The Northern Sea Route User Conference
The 21st Century – Turning Point for the Northern Sea Route?

18–20 November 1999 - Holmenkollen Park Hotel Rica, Oslo, Norway

Executive Summaries

 Compiled by the Conference Secretariat 8 November 1999


Table of Contents

Introductory Note *

Presentation of the Conference Organizers *

Presentation of the International Northern Sea Route Programme (INSROP) *

Notes on Speakers and Panellists *

Welcoming address. By Yohei Sasakawa *

Introduction to NSR history and INSROP’s background. By Vsevolod I. Peresypkin *

What do we need? The shipping industry’s views on the NSR’s potential and problems. By Rolf Sæther *

What do we know about the NSR? INSROP’s overall approach and conclusions: A summary. By Willy Østreng *

What can we offer? – Russia is optimistic about the future of the NSR. By Nikolay I. Matushenko *

Natural conditions, ice navigation and ship design – pushing the limits. By Lawson W. Brigham *

NSR activities – Environmental assessments. By Kjell A. Moe *

The NSR’s commercial potential and restraints. By Michael Tamvakis *

Strategic, legal and political implications of international shipping on the NSR: A summary. By Willy Østreng *

Presentation of INSROP’s simulation study of NSR shipping. By Hiromitsu Kitagawa *

The chosen simulation routes and their ice conditions. By Vladimir Vasilyev *

Legal and environmental evaluation of selected routes along the NSR. By Gennady N. Semanov *

Results of the simulation study: Under which scenario is NSR navigation economically feasible? By Kazuhiko Kamesaki *

Transiting the Northern Sea Route: Shipping and marine insurance interests. By Edgar Gold *

Potential for transit operations on the Northern Sea Route. By Trond R. Ramsland *

Development of marine transport of Russian gas to the EU. By José L. Anselmo *

The NSR tariff System – Present practice and future requirements – The ARCDEV experience. By Ivan Ivanov *

Will Russia’s Arctic oil be exported by sea? By Asbjørn Sæbøe *

The real face of NSR shipping. By Alexander P. Ushakov *

Human resources: Will there be a need for specially trained Northern Sea Route seafarers? By Anders Backman *

Suggestions for future NSR shipping based on NSR experience. By Juha Säävälä *

A foreign company’s view of NSR technology and infrastructure – Perceived problems and uncertainties. By Makoto Shinagawa *

Russian ice information services in the future. By V. Smirnov, I. Frolov, V. Grishchenko and E. Mironov *

Future development of NSR ship design – Technology and price. By Kimmo Juurmaa *

The Murmansk region - Russian northern gateway to the Arctic. By Yury A. Yevdokimov *

What does the shipping industry expect as to administration of the Northern Sea Route? By Ronald Bergman *

The future structure of NSR administration and operations. By Anatoly G. Gorhkovsky *

Financing of the NSR infrastructure: Russian resolve and possible international contributions. By Robert N. North *

The Arctic environment and the indigenous peoples. By Alona A. Yefimenko *

The legal regime of the NSR – A US/Russian dispute with a potential to stop foreign ships. By Douglas Brubaker *

INSROP GIS. By Stig Magnar Løvås and Odd Willy Brude *


 Introductory Note

 This issue contains a compilation of summaries of plenary session speeches for the Northern Sea Route User Conference in Oslo, Norway, 18-20 November 1999. All summaries received by 8 November 1999 have been included here. The Conference Secretariat, which has prepared this issue, wishes to point out that the papers reproduced are in their preliminary, summary versions only and thus not suitable for scholarly citation. Very little editing of the summaries has been undertaken by the Conference Secretariat. Apart from some English language corrections and some technical interventions, the Executive Summaries are reproduced in the contents as received from the authors. The main purpose of this Executive Summaries issue is to assist the Conference participants in their preparations for discussion, as well as to provide basic information on the contents of the Conference for all those interested.

The full text of all the papers presented at the Conference, incorporating necessary revisions in order to reflect the outcomes of the Conference, will be published in the Conference Proceedings which will be edited by the Conference Secretariat in the aftermath of the Conference.

Conference Secretariat

Lysaker, 8 November 1999


Presentation of the Conference Organizers


The Fridtjof Nansen Institute (FNI) is an independent research foundation. Established in 1958, it is located just outside Oslo at Polhøgda, once the home of the famous Norwegian polar explorer, statesman, scientist and humanist Fridtjof Nansen. The Institute is engaged in applied social science research on international relations and international law, especially on issues concerning resource management, energy and the environment. Study of ocean policy and law, as well as Arctic and Russian affairs, has traditionally ranked high on the Institute’s research agenda. The Institute co-operates extensively with other research and academic institutions, in Norway and abroad.


The Ship & Ocean Foundation (SOF) is a private, non-profit organization dedicated to the research and development of shipbuilding/marine technology, and to the distribution of information on maritime topics. It was established in 1975 and is currently committed to a broad range of activities. Even though its total staff numbers less than 30, SOF is considered to be one of Japan’s most important private foundations. SOF is organized into three main departments: Shipbuilding Technology Research, Marine Technology Research, and Marine Environmental Research. SOF also has an International Affairs Division which promotes collaboration in the fields of shipbuilding and international transport.


The Central Marine Research and Design Institute (CNIIMF) was established in 1929, and is a major scientific organization of the Russian Federation in the Marine transport area. CNIIMF has at its disposal highly skilled specialists, up-to-date laboratories, and experimental and appropriate computer engineering and graphics faculties. CNIIMF’s main areas of research include Arctic shipping, satellite navigation, ship architecture and sea transportation safety, and the institute also carries out declaration and certification of goods. CNIIMF experts participate actively in several international organizations such as IMO and different EU and European Commission Committees. In 1998 CNIIMF was granted the Certificate of Quality System Conformity with ISO 9001:9004 requirements and in 1999 the Institute passed successfully the Ministry for Science and Technology’s state accreditation as a scientific organization.

Presentation of the International Northern Sea Route Programme (INSROP) 1993 – 1999


INSROP (International Northern Sea Route Programme) has been a 6-year international research programme designed to create an extensive knowledge base about the shipping lanes along the coast of the Russian Arctic from Novaya Zemlya in the west to the Bering Strait in the east. This route was previously named the Northeast Passage, but is now known as the Northern Sea Route (NSR).

The NSR represents an up to 40% saving of distance from Northern Europe to Northeast Asia and the northwest coast of North America compared to southerly sea routes via Suez or Panama. The NSR may also prove instrumental in connecting the Russian Arctic with the rest of the world. The NSR was officially opened by the government of the Soviet Union to international shipping on 1 July 1991, but has so far not been utilized commercially to a significant degree by non-Russian vessels.

The most obvious obstacles to commercially viable shipping in the NSR are the harsh natural conditions, including ice most of the year. Even though modern technology can overcome such practical difficulties, the investments needed to build a fleet of adequate ice-classified cargo vessels are staggering. An equally big problem, is for Russia to muster the political and economic strength needed to maintain a stable, well-functioning infrastructure along the NSR.

INSROP’s objective and research philosophy

The research policy of INSROP has been that one must be well aquainted with the scope of environmental, human, cultural and political parameters before the route is exposed to a sharp increase in use. The users of the route must have a common knowledge base and understanding upon which to draw in order to keep problems to a minimum and optimize the advantages to be gained by using the route.

However, it has not been the task of INSROP to legitimize an increased use of the NSR based upon economic interests, or for that matter a closing of it based on environmental interests. Such decisions are entirely up to the Russian government at any time. INSROP's task has been to build up a scientifically based knowledge foundation encompassing all relevant aspects of this problem complex to enable public authorities and private interests to make rational decisions based upon scientific insight rather than upon mythology and insufficient knowledge.

INSROP’ history

INSROP's Phase 1 took place in 1993-95. After an independent evaluation by an 8-member international evaluation committee of scientists, it was decided to carry out a two-year Phase 2 in 1997-99.

The research has been organized in four sub-programmes:

I Natural Conditions and Ice Navigation

II Environmental Factors

III Trade and Commercial Shipping Aspects

IV Political, Legal and Strategic Factors

Phase 1 resulted in 112 peer reviewed INSROP Working Papers as well as the hardcover volume (Northern Sea Route; Future and Perspective) – the proceedings of the INSROP Symposium Tokyo '95.

In INSROP Phase 2, a numerical simulation of NSR sailing based on different scenarios has been carried out, digitized information about the NSR in the form of an INSROP Geographical Information System (GIS) has been assembled, an Environmental Atlas of the NSR has been published, and a book (The Natural and Societal Challenges of the Northern sea Route – A Reference Work) based on the analysis and integration of five years of multidisciplinary research has been presented. In addition, INSROP Phase 2 has produced another 55 peer reviewed Working Papers. Final conclusions and recommendations, as well as the INSROP GIS database, were published in early 1999, and will be presented at the Northern Sea Route User Conference in Oslo 18-20 November 1999.


INSROP’s Main Conclusions

The main conclusion of INSROP’s research is that in spite of climatic, technological and political restraints, an increase in international commercial shipping is feasible – in economic, technological and environmental terms.

INSROP’s survey of the main cargo-generating regions at the western and eastern ends of the NSR (NW Europe, NE Asia and the North American West Coast) has identified a stable transit cargo potential, most notably for dry bulk such as mineral fertilizers and fabricated metals. An even more obvious cargo potential is found in the huge oil and gas reserves in the Russian Arctic – both onshore and offshore – and calculations show that for many of the fields, marine export will be preferable to export by pipelines. Calculations comparing the NSR with Suez have also identified several scenarios in which the NSR will be the most profitable alternative, provided that Russia adopts a reasonable tariff policy for the route.

The technology needed for building operationally and environmentally safe ice breaking cargo vessels is within reach, even though a development towards less costly technology and larger ship types is required. Ecologically vulnerable areas, as well as areas of special importance to local indigenous peoples, have been identified and mapped, and may largely be avoided.

The main problems which will need to be solved before the NSR’s potential can be fully utilized, are on the political level. Continuing economic and political turmoil makes it difficult for Russia to raise the necessary investments towards upgrading and maintaining an adequate infrastructure for the NSR. It has so far also prevented Russia from establishing a stable, competitive tariff regime.


INSROP’s Organization

The three principal partners are Central Marine Research and Design Institute (CNIIMF), Russia, Fridtjof Nansen Institute (FNI), Norway; and Ship & Ocean Foundation (SOF), Japan.

More than 450 researchers from 14 countries have been involved in the programme.

The highest official body of INSROP has been the Steering Committee of Sponsors (SCS) with representatives of Russian, Japanese and Norwegian sponsors. Under the SCS has been the Joint Research Committee (JRC) consisting of representatives from the three principal cooperating partners CNIIMF, SOF and FNI, also including scientific experts. The JRC has drawn up the guidelines for INSROP, decided what projects to implement; and finally continuously monitored INSROP from both a scientific and financial perspective.

The INSROP Secretariat has been located at FNI, and has carried out the decisions of the JRC.

INSROP has been sponsored by: The Nippon Foundation/Ship & Ocean Foundation, the Russian Federation, The Research Council of Norway, the Royal Norwegian Ministry of Foreign Affairs, the Royal Norwegian Ministry of the Environment, the Royal Norwegian Ministry of Industry and Trade, the Central and Eastern Europe Programme, the Norwegian Industrial and Regional Development Fund, Phillips Petroleum Company Norway, the Norwegian Shipowner's Association, Kværner, Norsk Hydro and the Fridtjof Nansen Institute.


Notes on Speakers and Panellists

José L. Anselmo has worked in the transport field for 25 years. In 1992, he joined the European Commission’s General Directorate VII (Transport), where he became Head of the Sector for Research and Development in waterborne transport. In 1998 he was promoted to Head of Unit, responsible for Research and Development for Modal Transport (air, rail, road and waterborne).

Anders Backman is a Master Mariner. He has been Head of the Ship Management and icebreaking Department of the Swedish Maritime Administration since 1 September 1999. He sailed onboard icebreakers and salvage vessels 1962–77, and was Project Manager for the icebreaker Oden 1986–88. He was the Master of the Oden during its Arctic expeditions of 1989, 1990, 1991 and 1996, including the 1991 voyage, when the Oden was the first non-nuclear vessel to reach the North Pole. A second visit to the Pole took place 10 September 1996. During 1997–99, he was responsible for the IB 2000 project, involving the construction of three vessels for offshore and icebreaking service in Norway.

Ronald Bergman is Chairman of Nordström & Thulin (N&T), Stockholm, previously President of the Baltic and International Maritime Council (BIMCO). He is Director of Nordisk Skibsrederforening, the Swedish Lifeboat Association, Lloyd’s Register General Committee and the Nautical Museum Association in Stockholm. He worked in shipping in London 1949–54 and then joined N&T, which now controls a 4 mill. dwt tanker and bulk-carrier. After merger with Argonaut, the group is now known as N&T Argonaut. N&T has been an owner-member of BIMCO since its foundation in 1905. Mr. Bergman has been a member of BIMCO’s Board since 1993 and joined the Executive Committee a year later.

Lawson W. Brigham is a researcher and doctoral candidate at Scott Polar Research Institute, University of Cambridge. A US Coast Guard officer from 1970 to 1995, towards the end of his career he served as head of strategic planning in Washington and captain of the icebreaker Polar Sea on Arctic and Antarctic expeditions, including an Arctic Ocean crossing in l994. Captain Brigham has published widely on the Northern Sea Route, polar science and technology, and ice navigation. He has been a research fellow at Woods Hole Oceanographic Institution and associate research professor at the US Naval Postgraduate School. He is also the editor of The Soviet Maritime Arctic (1991).

Douglas Brubaker is a Senior Research Fellow at the Fridtjof Nansen Institute, where he was a Project Manager for INSROP between 1993–98. He is the author of Marine Pollution and International Law: Principles and Practice (1993) and is preparing a monograph on Russian Arctic waters in international law. He has published several articles on these subjects and has lectured in international law, law of the sea, human rights and indigenous rights at the University of Tromsø, Norway.

Odd Willy Brude is a physical geographer and works as an environmental advisor at Alpha Environmental Consultants. His work has been focused on geographical information systems, environmental data analysis, remote sensing and lately also on environmental impact and risk assessments. He participated in INSROP 1995–99, where he was one of the developers of the INSROP GIS.

Emil Aall Dahle is at present Senior Principal Surveyor at Det Norske Veritas, where he is mainly working with risk assessment of shipping and offshore activities in Norway and elsewhere. He is educated as a Naval Architect, and holds a Degree in marine hydrodynamics from the Technical University of Norway, where he was also Professor in Naval Architecture for several years. Dahle is also educated as a Master Mariner, and is occasionally sailing as deck officer.

Alexander Evai is an ethnic Nenets from the Yamal district. He graduated in 1978 as a Construction Engineer from the Tyumen Engineering-Construction Institute. He is presently Chief of the Goskomsever (State Committee for the North) Regional Department in the Yamalo-Nenets Autonomous Region, as well as Chairman of the Autonomous Region’s RAIPON branch. He is also President of the "Yamal for the Future Generations" Association.

Bruce Farthing was Consultant Director of the International Association of Dry Cargo Shipowners (Intercargo) 1983–August 1999, and remains an advisor. Previously, he has held positions as Deputy Director General of the Chamber of Shipping (1976–83), Rapporteur of the International Chamber of Commerce’s Maritime Transport Commission (1976–96), Secretary of the Committee of European Shipowners (1967–74) and Secretary General of the Council of European and Japanese National Shipowners Association (1974–76). Current obligations include service on various Corporation of London committees, and the Chairmanship of the "Maritime London" group, promoting London as the World’s Maritime Centre.

Edgar Gold is Professor of the Oceans Institute of Canada and Dalhousie University, and a specialist of international marine and environmental law and policy, maritime training, and international ocean development. He is a former Senior Partner with the law firm Huestis Ritch in Halifax and a former President of the Canadian Maritime Law Association. He is a Master Mariner and served for 16 years, including several years in command. He was Supervisor of the INSROP marine insurance sub-project (1993–99). He has over 250 publications in the maritime law and policy field.

Anatoly G. Gorshkovsky is currently Head of the Russian Ministry of Transport’s Northern Sea Route Administration (NSRA). He graduated from the Leningrad Admiral Makarov State Marine Academy in 1972, and entered Murmansk Shipping Company (MSCo) the same year. In the period 1972–96, he served onboard several of MSCo’s diesel-electric and nuclear icebreakers, including postings as Captain of the nuclear icebreakers Rossiya (1986–88) and Sovietskiy Soyuz (1988–96). From 1996 to 1999 he was manager of the MSCo’s Icebreaker Service Department before leaving the company in order to take up his present position in the NSRA.

Ivan Ivanov has worked with Neste/Fortum since 1991, first as a Navigator, later as a Vetting Inspector, and since 1997 as Operational Superintendent for Fortum Oil & Gas, Shipping (formerly Neste Shipping). He is also Project Manager of the ARCDEV project. He graduated in 1981 from the Marine Academy in Varna, Bulgaria, with a Master’s Degree. Since 1985, he has lived in Finland, and has completed higher education at the Institute of Navigation and Seafaring and the Higher Professional School, Marine Department, qualifying as a Finnish Merchant Marine Captain. He has served as Navigator and Captain in the Bulgarian and Finnish Merchant Marines.

Kimmo Juurmaa graduated from the Helsinki University of Technology as a naval architect in 1973. His whole professional career has been related to Arctic R&D and construction of Arctic vessels. He started as research engineer at the Wärtsilä Ice Model Basin in 1972. During 1982–91, he was project manager for nuclear icebreakers built in Finland, and was responsible for the development, design and construction until the end of their guarantee period. Since 1992 he has been Manager of the Arctic Technology Group of the Kvaerner Masa-Yards Inc. He has published several articles dealing with Arctic development.

Kazuhiko Kamesaki is a trained Naval Architect and has worked with NKK Corporation since 1976, specializing in ice engineering topics. He is currently Head of the Ship and Marine Structure Laboratory at Tsu, Japan. He was engaged in INSROP during 1993–98 and has been a part-time lecturer at the Naval Architecture and Offshore Engineering Course at Osaka University (1997–98). He is also a member of the Society of Naval Architects of Japan and the International Ship and Offshore Structures Congress, Specialist Committee on Structural Design against Ice Loads.

Hiroyasu Kawai is currently Senior Research Supervisor at Ship & Ocean Foundation in Tokyo. He is a graduate of Naval Architecture from the University of Osaka. In 1978, he entered the Japanese Ministry of Transport, where he has held several positions, including the post as Planning and Cooperation Officer in the Shipbuilding Division’s Maritime Technology and Safety Bureau. For two years, he also worked for the Shipbuilding Research Institute of Japan. Furthermore, he has been Director of the Science and Technology Agency’s Nuclear Materials Transport Office, as well as Director of Japan External Trade Organization’s Ship Department in Paris.

Hiromitsu Kitagawa is Professor at the Ice and Snow Technology Laboratory, Graduate School of Engineering, Hokkaido University. He has previously held positions as Director General of the Japanese Ministry of Transport’s Ship Research Institute (1993–94) and President of the Shipbuilding Research Centre (1995–96). He was also the coordinator of all Japanese projects under the INSROP programme (1993–98). His main areas of work include ship hydrodynamics and ice and snow engineering. He has published more than 100 technical papers in Japan and abroad.

Eisuke Kudo is presently the Managing Director of Ship & Ocean Foundation in Tokyo. He is a graduate of Naval Architecture from the University of Osaka. He joined the Japanese Ministry of Transport in 1970, and his postings in the Japanese civil service have include the positions as First Secretary at the Embassy of Japan in the UK (1982-85), Director of the Safety Standard Division’s Maritime Safety and Technology Bureau (1991-95), Commander of the Maritime Safety Agency’s 8th Regional Maritime Safety Headquarters (1995-97) and Director General of the same agency’s Equipment Technology Department (1997-1999).

Jan P. Larsen is educated as a Master Mariner in the Norwegian Merchant Marine Academy. Following service as deck officer, he joined the P&I-club Gard of Arendal, Norway, in 1966. He has served as Director of both the underwriting and claims sections of Gard, lately with emphasis on collision cases and major marine casualties.

Stig Magnar Løvås has been Research Scientist at SINTEF Civil and Environmental Engineering, Trondheim, since 1987. He is currently on leave for a Ph.D. Scholarship at the Norwegian University of Technology and Science, to be completed in year 2000. His areas of competence include software development, data analysis, geographical information systems (GIS), remote sensing, laboratory and field experiments, especially in connection with sea ice and icebergs. He participated in INSROP 1994–98, where he was one of the developers of the INSROP GIS.

John C. Lyras is a Director of Paralos Maritime Corporation and has been involved in shipping since 1975. He is the President of the Union of Greek Shipowners, where he also serves as Chairman of the Foreign Affairs Committee. He is a former president of the European Community Shipowners’ Associations and also a founding member and board member of the Hellenic Marine Environment Protection Association. A former vice-president of the International Chamber of Shipping, he served on the Executive Committee for eight years, and is currently a member of both the American Bureau of Shipping’s Greek Technical Committee and Lloyd’s General Committee.

Nikolay I. Matushenko is currently Head of the Russian Ministry of Transport’s Marine Policy Department. Until 1999, he worked with the Murmansk Shipping Company (MSCo). He entered the company as a navigator, and served in various positions on several vessels before reaching the rank of Ship Captain. He was thereafter assigned to work in the MSCo’s main administration, and has held positions both as Managing Director and Chairman of the Board.

Arild Moe is Deputy Director of the Fridtjof Nansen Institute. He graduated as a political scientist from the University of Oslo.His main area of research is the Russian energy sector, in particular the oil and gas industry. His recent research has focused on the reorganization of the industries. Other areas of research include the European gas market, with particular emphasis on Russia’s role, and studies on the development of Norwegian policy in the Arctic. He is the author and co-author of several books and articles on these issues, and has also written on regional issues within INSROP.

Kjell A. Moe is a marine biologist and Senior Advisor at Alpha Environmental Consultants. He was the Norwegian coordinator of INSROP’s sub-programme on environmental factors 1993–98. His main areas of competence include monitoring and pollution research on marine ecology, combined with impact and risk assessments of industrial development. Focal issues include implementation of results from laboratory, mesocosms and field studies on marine pollution in environmental management strategies and geographical information systems. He has experience from projects in the Norwegian coastal waters, the North Sea, the Barents Sea, China, India, the Baltic states, Russia, Azerbaijan and Georgia.

Robert N. North is Associate Head and Associate Professor at the Department of Geography, University of British Columbia. His main areas of work include the geography of Russian transport (especially Siberia and the Russian Far East) and Russian regional economic development. He has written several books on these topics, including Tsarist and Soviet Development (1979), and Russian Transport: Problems and Prospects (1996).

Antony S. Nunn is currently the International Union of Marine Insurance’s Liaison Officer to the International Maritime Organization. After service in the British Royal Navy, he joined the Marine Insurance Company Ltd. and thereafter gained experience in both Lloyd’s and Company markets as marine underwriter and finally General Manager of an Institute of London Underwriters (ILU) company. He has been Chairman of the Institute of London Underwriters (1982–83), Chairman of the Joint Hull Committee (1984–87), Chairman of IUMI’s Ocean Hull Committee (1984–91), Chairman of Salvage Association (1990–92), and Government and International Affairs Advisor to ILU (1992–97).

Gail Osherenko is a senior fellow of the Institute of Arctic Studies at Dartmouth College, in New Hampshire, US, and is currently a visiting research fellow at the Fridtjof Nansen Institute. During 1993-99, she supervised the project on indigenous peoples for INSROP. Her newest book is Siberian Survival: The Nenets and Their Story, coauthored with Andrei V. Golovnev. She is also co-author with Oran Young of Polar Politics (1993) and The Age of the Arctic (1989). Her work focuses on indigenous rights, natural resources and environmental law and policy in the Arctic.

