Dare we say it, the "light at the end of the tunnel" is visible concerning plans for the development of the Northern Sea Route. Recently, the Russian authorities have announced scenarios for the NSR, ranging from most ambitious to the realistic one.
The reality is that Russia is now forced to invest much money in the development of alternative routes to provide energy supply, including the NSR infrastructure, which is becoming the most important transport corridor for Moscow facing Western sanctions, and violation of the logistics of supply.
It’s worth noting that plan for the NSR development until 2035 sets a goal for cargo turnover of 150 million tonnes by 2030, 80 million tonnes by 2024. Plus, in May 2023, the leading Arctic companies – Novatek, Vostok Oil, Gazprom Neft, Nornickel, Baimskaya and Severnaya Zvezda – signed commitments on cargo volumes. Under the agreements, these companies alone must ship through the NSR at least 30 million tonnes of cargo this year, no less than 71 million tonnes in 2024 and over 190 million tonnes in 2030.
So, now the ambitious scenario suggests increasing cargo traffic over the initial target: the state officials mention volumes of 244 million tonnes by 2030 and 288 million tonnes by 2035. The growth here is mainly driven by Novatek Arctic LNG 1 and Arctic LNG 3 projects’ outputs, reserves of Novatek-Yurharovneftegaz gas fields, as well as project development of the Taimyr and Syradasaysky coal basin.
The base scenario foresees cargo volume of 74 million tonnes in 2024, 224 million tonnes by 2030, and 230 million tonnes by 2035. In this case, 75% of cargo traffic on the Northern Sea Route will consist of exactly oil and LNG. Meanwhile, the massive Vostok Oil project, as well as Arctic LNG 1, Arctic LNG 2 and relatively small Ob LNG projects are running as planned, having in disposal enough icebreakers and infrastructure facilities.
Under the so-called conservative scenario or the most realistic in other words, turnover would amount only to 117 million tonnes by 2030, 131 million tonnes by 2035, with transit traffic reaching 38 million tonnes per year. This scenario suggests that NOVATEK will stop implementing the Ob Gas Chemical Complex (as part of Ob LNG project) and Arctic LNG 1 projects due to sanctions, while the overall capacity Vostok Oil and other big projects is expected to be significantly reduced.
In addition, by 2035, the eastern part of the Russian Arctic should be equipped with three LK-60, which are considered to be the world's most powerful class of icebreakers, as well as the Leader icebreaker which will have twice the power of the currently most powerful icebreaker.
But again, the intentions to cut funding for the construction of new icebreakers almost by ten billion rubles for the period 2024-2026 have been already claimed. In addition, some experts note the lack of information on the progress of the port fleet construction for Vostok Oil and the Arctic LNG 2 projects, including the LNG transshipment points in Murmansk and Kamchatka.
The editorial board of The Arctic Century