Norway awarded its first new oil and gas leases in decades earlier this week, opening up ten new Arctic sites for exploration work to a handful of local and global drillers. These kinds of deals usually go unnoticed unless you happen to have a stake in the drillers awarded new sites, but this was unique for a couple of reasons.

If you’ve ever bought real estate, you know it’s all about location, location, location. In this case, all of the sites are located in the Arctic, a region that isn’t easy or cheap to operate in. Between extreme weather and advancing and receding ice, the region presents a host of operational challenges. And overcoming those challenges isn’t cheap.

But plenty of companies were interested in the sites.

While crude prices have rallied by nearly 80% so far this year and are approaching $50 a barrel, they’re still well off the $110 they fetched less than two years ago. That’s forced even some of the largest global oil companies to slash their capital budgets and scuttled a number of projects.

When Royal Dutch Shell (NYSE: RDS/A) announced earnings last month, profits were down by more than 80% and it cut its capital expenditure budget by another 10%, to $30 billion this year. Around the same time ConocoPhillips (NYSE: COP) announced a $700 million cut to its spending, while the month before Exxon Mobile (NYSE: XOM) said it was scaling back 25% in 2016 and would be “highly selective” about its investments.

Pick any major oil company and you see spending cuts and projects cancelled.

So why the interest in Arctic drilling? The U.S. Geological Survey estimates that the Arctic holds about 13% of the world’s undiscovered oil and nearly a third of undiscovered gas. That’s a respectable chunk of hydrocarbons, so even though it will take years to develop drilling in the region – the first real payoff isn’t expected until the late 2020s – the companies that get in and get established will have an edge. That will take a sizable investment though.

Another interesting angle on Arctic drilling: while a growing body of treaties covers who owns what, disputed territory abounds up there. Back in March, the U.S. Bureau of Ocean Energy Management issued a proposal for new leases off the north coast of Alaska in the Beaufort Sea. That’s sparked something of a diplomatic kerfuffle between the U.S. and Canada, who have disagreed over control of that area of sea since 1825.

Considering that the U.S. and Canada are about the coziest of neighbors, that’s a pretty good indication problems are coming. Those recently released Norwegian claims? They’re in an area where Norway only recently settled a border dispute with Russia.

So what’s all of this got to do with Global Income Edge?

While we don’t have energy or resources stocks in our portfolios currently, business is increasingly global and we monitor anything that might stifle commerce—and affect the yields of stocks in our portfolio.

 As businesses spread around the world, they face an increasingly tangled regulatory regime and, whether you’re drilling for oil in the Arctic or selling software in China, it’s not hard to run afoul of governments.