Willy Østreng is Professor in Political Science at the Norwegian University of Science and Technology in Trondheim. He has been Director of the Fridtjof Nansen Institute since 1978, and is currently on leave for two years. He headed the Secretariat and the Joint Research Committee of the International Northern Sea Route Programme (INSROP) 1993–99, and has published more than 120 scientific works on Northern security, resource management and polar and oceans policy. Most recently, he has edited National Security and International Environmental Cooperation in the Arctic: The Case of the Northern Sea Route (1999) and Order for the Oceans at the Turn of the Century (1999).

Vsevolod I. Peresypkin has been the Director of Central Marine Research and Design Institute in St. Petersburg since 1986. He graduated in 1954 from Admiral Makarov State Marine Academy, and worked during 1954–86 with the Russian State Hydrographic Office, heading several expeditions to the Arctic and other regions. He has led research on the substantiation of Russian state marine transport policy. He has participated in IMO work since 1969, and has been vice-chairman of IMO’s MSC NAV Sub-Committee since 1988. He is a member of the Academies of Transport of Russia and Ukraine, and of the International Academy of Regional Cooperation. He has published over 70 scientific articles and three monographs on hydrography, oceanography, navigation and safety of navigation.

Trond R. Ramsland holds an MSc and is currently working as an independent consultant with Synergy Research in Bergen, Norway. He has previously worked with the Norwegian Foundation for Research in Economics and Business Administration (SNF), and has also served several years as an officer in the Royal Norwegian Navy. He has been involved in INSROP since Phase 1, and has authored 10 INSROP Working Papers on trade and commercial shipping aspects.

Vyacheslav V. Ruksha has been General Manager of the Murmansk Shipping Company (MSCo) since 1998. He graduated as a diploma engineer-electrician from Leningrad Higher Engineering Marine College in 1976, and entered the MSCo the same year. In the period 1976 to 1990 he worked onboard icebreakers, after which he was employed as Manager of the icebreaker Fleet Training Center in St. Petersburg (1990–94). In 1994–98, he was the Technical Director of MSCo’s icebreaker fleet.

Juha Säävälä started his marine career 30 years ago. After graduating from the Institute of Navigation and Seafaring in Rauma, Finland, with a Captain’s degree, he signed up in 1979 as Chief Officer of the M/T Lunni, one of Neste (now: Fortum Oil and Gas) Shipping’s ice-class tankers. Since 1982 he has served as Captain of the M/T Lunni and the M/T Uikku, including several voyages on the Northern Sea Route. His long sailing experience in ice-covered waters of the Baltic and Arctic Seas has made him a specialist in the challenging field of Arctic navigation.

Asbjørn Sæbøe is a Master of Science from the Imperial College in London. He previously worked as a geologist in Spitsbergen, the North Sea and the Middle east. Since 1989 he has been working with generating new projects for Norsk Hydro in Russia, both onshore and offshore in the Arctic regions.

Rolf Sæther is Director General of the Norwegian Shipowners' Association. He is a law graduate from the University of Oslo and has worked several years in various ministries. He joined the Norwegian Shipowners' Association in 1968, became Head of the International Division in 1980 and Deputy Director General in 1985. He was appointed Director General in 1991. He is Vice Chairman of the Norwegian Atlantic Committee, Chairman of Fortum Petroleum, and has taken part in numerous government delegations to international organizations.

Yohei Sasakawa has been the President of the Nippon Foundation since 1989. Under his presidency, the foundation has undertaken several major health, food and education programmes around the world. The Nippon Foundation is also heavily involved in several ship- and ocean-related research programmes, and has been a major sponsor of INSROP. Mr. Sasakawa is also the Chairman of the Sasakawa Pacific Island Nations Fund, the Sasakawa Japan–China Friendship Fund, the Sasakawa Central Europe Fund and the Sasakawa Southeast Asia Cooperation Fund.

Gennady N. Semanov is Head of the Environmental Safety of Marine Transport Laboratory at the Central Marine Research and Design Institute in St. Petersburg. His experience involves 27 years of research and management of environmental projects such as oil-spill combating, contingency planning, risk assessment and port waste management. He was the Russian Coordinator of INSROP’s Subprogramme on Environmental Factors. Dr. Semanov is the creator of 17 inventions and the author of some 100 publications. He is a member of the Russian delegation to IMO, PAME and EPPR Working Groups and to the Arctic Council.

Makoto Shinagawa has worked in the Nippon Yusen Kaisha (NYK Line) since 1973, and has mainly been involved in liner business, tramp business and development of human resources. He has also been posted in Melbourne (1988–92) and in Buenos Aires (1995–98). He is currently General Manager of the NYK Line's Tramp Co-ordination Group, coordinating the activities of various tramp sections.

Vladimir G. Smirnov graduated from the Arctic Faculty of the High Engineering Marine School in 1973 and later held positions as chief engineer, chief of the oceanographic detachment (onboard several research vessels) and senior scientist at the State Oceanographic Institute. At present, he is Head of the Department for Improvement of Ice-Information System at the Arctic and Antarctic Research Institute (AARI) in St. Petersburg. His main areas of work include thermohaline fine structure of deep-water intrusions, remote sensing and development of information systems. He has published in Russia and abroad on satellite monitoring of ice conditions, and various other topics.

Lars Sponheim is the Norwegian Minister of Industry and Trade since 1997. He graduated as a Master of Agriculture from the Agricultural University of Norway in 1981. He was Mayor of Ulvik County 1988-91 and has been a member of Parliament since 1993. He has also been the Leader of the political party Venstre since 1996.

Michael Tamvakis has been, since 1998, Director of the MSc in Shipping, Trade and Finance at City University Business School in London, where he is also a lecturer. He holds a BA in Economics from the Economic University of Athens, and entered City University Business School in 1988. He joined the staff as an ESRC Management Teaching Fellow in 1989, and received his PhD in 1999 after submitting his thesis, An Economic Model of the Iron Ore Trade. He is a member of the Education and Training Committee of the Institute of Chartered Shipbrokers, and External Examiner at Liverpool John Moores University.

Nils Telle graduated from the Norwegian University of Science and Technology in 1962. He worked for 10 years in the design departments of several Norwegian shipyards before he joined the Research Department of the Norwegian Shipowners' Association in 1972. He was appointed head of the department in 1983. He has been a member of the board of numerous national R&D programmes and is a member of the board of the Norwegian Marine Technology Research Institute. He has also had various positions in international research institutions.

Loly G. Tsoy is a Naval Architect and is currently Head of the icebreaking Technology and Ice Performance of the Ships Laboratory at the Central Marine Research and Design Institute in St. Petersburg. His main areas of competence include development and testing of icebreakers/icebreaking cargo vessels and their ice qualities, as well as mathematical modelling of ships movement in ice. He has taken part in 15 Arctic expeditions, and has since 1982 been engaged in cooperative projects with Finnish, German, Canadian and US shipbuilders, authorities and oil companies. He has also participated in the INSROP and ARCDEV programs. He is the creator of 8 inventions and has published more than 120 scientific works.

Alfred Tunik, a graduate in Naval Architecture from the Leningrad Shipbuilding Institute, worked for 20 years at research institutes in Russia, including the Arctic and Antarctic Research Institute. After immigrating to the USA, he worked for 18 years at the American Bureau of Shipping, but left ABS in 1999 to work as an independent consultant. He helped to develop the first Russian Register rules for Arctic Ships, and at ABS, developed the first ABS rules for ice-strengthened ships. He is currently involved in developing the first international rules for polar ships. He has participated several Arctic ship trials, and has published more than 30 works in English on Arctic engineering and ice mechanics.

Alexander P. Ushakov has been the Deputy Head of the Northern Sea Route Administration since 1971. Since 1993 he has also been the Chairman of the NSR Working Group of the Council of the Barents Euro-Arctic Region. He is a graduate of the Arctic Faculty of the Leningrad Admiral Makarov State Marine Academy, and has served onboard the icebreaker Malygin. In the period 1993–98 he was the Russian coordinator of INSROP’s projects concerning legal support of navigation in the Russian Arctic and of problems of safety of navigation along the NSR, and has written several reports on these subjects.

Vladimir Vasilyev is Head of the Navigation Laboratory at the Central Marine Research and Design Institute, where he is also a member of the board. His main fields of competence include safety of navigation, computer simulating and IT methods of mathematical modelling of vessel motion, as well as database programming and management. He is a member of the Russian Ministry of Transport’s Scientific Council. He has written more than 40 publications, both in Russia and abroad, and is the creator of several inventions in the field of marine life-saving equipment.

Hajime Yamaguchi is a Naval Architect and an Associate Professor at the University of Tokyo’s Department of Environmental and Ocean Engineering. His main areas of research are numerical modelling of pack ice rheology, ice engineering for icebreaking ships and ocean structures, applied fluid mechanics on cavitation, and propulsion engineering. He has published extensively on these issues, in Japanese and international journals. In August 1995, he headed INSROP’s Experimental Transit Voyage through the NSR from Japan to Norway aboard the Russian ice-worthy cargo vessel Kandalaksha.

Alona A. Yefimenko is currently a Technical Advisor at the Indigenous People’s Secretariat of the Arctic Council. An indigenous Even from the Koryak Autonomous Okrug in northern Kamchatka, she studied ethnography and philology at the Department of Northern Peoples of Herzen Pedagogical University in St. Petersburg.

Yury A. Yevdokimov is the Governor of Russia’s Murmansk Region. He graduated as a Diploma Engineer-Mechanic from Dnepropetrovsk Polytechnic Institute in 1972. In 1974-1989 he worked as a construction company engineer, then as a Communist Party Leader in the City of Kirovsk and later in the whole Murmansk Region. In 1990 he was elected as Chairman of the Murmansk Region Regional Council of Public Delegates, before being elected as Murmansk Region Governor in 1996.

Welcoming address

By Yohei Sasakawa

Chairman, INSROP Steering Committee of Sponsors;

President, Nippon Foundation, Tokyo, Japan


The Northern Sea Route (NSR), which links Asia and Europe by way of the Arctic Ocean, has the distinct advantage of being only half as long as the corresponding distance via the Suez Canal. The route, however, is blocked with meters of ice for a great part of the year. Only during the short summer months, when its perennial ice barriers allow temporary access, can ships navigate it, escorted by Russian icebreakers. Recent advances in shipbuilding technologies, coupled with the development of new navigation aids like an artificial satellite-supported remote-sensing system, have now improved the prospects of year-round navigation along the NSR.

Such year-round navigation on the NSR would bring immeasurable economic and commercial benefits to the international community. In addition, a commercially viable NSR would invigorate Russian goods transport, making more natural resources from the Russian Arctic available on the world market.

With this in mind, the Fridtjof Nansen Institute of Norway, the Central Marine Research and Design Institute (CNIIMF) of Russia and the Ship & Ocean Foundation of Japan have been working together on the International Northern Sea Route Programme (INSROP) since 1993. Research efforts have focused on the following four themes: (1) natural conditions in the Arctic and ice navigation technology; (2) effects of opening up the NSR upon the natural, biological and social environments of the Arctic regions; (3) the NSR’s economic potential, and (4) the political and legal backgrounds associated with opening up the NSR. A total of 390 eminent researchers and experts from 14 countries joined forces in implementing INSROP. The result is as many as 170 volumes of reports and the creation of the INSROP GIS (Geographical Information System), a database on the Arctic Ocean.

The present conference has been staged so that the results of INSROP as an intellectual property may be shared among a wide range of people working in the areas of international shipping, shipbuilding, trade, insurance and environment protection, as well as government officials responsible for policy-making. I hope this conference will serve as a forum where NSR users and researchers can exchange views as to the challenges the NSR is now facing. Frank discussions will help us develop the INSROP results into a tool which can lead to practical guidelines for commercial shipping on the NSR.

I anticipate that this conference will help to promote greater understanding among the participants so that we may see the NSR opened as a new ocean corridor of the 21st century linking Europe, Russia and Asia. Finally, I would like to conclude by expressing my sincere gratitude to researchers of many countries for their vital contributions to INSROP, and to all colleagues at partner institutions and sponsors in Norway, Russia and Japan.

Introduction to NSR history and INSROP’s background

By Vsevolod I. Peresypkin

Director General, Central Marine Research and Design Institute, St. Petersburg, Russia


The Northern Sea Route (NSR) is a major component of the infrastructure of the economic complex existing in Russia’s extreme north. It is also a link between the Russian Far East and the western areas of the country, uniting the largest rivers of Siberia in a uniform transport network. For some areas of the Arctic zone (Chukchi Peninsula, islands of the Arctic seas and a number of the inhabited localities of the Krasnoyarsk region and Tyumen area) sea transport is the sole mean of maintaining mass-cargo shipping.

Russia has spent huge means and efforts over many generations on the study and development of the NSR. From the beginning of the 16th century, Russian coastal dwellers, hunters, dealers, seafarers, Cossacks and researchers continuously expanded their activities in the coastal areas of the Kara, Laptev, East Siberian and Chukchi seas. The Arctic Region has always attracted researchers, travellers and courageous people. In Russia we remember and mark with gratitude the contribution of foreign scientists in research and discovery in the Russian Arctic Region.

In the 1950s, the reorganization of "Glavsevmorput" began.Ports, air stations, shipping companies, the hydrographic service, the hydrometeorological network, polar aviation, supply services and other enterprises that had been created and equipped by Glavsevmorput were transferred, depending on their functions, to specialized ministries and departments.

As a result of this reorganization, the Arctic sea transport system was generated. It included:

1 a transport fleet;

2 liner and port icebreakers;

3 coastal support services;

4 means of navigation support (navigational-hydrographic, hydrometeorological, air, communication);

5 emergency rescue service, supply bases and maintenance service;

6 divisions managing sea operations, directly in Arctic Region, as well as beyond its borders (the Headquarters of Marine Operations, and the services of the icebreaking fleets of Murmansk and Far Eastern Shipping Companies).

In order to strengthen state supervision of rational use of the NSR and the organization of Arctic navigation, in 1970 the NSR Administration was established. In the following years, active research and experimental work was conducted to improve the conditions of Arctic navigation.Since 1978, cargo transport between Murmansk and the Yenisey river has taken place year-round.

Unfortunately, the negative consequences of various Russian reforms have not bypassed the Extreme North. This has been painfully reflected in all elements of the economic infrastructure, including its transport component – the NSR. The transition to a market economy, privatization of sea shipping companies and ports, liquidation of the state-owned logistics, infringement of regional transport technological communications – all these have brought about the disintegration of a uniform economic mechanism for the NSR. As a result, the volume of shipping in the Arctic Region has fallen greatly.

Under the initiative of the Ministry of the Merchant Marine of the USSR and the Fridtjof Nansen Institute (Norway), in 1988 the conditions were developed for an international pilot research project on the transit transportation of cargo on the NSR. This project was to be carried out on the basis of a bilateral agreement on scientific and technical cooperation between Central Marine Research and Design Institute (CNIIMF) and the Fridtjof Nansen Institute (FNI), with experts from Great Britain, Finland, the USA and other countries. CNIIMF and FNI were selected as the coordinators from the Russian and Norwegian partners.

Work on the pilot project was carried out in 1990–91. This involved the conceptual estimation of the probability of transit navigation of transport vessels on the NSR in an extended sailing season between West European ports and ports of the Pacific Ocean. It also developed the concept and structure of a further international programme which was to become the International Northern Sea Route Programme (INSROP). It was concluded that continued intensive scientific research was necessary.

The search for financing of this programme was not completed until the first half of 1993. The group of sponsors included Norwegian governmental bodies, state organizations, private companies, and the Japanese non-commercial private organization Nippon Foundation/Ship & Ocean Foundation (SOF). The tripartite agreement on cooperation for a three-year period with possible prolongation for two years under the INSROP programme was signed in May 1993. The contract was signed by CNIIMF as the Russian coordinator, by FNI as the Norwegian coordinator and by SOF as the Japanese coordinator. It is symbolic that this agreement was signed in the very house that had belonged to Fridtjof Nansen – the great son of the Norwegian people, famous polar researcher and friend of the people of Russia.

The INSROP programme has had several basic aims. One is to attract the attention of business circles, freighters and shipowners to the NSR and to show how it can be used profitably. Another purpose has been to maintain and to involve the Russian Arctic fleet and icebreakers, as well as maintaining the infrastructure of the NSR and the population of Arctic cities, settlements, polar stations. Furthermore, for Russia to harvest a profit on the operation of this national transport artery.

Yet another important task has been to estimate the potential influence of increased navigation on the environment and indigenous peoples of the Arctic Region. Recommendations have been developed onhow to minimize and mitigate possible negative consequences.

The programme has been financed by equal payments from Norwegian and Japanese sponsors – with the annual budget being more than 10,000,000 Norwegian kroner (NOK). The Russian partner also participated in financing the programme (20–40 thousands of denominated roubles annually), funds provided by the Ministry of Sciences of Russia through the programme "World Ocean" and by the Ministry of Transport of Russia from its budget on research and development of an Arctic sea transport highway. The Russian funding was used exclusively on work carried out by the Russian participants. Managing bodies of the programme were the Steering Committee of Sponsors (SCS), the Joint research Committee (JRC) the International Advisory Group (IAG) and the INSROP Secretariat.

The INSROP programme was carried out in two phases.

The first phase of the programme (1993–95) consisted of four sub-programmes, each of which was headed on equal conditions by Russian and Norwegian coordinators:

1. Natural conditions and ice navigation.

2. Environmental factors.

3. Trade and commercial shipping aspects.

4. Political, legal and strategic factors.

The first phase of the programme concluded with an experimental transit voyage through the NSR from Japan to Norway on the Russian m/v Kandalaksha (ice-class ULA), with participation of experts from Japan, Russia and Canada. In October 1995, an international symposium was held in Tokyo: "NSR: Future and Perspective", organized by SOF together with FNI and CNIIMF within the framework of INSROP. During the symposium, in which some 280 experts from many countries took part, the basic results of the first phase of the programme were summed up.

In 1995 the international diploma "Seatrade Awards" was awarded to the coordinators of the INSROP programme.

In 1996 an evaluation of the Phase 1 results was carried out. The International Evaluation Committee consisted of leading scientists from Denmark, Italy, USA, Canada, Great Britain and Japan. After a careful analysis of the results of INSROP’s first Phase, it was urgently recommended to continue the programme. On the basis of this conclusion SCS and JRC agreed to prolong INSROP for a two-year period (1997–98 – Phase 2). The basic purpose of the second INSROP phase was to make accurate estimates of the conditions of navigation on the NSR, defining the size of risk, including ecological and social influence, expanding the scientific knowledge base about the NSR as a potential international transit highway for transportation of cargo from Europe to Asia and America and back, and also for export of petroleum and gas from the Russian Arctic.

In 1997–98:

The total budget for INSROP 1993–98 has been more than NOK 55,000,000, not counting the additional expenses of SOF in chartering the m/v Kandalaksha and organizing the Tokyo symposium. In addition, Russia has made a financial contribution of 174,000,000 old roubles.

Approximately 470 scientists and experts from 14 countries have taken part in the INSROP programme as researchers or as evaluators. A total of 167 scientific Working Papers have been published. Under the editorship of Professor Willy Østreng, the final INSROP Integration Book has been prepared, integrating all INSROP’s main results and conclusions.

For the legal evaluation of the NSR, the 1998 Russian Federal law "On internal sea waters, territorial sea and adjacent sea zone of Russian Federation" is of major importance. According to Article 14 of this law, "navigation on the routes of the NSR – historically developed as a national uniform transport and communications route of the Russian Federation in the Arctic Region, including the straits of Vil'kitskiy, Shokalskogo, Dmitiya Lapteva and Sannikova – is carried out according to the present Federal law, other federal laws, international treaties of the Russian Federation and rules of navigation on the routes of the NSR confirmed by the Government of the Russian Federation and published in the Notices to Mariners."

The valid "Rules" approved by the Ministry of the Merchant Marine in 1990 proceed from the rules of the UN Convention on the Law of the Sea from 1982 (article 234 on "ice-covered areas "), authorizing coastal states to accept and to enforce observance of non-discriminatory laws and rules on the prevention of marine pollution from vessels. The advised order of access on routes of the NSR of vessels of all states, established by the "Rules", corresponds to opening of the NSR for international commercial navigation. Vessels need to meet special requirements to design, equipment, supply and crew qualifications.

For each Arctic sailing season, the government of Russia has issued an order to open up 70 Arctic ports and loading points for the calls of foreign vessels. In the 1999–2000 season, these will be opened up for foreign vessels on a year-round basis.

Annual cargo potential of the NSR to 2015–2020 is estimated to be as follows:

The INSROP programme has received support at an intergovernmental level. The results of the research carried out by INSROP have allowed all of us to look at the NSR with new eyes. There can be no doubt that the 21st century will be the century of the NSR. We can look forward to the establishment of year-round navigation on the Northern Sea Route, which will bring essential benefits to Russia, to the users and to the world community.

What do we need? The shipping industry’s views on the NSR’s potential and problems

By Rolf Sæther

Director General, Norwegian Shipowners' Association


Our association organizes all the major Norwegian shipowning companies involved in international shipping. One of our tasks is to keep abreast of developments in areas that might represent new business opportunities for our member companies.

Norwegian shipping has long traditions in the Arctic, both in whaling and in commercial shipping. We have therefore followed the INSROP programme ever since the very first initiative taken by the Fridtjof Nansen Institute early in the 1990s.

We found the INSROP proposal interesting. It seemed well organized, and leading experts world-wide were invited to cooperate in INSROP. When we decided to participate, we hoped that the research programme could reveal whether the Northern Sea Route really did represent an interesting business opportunity for shipping, economically and technically. Further we wished to learn more about ice- and weather conditions along the route. Finally we needed to understand what additional know-how we would have to develop to become a quality operator in the area.

Now INSROP is brought to an end. We congratulate the research team on having carried out this programme in such a professional way. And the results are indeed of interest.

The sub-programmes "Natural Conditions and Ice Conditions", "Environmental Factors" and "Political, Legal and Strategic Factors" present results highly salient to us in judging the potential of the NSR. Early on, we announced that our primary interest was the sub-programme "Trade and Commercial Shipping Aspects", which we hoped would indicate the potential for the NSR as an international trade route.

The invitation to this conference states: "INSROP has shown that international commercial shipping on the NSR is feasible – economically, technically and environmentally". We feel you are right as far as technology and the environment are concerned. But we are far from sure that NSR represents an interesting alternative for commercial shipping companies.

The draft restriction is a serious constraint. The draft in the NSR limits ship size to 20–25,000 t DW, whereas the deadweight capacity for ships travelling the ordinary routes are 3 to 4 times as high.

Ships designed for the NSR need extra investment, and this extra investment must show a return on investment to the same extent as other investments for the owners. This would seem difficult, since ships designed for INSROP will travel on this route only 4 to 5 months a year.

Shipping on the NSR is risky, and that fact cannot but influence insurance costs as well.

For these reasons, then, we do not think that, in the immediate future, the NSR will play any vital role as a new sea route influencing world trade. I am then talking of the NSR as a transit route from east to west or vice versa.

On the other hand, INSROP research has yielded very valuable information about the tremendous resources in Northern Russia. Ship transport seems to be the most economic and environmentally friendly way to bring these resources to the markets. Here we are talking about transport from East Siberia eastwards and from western Siberia westwards

Also in this regard there are several conditions that must be fulfilled, even if we are not focusing on the NSR as a transit route. (1) We must have a professional and reliable information service for monitoring and forecasting ice conditions. (2) Icebreaker service has to be improved compared to the present situation. (3) Electronic navigational aids with high reliability must be installed along the route. (4) The fees charged the shipping companies travelling the NSR must be realistic, acceptable and predictable.

This might seem a negative conclusion. But our overall evaluation of the INSROP programme is a positive one. You have done a good job, and you have produced the information we were looking for.

