No abstract

The Northern Sea Route (NSR) has received increased international attention during the recent years as an alternative transit corridor for shipping between Europe and East Asia. In 2015, the project "Feasibility and Reliability of Shipping on the Northern Sea Route and Modeling of an Arctic Marine Transportation & LogisticsSystem" was established to perform a comprehensive analysis of the current status and future prospects of NSR transit shipping. The project brought together several partners and numerous participants representing industry, governmental bodies, and research groups from Europe, Asia, and Russia, thus providing a unique and comprehensive overview of the subject. This paper is based on the insights gathered during the project. Firstly, it provides a comprehensive overview of the NSR's current regulations and support services. Secondly, it combines the information on the current status of the route with feedback received from the stakeholders during project discussions for the purpose of establishing several possible future operational models for transit shipping along the NSR. It is concluded that the most probable of the analyzed operational models is a combination of ice-strengthened vessels and independent ice-going cargo vessels. This model requires a decrease in severity of ice conditions to allow for year-round commercial navigation, an increase in bunker prices, further development of maritime infrastructure and icebreaking support, and the development of new maritime insurance models. Additionally, establishing transshipment hubs at each end of the NSR with ice-going cargo vessels sailing between them is also considered to be a viable future option.

Analysis of detailed statistics shows remarkable fluctuations in the volume and composition of voyages on the Northern Sea Route (NSR) along the northern coast of Russia since international use began in 2010. There has been strong growth in destination shipping between the Arctic and ports outside the region, but transit shipping between the Pacific and the Atlantic has not experienced the growth many had anticipated. Explanations are found in international market conditions as well as in the management of the NSR, with important lessons for the future development of different shipping segments. Shipping companies from several countries took part in the period up to 2019, but they seem to have become less central in the current phase of NSR shipping, which is dominated by the transport of hydrocarbons out of the Arctic. Russia expects international transit to pick up later. However, Russia alone cannot determine the volume of international traffic: it is the international shipping industry that will assess the balance of factors and conditions, and conclude if and when the shorter Arctic routes are safe, efficient, reliable, environmentally sound and economically viable in comparison with other routes.

Russian resource developers operating in remote parts of the Arctic have demonstrated over the past several years that it is feasible to extract natural resources throughout the year, and ship large quantities of raw materials with regular intervals from the Arctic to international markets; this despite very difficult operational conditions in the Arctic during both winter and spring. Several resource extraction projects are currently being implemented or planned. This study examines how the extractive companies have built up enhanced supply chain resilience and transport reliability to mitigate common Arctic risks. The companies have taken control over supply chains and adopted several precautionary and innovative infrastructure and logistics measures designed to prevent or mitigate disruption to these supply chains. Preferred logistical solutions for all of these extraction projects have developed into large package deals, where long-term production and transport of commodities, icebreaking services, and state support are all included. Western sanctions on Russia as a result of the war in Ukraine, will slow down the pace of future Russian projects in the Arctic, at least in the short to medium-term, but the sanctions are likely to increase the future significance of export terminals on the NSR, as the preferred departure points for Russian Arctic commodities on their way to selective market destinations.