Unfreezing the plans
The draft plan for the development of the Northern Sea Route infrastructure till 2035 foresees the establishment of a unified container shipping operator and a national dredging company, construction of three nuclear-powered icebreakers of the Leader series and a refinery in the Murmansk Region as well as other measures. The Northern Sea Route is to become an all-year-round sea way. The plan can also include the requirement on using LNG as a marine fuel.
The new of the old
Upon approval of the ‘two-key’ principle for running the Northern Sea Route with Rosatom and Transport Ministry as ‘key keepers’, an active work on NSR development plan till 2035 began. The draft plan, which is to be approved by the RF Government, sets quite ambitious targets foreseeing the creation of a fleet flying under the flag of Russia, development of railway approaches to the Arctic ports and creation of new consignor companies.
In particular, the document highlights the necessity to establish a unified operator of the Northern Sea Route to integrate the maritime, port, railway and motorway components of the transportation process. An alliance of ad hoc organizations could be established to operate the route. The issue should be solved by 2025. By that time, shipping by the NSR is to be arranged via a multimodal electronic system through application of standard documents and through rates. It should be noted that representatives of different companies earlier suggested to create a NSR container shipping company and construction of a dedicated fleet. The point is that cargo base is not sufficient so far, the more so as Atomflot has its own lighter-container ship. Another issue is the competitive environment since it the case of a monopolist creation.
Also, according to the draft plan, the issue of creating a national dredging company is to be explored by November 2019. It should be noted that its functions are currently performed by FSUE Rosmorport which is regularly boosting the scope of dredging performed by its own facilities and at its own expense. Moreover, there is a plan on transforming it into a joint stock company. Read more about dredging in Russia >>>>
The increase of the NSR cargo base is planned particularly through the development of railway approaches to the Arctic ports. The plan includes the construction of a railway branch to Sabetta as part of the Northern Latitudinal Railway-2 project as well as the Belkomur and Barentsamur projects. Those projects were put off more than once. Now, they are to be updated till December 2019. In our opinion, the Northern Latitudinal Railway-2 project is the most realistic one since the development of port infrastructure in the Gulf of Ob is the most intense.
In the part of shipping, the plan foresees construction of three nuclear-powered icebreakers of the Leader series. According to the proposals of the RF Government’s Analytical Center, two icebreakers of this type are to be put into operation by 2030. By 2035, there should be three of them. All in all, 13 icebreakers are to operate on the Northern Sea Route by 2035 with nine nuclear-powered icebreakers including the 50 Let Pobedy icebreaker being in operation today and four LNG-powered icebreakers.
In the part of ecology, there is a proposal according to which vessels operating on the Northern Sea Route are to be powered by LNG instead of oil products. That idea was earlier supported by Russian President Vladimir Putin.
According to the draft plan says, justification for Arctic rescue and auxiliary ships requirements are to be ready by January 2020.
To ensure the development of oil cargo flow in the eastern direction the draft plan foresees to build a refinery in the Murmansk Region by 2021. The facility is supposed to refine oil from the Prirazlomnoye, Novoportovskoye and Pecherskoye fields. Crude oil and oil products are to be transshipped by an onshore terminal Lavna on the left shore of the Kola Bay.
In general, the draft plan seems to update the old projects some of which are disputable or being discussed for years without any result. An interesting aspect is an idea to create an added value in the Arctic, as in the case of the Murmansk Region refinery. In our opinion, projects on creation of an added value in the Arctic would ensure faster return on enormous investments suggested for the region.