What do we know about the NSR? INSROP’s overall approach and conclusions: A summary

By Willy Østreng*

Professor, Norwegian University of Science and Technology, Trondheim; The Fridtjof Nansen Institute, Lysaker, Norway


INSROP’s approach to the NSR has been designed around two countervailing factors: obstacles to increasing utilization, and factors that promote increasing utilization. To describe these, we have distinguished between two categories of parameters, or factors: natural and societal. The natural parameters – ice, shoals, climatic conditions etc. – are basically inflexible: they have no ability of their own to adjust to changing circumstances. At the outset, these factors represent conditioned obstacles to increasing utilization, in that they have only partly been outwitted by the application of adequate technology, know-how and operational experience. By contrast, the societal parameters – military, legal, political and cultural conditions – are manifestations of government decisions which, in principle, can be altered and/or replaced by new political decisions. As such they are flexible in character, and possess, to a relative extent, the ability to adjust to changing circumstances. In this way societal factors can be seen both as obstacles to utilization and as factors that can promote utilization.

This paper seeks to link together the natural and societal parameters, so as to better address the complexity, distribution, variability, interactional pattern and value composition of the navigational challenges facing the NSR. This we do by identifying geographical areas where the factors multiply, mix, interact and cluster together in aggregations making passage of ships a complex, multi-faceted challenge. These are the aggregated hot spots of the NSR.

The hot spots have their counterpart in the cool spots of the route, i.e. areas hosting just one single navigational parameter (such as ice) to be overcome without violating significantly the values of the parameter in question or the values of associated parameters, for instance environmental interests or the well-being of indigenous peoples. The cool spots are uni-dimensional in two ways: in the number of impediments to navigation involved, and in the number of parameters affected by navigation. Uni-dimensionality reduces the complexity of passage and navigation, but geographical areas involving just one single parameter should not automatically be considered to be cool spots. Some of these areas may host a parameter with a particularly high societal and natural value. These then are the issue-specific hot spots, as opposed to the aggregated hot spots.

The differences between the various categories of ‘spots' should not be misinterpreted to mean that navigation is possible only in the cool spots. The likelihood of passage depends solely on the robustness of parameter(s), whether they appear singly or in clusters. A single ice massif will more than suffice to block effectively the safe passage of any ship, whilst the combined effect of political, legal and cultural factors at work in an aggregated hot spot may not be regarded as enough to impede passage. Thus, aggregated and issue-specific hot spots may feature in two different versions: both as areas accessible to navigation and its associated consequences, and as areas inaccessible to navigation and its associated consequences.

The concept of aggregated hot spots is introduced to highlight the number, quality and value composition of parameters affected by navigation in a specific area. An aggregated hot spot hosts a diversity of values/interests, clustered together into what we have termed socio-biodiversity. This must be treated in a sustainable manner so as to reduce the likelihood of negative political reactions to increased navigation in the future. The sustainability of the socio-biodiversity of these geographical areas may, in the course of time, prove mandatory for the continued Arctic navigation.

In applying this approach to unravel the complex realities of the NSR, the paper addresses the following issue-areas:

One pattern emerges saliently from the discussion: the straits stand out as the most pronounced high-risk navigational areas of the NSR. This conclusion comes as no surprise – in terms of ice and depths, the straits have long been recognized as major trouble spots. What INSROP has shown is that the straits may become the object of much more political interest and opposition than previously acknowledged, and that the only way of mitigating this possibility might lie in developing and implementing a new mode of Arctic navigation.

What can we offer? – Russia is optimistic about the future of the NSR

By Nikolay I. Matushenko

Head, Shipping Policy Department, Russian Ministry of Transport


Revival of the Arctic national transport route is inevitable; furthermore, this will take place under new economic conditions and on a commercial basis. Common public and business interests are the keystone of development of the Arctic sea transport system. The research undertaken during 5 years of INSROP activity has offered to the international community and Russia a new approach to advantages of the Northern Sea Route. Currently this route is the most reliable key to opening the vast natural resources of the Russian North, Siberia and the Far East, the stock of which is forecast to become the major raw-material source of our planet in the 21st century.

To overcome the severe economic crisis in Russia and raise currency revenues, a significant increase of oil and gas export (25–30%) is planned. Such increase is viable, provided that hydrocarbons are extracted in the Northern and Arctic areas. Even according to the most pessimistic estimations, by 2015 the volume of oil and gas export from fields of the Barents and Kara Seas could exceed 20 million tons.

The acquisition of the controlling share in Arkhangelskgeoldobycha by Lukoil Company in 1997, and shares of the Murmansk Shipping Company in 1998, is a very promising indication of the ability of joint industry and transportation capitals to overcome the crisis in the Russian Arctic Fleet and the NSR. As a result, MSC has acquired reliable prospective freight facilities and development opportunities. In September 1999, at the Admiralty Shipyard in Saint Petersburg, the Astrakhan enforced ice-class tanker with a deadweight of 20,000 tons for Lukoil Company was launched. By the year 2000, the fleet of the company will comprise 10 ice-class tankers. Construction of ice-class tankers of 55,000 tons displacement is being investigated.

The growth in volumes of Arctic transportation up to 10 million tons determines the payback of costs for maintenance of the MSC icebreaker fleet with the average icebreaker fee of $5–$7/t. In addition to prospective transportation of large volumes of hydrocarbons to the West, the current annual sea export of metals and fertilizers to Southeast Asian countries, including China, through Northwest Russian ports exceeds 3 million tons, of which 1 million passes through the port of Murmansk. Almost all of this is by non-Russian ships.

The NSR is the shortest and the cheapest direct sea transit route linking the economic centres of Europe and the Asia-Pacific region. According to UN data, the potential freight load for the transit through the NSR is estimated to 7.6 million tons. The high efficiency of transit by the NSR has been proved by the scientific-commercial trip – Yokohama–Kirkenes (Norway) – by the Russian Kandalaksha in August 1995. During summer-autumn navigation (June to November), the NSR shortens trip time up to 10 days as compared to the Southern Sea Route. An icebreaker fee rate of $5–67t guarantees additional profit up to $250 for transportation of one container, and up to $10 per one ton of cargo. For passage of one foreign vessel, Russia can receive revenues of up to $100,000.

In August 1999, at the level of the Russian Federation Government, the task for developing the project 'Complex Development of the Northern Sea Route and Its Commercial Operation' was formulated. The basic idea is to develop, in the process of vitalization of the economy of the Arctic area and complex development of the NSR, a self-supporting Arctic sea transport system controlled by the state. The Technical Specification for project development prepared by CNIIMF in September was submitted for consideration and coordination to involved ministries, agencies and executive bodies of the Russian Federation entities with its further approval.

The basic elements of this fundamentally new approach to complex development of the Northern Sea Route are as follows:

The system of tariffs and dues for vessels sailing on the NSR is being improved to ensure profitability in comparison to the southern sailing route via the Suez Channel. The recently prepared 'Rules on dues for NSR sailing' have been submitted to the state authorities.

The primary objective of the project is to substantiate construction of the new generation of icebreakers and icebreaking transport vessels, capable of ensuring on-schedule, full-volume transportation by the Northern Sea Route.

Recently, CNIIMF in cooperation with MSC has prepared and submitted to the RF Ministry of Transport the analytical memorandum to substantiate the needs of the icebreaker fleet till the year 2025 with estimation of efficiency of capital investments. Work has commenced on a feasibility study for the construction of four new nuclear-powered icebreakers.

Simultaneously, the modernization of the existing icebreaking fleet will be undertaken to prolong the vessels’ operational life by several years. This will make possible a longer Arctic navigation season for import/export and transit cargo up to year-round navigation.

Usage of high-latitude routes – the 'Arctic Great Circle Route' – is meant to provide not only shorter transit NSR sailing distance, but also year-round sailing for large-tonnage vessels.

Implementation of the Programme will ensure a strengthening of the geopolitical and strategic role of the Northern Sea Route in the economic revival of the North, and of Russia in general.

Natural conditions, ice navigation and ship design – pushing the limits

By Lawson W. Brigham

Scott Polar Research Institute, University of Cambridge, UK; Captain, US Coast Guard (Retired)


Three practical aspects of the Northern Sea Route (NSR) were reviewed within INSROP’s Sub-Programme I ("Natural Conditions and Ice Navigation") and Phase 2 simulation study – the natural environment (including sea ice distribution, geographical setting and regional climate), ice navigation (including charts, routes, aids to navigation, communications and convoying), and Arctic ship technology. 58 of 167 INSROP Working Papers contain a wealth of key information regarding these broad topics that are critical to the NSR’s future. Sea-ice data for the Russian Arctic coastal seas were provided primarily in the form of summarized historical records of the Arctic and Antarctic Research Institute (AARI) in St. Petersburg. Other important Russian contributions include general NSR geography and routing, ice escort techniques, ice information systems, NSR regulations, historical ice damage to NSR ships, and NSR communication and navigation systems (see figures 1 and 2 for recommended NSR routes during winter and summer). Most of this specialized information has never been available outside Russia. INSROP studies on Arctic ship technology and design were conducted by both Russian and non-Russian engineers and ship designers. INSROP Working Papers also provide essential information in four areas that will facilitate NSR decision-making: the extent and thickness of sea ice in all regions of the Russian Arctic; the constraints on Arctic ship design imposed by the NSR; current and future ice information, particularly enhancements provided by satellite remote sensing; and, key NSR operational procedures and experiences of Russian mariners.

Sea ice covers the length of the NSR in winter with extensive fast ice found along a majority of the coast. Thick, first-year ice is the dominant ice type in the region and INSROP analyses of the Russian historical record show that no NSR region is completely ice free in summer (see Table 1 with historical sea ice data for NSR ice-free regions). January mean ice thicknesses for all NSR regions are 150 cm or less, while late winter thicknesses of 200 cm have been observed in the eastern Laptev Sea and western East Siberian Sea. Three regional ice massifs (stable, regional ice clusters) impact directly on NSR navigation – Severnaya Zemlya massif (northeastern Kara Sea and Vil'kitskiy Strait), Taymyr massif (western Laptev Sea), and Ayonskiy massif (Long Strait and the East Siberian Sea). AARI maintains an extensive, automatic ice information system that readily supports NSR navigation; Russian as well as non-Russian satellite data are now integrated into AARI’s ice and meteorological forecasts. Demonstrations during INSROP have shown the value of synthetic aperture radar (SAR) images of sea ice for NSR operations. However, a gap in SAR coverage for the central region of the NSR requires the addition of a receiving station to complement the coverage of stations in Tromsø, Norway, and Fairbanks, Alaska.

The geographical setting of the NSR – broad, shallow continental shelves with numerous, shallow straits – presents significant constraints to large ship navigation. For example, Dmitriy Laptev Strait and Sannikov Strait (both through the New Siberian Islands) have minimum depths of 6.7 and 13 m respectively. In contrast, routes that avoid the straits of the northern island groups require navigation through areas of difficult, multi-year ice. If commercial ships plan to call on ports along the Siberian rivers, an additional shallow water design constraint must be addressed. Since the ARKTIKA class ships (28 m breadth) will remain the primary escort icebreakers in the near future, a design limitation of 30 m maximum breadth was adopted in INSROP research on future ship designs. Thus, if a cargo ship is calling on NSR ports, draught and breadth are limited to 9 m and 30 m (cargo capacity will be 20,000 dwt). For more northerly routes, ships designed with a 12 m draught and 30 m breadth (50,000 dwt capacity) can be accommodated (see Figure 3 for a 40,000 dwt design). Today, mandatory escort of all ships is required in Vil'kitskiy, Dmitry Laptev, Sannikov and Shokalskiy straits. In summary, new Arctic ship designs for the NSR must take into account the unique geography of the region and any restrictions imposed by the methods of icebreaker escort (or convoying) employed.

Two icebreaking cargo ship classes currently operating on the NSR – the Russian-flag (Finnish-built) Norilsk class SA-15 bulk carriers and the Finnish-flag (Finnish-built) Lunni class tankers – provide unique benchmarks, or prototypes, for future NSR commercial ships. Both ship types are capable of independent operations (without icebreaker escort) along sections of the NSR in summer. Comprehensive assessments of the icebreaking capability and hull strength of both ship classes are available in INSROP Working Papers. For example, key operational performance data on the SA-15 ships are now published: the SA-15s can move continuously through 80 cm ice at 5 knots; SA-15s have attained 11–13 knot average speeds along the NSR in summer (July to October); during winter voyages with Arktika class escort, SA-15s have attained average speeds of 6–8 knots; and, with Arktika class escort in heavy ice of 2 m thickness, 2 knot speeds have been achieved. INSROP simulation research has also added to fundamental information on future NSR operations by providing estimated average ship speeds: for new ship designs 4–7 knot average speeds in winter (with substantial ice escort) and 9–14 knot average speeds in summer (August to October with minimal escort) may be possible. Complementing such ship speed data have been Russian historical records of ice damage to NSR ships analysed in INSROP reports. Significant hull damage has occurred during NSR operations particularly in the East Siberian and Chukchi seas. The frequency of hull damage in all NSR regions will influence the design of future NSR carriers and be a key factor in the insurance industry’s evaluation of the NSR.

A synthesis of INSROP information from Sub-Programme I points to a clear distinction between the eastern and western operating regions of the NSR. For key reasons – such as a colder regional climate, more severe ice conditions and a confining geography – the Arctic coastal region from Vil'kitskiy Strait east to Bering Strait is one of the most challenging ship operating environments on the planet. The length of the navigation season in this region has traditionally been July through October, although sea ice reductions during the l990s (primarily in the East Siberian Sea) have allowed a modest extension of ice navigation through November and on occasion into December. A 150-day navigation season is currently feasible. Contrasted with this extreme situation is the effective, year-round Arctic marine operation maintained to Dudinka (across the Kara Sea to the Yenisey River) since the late 1970s. Continued warming in northern Eurasia and throughout the Arctic may in compelling ways change this divided picture of the NSR.

The Russian maritime Arctic presents unique challenges to marine operators and to modern technology. To summarize, this key part of the INSROP effort integrates a triad of practical factors linked to Arctic marine transportation – knowledge of the polar operating environment, the ice navigation practices used in the region, and the type of commercial ships envisioned for any future ice routes. With this fundamental information readily available, appropriate projections, planning and risk assessment can be accomplished to determine the plausible limits to commercial ship operations along the NSR.

Fig 1: Recommended shipping routes along the Northern Sea Route during winter (November to May).

Source: INSROP Working Paper 108



Fig 2: Recommended shipping routes along the Northern Sea Route during summer (June to October).

Source: INSROP Working Paper 108


Table 1: Summer Ice-free Regions Along the NSR (% of Region’s Total Area that is Ice-free)

End of Month

Region June July August September

Southwest Kara 17 40 85 95

Northwest Kara 0 18 41 53

Western Laptev 10 24 45 51

Eastern Laptev 10 33 69 80

Western E. Siberian 0 10 31 49

Eastern E. Siberian 0 6 17 27

Southwest Chukchi 27 57 75 85


Fig 3: INSROP design for a 40,000 dwt icebreaking bulk/container ship.


NSR activities – Environmental assessments

By Kjell A. Moe

Senior Advisor, Alpha Environmental Consultants, Oslo, Norway


From the very beginning, the INSROP Sub-programme II: Environmental Factors (1993–98), aimed to develop the foundation of environmental assessments with regard to NSR activity (Moe & Semanov 1999). Faced with the transitional state of Russian environmental management strategies during the 1990s, a need for a flexible approach was recognized early on. One-off solutions should be avoided, re-use of the findings should be emphasized. Consequently, effort has focused on two main components:

The integration of these two, through the NSR Environmental Assessment & Planning System, makes the INSROP EIA complementary to basic elements in Strategic Environmental Assessment. The results of the study – the baseline of the temporal and spatial distribution of vulnerable natural resources (Brude et al. 1998), an integrated information system (Løvås & Brude 1999; Brude & Løvås 1999), and tailored methods for impact analyses (Thomassen et al. 1999a) – provide a basis for environmental assessment relevant to NSR activities in the short term, and for strategic long-term assessments of future developments (Moe & Semanov 1999; Thomassen et al. 1999b). The IT toolkit, the INSROP GIS, is easily implemented for specific case-studies like assessments of sailing routes, oil-spill risk and contingency planning, and reflects the call for transparency and stringency that is required to this kind of processes. The concept has been accepted among scientific communities in Russia and Norway and has proven to be in line with Russian regulations on Preliminary EIA.

Results & Discussions

The Arctic environment is currently exposed to contaminants and stress in a variety of modes (cf. AMAP 1998). Contaminants like radionuclides from nuclear waste, petroleum hydrocarbons from extraction and transport of oil and gas, and persistent organic pollutants from power stations, mining industry and landfills, are considered among the most pronounced threats. The trend towards more frequent low-level environmental deviations is gradually reducing the common perception of the Arctic as a pristine environment.

With the exception of local terrestrial, river, harbour and port pollution, and earlier dumping of nuclear waste from the icebreaker fleet, as well as waste and wreck accumulation on shores etc., there is no scientific evidence that civilian navigation as such has resulted in significant stress to the NSR environment. Sailing on the NSR has been carried on for decades. Even if significant local and even regional contamination has been documented, large-scale trends of some declining ecosystem component populations that have been directly caused by this navigational activity are not reported.

Increased sailing frequency will, however, inevitably increase the risk of ship accidents, thereby increasing the risk of accidental release of oil and other cargo to the sea. Accidental oil spills may provide the most serious impact. If this happens at the 'wrong' place at the 'wrong' time – at the ice edge, in polynyas etc. during the high production period (late spring-summer) – the impact can be serious indeed. Shallow waters are considered most sensitive to such pollution, and these areas are important to organisms of all levels of the Arctic food chain. Adverse effects may easily pass from one level to another, ultimately affecting the entire regional ecosystem. The limnic and terrestrial environments have proven to be equally sensitive.

From an environmental point of view, there is also an obvious link between commercial shipping on the NSR, via the port, harbour and loading facilities, to land-based development of industry and infrastructure. These activities represent potential environmental loads in several ways.

Concluding Remarks & Recommendations

Based on the understanding of the inherent attributes of the Arctic environment and the NSR activities, selected recommendations on some selected overall measures are outlined in the following. For task specific measures and further details, see Moe & Semanov (1999); Thomassen et al. (1999b).

In Russia, several national research programmes on Arctic development and environment protection are being carried out. Russia is also an active member within the components of the Arctic Environmental Protection Strategy, and participates regularly in the Barents Euro-Arctic Region and IMO working groups. The projects on environmental monitoring and harmonization of EIA standard, are other important multi- and bilateral projects with Russian participation. It is highly recommended that these contributions to environmental management and protection strategies, both on national and international basis, are implemented in the relevant Russian decision-making processes.

In this context, the procedural manuals and guidelines for pollution preparedness and response developed during INSROP (cf. the separate presentation of these issues by G.N. Semanov) represent a series of concrete contributions. On the other hand, the many legal instruments for preventing pollution – whether aimed at shipping, oil discharges, dumping of radioactive waste etc. – have proven insignificant in competition with other, short-term economic priorities. At present, getting compliance with existing legal instruments appears to be more important than developing new ones. Consequently, a vital challenge is to implement management strategies that can facilitate permanent implantation of the acceptance of sustainable development – among the public as well as the stakeholders of commercial industry and authority bodies. This, however, is not done overnight.



AEPS (Arctic Environmental Protection Strategy) 1997. Guidelines for environmental impact assessment (EIA) in the Arctic. Finnish Ministry of Environment, Finland. 50 pp.

AMAP 1998. AMAP Assessment Report: Arctic Pollution Issues. Arctic Monitoring and Assessment Programme (AMAP). Oslo, Norway. Xii + 859 pp.

Brude, O.W. & S. M. Løvås, 1999. INSROP GIS. Data set documentation & information structure. INSROP Working Paper No. 166–1999. 163 pp.

Brude, O.W.; K. A. Moe, V. Bakken, R. Hansson, L. H. Larsen, S. M. Løvås, J. Thomassen & Ø. Wiig, 1998. Northern Sea Route Dynamic Environmental Atlas. INSROP Working Paper No. 99 – 1998/ Norsk Polarinst. Medd. Nr. 147. 58 pp. (A-3 format)

Løvås, S.M. & O. W. Brude, 1999. INSROP GIS v3.0a. User’s guide and system documentation. INSROP Working Paper No. 165–1999. 121 pp. / INSROP GIS. Software and Database. CD-ROM.

Moe, K.A. & G. N. Semanov, 1999. Environmental Assessment. Pp. 117–215 in Østreng, W. (ed.): The Challenges of the Northern Sea Route. Interplay between natural and societal factors. INSROP Working Paper 167 – 1999. 425 pp. Kluwer Academics: Manuscript submitted.

Thomassen, J.; K. A. Moe, O. W. Brude, S. M. Chivilev, M. Gavrilo, V. Khlebovich, V. Pogrebov, G. N. Semanov & S. Zubarev, 1999a. A guide to EIA implementation in INSROP Phase 2. INSROP Working Paper No. 142 – 1999. 91 pp.

Thomassen, J.; K. A. Moe & O. W. Brude, 1999b. INSROP Environmental Impact Statement. INSROP Working Paper No. 163 – 1999. 143 pp.


The NSR’s commercial potential and restraints

By Michael Tamvakis

Director, MSc Shipping, Trade and Finance, City University Business School, London, UK


For centuries the Northern Sea Route has been a challenge – to navigators, explorers, scientists and the military, but also to traders, who cannot ignore the fact that the route cuts almost in half the distance between Northwest Europe and Northeast Asia.

Today, the role of traders and commercial interests in general cannot be overstated. Any future extensive usage of the NSR will depend largely on its commercial viability. The research undertaken within INSROP’s 5-year mandate clearly points out that the potential offered by the NSR will be hard to ignore. True, performance so far has not been impressive, and a critical mass (in cargo movements) has not yet been reached. Nevertheless, there are enough private interests outside Russia that could take the initiative to invest in projects along the NSR – provided there is a reliable, stable political and legislative framework as well as a reliable operational environment.

Despite the NSR’s undisputed advantage in distance reduction, navigation is still marred by physical constraints imposed by the geomorphology and weather conditions of the region. The decision to transit the NSR, instead of the 'warm' southern routes, in order to reach Northeast Asia will always depend on a comparison between the savings in fuel and time offered by the shorter haul, and the additional transit costs and risks that the operation entails.

Commercial viability does not depend solely on transit cargoes, however. There is the potential for substantial cargo flows to be generated from the natural resource-rich Russian lands along the NSR, which include substantial hydrocarbon and other mineral reserves. Moreover, developing adequate export infrastructure could create a need for import of the necessary machinery, equipment and other supplies.

The task ahead is neither simple nor easy. Several questions have been posed by the INSROP researchers:

The answers to these questions are neither easy nor unqualified. Facts and figures so far reflect a 'lukewarm' reaction of commercial interests to the NSR challenge/opportunity. So far the NSR has been used for limited amounts of exports of dry bulk commodities and imports of necessary supplies for the indigenous population. The existing transit trade is of marginal commercial significance, although it is important for observation purposes in order to improve our knowledge of operational aspects of ice navigation. Most INSROP studies have shown both the technical and the economic feasibility of energy exports from northern Russia, via the NSR, to the Western world.

Such trade flows can be generated only with the necessary investment to allow the production of such resources in the first place. This initiative lies very much in the hands of the Russian state, large energy-trading monopolies in particular. Only when a policy about the fortune of the NSR has been decided, when the proper financial resources (domestic or foreign) have been found and the infrastructure is in place, will NSR’s future have a sure footing. The resources are there, the technology is available, but the remoteness and extremities of the NSR can only be tackled by a state that is ready to support strategic projects. For the Russian state to be able to do so will require considerable time and effort until the economy emerges strong from its currently turbulent transition phase.

