The development plan that was adopted by the federal government on August 4 has great ambitions for the Russian Arctic. In the period up to 2035, a total of 1,800 billion rubles (30.1 billion euros) is to be invested in 152 regional projects.
Among them, the construction of 153 new ice-class ships, including ten icebreakers, twelve new seaports, twelve satellites, thirteen helicopters, several hospitals and search and rescue units.
All this will allow Russia to transport up to 100 million tons of cargo per year by 2025 and 200 million tons by 2030, informs the Federal Ministry for the Far East and the Arctic.
The adoption of the document was not easy. Apparently, Deputy Prime Minister Yuri Trutnev locked all relevant officials in a small, uncomfortable meeting room on the top floor of the government building and refused to let people leave until the document was approved by everyone.
The plan comes as Russia spends much of its public treasury on the war against Ukraine and international sanctions cripple key sectors of its economy.
Nevertheless, the Russian government maintains that the Northern Sea Route is an indispensable priority.
“This is a reliable, much-needed sea route for businesses and of course people in the Arctic and the Far East,” Prime Minister Mikhail Mishustin said in a presentation.
“And it is located entirely within our territorial waters and exclusive economic zone, which is critically important at a time of external pressure from sanctions and when supply chains for delivering goods are disrupted,” he said. he adds.
The new plan comes after President Vladimir Putin in April this year called for an acceleration of current and future projects in the region.
But far from everyone has faith in the projects.
Head of consultancy firm Gecon Mikhail Grigoriev said he had been skeptical of official government policy at least since 2018, when Vladimir Putin called for annual volumes of goods on the road to reach 80 million. tonnes by 2024.
According to Grigoriev, it is unclear where the vast volumes of goods will come from.
“I’m familiar with the basic federal targets for freight traffic, and I don’t see those kinds of volumes,” he said in a lengthy interview with the Korabel news outlet.
“I feel like it’s nothing more than a play put on by state officials,” he said.
And the war made everything much more difficult. “The feeling among international shippers and traders is that anything going through Russia now is like acid,” he says.
Grigoriev is a widely respected veteran of Russian Arctic developments and has, over the past two decades, worked extensively on transportation and natural resource extraction issues in the region.
He was skeptical of plans by Dmitry Bosov and his company Vostokugol to extract more than 30 million tons of coal from the Taymyr Peninsula and export it through Arctic waters. Likewise, he is now skeptical about Rosneft’s plans to produce more than 100 million tonnes of oil per year as part of its Vostok Oil project.
Rosneft will hardly be able to build enough ice-class tankers to meet its much-heralded plans, he argues.
He also has a lack of confidence in Novatek and its plans for Arctic LNG 2. According to Grigoriev, the announced LNG production volumes are far too optimistic. The project’s second and third trains are likely to face delays as foreign technology has to be replaced with Russian technology. Operational adjustments are necessary, and this will take time and money, he explains.
Mikhail Grigoriev is far from the only expert to question the credibility of the Northern Sea Route plans.
US researcher and former Coast Guard officer Lawson W. Brigham strongly doubts that the NSR will ever become an important international trade route for shipping and also claims that the ongoing energy transition could ultimately reduce demand for Russian commodities In the region.
Norwegian researcher Arild Moe also has doubts about Russian Arctic ambitions.
According to Moe, the realism of Russia’s plans could already be called into question in 2020 when a strategy document for the NSR was published.
“Neither then nor now is the plan fully funded. This requires very substantial investments from commercial players,” the researcher from the Fridtjof Nansen Institute told the Barents Observer.
“The government claims that nothing has happened that could change the outlook. But obviously, factors beyond the government’s control impact developments. They include technological sanctions that will delay projects, in particular LNG, but also market access limitations,” he points out and adds that the risks of investing in the Russian Arctic are now considered higher. than before.
This includes investing in vessels specifically designed for operations on the Northern Sea Route, says Moe.
Meanwhile, the ice-free season is fast approaching in the region. Maps from the Russian Arctic and Antarctic Research Institute show that large parts of the route in mid-August had open water. An increasing number of ships are plying the region. But this year they are almost exclusively Russian.
According to data from the Northern Sea Route Administration, a unit operated by the nuclear energy company Rosatom, no European, American or Chinese vessel has requested to enter the zone this year.