Don’t expect the Northern Sea Route to be croweded any time soon

Although it’s possible to pilot large cargo vessels through Arctic Waters, there are a number of reasons why it is not particularly attractive to operators. You know… icebergs an’ all that. Getting insurance can be a bit of a bugger, too.

Arctic Shipping Route Plagued by Icebergs and Insurance

The new shipping route opened up through the Arctic by climate change will not be crowded any time soon.

Cargoes of coal, diesel and gas have made the trip but high insurance costs, slow going and strict environmental rules mean there will not be a rush to follow them.

Looser ice means icebergs. One vessel has already been holed, and large ice breaking vessels, not always on hand, are a must.

“Significant safety and navigational concerns remain an obstacle to commercial shipping in the Northern Sea route, despite recent media reports of ‘successful’ transits,” said Richard Hurley, a senior analyst at shipping intelligence publisher IHS Maritime.

“AIS (ship) tracking of vessels in the area shows all vessels are subject to deviation from direct routes as a result of ice, and many areas still cannot be navigated safely without the presence of large icebreakers able to provide assistance such as lead through to clearer waters.”

Last month, a dry bulk vessel carrying coal from Canada passed through the Northwest Passage to deliver a cargo to Finland, in a trip its operators said would save $80,000 worth of fuel and cut shipping time by a week.

The world’s top oil trader Vitol brought tankers in October with Asian diesel to Europe via the Northern Sea route over Russia, potentially saving hundreds of thousands of dollars in costs.

The fast-growing liquefied natural gas market, in which Arctic players like Russia and Norway play a big role, has also seen maiden Arctic voyages.

Hurley said the passage of the Yong Sheng cargo vessel in August from China to Europe via the Northern Sea was only possible with the aid of the world’s largest nuclear powered icebreaker, 50 Let Pobedy, to get it through the Lapatev Sea. Ship tracking showed only four large icebreakers were available at any one time to cover the whole Northern sea route.

Separately, a small Russian oil products tanker was holed in September in the Kara Sea, also off Russia.

“Even though damage was minimal and did not cause a pollution incident, the holing revealed fragility of emergency help,” Hurley said. “Taken together, all the inherent dangers and concerns over potential Arctic pollution count heavily against time and cost savings alone when assessing the commercial viability of the seaway.”

INSURANCE AND CONTAINERS

The market is also still nascent for insurers.

“The key obstacle here will remain the insurance, as it’s still simply too risky a proposition for standard commercial insurers,” said Michael Frodl of U.S.-based consultancy C-Level Maritime Risks, who advises insurers.

“The ships aren’t ready, the support facilities and port infrastructure are not yet in place, and the risks haven’t been figured out enough to price insurance correctly.”

Others say the commercial potential is unlikely to be viable for container ships, which transport consumer goods, partly as trade flows develop beyond China in coming decades towards other regions including Africa and South America.

“The further away global trade moves from a totally China-centric export pattern, the more a short ‘polar’ route looses its appeal,” said Jan Tiedemann, shipping analyst with consultancy Alphaliner.

“The Southern route – even if longer – will always have the advantage of serving numerous markets at the same time. Think of the Middle East. Think of transshipment via the (Malacca) Straits to Australia and New Zealand. Think of transshipment in Arabia for East Africa. Think of Med and Black Sea loops.”

Until recent years harsh weather conditions, which can drop to 40 to 50 degrees centigrade below zero, had limited Arctic shipping mostly to small freighters and ice-breakers that supplied northern communities in Canada, Norway or Russia.

According to French ship classification society Bureau Veritas, there were 40 Arctic route trading voyages in 2012 for all vessel classes including oil tankers, with around one million tonnes of cargo moved. That compared with 700 million tonnes transported through the Suez canal.

Knut Espen Solberg of Norwegian shipping and offshore classification group Det Norske Veritas, said dry bulk vessels carrying coal were best suited for Arctic shipping as the potential for environmental potential was less.

“Oil and container spills have a much bigger potential environmental impact than coal, so their shipping is likely to be restricted heavily,” said Solberg, a former Arctic mariner.

http://www.maritime-executive.com/article/Arctic-Shipping-Route-Plagued-by-Icebergs-and-Insurance-2013-10-15/

First bulk carrier makes its way through Northwest Passage

Nordic Orion is a Panama-registered bulk carrier (40,142 GRT) built by Oshima, Japan and launched in 2011 and operated by Nordic Bulk Carriers. Considered an “ice bulker” the Nordic Orion is 1A for summer/autumn operation in thin-to-medium first-year ice. The shorter direct route from Vancouver, Canada to Poli, Finland saves time & fuel… allowing the Nordic Orion to carry 25% more cargo.