As mentioned, there are private interests outside Russia that could take the initiative to invest in projects along the NSR, provided that at least a reliable and stable political, legislative and operational framework is in place.

Until that time comes, the commercial viability of the NSR remains very much a 'target' and not a 'reality'. However, what is now viewed as a negative point need not be an impediment for future prospects. The provisos laid down earlier could be treated as opportunities to be taken advantage of when the time is ripe. The North Sea Route may never compete on a par with warmer sea routes, but given the right conditions it can provide the shrewd investor with considerable profit-making opportunities.

Strategic, legal and political implications of international shipping on the NSR: A summary

By Willy Østreng* Professor, Norwegian University of Science and Technology, Trondheim; The Fridtjof Nansen Institute, Lysaker, Norway


The purpose of this contribution is to evaluate the military utility, legal regulation and political management structure of the NSR, and the likely effect of those three parameters on the international usage potential of the route.


Military utility

During the Cold War, many in the West believed that the Soviet Navy in an emergency situation should be able, by using the NSR, to transfer warships from one sea-border of the Soviet Union to the other – undisturbed and in a short time. It was assumed that nuclear submarines could transit the NSR virtually at will. These perceptions have survived the Cold War and are still reiterated by military experts in the West. Even today, such perceptions have been invoked as an obstacle to international utilization of the route.

The formal opening of the NSR to foreign shipping in July 1991 has proved, beyond any reasonable doubt, that military interests do not represent a definite obstacle to civil utilization. All the same, it is still important to clarify the military preconditions of the Russian offer: Is it based on a tacit assumption that foreign ships will have to adjust their operations to the needs dictated by the assumed military use of these waters? Or will ships be able to operate without interference of military requirements at all?

The important thing is, on the basis of a critical analysis, to determine the likely degree of military adjustments to be imposed on foreign users. The lower the adjustment degree, the more tempting the offer to use the NSR may be. All assumed and potential military uses of the NSR must be addressed, which means the route’s potential as:

Analysis of the military utility of the route, based on objective, controllable criteria, clearly indicates that the time has come for a re-evaluation of those military-strategic perceptions which for several decades suppressed the civilian sector from taking an independent part in developing the NSR on terms specific to civilian society.

Legal Regulation

The legal status of the NSR has long been one of the most contentious political issues in US–Soviet/Russian Arctic relations. The USA claims the ice-covered straits of the route to be international and subject to the right of transit passage, while Russia claims them as internal waters under several lines of argument, including historic waters, closed by straight baselines. The Russian Federation also claims that sea-lanes running in between the North Pole and the 200-mi. economic zones of Russia in the Arctic Ocean belong under Russian jurisdiction as long as part of the voyage passes through North Russian coastal waters. This, in the US view, is a violation of the high seas status of these waters. Legally speaking, the two states would appear to be diametrically opposed, with both invoking national security as a major interest underlying their respective stands. How can this be coupled to comply with the military conclusions noted above?

The legal/political disagreement between the two countries may prove a severe bottleneck to internationalising usage of the NSR. This could have a domino effect in that other countries, for political or legal reasons, may hesitate to accept the Russian offer, so as not to strain their bilateral relations with the USA. As those countries have no vested interests, tradition, or, indeed, capability in using the NSR, they can easily stick to their traditional modes of transportation – the Suez and Panama Canals for Pacific/Atlantic transit. Resolution and/or agreement between the two countries – tacit or formal – may be a necessary precondition for many US-aligned countries to assess the Russian offer on its own intrinsic economic merits. Possible ways of addressing this problem are addressed in this paper.


Political Management Structure

The outlying Russian/Soviet administrative subjects have a long tradition of bowing to directives from the centre. Now, in the post-Soviet era, calls for a more independent role for the Northern regions in NSR affairs are increasingly being heard, not least from the Far East and the Sakha Republic. Changing in the economic system of Russia from centralized planning to a one where market forces play an important role has had a noticeable impact on the regions along the NSR. There has been a marked change with regard to their role in the socio-economic development of their territories, and in the actual management and financing of infrastructure and maintenance of the NSR. In the post-1991 system, three major actors are involved in maintaining the NSR: the federal government, regional governments and commercial interests.

The interactional pattern of these actors in NSR affairs is discussed against the backdrop of the economic, political and social problems facing Russia as a federation. Some observers have indicated that Russia is in imminent danger of becoming a 'failed state' – not breaking into pieces, as the Soviet Union did in December 1991, but simply ceasing to function as a cohesive federal government. The emerging consequences of a failed state are now being felt also in NSR affairs. A top priority for the Russian central government is to avoid becoming a failed state, and then concentrate on becoming the strong state from which the NSR historically always has benefited.

Presentation of INSROP’s simulation study of NSR shipping

By Hiromitsu Kitagawa

Professor, Department of Civil Engineering, Hokkaido University, Japan

The simulation project was set up to perform a more technically oriented integration of INSROP results by numerically simulating different scenarios of NSR shipping. The objectives have been to identify and quantify main factors and obstacles that may make shipping on the NSR economically possible or infeasible, and to make recommendations on preferable scenarios, as well as appropriate measures to be taken.

The simulation project consisted of eight work packages (WPs). The routes in the simulation were carefully examined through discussions among the various WP members. Four routes were finally determined: a northerly transit route with a deep-draft ship, a southerly transit route and two regional routes with a shallow-draft ship. Complete transit route data for the four routes as well as major ports were provided by WP1 (Baskin et al.), in collaboration with WP7 (Yakovlev et al.). The routes were divided into several segments and sub-segments. Ice data for previous years were analysed in WP2 (Brestkin et al.) and tabulated for each segment and sub-segment along the routes.

Both year-round and seasonal operations were evaluated, and effective operation scenarios for the service vessels were selected. The feasibility of seasonal operations will naturally depend in part on the results of the simulation themselves. The database for economic evaluation was established by WP3 (Ramsland: Isakov et al.), by collecting data on Russian foreign trade in recent years and cargo movements between Russia and southeast Asia via Suez. In WP7, legal and environmental evaluations were performed for the selected routes.

WP4 (Forsen et al.) designed open/bulk carriers for the simulation. Cargo capacity and main particulars were determined after thorough discussion. The shallow draft bulk/container has a cargo capacity of 25,000 dwt; a draft bulk/container of 40,000 dwt and a bulk carrier of 50,000 dwt were also designed for the simulation. The ships feature the DAS (Double-Acting-Azipod Ship) with Azipod which rotates 360 degrees and works in pulling mode as well.

The Russian SA-15 operations data were presented by WP5 (Tsoy et al.), intended as useful references for the simulation. Utilizing the SA-15 data and other various data sources, ship transit algorithms were developed by WP6 (Riska & Patey) where estimations of ice resistance, analyses of ice parameters and elaboration of the numerical codes were derived and verified. Unfortunately WP2 could not provide appropriate digital data sets for the algorithm of WP6. Lack of those digital data resulted in a slight modification of the algorithm. The first modification was an application of a probabilistic concept of assessment.

A numerical code for the simulation was developed by WP8 (Kamesaki et al.), by the introduction of an ice-index concept similar to Canadian ice regime, reflecting the data and information obtained through the activities of the WPs. Two modes of ship operation were discussed: monthly voyage simulation and annual serial voyage simulation. In the monthly voyage simulation, the voyage was to start at Yokohama and terminate in Hamburg on transit voyage, whereas Dikson and Yokohama were the cardinal ports on regional routes.

Ship operation costs will vary with season and year, particularly on the NSR. The costs of one voyage were carefully estimated in terms of capital costs, ship operating costs, including crew costs, maintenance costs and insurance costs, icebreaker escort costs as the sum of tariff and ice pilot fee, fuel costs and port charges. Sensitivity analyses were conducted to clarify any major factors and obstacles that could make NSR operations economically unfeasible.


The chosen simulation routes and their ice conditions

By Vladimir Vasilyev

Head, Navigation Laboratory, Central Marine Research and Design Institute, St. Petersburg, Russia


As defined by official documents, the NSR is bounded on the west by the western entrances to the Novaya Zemlya straits and the meridian running north through the Mys Zhelanya Cape, and on the east (in the Bering (Beringov) Strait) – by the parallel 66°N and the meridian 168°58'W.

A major factor determining the choice of routes for navigation along the NSR is the distribution of ice cover. In the seas of the Siberian shelf, ice along the navigation routes can be met practically all the year round.

Numerous variations of the NSR are possible. The Marine Operations HQ of the West and East regions of the NSR selects the most favourable variants of routes to follow in ice conditions. Vessels navigating along the NSR receive the routing recommendations elaborated with respect to ice-cover observations and forecast data. The most favourable navigation routes in the Arctic regions essentially depend on distribution of the ice cover during the navigation season. Navigation routes are established on the basis of long-term practice of organization of sea operations, generalization of experience of ice navigation and study of peculiarities of ice conditions.

In summer periods (June – October) the position of standard routes is determined by situation of ice massifs, distribution of zones of openings, clearings, polynyas, leads, very open pack ice and open water.

In winter and spring periods, when the coast and islands of the Arctic seas are blocked by shore ice, standard navigation routes are determined by development and stability of water openings between the shore and sea ice, and the possibility of crossing the shore ice by icebreakers in key areas of the NSR.

The location of standard navigation routes on the NSR depends on bathymetry: the seas of the Siberian shelf have depths in general not exceeding 40–60 metres, extensive zones with depths of less than 20 metres and banks with depths of 8–15 metres.

Vessels are employed either in port-to-port navigation within the NSR or in transit navigation along the NSR. The choice of standard routes should be made with this circumstance in mind. However, in all cases there are adopted points of the beginning (and termination) of separate legs of standard navigation routes. The coordinates of these points are shown in the normative documents and, in particular, in "Guide to navigation through the NSR, 1995".

There are no distinctions in the location of standard routes in the Southwest part of the Kara Sea in summer and in winter–spring periods. From season to season, only the use of each specified route is subject to changes. This is different in the northeastern part of the Kara Sea and in the Laptev and East Siberian Seas, where the formation of powerful shore ice and the presence of water openings between the shore and sea ice, in addition to some other circumstances, mean that standard routes must be shifted toward water openings in the winter–spring period.

Due to the variability of standard navigation routes, the routes between various waypoints along the NSR may have sizeable year-to-year variations. Moreover, the use of several variants of navigation involves differences in the distribution of the basic characteristics of the ice cover along the navigation route. For each of the standard variants of navigation the information on all characteristics of ice cover (thickness, concentration, age etc.) was combined for the whole period of regular ice observations (1946–90). On the basis of long-term experience in Arctic navigation the main variants of navigation with more favourable ice conditions were determined. In general, the NSR standard variants of navigation have been determined and rather thoroughly investigated for the summer period (June–October), and an analysis of routes of experimental transit passages has been carried out. For the period 1971–93, a total of 11 experimental transit passages in the spring period were carried out along the NSR .

In the spring period experimental passages were made most frequently along a route which passed through the Karskye Vorota Strait, further through the Ob-Yenisey and Central Kara water openings to the shore ice region of the Vil'kitskiy Strait. After passing through the shore ice and the Taymyr ice massif, the vessel entered the Novosibirsk water opening. Further navigation progresed along the shore ice of the Novosibirsk Islands to Cape Shelagskiy, then through the Longa Straits by way of the Chukchi water opening to the Bering Strait. When some water openings did not develop or some sectors of the route were blocked by heavy ice, other route variants were selected.

The shore ice of the Novosibirsk Islands and the essential restrictions imposed on depths for modern types of vessels excluded an opportunity of navigation through the Sannikova Strait in the spring period. The obtained data proved that in the above period vessels encountered the greatest difficulties in navigation through the shore ice in the Vil'kitskiy Strait and drift ice of the Ayon ice massif. If the old ice blocks the coastal route between the Shelagskiy Cape and the Bering Strait, it is wise to use the route which runs to Vrangel Island and to the Northern or Southern Vrangel water opening, and then to the edge of one-year ice. This particular variant of navigation was used when the m/v Kandalaksha was escorted by the icebreaker Rossia in May 1993.

Thus the navigation routes in spring periods are characterized by gravitation towards stationary water openings between shore and sea ice. In the absence of such water openings the disintegration of ice cover – channels, breaks, cracks – should be used for routing. It is possible to prove that the same features of routes are also typical of the winter period. In summer periods, the routes of transit passages through the NSR will frequently coincide with standard variants of sailing.

The advantages of the transit trans-Arctic variant of navigation are obvious: the shortest distance between the Bering Strait and ports of Europe, hydrographic safety of navigation (absence of low depths), insignificant compression in ice cover because of long distance from the coasts. However, the efficiency of shipping in this variant will entirely depend on the quality of hydrometeorological support to navigation, structure and ice class of transport vessels.

Ice cover compels the navigator to choose not the shortest and most direct routes but those that can provide the most favourable ice conditions. In choosing navigation routes the most probable location of recurring ice massifs and zones of intensive clearing of sea ice was taken into account. For the winter period the location of fast ice, zones of regional clearings and poles of ice massifs were taken into consideration. In choosing navigation routes the experience obtained from the standard passages, experimental passages on the NSR, including the sailing of the m/v Kandalaksha under the INSROP program in 1995 were also used.

For a coastal transit route one of the standard variants of navigation in the coastal part of the seas with the highest probability of occurrence and with the most rapid clearing of ice is offered. Besides, under the influence of southerly winds in the coastal part of the seas, it is likely that there will be formed zones of open water and open ice, favourable for navigation.

In the Kara Sea a route leg between Karskiye Vorota Strait and Beliy Island is advisable for plotting across this area and – as to the leg between Beliy Island and the port of Dikson – close to the coast, where the probability of favourable ice conditions is high. Vessels are recommended to round the Nordenskiöld archipelago northward of Russkiy Island, using a standard central coastal variant of navigation in the northeast part of the Kara Sea.

In the Laptev Sea it is advisable to plot the route along the coast of the Taymyr Peninsula to the Petra Islands and further directly up to the 130° E meridian through the ice of the southern periphery of the Taymyr ice massif and further, skirting Stolbovoy Island from the North, and then through the Sannikova Strait to the East Siberian Sea.

In the East Siberian Sea it is wise to plot the route directly to the Medvezhiy Islands through the Novosibirsk ice massif, which is often broken up in the summer period. Further, the route is offered to follow along the coast, where favourable ice conditions are observed more often, from Ayon Island and Cape Shelagskiy to the Chukchi Sea.

In the Chukchi Sea it is advisable to plot the route in close proximity to the coast of the Chukotsky Peninsula.

In the winter period the passage of the Vil'kitskiy and Sannikova Straits involves the necessity of passing through the extensive shore ice of the northeast part of the Kara Sea and the region of the Novosibirsk Islands.

In choosing a high-latitude transit route, it is recommended to use the experience of the experimental passage and the passage of the m/v Kandalaksha in 1995 and to plot the route near the northern capes of the Arctic islands: Cape Zhelanya (Novaya Zemlya Islands), Cape Arkticheskiy (Severnaya Zemlya Islands), Cape Anisiy (Novosibirskiye Islands).

In the Kara Sea a good solution is to plot the route from Cape Zhelaniya to Uedineniya Island through the peripheral zone of ice massifs, which are the most quickly destroyed in the summer period, and further from Uedineniya Island along the 90°E meridian to the Arkticheskiy Cape. The 90°E meridian is a line where the boundary between the Karskiy and Severozemelskiy ice massifs passes the most frequently in summer. This division zone is recommended for navigation.

In the Laptev Sea from the Arkticheskiy Cape to the Petra Islands one is recommended to choose the route that passes near the coast, as this zone most probably clear of ice, and further northward of Bel'kovskiy Island to the Anisiy Cape, skirting the Taymyr ice massif on the South edge. Then doubling the north end of the Novosibirskiye Islands, the navigation route proceeds to the East Siberian Sea.

In the East Siberian Sea, starting from the Novosibirskiye Islands, the route should be plotted directly to the turning point (waypoint) located a little bit to the East of the Medvejye Islands, along the line of the most probable division of the Novosibirskiy and Ayonskiy ice massifs. Further the route should be plotted to Vrangel Island to pass along the Ayon ice massif on its south edge.

In the Chukchi Sea from the Billings Cape the route was plotted southward of Vrangel Island, running northward of the Vrangel (Longa) ice massif. Besides, under the influence of winds from the north, a clearing develops southward of Vrangel Island, which may be used for navigation; in the vicinity of the Chukchi Peninsula coast the ice conditions resulting from such winds will become difficult. The navigation route near the island is an alternative to the coastal variant of navigation when the south wind turns northerly.

In the winter period the high latitude transit route adheres more closely to the position of fast ice, zones of breaks in the ice, and water openings.

The total route distance for transit passage through the NSR may take two weeks or more depending on navigational season, and ranges from 2,100 to 3,400 nautical miles (n.m.). Even in the period of maximum ice cover development (the first ten days of June) it is only about 2,350 n.m.

The total distance of the above recommended routes yields the following values:

Route N (high latitude transit route)

main variant about – 2450 nm;

variant via the Vil'kitskiy Strait about – 2100 nm;

Route S (coastal transit route) about – 2700 nm.

Legal and environmental evaluation of selected routes along the NSR

By Gennady N. Semanov

Head, Environmental Safety of Maritime Transport Laboratory, Central Marine Research and Design Institute, St. Petersburg, Russia


In opening the NSR for international commercial shipping, Russia created a favourable legal regime for this purpose. The Regulations for Navigation on the Seaways of the NSR of 1991 establish the same non-discriminatory regime for navigation along the NSR, irrespective of the vessel’s flag or the status of waters which the selected routes go through.

The Russian Federation has introduced a common legal status to develop international commercial shipping along the NSR. The basis for regulation of shipping along the NSR is found in the provisions of article 234 of UNCLOS (1982) dealing with 'ice-covered' waters within the limits of the exclusive economic zone. Regulations for Navigation are valid for the entire NSR – internal waters, territorial sea and economic zone of the Russian Federation. The main objectives of shipping regulation are to ensure safety of navigation, to prevent pollution from ships and to enable the selection of the best routes.

Nearly one-third of the Southern route lies within sea areas over which Russia exercises absolute sovereignty. The remaining stretch of the Southern route, as well as the whole of the Northern route, is within the limits of the economic zone where Russia exercises its jurisdiction on the maintenance and protection of the marine environment.

The routes pass through the straits of Karskie Vorota (Kara Gates) Vil'kitskogo (Vil'kitskiy) and Sannikova, to which the regime of internal waters has been in effect since 1985. Entrances to the straits are enclosed by straight baselines intersecting the geographical coordinates in accordance with the List of Coordinates approved by Russian Government. The regime of territorial sovereignty of the USSR had been extended to practically all straits of the Soviet part of Arctic. This action, taken in the period of the 'Cold War', had one goal – to prohibit uncontrolled navigation of foreign vessels through the straits.

Today Russia is working to develop international shipping along the NSR. Permission for entering the NSR seaways may be granted on the principle of notification, which requires an application for leading. The application shall contain information on payment (payment guaranteed) of icebreaker fees. The Northern Sea Route Administration (NSRA) sends the necessary information regarding the leading of foreign vessels to Marine Operations Headquarters (MOHs).

New regulations for icebreaker fees are currently being developed. It is anticipated that a part of the fees will be reimbursed by the Federal budget. As traffic along the NSR increases, the fees charged will be reduced.

As to marine risk insurance, the Russian position is as follows:

Special attention is drawn to civil liability insurance (P & I) of shipowners for pollution of the marine environment. Shipowners may use the services of the Russian insurance companies POOL – 'Russian P&I POOL'.

'Requirements for the Design, Equipment and Supplies of Vessels Navigating along the NSR' are set forth in the Guide by the same name. These requirements apply to the vessel’s hull, her mechanical installations, stability and unsinkability, aids to navigation and means of communication, supplies and emergency equipment, and manning of the vessel.

According to the provision of Arctic 6.1 of the Regulations for Navigation on the Seaways of the NSR, vessel inspection may be carried out if unfavourable ice, navigational, hydrographic, weather, or other conditions occur that might endanger a vessel, or where there is a threat of polluting the marine environment or the Northern Coast of Russia. Vessel inspection to verify compliance with the Requirements is undertaken for the account of the shipowner and may be carried out in the ports of Murmansk, Nakhodka, Vladivostok, Provideniya or any other port convenient for the shipowner.

The selected routes lie within the MOHs zones of responsibility for the western and eastern regions of the NSR. The main duties of the MOHs are to fulfil marine operations plans, to select the most appropriate routes, to render icebreaker leading services, to form convoys for ice leading, to ensure safety of ice navigation, to exercise ongoing control over positions and traffic of all vessels on the routes, to ensure compliance with the Regulations for Navigation on the Seaways of the NSR .

The main provisions regarding duties and responsibilities of shipmaster, icebreaker masters and State ice pilot during leading along the NSR are set forth in the regulations for icebreakers. In accordance with the Regulations [9, Article 4] guiding along the NSR is to be carried out by means of Russian nautical charts and other publications. Radio communication with vessels is carried out in accordance with 'The Directions on Communication for the Period of Arctic Navigation through the NSR'. Emergency, rescue and repair parties are carried on board ice-class salvage tug-boats (in Dikson and Pevek) and on liner icebreakers.

Regulations for calling at and lying in the open ports (roadstead) and borderguard control are set out in 'The Law on the RF State Border' of 1993, as well as in other legislative acts of the RF and special Decrees of the RF Government published in Notices to Mariners.

On the whole the legal evaluation of the selected routes has been carried out in accordance with international legal provisions and Russian legislation. The Regulations for Navigation on the Seaways of the NSR regulate shipping along the selected routes on a non-discriminatory basis. Special emphasis has been placed on the sailing of foreign vessels.

A Preliminary Environment Impact Assessment (PEIA) has been carried out, taking into consideration the proposed activity scenario on the NSR. The scenario assumes that 20 container carriers of approx. 40,000 t dwt will be involved in transporting cargo from Asia to Europe and back. The ships navigate only during summer and the early autumn season. Some harmful features of shipping have been identified, the main ones being wastes discharged into sea, and emissions to air from ships, such as oily water, sewage, garbage, sulphur and nitrogen oxides. Most wastes are utilized on board the ship, except emissions from diesel engines.

Basic environmental impacts may be outlined as follows:

The PEIA has been performed according to relevant Russian environment legislation and the INSROP-accepted EIA procedure has been adapted for the purpose of the project.

The Russian legislation pertaining to ecological safety of shipping at sea, including the Arctic, is based on the following laws of the Russian Federation: the Environment Protection Law (1992), the Continental Shelf Law (1995), The Code of Water (1995), as well as The Ecological Expertise Law.

The validity of previous impact hypotheses according to the suggested model scenario of transit trouble-free navigation (regular operation scenario) along the NSR is evaluated.

The Impact Hypothesises (HIs) are assigned categories as follows:

A. The hypothesis is assumed not valid.

B. The hypothesis is valid and already verified. Research to validate or invalidate the hypothesis is not required. Surveys, monitoring, and/or management measures can possibly be recommended.

C. The hypothesis is assumed to be valid. / Research, monitoring or survey is recommended to validate or invalidate the hypothesis. Mitigating measures can be recommended if the hypothesis is proved to be valid.

D. The hypothesis may be valid, but not worth testing for professional, logistic, economic or ethical reasons, or because it is assumed to involve environmental influence of minor value for decision-making.

The description of impact hypothesis is based on the list of important factors suggested by Thomassen et al. (1994) for regular operation scenario, with consideration for more detailed information offered for the present model scenario. Impact hypotheses previously classified into the B, C and D categories have been subjected to evaluation; the hypotheses previously rejected (A) were not considered. Thus, the hypotheses associated with hazardous situations were also excluded.

