreements and Resource Trade

  • International trade agreements can influence resource trade patterns
    • Free trade agreements (FTAs): FTAs reduce tariffs and non-tariff barriers, facilitating resource trade between member countries (North American Free Trade Agreement (NAFTA) for energy trade)
    • Preferential trade arrangements (PTAs): PTAs provide preferential access to resources for specific countries or regions (European Union's preferential trade agreements with resource-rich African countries)
    • Environmental and resource management provisions: Trade agreements may include provisions related to sustainable resource management and environmental standards (inclusion of environmental chapters in modern FTAs)

Resource Dependence and Economic Vulnerability

  • Resource-based economies, particularly those dependent on a single commodity, are vulnerable to global market fluctuations
    • Price volatility: Fluctuations in global resource prices can lead to economic instability and budgetary challenges for resource-dependent countries (impact of oil price crashes on Venezuela's economy)
    • Dutch Disease: The appreciation of a country's currency due to resource exports can make other sectors less competitive (the decline of manufacturing in resource-rich countries like Nigeria)
    • Challenges in economic diversification: Resource-dependent countries may struggle to diversify their economies and reduce their reliance on resource exports (the need for economic diversification in Gulf Cooperation Council (GCC) countries)

Scarcity vs Abundance: Economic and Geopolitical Implications

Resource Scarcity and Its Implications

  • occurs when the demand for a resource exceeds its available supply
    • Higher prices: Scarcity can lead to increased prices as consumers compete for limited supplies (the impact of rare earth element scarcity on technology prices)
    • Increased competition: Countries and companies may engage in intense competition to secure access to scarce resources (the global race for lithium reserves)
    • Resource nationalism: Governments may restrict exports or nationalize resource industries to ensure domestic supplies (Indonesia's ban on nickel ore exports to protect its domestic processing industry)
    • Potential conflicts: Scarcity can contribute to geopolitical tensions and conflicts over resource access (disputes over water resources in the Nile River Basin)

Resource Abundance and the Resource Curse

  • Resource abundance refers to a surplus of a particular resource within a country
    • Economic benefits: Abundance can provide economic advantages, such as increased government revenues, job creation, and infrastructure development (the role of oil wealth in the development of Gulf Cooperation Council (GCC) countries)
    • : Overreliance on resource exports can lead to economic instability, corruption, and social inequality (the challenges faced by Nigeria and Venezuela in managing their oil wealth)
    • Dutch Disease: The appreciation of a country's currency due to resource exports can make other sectors less competitive (the impact of the oil boom on Norway's non-oil sectors)

Geopolitical Tensions and Resource Competition

  • Competition for scarce resources can lead to geopolitical tensions and conflicts
    • Territorial disputes: Countries may claim sovereignty over resource-rich territories, leading to regional tensions (the ongoing disputes in the South China Sea over oil and gas reserves)
    • Resource diplomacy: Countries may use their resource wealth as a tool for political influence and leverage (Russia's use of natural gas exports to exert influence in Europe)
    • Strategic partnerships: Countries may form alliances and partnerships to secure access to critical resources (China's Belt and Road Initiative and its resource-focused investments in Africa and Asia)

Global Economic Inequalities and Resource Distribution

  • The uneven distribution of resources can exacerbate global economic inequalities
    • Resource-rich countries: Countries with abundant resources may experience higher economic growth and improved living standards (the high per capita incomes of Gulf Cooperation Council (GCC) countries)
    • Resource-poor countries: Countries lacking significant resources may struggle to compete in the global economy and face development challenges (the economic challenges faced by resource-poor countries in sub-Saharan Africa)
    • Resource curse and inequality: Even within resource-rich countries, the benefits of resource wealth may not be evenly distributed, leading to social and economic inequalities (the widening income gap in resource-dependent countries like Angola and Equatorial Guinea)

Climate Change and the Transition to a Low-Carbon Economy

  • The global shift towards a low-carbon economy is reshaping the resource landscape
    • Renewable energy sources: Increasing focus on renewable energy sources, such as solar, wind, and hydropower, is driving changes in resource demand (the growth of solar and wind power in China and the United States)
    • Sustainable resource management: Emphasis on sustainable practices in resource extraction and consumption to mitigate environmental impacts (the adoption of circular economy principles in the European Union)
    • Economic and geopolitical implications: The transition to a low-carbon economy has implications for resource-dependent countries and global power dynamics (the impact of the energy transition on oil-exporting countries in the Middle East)
    • New alliances and partnerships: Countries are forming new alliances based on shared interests in clean energy technologies and sustainable resource management (the International Solar Alliance and the Global Battery Alliance)