Danish firm seeks to be first to bring bulk carrier through Northwest Passage

The Nordic Orion along the Northern Sea Route – north coast of Russia in this undated handout photo.

Earlier this month, the ice-strengthened bulk carrier Nordic Orion was loaded with coal at a Vancouver terminal. From there, it headed to Finland via the Northwest Passage, undertaking a voyage that could make it the first commercial bulk carrier to traverse the route since the SS Manhattan broke through in 1969.

The Northwest Passage sailing marks another milestone for Nordic Bulk Carriers, the Danish company that owns the ship and has staked its future on northern routes. But it is a bigger breakthrough for international trade and for the fabled waterway, which defied early explorers’ efforts to map its bays and channels and led many to an icy grave. Now, with its ice cover changing and receding and a bulk carrier poised to plow through it, the Northwest Passage stands to witness history again while potentially becoming a viable route for commercial traffic.

“I think this pretty much cements our position as a world-leading ice operator,” Christian Bonfils, managing director of Nordic Bulk, said Wednesday in a telephone interview from Denmark. “In four years, we have created history in two new shipping routes – we are a small company and that’s pretty special.”

Nordic Bulk became the first non-Russian company to sail the Northern Sea Route – which runs across the northern coast of Russia – when it shipped iron ore from northern Norway to China in 2010.

“For some routes, it [the Northwest Passage] can save up to 7,000 kilometres – and that’s not just a distance savings, that’s a savings in terms of fuel, time and salaries,” Michael Byers, an international law expert at the University of British Columbia, said on Wednesday. “Time is money in the international shipping business and a 7,000-kilometre shortcut is of great interest.”

Transport Canada and the Canadian Coast Guard are monitoring the journey and the Nordic Orion is required to check in daily with Nordreg, a Coast Guard agency, Transport Canada said. The ship is scheduled to arrive in Pori, Finland, in early October.

“If they are complying with Nordreg, this is good for Canada’s legal position,” Prof. Byers said. “This is an example of an international shipping company accepting the obligation to register with Canada – essentially recognizing Canada’s jurisdiction over the Northwest Passage.”

Such compliance would be more significant if it involved an American ship, as Arctic disputes have involved Canada and the United States, not other countries, but it still sets a welcome precedent, he added.

Nordic Bulk complies with the rules of the country in which it is sailing, Mr. Bonfils said, adding that the 25-person crew includes a Canadian ice pilot with a couple of decades’ experience in the waterway.

When Nordic Bulk bid on the job to carry coal from Vancouver to Finland, it had the Northern Sea Route in mind. But with its customer’s blessing, Nordic Bulk scrapped that plan in favour of the Northwest Passage.

The fabled route has taken the lives of many explorers. But changes in ice cover attributed to climate change, as well as advances in ship design, have opened the prospect of commercial traffic.

The SS Manhattan, undertaken to test the viability of shipping oil from Alaska to the Gulf of Mexico, was repeatedly trapped by ice and the U.S. turned away from the idea and instead built a pipeline.

The Nordic Orion is carrying B.C. metallurgical coal bound for Rautaruukki Corp., a Finnish steel company. Nordic Bulk beat other contenders for the job with a bid based on savings of about 1,000 nautical miles and four or five days of sailing time. Nordic Bulk was also able to carry more coal – a fully-loaded 73,000 tonnes – than the 60,000 tonnes or so that could pass through the shallower Panama Canal.

Insurance – once difficult to obtain for Arctic routes – has become more readily available as traffic on the Northern Sea Route has increased, Mr. Bonfils said.

In recent years, there has been considerable debate over whether commercial shipping would become a reality in the Northwest Passage, with Prof. Byers among those arguing such traffic was likely to arrive sooner rather than later.

Now proven correct, he worries Canada is short of search-and-rescue and other safety capabilities, including clean-up capacity in the event of a fuel spill or other accident..

“This is the kind of challenge that by all rights should necessitate hundreds of millions if not billions of dollars of fairly rapid investment by the government of Canada to ensure that vessels like this … if they come into the Canadian Arctic, they can do so in relative safety.“


http://www.theglobeandmail.com/report-on-business/international-business/european-business/bulk-carrier-capitalizes-on-arctic-shortcut/article14405743/

4 nuclear-power icebreakers escort Russian battlecruiser, ignore oil tanker in distress

So the Yuri Andropov… sorry… I mean the Petr Veliky (old Soviet leopard, new Russian spots) warrants 4 nuclear-powered icebreakers for a jaunt through the Nordenskiöld Archipelago, but a floundering tanker loaded with diesel oil is left to its own devices. There’s Soviet logic … oops… sorry… I mean Russian logic for you. What’s the harm of an ecological disaster here or there?