As many as 56 hypotheses classed into the B, C and D categories have been tested for all types of VECs exposed to the impacts under the assumed conditions of the activity scenario. Since the model scenario excludes such types of impact as oil spills or waste dumps, 22 hypotheses were rejected. A further 14 hypotheses were accepted as valid though requiring additional research and monitoring, to enable the evaluation of particular consequences and their significance.

On the basis of the PEIA for the NSR area, we may conclude that the activities assessed would involve only minor negative impact, provided that conventional navigation practice is observed and that the natural and legal peculiarities of the area are taken into account.

Basic recommendations are as follows:

1. During NSR navigation one should avoid approaching bird or animal colonies, especially in the vicinity of protected territories where animals have become less fearful and are therefore more vulnerable.

2. To obtain reliable data on current animal and bird population and to follow the populations' dynamics and variability, provision should be made for ecological monitoring along the NSR; personnel currently available in the reserves and experts from Goskomgidromet should be involved in this.

3. In the INSROP format, it is desirable to focus on the systematization of Russian legal documents and international agreements, with due attention given to a quantitative assessment and compensation for damage to the natural environment in NSR standard operating conditions and the identification of mechanisms for purpose-oriented use of available funding.

Results of the simulation study: Under which scenario is NSR navigation economically feasible?

By Kazuhiko Kamesaki

Head, Ship & Marine Structure Laboratory, NKK Corporation, Tsu, Japan


The Northern Sea Route needs to maintain its cost advantages against other alternative means of transport, including railways or routes through the Suez Canal. Naturally enough, those seeking to utilize the NSR commercially will be highly concerned about cost benefit and associated risks. The so-called "Box B project" of INSROP Phase II was entasked with performing a ship transit simulation in order to answer these concerns, by incorporating advanced ship design and historical ice data. Here multidisciplinary knowledge has proven necessary. The Box B project has thus been divided into nine work packages, and Work Package 8 (WP8) takes responsibility for integrating other project results.

WP1 selected the routes both for regional and transit voyages, and gathered data for associated infrastructures. Two transit routes liking Yokohama and Hamburg were selected as compatible for 9m and 12.5m draft ships. The regional routes selected were the eastern route between Tiksi and Yokohama, and the western route between Dikson and Hamburg. These routes were plotted on sea charts every 20 nm to identify any obstacles. WP2 presented a large amount of historical environmental data, consisting of 18 items along the selected routes every 20 nm on a monthly average basis. In the final simulation, the data from 1957 to 1990 were used. WP3 presented the cargo flow data, current and future. WP4 performed the preliminary design and ice-tank tests for the two icebreaking cargo ships used for the simulation. They featured container/bulk carriers and eight-month independent navigation capability in ice. In addition to WP4 results, a 50,000 dwt icebreaking bulk carrier was also used to examine the effect of balance between icebreaking and open-water capability. Tables 1 and 2 summarize the routes and characteristics of three ships used for the simulation. WP5 gathered SA-15 performance data on ice and structural damage to calibrate the simulation data. WP6 developed the ship velocity calculation code, essential for determining the simulated ship velocities in ice conditions provided by WP2. WP7 reviewed the selected route from the legal viewpoints and performed the environmental impact assessment. WP8 imported some of the results from the other projects and incorporated them into the simulation work. As these eight projects are closely interrelated, intensive coordination efforts were made so that the project might proceed smoothly.


Table 1 Distances of the four routes

Route name

Route points

Distance within

the NSR (nm)

Distance outside

the NSR (nm)

Total distance (nm)

Northerly route

Hamburg to Yokohama

2,446 (34)

4,750 (66)

7,196 (100)

Southerly route

Hamburg to Yokohama

2,680 (37)

4,650 (63)

7,330 (100)

Regional East route

Hamburg to Dikson

1,326 (33)

2,694 (67)

4,020 (100)

Regional West route

Yokohama to Tiksi

468 (20)

1,929 (80)

2,397 (100)



Table 2 Characteristics of the three ships used for the simulation

Type of ships

Lpp x B x draft (m)

Cargo Capacity




Speed in Open water (knots)

Icebreaking Capability (m)


40,000 dwt Bulk/Container

186.1 x 27.5 x 12.5




1.85m at

1.0 m/sec

N- route

25,000 dwt Bulk/Container

184.1 x 25.1 x 9.0




1.85m at 1.0 m/sec

S-route &



50, dwt

Bulk Carrier

240.0 x 30.0 x 12.5




1.2m at

1.5 m/sec


This simulation seeks to connect the ship velocity simulation code by WP6 and the ice conditions presented by WP2. The concept for the ice index – originally introduced by the Canadian Arctic Ship Pollution Prevention Regulations as ice numerals – has been modified to express the ice conditions quantitatively as a solution; then the probabilistic relations between the ice condition and ship velocity are developed using the code provided by WP6. This method facilitates shortening of the simulation time, keeping a reasonable relation between ice conditions and transit time.

We developed two types of this simulation – Monthly Voyage Simulation (MVS) and Annual Serial Voyage Simulation (ASVS). MVS calculates a required cost for one voyage to examine trends of costs and transit velocities in terms of months and sea areas. ASVS gives several voyages per year to estimate freight cost per ton, and is mainly employed to simulate the costs of seasonal use of the NSR by switching between NSR and Suez routes.

An icebreaker tariff is assumed, at a flat rate of around US $5 per gross tonnage, which is 26% less than the extrapolated values estimated from current guidelines. It is also assumed that standby time for icebreaker escort is negligible. As for the transit routes, 50BC yields lower freight cost than the other two ships, due to the advantages of less capital cost, higher speed in open water and larger cargo capacity. Figure 1 shows voyage days for 50BC; Figure 2 presents transit velocities by month and sea area calculated by the simulation code developed in WP8. The total voyage days presented includes 6 days in port for unloading and loading. Freight costs range from US $18.9 to 20.4 per ton for the period June–October and from $21.4 to 23.0 per ton for the period November–May. However, icebreaker escort was needed for more than 12 days from January to June; for such a long period with escort, it is not realistic to apply flat-rate icebreaker tariff. 50BC freight cost was further studied by alternating between the NSR and Suez routes, i.e. seasonal use of the NSR. In the analysis, the historical data from 1980 to 1989 and ASVS were applied. The average number of voyages was 10.2 times per year, out of which the NSR was selected 9 times. Freight costs went from US $20.8 to 21.6 per ton, which comes close to that of conventional handy-size bulk carriers for the Suez route.

We conclude that NSR transit voyages with handy-size bulk carriers of moderate icebreaking capability may be economically feasible in the future with an icebreaker tariff of less than 5 $/ton. The tariff rate must be further discussed on the basis of this kind of simulation, and specified in detail by season and icebreaking capability, together with standby time and standby location of icebreakers. At present., the NSR does not guarantee voyage days despite its expensive tariff. The time has come to consider what services NSR can offer to potential users.


Figure 2 Navigation speed for the 50BC by the sea area, average 1957–90


Transiting the Northern Sea Route: Shipping and marine insurance interests

By Edgar Gold

Professor, Oceans Institute of Canada; Dalhousie University


It was apparent from its beginnings that the Northern Sea Route (NSR) would never move from innovative idea to practical reality if shipowners would not send their vessels through this new navigational shortcut. On the other hand, it was also clear that even if owners were willing to try the route, the risks and liabilities involved would require adequate marine insurance coverage. An assessment of the latter aspect was the principal object of an INSROP Sub-Project entitled "Marine Insurance for the Northern Sea Route". This sub-project commenced operations in early 1993 and was concluded in late 1998.

In retrospect, it can be stated that the importance of this subject may well not have been fully recognized when INSROP was initially designed. The shipping industry and its risk assurance sector are conservative entities not known for changing well-tried and traditional operations quickly. Furthermore, the economic difficulties of shipping generally, and the Asian region specifically, contributed to the circumstance that new, untried initiatives would not receive priority. In other words, it appeared unlikely that the shipping industry would develop an interest in the NSR without the necessary economic incentives or much better information on the route. On the other hand, the marine insurance industry generally reacts only to the demands of its clients, rarely developing new initiatives unless its client base demands it.

During the period 1993–98 the marine insurance sub-project produced seven working papers in addition to numerous other presentations and papers produced for other meetings and occasions. Much of this work was based on actual "field work" carried out in the major global shipping and underwriting centres. A number of conclusions were reached. Firstly, there were clear indications that limited capacity for marine insurance coverage was available in the Russian underwriting market. This market was quickly losing its state-monopoly antecedents and well on its way to establish a standard risk market with competing companies and rates, assisted by a modernized legal system. Secondly, it was established that the major traditional marine insurance markets had the capacity as well as initial, limited interest in NSR operations – subject, as always, to the demands of their shipping industry clientele. Third, several specific problems related to cargo insurance and liability for NSR transit were identified. Fourth, although it had become clear that NSR transit would present marine insurers with a new risk regime, it was established that such a regime could be serviced by the underwriting sector provided that a reliable, comprehensive data base on all aspects of NSR transit were available.

This practical research, nevertheless, showed that the principal weakness in INSROP would continue to be that it was more hypothetical theory than factual reality. Although, shipping had used the NSR for many years, this had been confined to specialized, mainly Russian shipping. In other words, the research had not so far been able to present marine insurers with "real" ships and cargoes. Even the experimental voyage carried out by INSROP in 1995 was a more a test of propulsion technology, communications and navigation systems, ice strength, ship hull design, etc. than a commercial venture. Although the experiment was important and highly successful it needed further trial voyages in order that the commercial aspects could be tested. Although the Ship and Ocean Foundation of Japan, one of INSROP’s principal co-sponsors, was planning a further test voyage for 1998–99, this test appears to have been postponed indefinitely.

The lack of practical experience on the NSR and the need to test the acquired INSROP data was also the impetus for research work undertaken by another INSROP sub-project, assisted by the marine insurance sub-project. This study evaluated INSROP Phase I data through a case study method utilizing a hypothetical commercial shipping project. It was based on a realistic example: a West European vessel carrying nickel concentrate ore from Russian Arctic ports to Rotterdam. The project was divided into six components that examined: required investment; operating costs; income and competition aspects; operating risks; legal requirements and restrictions; and, marine insurance coverage factors.

One of the main difficulties referred to above continues: marine insurers are generally reactive rather than pro-active. Risks presented must be in existence as tangible operations rather than in the form of hypothetical or theoretical proposals. This difficulty is exacerbated by the fact that the shipping industry has not so far taken a discernible position on NSR use. With a few specialized exceptions, shipowners have not so far requested quotes from marine underwriters for NSR coverage. Nevertheless, it is unlikely that marine insurers would refuse NSR coverage. Marine insurance is an innovative, highly competitive business that has always reacted positively to new market demands. As a result, INSROP research has determined from its contacts with the various markets, that marine insurance coverage will be available if and when required. Of course, questions such as premium cost, exceptions and conditions can only be determined when the potential risk is presented.

However, there appeared to be less certainty on whether the shipping industry is at this stage committed to, interested in, or sufficiently informed about the NSR. It was apparent in the early stages of the marine insurance sub-project’s research work that it would be insufficient simply to examine possible access to marine risk coverage without a closer examination of the shipping sector that would operate on the NSR. As a result, the terms of reference of the marine insurance sub-project were broadened to permit, at the very least, a peripheral examination of the major shipping centres' interest in the NSR. During the final phase the marine insurance sub-project, therefore, carried out further field research in the major shipping centres in Asia and Europe. Contacts were made with major shipping groups and shipping associations in order to determine NSR interest. It quickly became apparent that the industry had not made any decisions on NSR navigation for various reasons, including: a) not enough was known about it; b) the industry was undergoing economic difficulties that curtailed new and untried initiatives; c) traditional navigational routes were available; d) there would be operational difficulties for liner service companies; e) fleets were not ice-strengthened; and f) the economic and commercial advantages of the NSR had not been clarified. This is clearly an area that requires attention in any future NSR work. At the very least, further contacts with potential NSR users will be mandatory. Hopefully, this Conference will be one of these contact points.

The overall INSROP marine insurance/shipping sub-project concluded with two final questions.

What is the likelihood of regular navigational use of the Northern Sea Route in the foreseeable future? At this stage it is too early to provide an answer. However, the likelihood of "regular" use is probably still some years away and would require further significant research by the shipping industry in terms of economic and operational advantage, the suitability and re-positioning of vessels, cargo interests etc. However, it is also clear that priorities can change rapidly. Political or operational problems in the Panama Canal, after its reversion to the Republic of Panama at the end of 1999, another crisis in the Middle East affecting the Suez Canal, and problems in Russia affecting the Asian "land-bridge" railway connection, could all quickly make an alternative sea route more attractive. This has also recently been recognized with the revival of the Kra Canal proposal across the narrowest part of Thailand that would reduce the distance between the Gulf and East Asia by some 2,000 miles but would cost at least USD 20 billion. The development of Russian Arctic resources, which has already commenced, will also result in more shipping in the region. The full development of these resources, however, depends on global energy prices, the willingness to invest in the Russian Arctic region, and the overall stability of Russia in the coming years.

Would the international insurance market be willing and able to underwrite Northern Sea Route risks? This final question takes us back to the basic terms of reference of the marine insurance sub-project. And this can be answered in the affirmative. As indicated throughout the sub-project’s research output, marine insurers are innovative and responsive to the demands and requirements of the shipping industry. In that respect NSR risks will be treated no differently, but will require further development of the data base already assembled by INSROP. Marine insurers will require their own studies, undertaken by the Salvage Association, and instructed by the International Underwriting Association, which will respond to the specific needs and demands of underwriters and which will, at the same time, take account of the special risks involved in navigating Arctic waters. In other words, if shipping wants to use the NSR, insurers will provide the necessary risk coverage.

Potential for transit operations on the Northern Sea Route

By Trond R. Ramsland

Synergy Research, Bergen, Norway

By using the Northern Sea Route between Europe and the Far East, significant savings in time and direct cost can be made for ice-classed vessels.

Cargo area is defined to be North West Europe (NWE) – Finland, Norway, Sweden, Denmark, Germany, Great Britain, Ireland, the Netherlands, Belgium, Luxembourg and France. The Far East (FE) is defined to be China, Hong Kong, South Korea, Taiwan and Japan. The North American West Coast is defined as British Columbia, and the US states of Washington and Oregon.


World trade in merchandized goods 1994–97

The major economies and trade blocs are within reach of NSR-optimized vessels. Over the past 25 years, world trade in value terms has grown to a total of US $5,464 billion (1997 figures). The industrialized countries are responsible for $3,634 billion, or roughly 2/3 of total export. The European Union as a trading bloc now outstrips both the US and the Japanese economies in terms of export value, being three times the size of the US, and four times the Japanese. Of the developing countries, East Asia – China, Hong Kong, Taiwan and South Korea – is the most significant region. Overall export was approx. $ 971 billion in 1997, or roughly 18% of total world trade.

The EU, the USA & the Far East thus represent about 77% of total world trade; more than half of the world trade in value terms can be argued to take place within the geographical scope of the NSR. These three distinct economic regions are widely separated by geography, making shipping the sole feasible means of transport for bulk cargoes and merchandized trade on scale. By contrast, most West European trade (65.7%) is intra-regional, probably due to the EU. Corresponding intra-regional figures for Asia are 47%, and for North America 36%. As the three regions are highly industrialized, one should expect the focus on inter-regional trade (containerized import and export) as subject to the UN Liner Code. Thus a NSR operator would probably have to be a legal entity and fly the flag of a market state. Here it will be of interest to see how the EU internal market, with its four freedoms and a single currency, affects a harmonized EU shipping policy and liner operations.


Suez Canal 1987–97

Northwest Europe as a trading area is the dominant import-export user of the Suez Canal, followed by the Far East. To determine the relevance of the cargo segments, export and import on northbound & southbound volumes must be matched. In terms of tonnage from 1995 Northwest Europe remains the most significant region, despite the decline in overall import-export to 1997. Export through the Canal shows a reduction of about 10 million tonnes, 20% down compared to 1995. However, this is unlikely to have much direct impact on Far East–Europe cross-trade, which follows from the composition of trade between these shipping areas. This conclusion is further supported by the growth in container traffic eastbound–westbound in the same period.

Main southbound cargoes through Suez are fabricated metals (13 million tonnes) and fertilizers (10 million tonnes), with Russia as the main exporter and China the main importer. Cereals from France dominate on export and China on import. Also significant are ores and metals, where Norway dominates on exports, and China and South Korea on imports. There is no movement of crude oil between the North Sea and the Far East through Suez, although a few vessel-loads of Norwegian crude oil are delivered to Taiwan and South Korea on VLCC round the Cape.

Main northbound cargoes are metal & ores, with a steady increase at 9.4 million tonnes in 1997; here the Netherlands and France are the main importers, and China the main exporter (710 thousand tonnes). Coal & coke originating in China follow, the main importers being the Netherlands and France. Starches move mainly between Taiwan and the Netherlands.


The liner market

Between 1990 and 1997 (Far East Freight Conference) overall westbound container volume (TEU) from FE to NWE grew from 1,032 000 to 1,878 000. For the eastbound trade, the corresponding figures show an increase from 447,000 to 1,356 000 in the same period, thus westbound trade is the greater by 38%. This imbalance began closing in the mid-90s, but has widened since then.

In terms of total carrying capacity by segments in the liner fleet in service (1998) there is a concentration in the 1,999 – 2,999 TEU segment. In the over-2,999 TEU classes there are no general cargo vessels, as these focus on serving smaller ports with less specialized cargo handling equipment. In terms of growth we note a significant concentration in the 0–4 year segment. Capacity in this age segment has two peaks, one in the 1,000–1,900 the other in the 4,000–4,999 range. This points towards two main characteristics: growth in regional economies, which leads to deliveries in the feeder segment serving the intra-Asian, South American and European trade. Secondly, growth in inter-continental trade, with a peak in the 4,999 TEU segment – larger liners that maximize capacity and speed on long-haul routes, conforming to economies of scale.

As to trade regions by liner port capacity (1998), the Far East ports dominate. Hong Kong is the most significant port in the world, important for domestic import and exports as well as acting as a transhipment point for South Chinese cargoes. In Europe the concentration is around the southerly North Sea & the English Channel. On the US West Coast, capacity is concentrated in three areas, the largest in Los Angeles/Long Beach, thereafter Oakland/San Francisco and thirdly the Seattle, Vancouver & Tacoma triangle in the northwest.

Table 1


Trade Route

Average Capacity

Average Ship Size












Average vessel size and port capacity show an almost linear correlation of 0.97. This is clear proof of economies of scale taking effect, a trend that has been accentuated over the latest 5-year period.

In terms of distribution of flag state & ownership by TEU capacity (1998) the liner markets differ from the bulk market in being more industrialized and organized through the conference system. The roles of government and the shore industry are thus accentuated, and differ from the shipping market in general. In terms of ownership, this point is underlined by the high proportion of US flagged capacity and Danish int. flagged vessels.

Table 2


Parent Owner


Flag State








United States of America




Danish Int.


United States of America




South Korea


Hong Kong




Norwegian Int


Rep of China




United Kingdom








Hong Kong


Isle of Man




Saudi Arabia




Russian Federation





The Far East

From Japan, motorized vehicles still dominate export to the European Union (value US $13 billion), followed by photocopiers, computers, electrical equipment etc. Thus, seaborne export from Japan to NWE is an industrialized trade in high-value goods involving special requirements, with purpose-built car carriers and emphasis on intermodalism where all aspects of on-schedule delivery, regularity and stock minimization apply.

South Korea follows the Japanese pattern of trade with the EU, although on a lesser scale (17% of the Japanese value). Export of motor vehicles is valued at $2.2 billion, or 32% of total exports to NWE, closely followed by computer equipment, at $2 billion. The same shipping requirements as for Japan apply here.

China’s re-export / export to the European Union roughly equals that of South Korea in value terms, just above $40 billion, but differs significantly in terms of structure. China exports mainly semi-low-value goods, and but is also an exporter of bulk commodities, as shown under the Suez Canal-Northbound Cargoes. Main exports are toys & models (total value $2.8 billion), followed by computers and clothing. This lower-range composition of Chinese containerized export market makes it relevant to the NSR even today. The evidence is that FDI inflow to China is significant in explaining export of merchandized goods to Europe. Overall westbound container shipments vs. export in value to EU explains 96.9% of the volume. Thus there is a clear linkage between FDI into China, export by foreign affiliates, Chinese export to EU in value terms and westbound container volumes.

Hong Kong’s main trading partner is mainland China which accounted for 30.2% of total exports in 1997, United States the second largest with 26.1%. NWE account for roughly 17%; the UK 5.1% and Germany 4.9%. In terms of articles exported, clothing accounts for 34.2%, electrical machinery for 15.6% and textiles in general for 6%. Hong Kong’s export is completely containerized.

Taiwan is not an especially preferred location with regard to FDI compared to mainland China. Its share of regional FDI in Asia has declined from 6.8% on average 1986–91 to 2.7% by 1997. Taiwanese merchandized export is tilted towards indigenous production, with little involvement on the part of the receiving NWE country. Taiwan is the largest exporter of computers to Northwest Europe – $5 billion, or 67% of total value of its export.


West Coast North America – Europe

West Coast Canada (WCC) export is based on forest products and mining. The trade is skewed towards the Far East and has become the main source for the Far East in several products. Bulk vessels offloading in the Far East may want to reposition back to Northwest Europe. One way to do so is to ballast or part cargo over the Pacific and take cargo from WCC to NWE. The WCC–FE segments, however, are industrialized, and heavy influenced by proprietary fleets or by contract of affreightments (COA) of the same importing nations in the Far East.

British Columbia’s (BC) exports reflect the factor abundance of the region, mainly related to mining and the forest industries, and make BC a market for potential NSR operation. Total export from BC to the EU was $1.7 billion, down from a high in 1995 of $2.25 billion. Woodpulp is the most valuable at $659 mill (41%), followed by lumber & wood at $304 mill. Coal comes fourth, but is the single most important bulk cargo segment related to the NSR in volume.

Although abundant in roughly the same endowments as British Columbia, export from Oregon and Washington is dominated by high-value technology as a function of skilled human capital and a much larger internal market in the USA than for BC in Canada. Thus natural endowments are not the decisive factor. For the state of Washington, export value to the world in 1996 was $40.3 billion, half of which went to the Far East, notably Japan. Washington is strong on exports of aeroplanes and computer software, with both Boeing and Microsoft located in Seattle. Europe as a market accounted for 12% or $4.65 billion – triple the export value from British Columbia. Imports from the EU accounted for some $1.7 billion. Some forest product and container segments should be able to be attacked as the market value of export trends up. Oregon’s global export was about $10 billion, or one-fourth that of neighbouring Washington. The Asia Pacific as a market accounts for 56%, and Europe 20% or $2 billion. Within the EU, the Netherlands is the major trading partner ($442 million), followed by Great Britain ($394 billion). High technology had an impressive 73% market share of exports, indicating the structure of the segments. However, also some bulk cargoes are shipped out of the area, especially grain shipped down the Columbia River to Portland (5.5% of the US total).


Financial results

For relevant vessel segments and current charter rates there exist substantial Net Present Value (NPV) of the cashflow differential to upgrade of standard bulk tonnage design to appropriate ice-class. Compared to use of the Suez Canal, a premium of between $13 and 18 million is available, and $8.4–8.8 million from the US/Canadian West Coast to NW Europe trading range, as compared with the Panama Canal. This is on assumption of risk to natural conditions being accounted for by ice-class construction. Subject to commercial risk, the applicability of tariffs becomes the key issue.



The overall impression of the scale and scope of the three cargo-generating regions is positive, indicating that use of the NSR involves advantages of geography and direct cost savings. The volume of merchandized trade is stable over time, although the individual segments vary during the period analysed.