Key Terms to Review (27)

Coal: Coal is a combustible black or brownish-black sedimentary rock primarily composed of carbon, along with various other elements, that is used as a major source of energy and fuel. Its extraction and use have significantly shaped global economies and energy production, impacting the distribution of resources and the environment across the world.
Comparative Advantage: Comparative advantage is an economic principle that describes how countries or entities can gain from trade by specializing in producing goods or services in which they have a lower opportunity cost compared to others. This concept emphasizes that even if one party is more efficient at producing everything, there are still benefits from trade if they focus on what they do best and allow others to handle their own strengths.
Copper: Copper is a ductile and malleable metal with high thermal and electrical conductivity, making it an essential resource in various industries, including electronics, construction, and transportation. Its extraction and processing have significant implications for the global distribution of resources, impacting economies and ecosystems worldwide.
David Harvey: David Harvey is a prominent geographer and social theorist known for his contributions to the field of economic geography, particularly through his analyses of capitalism, urbanization, and spatial justice. His work connects key concepts such as the role of transportation networks, production systems, and the dynamics of deindustrialization, offering critical insights into how economic processes shape and are shaped by geographic space.
Drilling: Drilling is the process of creating holes in the ground to extract resources such as oil, natural gas, and minerals. This technique is crucial for resource extraction as it enables access to subsurface materials that are not visible from the surface. The methods used in drilling can vary widely based on the type of resource being targeted and the geological conditions, impacting the global distribution of resources significantly.
Eco-efficiency: Eco-efficiency refers to the strategy of creating more goods and services while using fewer resources and generating less waste and pollution. This concept emphasizes sustainable practices in resource extraction and production, balancing economic growth with environmental responsibility. Eco-efficiency promotes innovation and the adoption of cleaner technologies, aiming to minimize the ecological footprint while maximizing productivity.
Economic dependency: Economic dependency refers to a situation where one economy relies heavily on another for resources, trade, or financial support. This reliance often leads to an imbalance in power dynamics and can affect a country's ability to develop independently. It plays a crucial role in understanding how resource extraction impacts environmental degradation and shapes the global distribution of resources.
Energy security: Energy security refers to the reliable and affordable access to energy resources, ensuring a stable supply for economic and social needs. It connects closely to the global distribution of resources, as disparities in resource availability can lead to geopolitical tensions, economic vulnerabilities, and strategies for resource extraction that seek to secure a nation's energy future.
Environmental degradation: Environmental degradation refers to the deterioration of the natural environment due to human activities, leading to a decline in the quality of air, water, soil, and ecosystems. This term is closely linked to resource extraction practices, which often result in habitat destruction, pollution, and the depletion of natural resources, impacting both local and global communities.
Fossil fuels: Fossil fuels are natural resources formed from the remains of ancient plants and animals, buried under layers of sediment and rock for millions of years. These energy sources, including coal, oil, and natural gas, play a crucial role in global energy production and consumption patterns, impacting both resource extraction processes and the geographical distribution of these resources around the world.
Geothermal energy: Geothermal energy is the heat that comes from the Earth’s interior, which can be harnessed for various uses, including electricity generation and direct heating. This renewable resource plays a crucial role in resource extraction and impacts the global distribution of energy resources by providing a sustainable alternative to fossil fuels.
Gold: Gold is a highly valued precious metal known for its rarity, lustrous appearance, and resistance to corrosion, making it a significant resource in various sectors including finance, jewelry, and electronics. Its extraction and distribution are vital components of the global economy, reflecting not only its intrinsic value but also its role in shaping geopolitical relationships and resource management strategies.
Habitat destruction: Habitat destruction refers to the process by which natural habitats are altered or eliminated, typically due to human activities such as agriculture, urban development, and resource extraction. This phenomenon leads to a loss of biodiversity and can severely disrupt ecosystems, impacting not only the flora and fauna that rely on these habitats but also the overall health of the environment. The consequences of habitat destruction are particularly significant when considering the environmental impacts of resource extraction and how it influences the global distribution of resources.
Iron ore: Iron ore is a naturally occurring mineral from which iron can be extracted, primarily in the form of iron oxides such as hematite and magnetite. This resource is critical in the production of steel, which is essential for various industries including construction, transportation, and manufacturing. The global distribution of iron ore deposits significantly influences patterns of resource extraction and economic development in different regions around the world.
