Putin Brings Russia’s Arctic, Northern Sea Passage Projects Forward

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Commits US$18 billion to construction of the Northern Sea Passage, the Northern Latitudinal Railway, and supporting transportation infrastructure and shipping

Russian President Vladimir Putin has been in the Russian Arctic the past few days discussing outstanding Arctic projects in hand. The Arctic Council, an inter-governmental institution including Russia along with Canada, Denmark, Finland, Iceland, Norway, Sweden and the United States, suspended operations in the wake of the Ukraine conflict. Russia has been holding its own International Arctic Forum instead in Moscow. Russia launched its first Arctika-M space satellite to monitor Arctic weather and conditions in February 2021.

Numerous projects are in hand to develop the Russian Arctic, not least the Northern Sea Passage and energy pipelines, in addition to railway infrastructure construction. President Putin stated at the Arctic Forum that the implementation of these projects in the Russian Arctic must not be postponed because of sanctions; on the contrary, their implementation rate must be increased.

“Taking into account all kinds of external restrictions and sanctions pressure – special attention must be paid to all projects and plans related to the Arctic. Not to postpone them, not to shift them, but instead, we must respond to attempts to curb our development with maximum increase of the work rate on both current and upcoming tasks.” he said.

He noted that dealing with social, economic, infrastructural tasks in the northern territories, implementation of large-scale investment projects there have been and remain a priority for Russian authorities. Putin pointed out that hundreds of thousands of Russian citizens live and work in the Artic territories, “almost all areas of national security are concentrated there” – ecological, resource, military-political and technological.

Putin noted that transport and logistics chains have been disrupted due to sanctions, with some foreign companies stopping the fulfillment of their contractual obligations or only partially complying. He noted “This creates certain complications for us, but Russia has all the resources and capabilities to quickly find alternative solutions, and, in the long-term perspective, to reinforce our independence from external factors. This is an extremely important task.”

Some of this restructuring has already been planned.

Northern Sea Passage

In early February 2022, Russia SOE Rosatom was instructed to integrate the “Development of the Northern Sea Route” (modernizing and expanding mainline infrastructure) and the “Northern Sea Route – 2030” (developing Arctic capable shipping) plans into one project.

Rostacom subsequently stated that “A total of 1.457 trillion rubles (US$18 billion) is to be allocated from the federal budget and extra-budgetary funds for the development of the Northern Sea Route (NSR) through to 2030.”

New projects have also been added, including a single platform for digital services on the NSR, the development of a transit container line, the construction of additional nuclear icebreakers and LNG-powered icebreakers, the construction of federal property at the Nagleynyn terminal at the port of Pevek among several others.

This includes measures to build new Project 22220 nuclear-powered icebreakers, including the 5th and 6th series vessels, as well as the construction of nuclear service ships for icebreakers Project 22220, the Lider-class nuclear icebreaker, four LNG-powered icebreakers, ice-rated rescue, survey and cargo ships (including container ships). Rosatom plans to expand the line of Project 22220 icebreakers with two new vessels and is working on the construction of LNG-powered icebreakers. The corporation earlier estimated the cost of building two new Project 22220 nuclear-powered icebreakers at 120 billion rubles.

The single “year-round Northern Sea Route” also includes projects for construction of transshipment complexes in the Murmansk Region and the Primorye territory, putting into operation of four floating power units for the Baimsky GOK, carrying out navigation and hydrographic surveys of the NSR offshore area, as well as construction of federal property facilities in the Sever port (PJSC Rosneft), “Yenisei” (North Star LLC, AEON holding), the Nagleynyn terminal at the port Pevek (JSC GDK Baimskaya), and the Utrenny terminal at the port of Sabetta (PJSC NOVATEK ), development of a satellite constellation and a unified platform of digital services.

Northern Latitudinal Railway

Putin also instructed that active construction of the Northern Latitudinal Railway (NLR) begins this year. “As for Russian oil, gas, and coal, we will be able to increase their consumption on the domestic market, stimulate deep processing of raw materials, and increase supplies of energy commodities to other regions of the world, where they are really needed. To solve this problem, we use all available opportunities, including the development of transport corridors. This includes the Northern Latitudinal Railway. Active construction on the facilities of this route must begin this year. I would like to draw the attention of the government, Russian Railways, Gazprom and the other companies involved in this project to this direct order. I ask you to look at it in this way. We have been working on the Northern Latitudinal Railway for a long time. The launch of this project will allow, among other things, to relieve the BAM and Trans-Siberian Railway, and this is fundamentally important given the reorientation to the east of our main export resources.”

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