The stumbling-block to use of the NSR is the uncertainty concerning tariffs and the investment barrier to building competitive vessels in the necessary segment size. Large-scale use of the NSR seems unlikely to develop on the basis of single nations or fleets: its realization will probably require the interaction of governments, the shipbuilding industry and the shipping market itself.

Development of marine transport of Russian gas to the EU

By José L. Anselmo

Head, Research and Development for Modal Transport Unit, DG VII, European Commission


The presentation will focus on the role played by the European Union’s Framework Programme on Research and Development in support of "Efficient Marine Transport of Russian Oil and Gas to the EU". This will be illustrated by a specific Case Study – the R&D "ARCDEV" project.

ARCDEV main objectives are as follows:

In terms of the above mentioned objectives the achievements of the work completed thus far may be summarized as follows:

  1. The project is establishing a link between the Russian West Siberian energy resources and the
  2. European Union. These resources may be considered as a long-term energy supply for Europe.

  3. ARCDEV is proving the possibility of year-round navigation between Europe and the Russian
  4. Arctic over the Northern Sea Route.

  5. It is proving the economic effectiveness of sea transportation of oil and gas-condensate from

Western Siberia to Europe by tanker ships.

4. The project has established joint European and Russian research on:

  1. It establishes an initiative base for developing a European–Russian Arctic Sea Transportation System for energy supply.

6. ARCDEV also links up to other projects:

7. A summary of key results will be presented.


 The NSR tariff System – Present practice and future requirements – The ARCDEV experience

By Ivan Ivanov

Operational Superintendent, Fortum Oil and Gas, Shipping, Helsinki, Finland

IntroductionThe verified oil and gas resources in northern Russia and the Russian Arctic constitute a significant proportion of the known global resources of oil and gas condensate. In addition, the region is very rich in other natural resources such as ore and several types of commercial minerals, as well as coal and timber. Due to the strategic significance of these resources there is a profound demand for transporting them to their markets, which are currently located mainly within the Russian Federation (RF) and the European Union.

At the present time the RF, on its own, is not capable of realizing the potential of these resources and delivering them to the world markets. This can be done in cooperation with western commercial companies using the many years of practical experience that has been gained by the Russians and more recently by Fortum Oil and Gas company. Capitalizing on these experiences presents both a challenge and business opportunity to the RF and to international operators. The interest in marine transport along the NSR has been growing, and in particular for the western part of the NSR between NW Siberia and Europe. A precautionary factor is that the freight volume in the region currently amounts to about two million tonnes per year, compared to an earlier peak volume of up to seven million tonnes.

NSR shipping operations have a number of unique features that can have a significant impact on the cost of marine transport, such as icebreaker (I/B) fees, insurance costs and delays due to a number of factors, such as ice navigation, Russian regulatory requirements and slow loading operations. In developing competitive and cost-effective freight rates for the NSR a critical review of these cost increasing and time consuming elements of the shipping operations are needed.

FORTUM Oil and Gas OY (formerly NESTE OY, Shipping) has been active within marine transportation of hydrocarbon products in both the North Sea and the Arctic for many years. FORTUM has operated along the NSR since the North Russian coast was opened for international use in 1991. In 1997 the project Arctic Demonstration and Exploratory Voyage (ARCDEV) was initiated by FORTUM and conducted under the European Commission / DGVII – Transport. The objective of ARCDEV is to investigate the practical aspects, challenges and commercial conditions for year-round marine transportation of hydrocarbons from NW Russia to Europe. The project involved 18 institutions from 7 countries, with the main field experiment conducted with the M/T UIKKU during late spring 1998. The ARCDEV voyage took place between Murmansk – Sabeta – Murmansk – Rotterdam and was completed within 28 days.

This paper summarizes FORTUM´s experiences with the ARCDEV project as well as previous experiences in maritime operation along the NSR.



The Challenge

In order to make shipping along the NSR more attractive and economical according to normal commercial standards, an acceptable and predictable cost structure has to be developed and implemented. This involves various technical, operational, economic and political factors that need to be resolved before it is acceptable to western operators.

The hydrocarbons transported along the NSR may be offered to the same markets as for, for example, the North Sea generated hydrocarbon products. Therefore the comparison of certain aspects of the two regions may provide the basic guidelines for NSR maritime operations and for developing an acceptable cost structure. In this respect some of the specific limiting factors of the NSR are:



I/B Assistance

A major part of the additional costs related to NSR operations arise from the fees for I/B assistance. During the ARCDEV voyage the I/B costs were more than one fifth of the total costs for the delivery of the cargo to Rotterdam. Year-round transportation along the NSR is dependent on I/B escorting assistance, currently provided by the Murmansk Shipping Company (MSC). The region, period and type of escort service are determined by Russian regulations and the actual ice conditions. The Marine Operational Headquarters of the MSC provides sea synoptic ice charts used in the process to determine the extent of I/B escort operations. Enhanced access to and operational use of new satellite radar technology will also improve the knowledge of sea-ice conditions and hence the needs for I/B support, both on board the supporting I/Bs as well as the cargo vessels.

What may be a reasonable level of rates for using I/B assistance? The volume of commercial work for the current fleet of I/B is modest. Using the annual running costs of I/B as the basis for determination of the rates may hence be misleading. Ideally, the capacity of the I/B fleet should be sufficient to cover the costs, however a transfer of the total costs of I/B operations to the commercial ship owners, through artificially high fees, will endanger the market development. Alternate approaches for I/B fee estimation should be evaluated, including multi-purpose use of the I/B throughout the year.

For example, in the Baltic ice navigation (where the traffic volume is significantly larger), a system of fairway fees, also during ice-free seasons, has been introduced. Such an approach would distribute the costs associated with ice navigation more evenly among all operators in the region as well as cover some of the inter-annual variability.

Customs and Border Control

The current practice in the NSR requires a deviation to Murmansk before entering the region in order to obtain the necessary permissions and clearances. During ARCDEV the vessel was berthed altogether 1.4 days in Murmansk. A port call to Murmansk should in the future merely be done for operational reasons, cutting costs and saving valuable time. Customs and border control formalities should be arranged at the ports of destination, respectively at the loading/discharging location and not necessarily only in Murmansk.

Cargo Operations

Improved operations of cargo handling and speed of loading operation will improve the profitability of marine transportation in the NSR. This will require significantly improved efficiency and development of the loading terminals capable of operating under extremely harsh environmental conditions. During the demonstration voyage, the m/t Uikku used 4 days for the loading in Sabeta. In comparison to Fortnum’s earlier experience in the region from similar cargo operations and weather conditions, this loading time was almost twice as fast! Still the loading time was almost as long as the ship passage between Murmansk to Rotterdam (4.8 days).


The NSR option means a high risk for the shipowners. They need protection through loss prevention measures, fair distribution of liabilities between all parties involved and sufficient comprehensive insurance cover.

The ARCDEV Rates

In analysis of the preliminary calculations and the actual costs incurred we may conclude that the ARCDEV cost assessment has been completed in a professional manner. For the ARCDEV programme, the preliminary calculation of costs for delivering a cargo of 10,700t of gas condensate from Sabeta (Ob estuary) to Rotterdam was $66.3/t. The actual cost figures reached $73.5/t, which is at the ultimate margin for profitable business activity. These figures could be reduced quite significantly if the several improvement factors that have been specified were put in place.



In order to make the NSR related hydrocarbon cargo competitive on the world market, an interaction between various factors of the total cost is necessary.

1. The total costs for transportation must be reduced to the absolute minimum by technological innovations within both production and dissemination.

2. The cargo flow must be significantly increased through increasing the production. The future production costs must be substantially lower than the average world market price, in order to compensate for the more expensive transport to the market.

3. A free competition in the freight market must assure ship owners meeting the requirements of quality tonnage and access to cargoes on equal terms.

In order to deliver competitive products to the world market the Russian Authorities should be prepared to accept the fact that in the short term, certain activities must be subsidized, keeping the cost level for the operators under break-even. This might be done through the determination of the level of sea fairway fees.

The development and the implementation of a sophisticated Arctic Transportation System and a VTMS (Vessel Traffic Management System) will in addition support the achievement of an optimum NSR Tariff System. Such a system available on board the I/B and the merchant vessels will provide access to a significant amount of information onboard related both to the actual environmental (ice and weather) and other ship specific information in order to make the optimal route selection through the ice covered waters.

The North Sea oil fields are a success story developed from a vision through action to well established competitive oil and gas producers. During the early era of exploration there was justified scepticism about producing oil and gas under such harsh conditions and managing to keep the total costs for exploration, production and transportation at a competitive level vis-a-vis world market prices. North Sea operations started from scratch. A new advanced technology was developed, enabling successful environmentally friendly production, and generating profits for the parties involved: oil companies, investors, finance institutions, ship owners, host countries, sub-contractors, skilled labour etc.

In order to develop a competitive business concept for the development of a year-round maritime transport of hydrocarbons in the eastern NSR, a stable and predictable cost structure is required. However also several other aspects need to be implemented in order to ensure the development of a competitive supply of hydrocarbons from northwestern Siberia. Through the experience gained from North Sea operations and the harsh Arctic environment the technology necessary for the operations must be implemented. Great challenges are facing producers, and a flexible approach by the Russian counterparts will be required.

Will Russia’s Arctic oil be exported by sea?

By Asbjørn Sæbøe

E & P International, Norsk Hydro, Oslo, Norway


Oil has been produced from the Timan Pechora Basin for a long time. From fields in the Komi Republic oil is transported to refineries in Ukta and Yaroslav. In the northern part of the basin, however, production has only just started. The Nenets Okrug alone has reserves estimated to more than 6 billion bbls while the offshore part of the region , where exploration has hardly started could have more than 2 billion bbls.

Planning of oil export from the Timan-Pechora region in the Nenets Okrug started around 1993. The remoteness of the area and the Arctic environmental conditions require careful, stepwise selection of a system of transportation.

In 1994, a group of Russian and Western companies, together with the administrations of Arkhangelsk Oblast and Nenets Okrug, initiated a complex study, the Northern Gateway Terminal Project, to identify the best possible option for export of oil produced in the Timan Pechora region. The study focused on the export of onshore oil, but consideration was also given to the export of offshore oil. Comprehensive efforts at gathering data and preparing conceptual engineering designs were undertaken. Careful consideration was also given to environmental protection and to the socio-economic impact on the region. The project was terminated in 1998, since no oil development projects as yet had been decided upon.

The only existing transport system currently in operation originates at the Ardalin field and ends at the Yaroslav refineries. Oil export has required swapping with Siberian crude and export through any one of the established export routes. The capacity of this system is limited; large-scale production from the Timan Pechora area will require the establishment of a new export system. There are two main alternatives: the onshore option BPS (Baltic Pipeline System), and the offshore option with tankers directly to the market or via a trans-shipment terminal. For the offshore option, tanker size in the range of 60,000–120,000 dwt has been considered, depending on production rate and water depth at the loading terminal. Tankers could be ice-strengthened or have icebreaking capability; the DAT could be an interesting concept. In all cases, icebreaker support will be required. Several offshore loading terminals have been considered, ranging from an STL type to a large GBS or an artificial island. Tanker transport could be conducted as shuttle transport to a trans-shipment terminal, or directly to the market. An active Ice Management System is required to plan each loading operation.

The first project to start production could be the Prirazlomnoye field, operated by Rosshelf (Gazprom). Oil from this field will be transported in tankers to the market or a trans-shipment terminal.

Various actors have been active in the region: some have withdrawn and new ones have appeared.

 The real face of NSR shipping

By Alexander P. Ushakov

Deputy Head, Northern Sea Route Administration, Moscow, Russia


The Northern Sea Route is made up of navigable routes passing through seas of the Arctic Ocean, which, depending on ice conditions, lie within the economic zone, territorial and internal waters of the Russian Federation. Depending on the route chosen, lengths can be from 2,200 up to 2,900 n.m. The primary role of the NSR relates to development of natural resources of the Far North, delivery of cargoes to Northern areas, a reliable linkage of the European part of Russia and the Far East and transit operations from European countries to Pacific countries.

The Russian Arctic Sea Transport System (RASTS) is a complex organizational structure which includes:

It is the costs related to each component of this system that determine the cost component of Arctic transportation.

Arctic navigation of vessels is managed by special services – Marine Operations Headquarters in the Western and Eastern areas of the Arctic Region. There are six nuclear-powered and six diesel icebreakers for support of the Arctic Sea Transportation System in Russia. Currently, these icebreakers provide for year-round navigation in the Western Area (oil and gas facilities on the Yamal Peninsula, Norilsk Industrial Centre) and perform piloting along the whole route (including transit) in the summer and autumn periods.

Navigation and hydrographic support for navigational safety in the Arctic Region is provided by the State Hydrographic Office of the Ministry of Transport of the Russian Federation. In operation since 1933, it has created a system which adequately meets the needs of modern Arctic navigation. The INSROP programme has provided detailed specifications for navigation by the NSR from the point of view of navigation safety. Characteristics of navigation hazards in the Russian Arctic Region are provided; first of all, shallow waters navigation routes passing along northern coasts of Russia requires increased attention and experience from ship crews.

Navigation and ship control along the NSR differs essentially from traditional methods. The location of ice fields frequently makes it necessary to choose coastal navigation routes. Safe navigation in such conditions can be ensured only by high accuracy in vessel positioning and thorough knowledge of ice conditions along the navigation route.

Safety of ship navigation in the Arctic Region may be considerably increased by the construction of 12 onshore control and reference stations on the NSR routes, ensuring operation of the global GLONASS/GPS navigation satellite systems in differential mode. Currently, four stations in the Western area of the Arctic Region have started pilot operation and provide ± 10 meter accuracy in positioning vessels from Kara Gate to Vil'kitskiy Strait, with 95% probability. Eight other stations will be deployed in the eastern part of the NSR after the year 2000.

The various routes of the NSR are completely covered by sea navigation charts (359 charts) and modern electronic charts (300 charts). Charts have been prepared in English and Russian (90 charts) for major areas and for transit navigation. A manual for through navigation of vessels via the NSR is available in Russian and English.

Both Russian and foreign vessels admitted to routes of the NSR, are subject to uniform requirements – The Rules for NSR Route Navigation, effective since 1 July 1991. They are based on the fact that the NSR is an open non-discriminatory route for Russian and foreign vessels, on condition that these observe the requirements concerning safety considerations and prevention of pollution of sea environment and the northern coast of Russia. In 1990, the Minister of the Marine Fleet of the USSR approved the effective Rules. With regard to implementation of the Federal Law 'On Internal Sea Waters, Territorial Sea and Adjacent Areas of the Russian Federation' of 31 July 1998, the Northern Sea Route is considered as a historically developed national common transport communication artery of the Russian Federation in the Arctic Region; the Ministry of Transport has amended the above Rules and filed them for approval with the Government of Russia.

In 1991, Russian President Boris Yeltsin declared the interest of the Russian Administration in international cooperation related to the NSR, having confirmed the legal validity of appropriate decisions made by leaders of the former USSR. In January 1993, Russia joined the cooperation in the Barents Euroarctic region (BEAR), which resulted in the formation of a workgroup for the NSR. In practice, the NSR is fully accessible for international transit navigation. Igarka is an open port of call for foreign vessels. With regard to the more than 40 other ports and points along the NSR, the Government of Russia every years make decisions on calls of foreign vessels.

In cases when the captains and crews of foreign vessels lack experience in navigation via ice routes of the NSR, the presence of a State pilot onboard is required. In emergency cases, route icebreakers may provide limited assistance to vessels on the NSR routes (divers' examination, repair, bunker, fresh water).

The first foreign vessel to pass through the NSR after its opening was L. Astrolabe – a French motor ship for Antarctic supplies which navigated the NSR in August 1991 from Murmansk Port to Provideniya Port in 12 days at an average speed of 11 knots. The voyage was of a promotional and familiarizing nature. Onboard were reporters from France, Japan, Norway and Russia who offered running comments and have produced film about the voyage.

Experience accumulated in the course of long-term operation of the Arctic Sea Transportation System allows practical posting of foreign vessels along the NSR routes, making this a usual practice giving mutual benefits to Russian and foreign partners. The INSROP materials provide detailed results for transit transportation with cargoes of foreign charterers carried out since the 1960s by Russian ships from west to east and back. In 1967, three Russian ships voyaged between ports in Northern Europe and Japan, taking from 1 to 19 days. From 1989–95, a growth in transit transport was observed: for example, in 1993 there were eastward voyages to Japan, China, Thailand, and westward from China to the Netherlands, England and Spain. A potential cargo base is available; however, it is not yet possible to organize a regular flow of transit cargoes.

Currently, the Ministry of Transport of Russia on behalf of the Government of the Russian Federation is reviewing the existing system for collection of icebreaking fees, with the purpose of maximum accounting for interests of both cargo owners, shipowners and the State. The suggested measures involve a progressive (per ton) fee, and should prove an economic incentive to further transit transport.

Under the INSROP programme, during the 1995 Arctic navigation season, the transit pilot commercial voyage was performed via the NSR, from east to Western Europe on a Russian Kandalaksha ice-class ship. On board were experts from Japan, Russia and Canada. Based on results of the voyage, a scientific report was prepared and calculations of NSR navigation conditions were performed. A film was also produced, which is available for viewing.

Since 1993, foreign vessels have been regularly attracted for transportation via the NSR, which transport makes a significant part of petroleum from northwest of Russia to Arctic ports; they deliver gas condensate and export metals from Dudinka. There have been no claims from captains of foreign vessels related to navigation, pilotage and icebreaking support.

Reliable radio communications play an essential role in safety of navigation via the NSR. Currently, the Inmarsat international system of sea satellite communications is employed in the Arctic Region. During 1997–98, Inmarsat third-generation satellites were launched and started regular operation. Use of the systems of sea satellite communication is carried out on a commercial basis.

The availability of a powerful icebreaking fleet, strengthened ice-class transport vessels, adequate scientific and technical facilities and services allow navigation of vessels by the NSR at practically any time of year and under any hydrometeorological conditions. The personnel of the Russian Arctic Fleet have significant practical experience of navigation, both during ordinary periods of Arctic navigation (June– October) and in extreme winter conditions.


 Human resources: Will there be a need for specially trained Northern Sea Route seafarers?

By Anders Backman

Head, Ship Management and Icebreaking Department, Swedish Maritime Administration


Polar exploration has long been a challenge for adventurers from all parts of the world. Some of them were successful but many never came back home. The knowledge of the risks of navigation in ice was limited, but taking risks was a part of the life of an explorer. On the other hand, we can note that their vessels were small, and carried limited quantities of polluting fuels. The voyages were more dangerous for the crew than for the environment.

Also today, experience from Arctic navigation is also today reserved for a few countries operating Arctic icebreakers. Representatives from those countries have for some years been working on a special Polar Code, describing unified requirements for ice-strengthening and equipment of Polar Vessels. The proposed Code has now been presented to the IMO. Special attention has been given to training programs for Navigators.

An Arctic Vessel Endorsement for Masters or Ice Pilots has been proposed and training programs are already available in Finland and Canada. Also in Russia there is a long tradition in training and education of the crews of icebreakers and Arctic cargo vessels.

In the paper some of the difficulties and risks involved in Arctic Navigation are identified. Methods for simulation, training and education are described and special emphasis is given to the need for unified rules.

 Suggestions for future NSR shipping based on NSR experience

By Juha Säävälä

Captain, M/T Lunni, Fortum Oil and Gas, Shipping, Helsinki, Finland


Background: Sailing the Northeast Passage

Neste Shipping started traffic in the Canadian Arctic in the early 1970s. The next stage followed in the late 1970s, when Neste transported all oil supplies for Greenland. In the exacting Arctic conditions of both Canada and Greenland, most of the transport was carried out by Lunni tankers until regular traffic started in the Northeast Passage.

Russia opened the NSR to international shipping in the early 1990s. As Neste already had experience of Arctic conditions, the company felt obliged and challenged to provide the required shipping services here as well. As early as 1991, a Neste Lunni passed rigorous inspection in what was then Leningrad, and was permitted to sail the entire route, the first Western freight vessel to do so. The tanker was to transport a cargo of Neste’s petroleum additive. However, as the price of this product developed unfavourably, the trip to Japan would no longer have been profitable. Neste’s opening of the Northeast Passage as a link between Europe and the Far East had to wait for more profitable cargoes, essential for the commercial success of long Arctic voyages.


Requirements for a tanker fleet

The protection of the marine and coastal environment is a priority for vessels sailing in the Arctic. Environmental protection and clean-up are more difficult in the Far North than in a more southerly climate. Environmental protection in the Arctic requires industry to take responsibility for Arctic traffic, and to arrange both export and import shipping on high ice-class vessels with efficient engines. If this is not ensured, the purity of the Arctic ice will continue to be stained. Environmental protection must be considered in all operations in polar areas, just as it is in the areas between the poles.

Statutes and regulations should define the future requirements of Arctic tankers. Standards are needed for double hulls, ice class, minimum engine output and for ensuring that the vessels are capable of sailing for the most part without icebreaker assistance.

Today environmentally responsible charterers transport oil in the Northeast Passage on tankers belonging to the Russian UL Ice Class or 1A Super Ice Class used by Swedish and Finnish carriers. These tankers have been designed to sail in extreme ice conditions.

Neste’s geographical location has provided us with a basic understanding of how to deal with seas that freeze over in winter, what kinds of terminals are needed and what types of vessels are required to transport oil without damaging the environment. In accordance with the environmental policy of Neste Shipping, our entire tanker fleet has long been provided with double bottoms for enhanced safety, and most vessels also have a double hull. We have gathered valuable experience from sailing in icy conditions and survival in extremely harsh Arctic conditions from our earlier transport in the Northwest Passage to Greenland and Canada. This experience, together with the know-how provided by our Russian partners, has played a crucial role in the success of our traffic in the Northeast Passage.

The vessels of the Lunni series were built more than 20 years ago and are now approaching the end of their service lives. They were originally designed for winter traffic in the Baltic Sea and the Gulf of Bothnia. The Lunni and the Uikku have double hulls; they belong to the top 1A Super ice class, and both have diesel-electric azimuth propulsion systems.


Traffic today

The plans to open the Northeast Passage for year-round traffic as a trade route between Europe and the Far East, as a feasible option to the Suez Canal, are exaggerated. Year-round traffic would require vessels which have a technical capacity close to that of icebreakers. Building such vessels with modern technology would mean sacrificing profitability. Although the distance is relatively short in nautical miles, the ice cover grows so thick in mid-winter that, with existing fleets, the annual sailing season is in practice only four months long.

The turmoil in Russia in the early 1990s has frozen the process of building up the infrastructure of northern Siberia. This in turn has slowed down the demand for transport. Instead, the focus has shifted to western Siberia, with its rich oil and gas resources.

Shipping in the Northeast Passage naturally falls into two parts, western and eastern. Dry cargo vessels of the Russian ULA class sail all the year round between the European ports of Russia and the Yenisey River. Such vessels have long sailed east from the Yenisey in summer, along the Northeast Passage to Asian ports on the Pacific Ocean. It is the Russian Ministry of Transport that decides on the granting or refusal of permits for the Northeast Passage. The required certificate has to be renewed for each sailing season.

The oil pipeline built across Alaska and the practice of cabotage prevented the rewriting of the history of the Northwest Passage in the Canadian Arctic. Finally, in 1993, a historic sailing, for the West, to the Russian Arctic took place, when the tanker Lunni took three cargoes of gas oil from Arkhangelsk along the NSR to the mouth of the Yana River. In the following year, the tanker Uikku joined the oil distribution chain in northern Siberia fitted with rebuilt engines and a diesel-electric azimuth propulsion system. Then, in autumn 1997, the Uikku sailed the entire Northeast Passage, the first Finnish and Western trade vessel to do so, fetching a cargo of diesel from Provideniya Bay.