{sigh} They don’t make this easy, you know, renaming ships an’ all. The Andropov is the Veliky, the Ural is the “50 Years of Victory or Fiftieth Anniversary of Victory”, the Nordvik is the Volgoneft. You know what this is? Maskirovka! 😉

Four icebreakers for missile cruiser – none for damaged tanker

The Northern Fleet’s flag ship «Petr Veliky» was escorted by no less than four nuclear-powered icebreakers on its voyage eastwards along the Northern Sea Route. At the same time a damaged tanker fully loaded with diesel fuel has been waiting for assistance for a week after it was struck by an ice floe.

Nuclear icebreakers escorting Russia’s heavy missile cruiser “Petr Veliky” along the Northern Sea Route. (Photo: mil.ru)

A vessel group consisting of ten different vessels from the Northern Fleet and led by the heavy missile cruiser “Petr Veliky” yesterday sailed through the Matisen Strait north of the Taymyr Peninsula, the Defense Ministry’s web site reads. The group was escorted by no less than four of Atomflot’s nuclear-powered icebreakers, among them the two largest and most powerful icebreakers in the world, “50 Let Pobedy” and “Yamal”. Also the two shallow-water nuclear icebreakers “Vaygach” and “Taymyr” were put in to escort the world’s largest battlecruiser through the crumbling ice.

Watch video from the Northern Fleet’s voyage along the Northern Sea Route on TV Zvezda.

Matisen Strait is the same place where a nearly 30 year old tanker loaded with diesel oil has been waiting for assistance for a week after it collided with an ice floe and started taking in water.

The 6403 dwt tanker “Nordvik” was struck by ice in the area last Wednesday while sailing in medium ice conditions – in all probability without icebreaker escort, while it only had permission to sail in light ice conditions. In the first information about the accident – which came from the Seafarer’s Union of Russia and not from any governmental source, it was said that the vessel was on its way to Murmansk, but later information from the Federal Agency for Sea and River Transport revealed that the tanker was drifting in the area, waiting for another tanker to come and unload the diesel and for an icebreaker to come and escort the vessel to port.

Ship-to-ship reloading of oil in ice conditions is considered to be a risky business, but in this situation it is probably safer than trying to sail the damaged ship to port.

http://barentsobserver.com/en/arctic/2013/09/four-icebreakers-missile-cruiser-none-damaged-tanker-11-09

Russia opens Arctic SAR centre on Northern Sea Route

Naryan-Mar is located north of the Arctic Circle on the Pechora River, 68-miles (110 kilometers) upstream its mouth on the Barents Sea.

Russia opens first Arctic search and rescue center

Deputy Minister of EMERCOM Aleksander Chupriyan opening the first Russian SAR center in Naryan-Mar, Nenets (Photo: Andrey Vokuev)

NARYAN_MAR: The first of a total of ten search and rescue centers along the Northern Sea Route has opened in the Nenets Autonomous Okrug.

With increased traffic on the Northern Sea Route comes the need for more onshore safety infrastructure. Russia in 2009 allocated 910 million rubles (app €20.6 million) to construction of ten search and rescue (SAR) centers from Murmansk in the west to Provideniya in the East. All centers are planned to be operational by 2015.

The first of the new SAR centers was officially opened in Naryan-Mar on August 20 by Nenets Governor Igor Fyodorov and Deputy Minister of EMERCOM Aleksander Chupriyan.

The center includes a fire department, a department for search and rescue operations with vehicles and boats, a berth and training facilities.

Similar rescue centers will open in Murmansk, Arkhangelsk, Dudinka, Pevek, Vorkuta, Nadym, Anadyr, Tiksi and Provideniye.

See photos from EMERCOM facilities in Naryan-Mar, Dudinka and Arkhangelsk:

The SAR center in Naryan-Mar hosts the region’s first EMERCOM cadet class. Andrey Vokuev / BarentsObserver

Governor of Nenets Autonomous Okrug Igor Fyodorov openinge the SAR center in Naryan-Mar. Andrey Vokuev / BarentsObserver

The center in Naryan-Mar is the first of ten centers that will open along the Northern Sea Route. Andrey Vokuev / BarentsObserver

EMERCOM representatives in Naryan-Mar. Andrey Vokuev / BarentsObserver

Construction of the new SAR center in Naryan-Mar started in December 2010. Andrey Vokuev / BarentsObserver

Search and rescue facilities in Arkhangelsk on the banks of the Dvina river. Thomas Nilsen / BarentsObserver

Search and rescue facilities in Dudinka on the inlet of the Yenisei river. Thomas Nilsen / BarentsObserver

EMERCOM vehicle in Dudinka. Thomas Nilsen / BarentsObserver

EMERCOM worker in Dudinka. Thomas Nilsen / BarentsObserver