John Friedmann: John Friedmann is a prominent geographer known for his work on urban development, economic geography, and the concept of uneven development. His research emphasizes how economic disparities between regions contribute to social inequalities and shape urban landscapes. Friedmann's ideas have significantly influenced the understanding of spatial dynamics, particularly concerning the core-periphery model, which illustrates the uneven distribution of resources and development opportunities globally.
Lithium: Lithium is a soft, silvery-white alkali metal that is highly reactive and flammable, primarily used in rechargeable batteries for electric vehicles and portable electronics. Its increasing demand is driven by the global push for renewable energy and sustainable technologies, making it a critical resource in the context of resource extraction and global distribution of resources.
Local development: Local development refers to a process aimed at improving the economic, social, and environmental conditions of a specific community or locality. It often focuses on utilizing local resources and engaging local stakeholders to create sustainable growth while enhancing the quality of life for residents. This approach is particularly relevant in the context of resource extraction, where local communities can be both directly impacted and beneficiaries of such activities.
Mining: Mining is the process of extracting valuable minerals or other geological materials from the Earth, which plays a crucial role in resource extraction and the global distribution of resources. This activity not only provides raw materials for various industries but also impacts economies, environments, and communities worldwide. The minerals obtained through mining are essential for manufacturing, construction, and energy production, making it a fundamental aspect of modern economies.
Natural gas: Natural gas is a fossil fuel primarily composed of methane, a colorless and odorless hydrocarbon that is formed from the remains of ancient marine organisms buried under layers of sediment. It plays a crucial role in the global energy landscape, providing a cleaner-burning alternative to coal and oil, while also being essential for heating, electricity generation, and as a feedstock in various industrial processes.
Oil: Oil is a naturally occurring liquid found in geological formations beneath the Earth's surface, primarily consisting of hydrocarbons. It is a critical resource for energy production and has immense economic significance due to its role in global trade, manufacturing, and transportation.
Resource curse: The resource curse refers to the paradox where countries rich in natural resources, such as oil and minerals, often experience slower economic growth, authoritarian governance, and social issues compared to countries with fewer natural resources. This phenomenon highlights how resource wealth can lead to negative consequences like environmental degradation and unequal wealth distribution, impacting both local and global dynamics.
Resource Endowment: Resource endowment refers to the natural resources available in a specific geographical area, which play a crucial role in shaping the economic activities and development of that region. The type and quantity of resources, such as minerals, forests, water, and arable land, directly impact a region's ability to extract and utilize these resources for economic growth. Understanding resource endowment is essential for analyzing global resource distribution and the economic implications of resource extraction.
Resource geopolitics: Resource geopolitics refers to the strategic use and control of natural resources in international relations, where access to, ownership of, and extraction of resources like oil, gas, minerals, and water can influence political power and global dynamics. This concept highlights how resource distribution shapes economic policies, international conflicts, and alliances, as countries vie for limited resources to fuel their development and maintain security.
Resource Scarcity: Resource scarcity refers to the limited availability of natural resources in relation to the demand for them. It is a fundamental concept in economic geography that highlights how the unequal distribution and depletion of resources can impact societies, economies, and global relations, particularly in the context of resource extraction and its geographical implications.
Solar energy: Solar energy is the energy harnessed from the sun's radiation, which can be converted into heat, electricity, or hot water for residential and commercial use. This renewable resource is abundant and sustainable, making it a key player in discussions around resource extraction and the distribution of energy globally, as it offers an alternative to fossil fuels while also impacting economic development and environmental sustainability.
Sustainable development: Sustainable development refers to a mode of human development in which resource use aims to meet human needs while preserving the environment for future generations. It emphasizes balancing economic growth, environmental integrity, and social equity to ensure that resources are available not just for today, but for years to come.
Wind energy: Wind energy is the process of converting wind currents into electricity using turbines. This renewable energy source has gained prominence due to its potential to reduce reliance on fossil fuels and lower greenhouse gas emissions. Wind energy plays a vital role in energy transitions, as societies shift from traditional energy sources to more sustainable options, and it is closely linked to the global distribution of resources as different regions harness wind for power generation based on local environmental conditions.
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