Both the Lunni and the Uikku, originally designed for the ice conditions in the Baltic Sea and the Gulf of Bothnia, have been kept busy transporting supplies to north Siberian towns and villages. Cargoes loaded in Murmansk and Archangel have sailed the Northeast Passage destined for river deltas in northern Russia, almost up to the Bering Strait. Each tanker has carried out two to four internal Russian oil transports in a four-month sailing season, but financial problems have sometimes delayed the return journey.



All activities in the Arctic are dictated by ice and weather conditions, so it must be stressed that the starting point is a good knowledge of the conditions. Many vessels have been damaged because of poor understanding of the Arctic environment. Crucial factors for sailing the Northeast Passage include ice conditions (ice thickness, duration of the ice season, extent of ice-free waters), sea conditions (temperature, wind, fog, darkness/lightness), and natural restrictions (width of the channel, depth of water, permanent ice).

The best sailing conditions are found between August and October. The ice reaches its maximal thickness of 1.1 to 2.4 metres in the second half of May. The coldest period is from December to March. All of the ice never actually melts in the Arctic region, but in a normal summer the ice becomes brittle as the north Siberian rivers discharge large masses of warm water into the shallow coastal areas. This impact is amplified by warm southern and eastern airflows.

The Arctic waters in Canada and Greenland are different from those in the Russian Arctic, so ice conditions in the Northeast Passage differ from those in the Northwest Passage. The Northwest Passage has so many huge icebergs that one can see the tips of hundreds of different-sized icebergs at one glance. 'Growlers', floating chunks of iceberg rising less than a metre above the surface, can be extremely dangerous, because the radar does not pick them out from the waves in the dark, and even when it’s light they are sometimes hard to spot. Where growlers occur, the tanker has to slow down and try to skirt them in order to avoid colliding with the chunks of ice the size of small houses.

Oil transport to eastern parts of the Northeast Passage normally starts in August and ends in November. The most dangerous situations are caused by permanent ice, which can be up to 4 to 6 metres thick. The 75,000-hp Polar icebreakers of the Murmansk nuclear fleet open the route when the ice cover gets too thick for Neste’s tankers. Ice has caused only minor damage and dents to the sides of our tankers, which is remarkable considering that these vessels were not originally built for such extreme Arctic conditions.

In a season with favourable ice conditions the passage of 5,200 nautical miles from Murmansk to Pevek in east Siberia and back, including unloading of the cargo, took only three weeks. In a less favourable season the time needed was almost two months.


Ports and routes

The Arctic port infrastructure along the Northeast Passage has much in common with the Northwest Passage, but less in common with ports in milder climates. The control station of the western Northeast Passage is located in Dikson on the Yenisey River and the eastern one in Pevek in eastern Siberia. These control stations issue sailing information, warnings and restrictions, coordinate icebreaker assistance and update the location of the vessels. The control stations pass on the vessels' arrival information to the loading and unloading ports. Ports are small and modestly equipped. They have no docks, port services, pilots, tugs, brokers etc.

In the East Siberian Sea, the Northeast Passage goes through the Sannikov Strait, where the depths can be as shallow as 13 to 15 m. in places, preventing deep-draught vessels from passing through the strait.

Our destination in the east is usually the port of Pevek, which is the oil distribution centre for the surrounding areas. Pevek has a dock, unlike all the other 'ports' between Pevek and the Bering Strait. In these places the only option is to cast anchor, if the wind is favourable, and pump the cargo through a floating pipeline several kilometres long. In poor weather conditions the unloading may take as long as three weeks.

At the mouths of the north Siberian rivers, the cargo is pumped into local river tankers for further transport. Anchoring is hindered by permanent ice, a moving layer on the sea bottom, strong winds and difficult ice conditions.

The lack of modern communication systems and compatibility are obstacles to efficient operations and safety.

Shipping gas condensate by the Northern Sea Route

Transport of gas condensate from the Gulf of Ob

The Yamal Peninsula has some of the world’s largest gas resources. A by-product of the pumping and transport of gas is a condensate, which has previously not been utilized due to the lack of an efficient transport system. Efforts are now being made to make shipping a competitive option to pipeline and rail transport. Operations can take place all year round in the Gulf of Ob with a fixed terminal and icebreaker assistance. Yamburg has been chosen as the loading port because of its infrastructure and railway connection.

Case-study: The M/T Uikku’s voyage to the Gulf of Ob in 1998

M/T Uikku sailed to pick up a cargo of gas condensate in late April 1998. The journey took place in extremely difficult ice conditions, the worst in 30 years. Choosing a route north of Novaya Zemlya because of difficult packed ice in the Kara passage, we pushed through the Kara Sea in a convoy of three, all the way to the mouth of the Ob. The ice cover was two metres at its thickest. Of the nuclear icebreaker fleet, only the Taymyr class (built in Finland, 45,000 hp) can sail the route to Sabeta, Tambey and Yamburg. A few days before our arrival, the Taymyr had broken a channel in the 2-metre-thick ice, which we could pass through to our loading site at Sabeta. It took us four days to load the gas condensate in Sabeta, at an average loading rate of 220 cubic metres an hour. The temperature of the cargo in the earth tank was –14 degrees Celsius. In spring 1996, a tanker of the Samotlor class had got jammed in the ice while loading.


A foreign company’s view of NSR technology and infrastructure – Perceived problems and uncertainties

By Makoto Shinagawa

General Manager, Tramp Co-ordinating Group, NYK Line, Tokyo, Japan

Features of the East Asia/Europe Tramp and Liner Services

In the shipping business, there are two kinds of services: tramp business and liner trade.

Major cargoes carried by tramp vessels are oil, iron ore, coal, grain and various other bulk cargoes; global trading volume of the respective cargoes are listed below in Table 1. Crude oil is also carried on tramp basis, and the types of vessels are ULCC/VLCC.

The major trading routes for crude oil originate from the Gulf and go to the Far East and Europe. In the case of iron ore, the major trading routes go from Australia to the Far East, and from Brazil to Europe and the Far East. As to coal, large volumes are coming from Australia to the Far East, from South Africa to Europe, and from North America to the Far East. The routes for grain mainly go from North America to the Far East and Europe, from South America to Europe/the Far East, and from Australia to the Far East and other areas.

The major trading routes for bulk cargoes go from the Southern Hemisphere to the Northern Hemisphere, which is not much related to the Northern Sea Route.

In the tramp business, companies have to assign suitable vessels, according to the cargo contents to load, and its cargo readiness. There exist more than 3,200 tankers and 5,000 bulk carriers in the world. Those vessels are, in some cases, assigned under a long-term contract. In other cases, companies come into the tramp market, charter a suitable vessel out of the market, depending on the vessel’s quality/charter-rate, schedule, etc.

In liner service, almost all cargoes are carried in container style (20'/40') by Full Container vessels. The main feature of liner service is to maintain a fixed schedule, based on the shipping timetable. Recently, weekly service in each port has become the minimum requirement for shipping companies: otherwise they will fail to gain the patronage of shippers/consignees of cargoes.

The worldwide container trading volume keeps growing. By 1998, it had reached some 40 million TEU with 3,500 container vessels.Tthe volume going between Asia and Europe represented about 20%. These are the main statistical facts of the Asia/Europe container service: 15 groups (Consortiums) /35 Operators are participating in the trade with 334 full container vessels, and there are 36 Loops of Weekly service, that is, more than 5 vessels a day sailing-in/out in this trade. With so many services and players, there is keen competition among the shipping companies. Bigger container vessels, in some case types of more than 6,000 TEU, are being introduced in order to profit from large-scale operations.

Under such circumstances, even if the NSR or other new commercial operations start up in Far East/Europe trade in the future, I wonder whether such alternatives would prove capable of competing with the current services mentioned above.



Table 1. Worldwide Seaborne Trade Volume in 1998

<Tramp Service>

*Oil 1,641 million tons

Iron ore 395 million tons

Coal 425

Grain 197

Other minor bulk 521


*Dry bulk total 1,538 million tons

<Liner Service>

*Container cargo 40,500 thousand TEU (approx. 600 million tons)

***Worldwide grand total: 3,779 million tons



Table 2. Worldwide Fleet Volume of Tanker/Bulk Carrier/Container Carrier

*Tanker: 3,208 Vessels/248 million DWT

*Bulk carrier: 5,005 Vessels/260 million DWT

*Container carrier: 3,500 Vessels/4,600 thousand TEU(approx. 70 million DWT)


***Total: 11,713 Vessels/578 million DWT


Comparison of the Northern Sea Route vs. the traditional Suez Route

Comparing the distance between Yokohama/Hamburg via Suez and NSR, the distance through the NSR is almost half of the southern route. However, as the service speed of vessels via Suez is normally expected to be almost double of NSR, transit time is several days shorter through Suez. Transit time via the NSR may be highly variable, subject to weather and ice conditions, which in turn would greatly affect the regular and accurate positioning of ships.

The number of containers that can be carried also varies greatly. Vessels currently operating in the trade normally have a container capacity of 3,000–6,500 TEU, which is assumed to be a much larger scale than that of NSR-based vessels. NSR vessels also score lower on several other factors compared with Suez-based vessels, mainly regarding service, speed and fuel consumption – speed is much lower and fuel consumption is higher.

The level of ocean freight net revenue varies with market conditions, EB and WB cargo content and volume and Loading/Discharging stevedores contracts.In order to simplify the analysis, we temporarily assume here net revenue to be $1,000 per TEU (after deducting loading/discharging cost). On this basis, the revenue per vessel (one-leg) differs by more than $3 million due to the larger scale merit of Suez-based container vessels, which greatly affects the profitability of the vessels' operation.

As for cost comparison, there are many unknown factors in NSR operations, making comparison difficult. Going via the NSR route, vessels can save the Suez Canal charge – but they have to include many additional cost factors such as icebreaker charge, insurance premium, and other extra charges which only apply to the NSR route. As mentioned, NSR vessels have much less speed and greater fuel consumption. This leads to the additional cost-factor of bunker charges, which are assumed to be more than $300,000 per one-leg voyage.


Table 3. Comparison of Distance/Transit Time

*Distance: Yokohama – Hamburg = 11,400 nm (via Suez)

= 6,600 nm (via NSR)

*Transit time/One-way (via Suez/21 knots basis) = 22.6 days

(via NSR/10 knots basis) = 27.5 days


Table 4. Comparison of Vessels' Particulars to deploy

<Case I: via Suez> <Case II: via NSR>

Typical type of NSR/40,000DWT Type

container service

------------------------- ------------------------------

LOA 299.0 m 206.5 m

Breadth 37.1 m 27.5 m

Depth 21.8 m 16.0 m

Draft 13.0 m 12.5 m

Gross tons 60,117 22,600

DWT 63,163 M/T 40,000 M/T

TEU capacity 4,730 TEU 1,600 TEU(?)

Sea speed 25 knots 14.5 knots

Fuel consumption per day 106 M/T (21knots basis) 187 M/T(with speed?)


Table 5. Revenue Comparison (simulation/One-Leg Basis)

Ocean freight revenue : $1,000/TEU (assuming here net revenue)

<Case I> $1,000 X 4,730 = $4,730 thousand

<Case II> $1,000 X 1,600 = $1,600 thousand


Balance: <Case-I> = +$3,130 thousand (with cargo / full capacity basis)

Table 6. Cost Comparison (simulation/One-Leg Basis)

Cost Comparison Summary (in thousand US $)

<Case I: via Suez> <Case II: via NSR>

----------------------- -------------------

Vessel charter rate $5–6/TEU per day ?

(depends on vessels/market etc)

Suez Canal charge +300

Bunker charge + 333

Icebreaker charge + ?

Insurance premium + ?

Extra pilot charge + ?

Agency fee in NSR area + ?

Any other extra charges + ?

*Other costs such as port charges, agency fees etc being assumed to be the same.





Being commercial businesses, shipping companies have always to seek how to transport the cargo safely, on schedule, speedily and cheaply. For these reasons, they may be reluctant to select NSR services under the current conditions.

As a first step towards commercial feasibility, it may be better to start taking cargo coming from/to Russian NSR areas. Indeed, this is already taking place to some extent. The northern part of Russia is said to be rich in natural resources (minerals/gases), and these resources may be transported by NSR vessels in the future.

In the case of transporting special cargo that may meet with difficulties passing through the coastal areas of many countries, there might be another chance that the NSR special route could be taken into consideration, in order to avoid unfavourable conflicts along the normal route.


Russian ice information services in the future

By V. Smirnov, I. Frolov, V. Grishchenko and E. Mironov

Arctic and Antarctic Research Institute, St. Petersburg, Russia


Ice information support is a component of hydrometeorological services of ice navigation and other activities in the Arctic that play a decisive role in providing safety and efficiency of sea operations. Multi-year experience of Arctic navigation in Russia has provided several examples of accidents and even losses of men and ships caused by difficult ice and hydrometeorological conditions.

Airborne sea ice observations on the NSR began in 1934. In subsequent years the methods of visual observations were improved, since the mid-1950s with airborne sea ice observations being performed also during the winter period. Regular airborne sea ice observations continued up to 1991.

Since 1969, Russian and non-Russian satellite data have been used successfully for the Arctic and Antarctic sea-ice monitoring. At present, remote sensing is the most effective and indeed often the only method for monitoring sea-ice cover in the Arctic basin. Satellite information is becoming increasingly important in support to ice navigation.

In Russia, the currently available automated ice information system for support of Arctic navigation and offshore activities is based on a complex approach to the methods and means for collecting information on ice conditions. This involves the combined processing and analysis of non-homogeneous information from satellites, ground-based observations, autonomous drifting stations, icebreakers, ships and aircraft. Ice mapping is performed using the information on ice regime, historical databases and ice models. Ice information is analysed by skilled ice experts with the use of modern hardware and special software developed at AARI.

The system has a module for analysis and forecasting of ice and hydro-meteorological conditions. Stochastic and hydrodynamic models for prediction of ice cover distribution from 1–7 days up to 3–6 months have been developed and are in current use. A numerical model for the evaluation of ice-routing, with due regard to actual or predicted ice information and technical characteristics of icebreakers and ships, has also been developed.

Organizationally, the ice information system is based on a spatially-shared, regionally-organized network for the collection, analysis and operational use of ice information with centres in Dikson, Tiksi and Pevek, as well as a specialized research institute (AARI) engaged in studying problems with methodological supervision and coordination of efforts for problem-solving. AARI also has a Center for Ice and Hydrometeorological Information for operational information support.

AARI has an archive of satellite images, the 'Databank on Sea-Ice of the Earth’s Polar Regions', stored in the SIGRID format for the period 1933–99, and databases on ice observations at polar stations for the period 1934–98.

AARI uses the INMARSAT communication system to transmit ice charts and all other information reports including images of local areas to icebreakers and other users, including the Marine Transport Operational Headquarters (MOH), located at the Murmansk Shipping Company.

MOH is the main centre for organization and coordination of ship traffic, icebreaker escort and navigation support in the NSR. Requirements for ice information differ, depending on the transport operation stage, season, ice conditions and the ice-class of ships. The following stages of ship navigation on the NSR will usually involved various requirements at to information support:

The ice-information system provides information support to all these stages as one cycle of transport activity along the NSR.

The modern state of the ice-information system is characterized by stages of reconstruction and improvement of the system, through developing instrumentation and introducing the latest technical means and technologies, among them GIS-based technologies.

This system functions as a unique information-controlling system in the framework of the Federal Service of Russia for Hydrometeorology, providing clarification of the ice conditions and conducting operations over the vast territories of the Arctic Ocean and the entirelength of the NSR.

However, the considerable decrease in NSR traffic during the last decade has caused certain difficulties for the development of the Russian ice information system.

Since the mid-1990s the next natural stage of the development of macro-synoptic processes in the northern hemisphere has begun. We are witnessing a climatological a transition, from the meridianal circulation epoch to the zonal circulation epoch. Observations have indicated a tendency towards decreasing air temperatures in the Arctic has been observed. This tendency is noteworthy against the general background of global warming elsewhere. Air temperature decrease is accompanied by greater amounts of compacted Arctic sea-ice, and by a transition from predominantly easy ice conditions to heavy ice conditions. In the early 21st century, hydrometeorological support for ice navigation will become increasingly important. This in turn will necesssitate further development of the ice-information system, to enable it to provide information of even better quality and greater timeliness.

AARI’s participation in INSROP work has made it possible to define the main requirements for ice information support of international ice navigation along the NSR and to develop a strategy for adapting the Russian system to these requirements. The first steps towards adaptation have already been taken. The development of the system will be continued with the use of national financial means and allocations from the revenues expected to accrue through the provision of ice-navigation support.

The participation of AARI in the international ICEWATCH and ARCDEV projects has meant that algorithms and technologies could be developed for combined use of Russian and non-Russian satellite data, including ERS and RADARSAT high-resolution information. This in turn has meant that successful navigational support could be provided to to an international convoy travelling to Ob Bay (western Siberia) under heavy ice conditions during the spring of 1998.

The future development of the Russian ice-information system will be follow these lines:

Work is already underway on developing the necessary technology to prepare ice information coverage in DX-90 format to be transmitted to ships supplied with ECDIS. The first test transmission of such ice information coverage onboard the icebreaker Sovetsky Soyuz was carried out in 1997.

International navigation along the NSR will be supported with the following type of information:

In order to support local transport systems (including regular transportation of hydrocarbons from offshore fields), the development of specialized subsystems under one information Center is envisaged. It will provide the possibility of using existing technical, information and intellectual resources without creating a whole new information infrastructure.

The cost of ice information services will include expenses of information acquisition (for example, the acquisition of RADARSAT or other commercial satellite information if necessary), expenses of its analysis, processing and dissemination to users. The cost of services will be fixed by specific contracts, taking into account the Russian legislature. An increase in marine freight turnover is anticipated to be accompanied by lower costs for ice-information support.

The principles and approaches to estimating the cost of all complex services of international navigation along the NSR including ice information support are now being considered by the appropriate Russian agencies.


 Future development of NSR ship design – Technology and price

By Kimmo Juurmaa

Manager, Arctic Technology Group, Kværner Masa-Yards, Helsinki, Finland


Factors influencing transport economics

The economics of marine transport on any sea route will be dependent on various interlinking factors – political, legal, commercial, technical.

The political factors stem from the needs of the home country of a sea route. By regulating the fees, customs, immigration and services provided, a country can influence the development of traffic on the sea route. An example is the fairway fee system in Finland. Any vessel visiting any port in Finland must pay a fairway fee, which is used to cover the government’s icebreaker costs. The amount charged depends the ice class of the vessel, with higher ice-class vessels paying less, and the highest fees being applicable to open-water vessels visiting Finland only during the summer time. As a result of this system, industry in northern Finland does not have to carry the full costs of winter navigation. Furthermore, the systemserves to encourage the use of higher ice-class vessels.

Legal factors come from the international law and agreements. A typical question here is whether the sea route is considered to be international waterway, or is subject to national regulations.

Commercial factors touch on possible alternatives to the sea route. If there is an alternative, there will always be competition to take into consideration.

The technology that will be applied in connection with any given sea route is dependent on the political, legal and commercial framework. Conversely, new technology and new innovations may change the role of a sea route, giving rise to new thinking also in political and especially in commercial questions.


Technology-dependent factors on the NSR

Although legal and political factors have a strong influence on the development of the NSR, technological factors remain even more important. As a minimum, the following technologies will be essential for further development of the NSR:


General infrastructure requirements:

The traffic control system on the NSR must be further developed, utilizing modern technology. During the EU-funded ARCDEV voyage, the helicopter carrying VIP visitors was unable to locate the tanker in the mouth of Ob river, so obviously there are some aspects of traffic-control in need of improvement.

The border-crossing process on the NSR is poorly developed. Today a foreign vessel that needs technical, customs and immigration inspection is forced to make an extra port call, thereby losing time and money.

In today’s situation, the icebreaker service available on the NSR is efficient and sufficient for current cargo volumes. However, with an increase in cargo volumes as well as in vessel sizes, this will become a problem area in the future.

Preparedness for rescue and pollution response operations on the NSR has been discussed in several INSROP papers. In practice this readiness has not as yet been demonstrated, so vessels operating in the area should be prepared to take care of the first response themselves.


Ship technology

In designing vessels for NSR traffic, consideration must be given to both the technology-dependent factors and the general infrastructure. Some items mentioned above have been demonstrated in practice, but no vessel utilizing the latest technology has been constructed.

Icebreaking technology. All vessels operating on the NSR today utilize basically the same technology for icebreaking: downwards bending hull form and low friction coatings. Some vessels are also equipped with special devices like air bubbling or heeling systems. The latest technology, which is based on the bow propeller effect and azimuthing thrusters, can reduce ice resistance by some 40 to 50 % and could cut vessel-construction costs by up to 15%. This technology is well proven in first-year ice conditions, but requires further development for areas with old ice. The gains will be in shorter sailing times and lower operational costs.

Material technology. The use of high tensile steels is proven technology up to 500 MPa, but in commercial vessels this technology has not yet been utilized. The additional costs would be marginal, and the gains in lower hull weight are obvious.

Propulsion systems. The performance of the propulsion system is an essential question for the successful operation of a cargo vessel in the Arctic conditions. Technically, the best alternative today is podded propulsion with electric transmission. Due to its high cost, approx. 40 % higher than cheapest conventional system, the system still needs further development.

Remote sensing and navigation. The ARCDEV voyage showed the importance of ice routing based on satellite images and helicopter flights – and modern technology offers possibilities to develop this further. The use of laser profiling and electromagnetic measurements together with unmanned aerial vehicles should studied properly.

Information technology. Advanced information technology offers almost unlimited possibilities to create remote-maintenance and other support systems for vessels operating in the Arctic. During the ARCDEV voyage a prototype system using tele-presence based on virtual reality was demonstrated. Similar systems can provide top-level expertise to assist in solving any problems. This will decrease the need for experts onboard thus help to reduce costs.

Open-water technology. For the overall economics of vessels operating on the NSR, open-water performance is also important. The best vessels in the area today represent compromises between ice and open-water performance. In open water, icebreaking vessels lose some 10% in efficiency compared to vessels optimized for open-water conditions. And still their ice resistance is some 20–40% higher than it could be. Experiments with Kapitan Sorokin-class icebreakers showed that icebreaking capability and assistance performance could be increased by some 50%. But this resulted in poor performance in open water, especially in waves. In this respect the Double Acting Tanker (DAT) concept could be a solution, since the vessel can be optimized for both conditions.

General Infrastructure

Although consideration should be given to all shortcomings in general infrastructure in the design of the future vessels for the NSR, icebreaker assistance is the most critical question. In today’s situation, where vessels are convoyed through the whole sea route, the best vessel cannot do any better than the weakest vessel in the convoy. This does not attract the ship owners to invest in new technology. In view of this and the uncertainty of the future of the icebreakers, a vessel which does not need any icebreaker assistance would seem an ideal solution. Since conditions along the NSR vary greatly, this might lead to over-design of commercial vessels. A more feasible solution might be to concentrate icebreaker services in the most difficult areas, like the narrow straits. This would reduce the total need for icebreakers and would benefit vessels with higher performance.

Towards lower costs through advanced technology

Today, traffic on the NSR is not economically viable. The main reason is the low cargo base, which cannot carry the costs of the technology required in these demanding conditions. However, the cargo base will not increase until performance on the NSR has been improved: this means reliability, regularity and lowered costs. The first step would be to collect icebreaker costs not only from the cargo that uses the icebreakers, but from a wider base. This is a political decision and will require a firm commitment towards maintaining activities in the Far North. The second step would be to develop the fee and management system to reward vessels with higher class and better performance. There exists a huge potential for developing the vessels and supporting infrastructure, whereas today’s system attracts only cheap low-class, low-performance vessels.

Considering the potential cargo base, especially the hydrocarbon reserves in the Russian Arctic, and considering the possibilities of modern technology, there should be no doubt that the NSR could be developed into an active and important sea route.

The Murmansk region – Russian northern gateway to the Arctic

By Yury A. Yevdokimov

Governor of Murmansk Region, Russia


All the Russian Northern territories – from the Kola Peninsula to Chukotka – are extremely interested in full recovery of the Northern Sea Route. Its significance as a main transport line is defined, first and foremost, by the need for industrial management of the rich natural resources of the Extreme North, and by the great opportunities for effective and economically beneficial transportation of cargoes from Europe to the Far East and South-East Asia.

The technical basis of the Arctic marine transport system includes the transport- and icebreaker fleets, reloading terminals, special organisations for fleet servicing and other coastal management objects, systems for navigation maintenance, and systems for marine Arctic operations management. All of these factors are fully present in Murmansk region, which for many decades has been the major base area of the Russian Arctic and the starting point of the Northern Sea Route.

The exclusively beneficial geographical position, an ice-free marine port with full infrastructure, the world’s mightiest icebreaker fleet with vast experience of NSR operations, large ship repairing enterprises and highly qualified personnel create real preconditions for effective use of this route for international transit navigation throughout prolonged navigation periods.

The solid scientific- and industrial complex of the Murmansk area, a significant part of which has been engaged in questions pertaining to the effective development of the Arctic, is ready today to provide full scale scientific and technical support for the recovery of the Northern Sea Route in general, and especially of its western part.

It is quite clear to us that a necessary requirement for development of northern areas is speeding up the construction and development of transport communications, of which the Northern Sea Route is the most important in the Arctic. That is why all the regions are extremely concerned about effective operation of the Northern Sea Route and ready to combine their efforts and resources for its development.

It seems reasonable and timely to create a financial-industrial group in the form of a Russian Stock Company where the state would hold the controlling share.

The question of the further existence of the Northern Sea Route - a national transport line – can be successfully solved by extensive development and production of hydrocarbons in the Barents Sea, increased mining in the northern regions and – as a result – increased activities via the Northern Sea Route.

An important component of resurrection of the Russian North and Russia in general is saving the existing scientific, production- and professional potential and all of the necessary infrastructure (icebreakers, hydrographic vessels, ports, meteorological stations etc.).

What does the shipping industry expect as to administration of the Northern Sea Route?

By Ronald Bergman

Immediate Past President, Baltic and International Maritime Council (BIMCO); Chairman, Nordström & Thulin, Stockholm, Sweden


BIMCO welcomes the opportunity to speak on aspects of the Northern Sea Route. While there are many problems to be solved to make the NSR viable, the prospects it offers are attractive to shipowners.

Freight rates may be reduced if the distance from for example, Hamburg to Japan can be decreased by thousands of miles. Huge amounts could be saved on running costs and bunkers, and the shortening of travelling time could open up for new possibilities.

NSR navigation is difficult and dangerous. Few foreign vessels have navigated the NSR, calling only at ports in northern Russia. Before owners will consider the use of the route as an attractive alternative, they will expect a great deal from the NSR Administration. This can be condensed into two words – SAFETY and GUARANTEES.



Owners will want to be sure that there are no obstacles that could endanger vessels and their crew. It will be up to the NSR Administration to convince each owner that every step possible has been taken to ensure the vessel’s safety during passage.

Navigating commercial vessels on a large scale in an area as environmentally sensitive as the Northern Sea Route may have severe environmental consequences in case of an accident or oil spill. The NSR Administration must prepare emergency response plans and ensure the availability of necessary equipment for fast clean-up. We must not ignore the reality that an accident may occur at some point. Ships must be able to enter any port along the entire route in case of emergency. A vessel in need of aid must be able to call at the nearest port: ports and services will have to be available to vessels of all flags.

There is also the necessity of well-maintained navigational aids. Weather and ice condition reports must be provided to all vessels.

Nor can the human element be ignored. Crews will be encountering relatively unknown conditions. They must rely heavily on experience, training and instinct. Pilots, masters of icebreakers and port operators alike must understand their contribution and the importance of effective communication. Crewmembers, pilots and masters of icebreakers must be able to communicate in a common language.



What kind of guarantees may we expect prior to embarking upon a voyage through the Northern Sea Route? There is a considerable uncertainty factor. Consideration must be given to the cost aspect of passing through the NSR, not least the financial consequences of delays of voyage. Fixed fees for services are needed. Such fees must be set at a competitive level.

Moreover, all ships must be guaranteed the availability of pilots willing to guide in a relatively treacherous stretch of water. Icebreaking tugs must be accessible. Accurate reports must be available, and resources for weather- and ice-tracking will have to be in place.

All of this points to the importance of administration. Administration must be the centrepoint in search and rescue operations, and must act as central liaison on all issues involving the use of the NSR.

The future structure of NSR administration and operations

By Anatoly G. Gorshkovsky

Head, Northern Sea Route Administration, Moscow, Russia


A major task of the NSR Administration is to define possible directions for the development of central and regional management bodies for the NSR, under conditions of political and economic reform in Russia.

Retrospective analysis of NSR management under the Soviets shows that success in the initial stages of the NSR development was possible due to the centralization of management, with state ownership of all NSR elements. The economic reforms which started in Russia in 1991 have damaged the central system of control. The legislative basis for a new NSR control system is set out in the Constitution of the Russian Federation (1993) and the Decree of the President of the Russian Federation (1993), which stipulate federal ownership of the icebreaking, emergency, salvage and hydrographic fleets, port facilities, navigation and hydrographic support for navigation safety, hydrometeorological service and radio communication facilities. These elements of the NSR are always to be under central management. The integration of central and regional management bodies with different ownership structures will be conducted with the active involvement of Federation entities and industrial enterprises in the Arctic Region. At all stages of development of the Route, the state will preserve the NSR as a uniform national transport route meeting the internal and external interests of Russia.

INSROP research has detailed the problems of NSR management in the near and distant future (after 2005). Improvement of NSR management will take place under conditions of deepened political and economic reforms in Russia in its transition to market relations.

The participation of the entities of the Russian Federation in the management of the NSR management will be governed through a division of powers: regulatory and legal, economic, administrative and day-to-day powers. Legal methods relate to development and adoption of federal and regional legal and regulatory acts. Economic methods are applied to provide incentives for activities of all participants in the transportation process, through state investments and financial support, compensation for a part of cargo transportation tariffs in Far North areas, and increased efficiency of management of state shares. Administrative management methods include state control of rational use of the NSR, appointment of state representatives in sea navigation companies, and the formation of state seaport administrations. Day-to-day methods are used for the direct management of ship postings by NSR routes.

The main objectives of the NSR management in the current period of economic stabilization in Russia are to define possible cargo flows and to maintain on-schedule delivery of cargoes required for developing Northern territories in market conditions, as well as to develop coastal, export/import and transit transportation by the NSR. The tasks for management of navigation will be oriented towards growing volumes of shipping, including transit cargoes. The existing potential of the icebreaking and transport fleet is adequate to ensure a prospective increase in transportation (up to 10 million tons) by 2005. Secondary management objectives relate to the safety of navigation, and the prevention of pollution of the marine environment and the northern coasts of Russia by ships.

Later, NSR management objectives in the period of steady economic development in the Russian Arctic Region (after 2005) will be to maintain cargo flows for further economic development of the Arctic zone, meeting the needs of the entities of the Russian Federation and ensuring good living conditions for the inhabitants of the Far North. For these future objectives to be met, the icebreaking and transport fleet must get new ships; and new transport and technological systems must be developed for the export of petroleum and gas condensate. In addition to ships of established Russian navigation companies, cargo transport will involve specialized ships of foreign companies and firms engaged in the development of the natural resources of the Arctic shelf, in coastal shipping and international NSR transit.

On the state level of the NSR management system, account has been taken of the future interests of Russia in the Arctic Region. On the regional level, the formation of bodies for direct management of transport operations is possible. In a market environment, the features of NSR management (subordination, coordination, control, etc.) will be determined by patterns of ownership and areas of authority. Under the Constitution of the Russian Federation of 1993, with regard to the NSR, the state shall control: the federal state property and its management; the federal transport, communication routes, information and communication facilities; the hydrometeorological service; customs regulation; federal taxes and fees. The following shall be under joint control of the Russian Federation and the entities of the Russian Federation: issues related to land ownership; differentiation of state ownership; use of natural resources; protection of the environment, establishment of principles of local self-management; coordination of international and foreign economic relations of the entities of the Russian Federation. Suggestions offered by participants in the final INSROP session on the content of the report of the NSR Administration have already been incorporated into the INSROP programme. They will be accounted for in further work with the report and in Arctic activities.


Financing of the NSR infrastructure: Russian resolve and possible international contributions

By Robert N. North

Professor, Department of Geography, University of British Columbia, Canada


The term 'infrastructure' is taken to include ports, navigational aids, icebreaking and dredging services. Investment in these cannot be anticipated unless the investors can expect some kind of return. Private investors would normally hope for monetary returns, either directly through payment for materials, equipment or services, or indirectly through the facilitation of traffic from which they could benefit. Government and international agencies might hope for returns in the form of, for example, improved military or environmental security.

What are the prospects for returns from the main actual and potential uses of the NSR, taking these uses to be northern supply, transit, and the export of commodities from northern Russia and the Arctic basin? Northern supply appears to offer poor prospects for monetary returns except with government subsidies, especially along the eastern sector of the NSR. Also, current Russian government policies seem more likely to reduce the northern population to a level which can be supplied by air, river, and road, than to restore the role of the NSR to Soviet levels. Transit traffic is commercially feasible for certain kinds of traffic, judging by some INSROP working papers. However, it is a matter of debate whether the route could be sufficiently attractive to major shipping companies that they would be prepared to invest in the infrastructure rather than simply pay for services on a voyage-by-voyage basis. Exploration for and exploitation of natural resources along the western sector of the NSR, especially oil and natural gas if world prices are high enough, may be attractive enough to stimulate private contributions to infrastructure. Also, the Russian government has a permanent interest in demonstrating its sovereignty in the Russian Arctic, even if it is financially incapable of a major effort at present and is unlikely to want to move naval surface vessels along the route to any great extent.

The potential for monetary returns, unless they are demonstrably likely to be extremely high, will not be sufficient in itself to attract foreign private investment. Post-Communist Russia has not proven as attractive to investors as have some other ex-Communist countries, for several reasons. They include abrupt changes in the conditions for investment, including tax regimes poorly coordinated among the various levels of government; hostility from local interests and a lack of understanding of the expectations of foreign investors; a high incidence of crime and corruption; and political and financial volatility. In addition, many foreigners are inadequately informed about Russia, the Russian business climate, and specific local circumstances, and find it difficult to acquire that knowledge.

Nevertheless, some transport projects have attracted foreign investment, including infrastructure projects. Some investors have identified immediate needs in a restructuring economy and presumably hope for good returns in the near future. Others seem prepared to take a long-term view of Russian economic recovery and world market behaviour. Some regions have attracted more attention than others, reflecting in part the attitudes and behaviour of the local political and economic elite. Investment in some areas has been stimulated by relatively high confidence in the guarantees offered to foreigners or by exceptionally good knowledge of the specific situation. From an examination of cases, the paper attempts to extract lessons useful lessons for attracting investment to the NSR.


The Arctic environment and the indigenous peoples

By Alona A. Yefimenko

Technical Advisor, Indigenous Peoples' Secretariat, Arctic Council


The Protection of the Arctic Environment and indigenous peoples – these are the ‘soft issues' which must not be overlooked.

The ambitions and challenges of INSROP are enormous. The responsible stakeholders in establishing the NSR, the governments in particular, have a responsibility for dealing with these challenges wisely. The establishment of a Northern Sea Route must not represent a threat to the Arctic environment, to the indigenous peoples who occupy the environment, or to the territories that will be affected by the sea route.

With the signing of the Declaration on the Protection of the Arctic Environment in Rovaniemi, Finland, in June 1991 the Arctic governments emphasized their responsibility to protect and preserve the Arctic environment. They further recognized the special relationship of the indigenous peoples and local populations to the Arctic and their unique contribution to the protection of the Arctic environment.

The Arctic Environment Protection Strategy has now been integrated into the work of the Arctic Council. In this Strategy, the role of indigenous peoples in the protection of the environment has been realized through the active participation of and the full consultation with the organization of indigenous peoples, in the processes of the Arctic Council.

Much work has already been carried out in assessing the environmental impacts that the opening of the Northern Sea Route could entail. Work has also been carried out in assessing the social and cultural impacts on the indigenous peoples living along the NSR. However, little has been done towards securing a legal and political infrastructure to facilitate the participation of the indigenous peoples in the necessary decision-making processes concerning the NSR.

Based on the experiences of Arctic indigenous peoples, this presentation concentrates on those aspects and areas that could have a potentially disastrous effect on the lives and cultures of indigenous peoples. These are areas where the attention of responsible stakeholders and decision-makers of the Northern Sea Route is needed. This contribution stresses the crucial importance of involving the indigenous peoples as stakeholders to the Northern Sea Route.


The legal regime of the NSR – A US/Russian dispute with a potential to stop foreign ships

By Douglas Brubaker

Senior Research Fellow, the Fridtjof Nansen Institute, Lysaker, Norway


NSR – Superpower Subterfuge – Why?

Due to shallow depths of large portions of the Russian Arctic seas and most of the Russian Arctic straits, the military strategic value of the NSR is likely low – as a link between the Russian Northern and Pacific Fleets, as a station area for SSBN’s and as a militarized surveillance area. In terms of perceptions, however, the NSR has a long history of consistent over-rating which also affects the legal regimes represented by the excesses shown of both the Russian regime and the US claims. Because of the asymmetry, the security-political as well as legal situation is inherently unstable. What lies behind such controversy? Why does the USA accept as well as ostensibly practise the LOSC Article 234 environmental regime for Arctic surface waters, but claims submerged passages exempt for Arctic seas in which it is difficult and even dangerous to navigate? Why does Russia attempt to legally secure straits as internal waters largely unusable to itself, while the USA claims but rarely enforces transit passage through such straits of minor 'indispensability'?

Russia promotes its regime for ice-covered areas in its exclusive economic zone and of internal waters for its Arctic straits because of the assumed concern for security and environmental control. A Cold War assumption probably continues that Russian security is bettered by keeping the straits closed. At least a picture is provided internationally of tighter security.

The reasons behind the US official declarations for transit passage and occasional submarine transit through these Arctic straits are generally clear, US deterrence and surveillance measures. However Russian Arctic waters are generally of less importance. The answers lying behind US policy include probably that freedom of navigation globally is of supreme consideration to the US military, and deviations will simply not be permitted. Rapid global mobility is being cared for and protected even with respect to largely unusable straits.

Another reason for the USA concerns future use. The relative importance of different avenues of the oceans in the future will depend on technologies, contexts, and needs which cannot be envisaged now. In a world where military capabilities take years to construct, but where political intentions can change overnight, the prudent course is not to surrender any of these maritime routes if at all avoidable. It may also be envisioned that research is occasionally being carried out by US SSNs in the deeper portions of the NSR to find possible SSBN rescue areas in the event of war. An US SSBN followed by Russian SSNs could find refuge along the NSR and wait for rescue from its own SSNs if it knew the underwater terrain.

Finally, the US Navy may consider it unnecessary to delve into policies conflicting with its views of law of the sea. This may be argued parallel to visits made by US Navy vessels possibly carrying nuclear weapons to ports of NATO allies prohibiting such, and opposition is met by official statements that the USA or the port state neither confirms nor denies the presence of such nuclear weapons.

Most of the reasons behind the over-rated military security perceptions concerning the NSR, including the expansive legal positions, relate to global macro-strategic interests in regions far removed from the NSR itself. These include the Gibraltar Straits, the Indonesian Straits, the Indian Ocean, and the GIUK gap, as well as the Barents Sea and the MIZ and polynyas of the Central Arctic Basin.

Consequences of the Asymmetrical Legal Regime

For the legal regime generally governing the Russian Arctic waters and rights of passage of state vessels and specifically the straits, the situation is less than desirable despite the developments noted, since it reflects the same conflicts of polarization previously existing within the international straits regime. Here the polarization is between the US claims as a user state for nearly free passage and the Russian claims as a coastal strait state for rights consistent with internal waters. It may even tend towards that noted by one expert – a near stalemate in the formation of customary law, but more localized to fewer states and more points of dissension.

This status, inherently unstable due to the legal distance between the claims, and therefore sensitive, is made even more sensitive by the complicated US coastal state legislation which has similarities to the Russian and Canadian, for the territorial sea and probably the EEZ. The issue of submerged passage in a geographic area still perceived as sensitive compounds the problems. All of these elements work against the establishment of a stable world order, despite the development of customary international law and the moderate profile cooperative developments surrounding Arctic environmental protection and safety. It is conceivable a more conservative Russia may decide it would be in its interest not only to disclose collisions between Russian and US submarines in the Russian territorial sea, but also to disclose US submerged transits through navigable Arctic straits claimed as internal waters. It may decide to enforce its provisions governing internal waters, and choose one of the possible interpretations under LOSC Article 39(1)(b) – threats of force – as a reason for actively denying transit. This would result in a subsequent increase in world tension – precisely the situation that the LOSC Part III regime was designed to alleviate. As noted by US representative to UNCLOS III J. Moore in l973,

A principal goal of the Law of the Sea Conference must be to agree on a regime which will minimize the possibilities of conflict among nations, conflicts which may arise because of uncertainties as to legal rights and responsibilities. In view of the importance of straits used for international navigation, any regime for such straits which depended upon a set of criteria that could be subjectively interpreted by straits states would sow the seeds of future conflict and undercut a major goal of the Conference.

The expert E. Brüel on the other hand notes the fears of the coastal states with the notable examples of Turkey and Denmark, and force exerted by the Great Powers:

(T)he possession of straits contains a risk for the littoral state, especially if it misjudges its privileges, based on international law, as Denmark learnt to its detriment in l801 and in l807. It is, therefore of the greatest importance, in particular to weak states having coasts adjacent to international straits, that not the slightest doubt exists as to what these privileges are.

In this connection we may to quote W. Reisman and J. Baker:

The law-level of regulation in many strategic modes is lamentable because it does not serve world order. A state actor that refrains from some theretofore licit practises may contribute, by its own abstinence to the formation and installation of a more appropriate norm...(T)he implementation of this recommendation requires that lawyers who have the necessary background, but who are not in the direct chain of command, have an opportunity to submit their written views, which become part of the record.

With this in mind the following recommendations are made.

 Recommendations – Conflict Resolution and Negotiation

With the aim of increasing world order and reducing tension, the US State Department and the Russian Foreign Ministry should take the initiative, in conjunction with the Canadian Ministry of External Affairs, to convene a conference with the express goal of negotiating a concrete legal regime for the Arctic focusing on the environment and navigational safety. The Scandinavian states and Finland and the Arctic Council, the Working Group on Harmonization of Polar Vessels Rules should also be included, due to their Arctic territories and/or vessel-building industries as well as experience in drafting environmental instruments.



By Stig Magnar Løvås and Odd Willy Brude

SINTEF Civil and Environmental Engineering, Trondheim, Norway /

Alpha Environmental Consultants, Oslo, Norway


In order to facilitate storage, retrieval and analysis of information obtained within INSROP, an INSROP Information System has been developed using GIS technology. The current version of the system is called INSROP GIS v3.0a, and is presented in INSROP Working Paper 165 (Løvås & Brude 1999a) and 166 (Brude & Løvås 1999). An early version of the system (v1.0) was presented in INSROP Working Paper 47 (Løvås & Brude 1996). The current system is prepared for distribution on CD-ROM (Løvås & Brude 1999b).

INSROP GIS was developed to provide INSROP projects with the power to visualize, explore, query and analyse geographic INSROP data. Of equal importance, the system is now meant to provide decision-makers with easy access to organized INSROP information and results.

Use of INSROP GIS requires basic knowledge of ArcView 3.x; all ArcView 3.x capabilities are available in INSROP GIS. In addition, INSROP GIS provides a customized user interface including access to INSROP GIS hypertext documentation, a set of special options for INSROP purposes, and INSROP GIS layout templates to facilitate the creation of INSROP hardcopy output. The figure below shows an example of using INSROP GIS, and what the ArcView Views window looks like when the INSROP GIS Extension is loaded.

In INSROP Phase 2, the system development and implementation of data within Sub-programmes I, III and IV was carried out within Project I.3.2 – Arrangement and Expansion of INSROP GIS, while Project II.3.10 – Geographical Information System was responsible for implementing all data within Sub-programme II. During INSROP Phase 2, ArcView Version 3.0a of was released; this provided new capabilities for INSROP GIS development. Moreover, changes in the ArcView programming language, Avenue, required several modifications to INSROP GIS v1.0. INSROP GIS is now an ArcView 3.0a Extension available for PCs running Microsoft Windows 95 or Windows NT 4.0. ArcView 3.1 was not released until the final preparation stage of INSROP GIS v3.0a, so time did not permit in-depth testing of the current version of INSROP GIS as an ArcView 3.1 Extension. As yet, however, no problems have been encountered in using the current version of INSROP GIS in ArcView 3.1.

ArcView on PC requires minimum an 80486/66 Intel-based microprocessor, but Pentium 133 MHz is recommended as a minimum. The PC must have at least 18 MB RAM, but a minimum 64 MB is recommended (at least for Windows NT 4.0). The part of INSROP GIS that needs to be installed on hard-disk requires approx. 1.4 MB available hard-disk space. In addition, hard-disk space is required for a few menu options which create temporary files (in the catalogue referred to by the TEMP system environment variable). The INSROP GIS database may be run from the CD; if run from a hard-disk drive, approx. 150 MB is required.

The datasets in the INSROP GIS database are organized into several topics, according to their attributes (listed below). Each database topic comprises one or more datasets, and within each dataset there may be information on a range of parameters/attributes. All data implemented in the INSROP GIS database are in a format that ArcView can handle - either ArcView shapefiles of ARC/INFO coverage for spatial data and dBase, or TAB-delimited text files for tabular data. The INSROP GIS database now includes approx. 150 M-byte of data on: Base Cartography, Coastal Zone Characteristics, Environmental Impact Assessment, Ice and Snow, Icing on Structures at Sea, Indigenous Peoples, Infrastructure, Marine Birds, Marine and Anadromous Fish and Invertebrates, Marine Mammals, Meteorology, Navigation, Ocean and Rivers, and Administrative Boundaries.

The INSROP GIS CD also includes data bundled with INSROP GIS. These data have been compiled from the 'Electronic Catalogue of Charts and Publications', which contains information on all paper charts, electronic charts and publications published by the Head Department of Navigation and Oceanography (HDNO) of the Russian Federation Ministry of Defence. The 'Electronic Catalogue' includes the data retrieval software 'dKart Catalogue Client' developed by HydroSERVICE A/S. See Appendix B in Løvås & Brude (1999b) and the 'catalogue.html' file in the dKartCatalogueClient folder on the INSROP GIS CD for further information.


Brude, O.W. & Løvås, S.M. 1999. 'INSROP GIS. Data set documentation & information structure', INSROP Working Paper, No. 166–1999. 163 pp.

Løvås, S.M. & Brude, O.W. 1999a. 'INSROP GIS v3.0a. User’s guide and system documentation'. INSROP Working Paper, No. 165–1999. 121 pp.

Løvås, S.M. & Brude, O.W. 1999b. 'INSROP GIS. Software and Database'. CD-ROM.

Løvås, S.M. & Brude, O.W. 1996. 'INSROP GIS v1.0a. User’s guide and system documentation', INSROP Working Paper, No. 47–1996. 69 pp. + appendix.


Reference to this document: The Northern Sea Route User Conference Secretariat (ed.), 1999: The Northern Sea Route User Conference - Executive Summaries. Lysaker: The Fridtjof Nansen Institute. ISBN 82-7613-377-0. 136 pp. Online version available at