Long-term dynamics of shipping and icebreaker capacity along the Northern Sea Route

Kiiski, Tuomas; Solakivi, Tomi; Töyli, Juuso; Ojala, Lauri

doi:10.1057/s41278-016-0049-1

Cited by 41 publications

(13 citation statements)

References 33 publications

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“…NSR tariff is another key cost concern that has an inverse relation with the total profit of the NSR. The higher fee is justified by the ice-breaking services to assist shipping activities in the harsh Arctic conditions, thus enabling safer navigation [45]. While we have used the official rate in our calculations, icebreaker fees are negotiable, as confirmed by several sources.…”

Section: Resultsmentioning

confidence: 97%

Energy-Saving Potential and an Economic Feasibility Analysis for an Arctic Route between Shanghai and Rotterdam: Case Study from China’s Largest Container Sea Freight Operator

Wan

Chen

2018

Sustainability

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Global warming has significantly reduced summer ice coverage in the Arctic region, providing long-awaited opportunities for the shipping industry to open new routes through a region known for its harsh navigational conditions. If a shortcut between Asia and Europe via the Northern Sea Route (NSR) is adopted, significant energy saving and pollution reduction are possible compared with conventional southern routes. However, opinions in literature differ regarding this shortcut's economic viability. We present an analysis from the perspective of COSCO, China's largest container sea freight operator. We perform a cost-benefit analysis under several scenarios considering the following current realities: (1) declining oil prices not seen for decades, even lower than the lowest prices assumed in previous studies; (2) declining Russian NSR tariff as an effort to attract shipping traffic; (3) possible emission control areas along a northern route may require much cleaner energy and thus impact costs not studied in previous models; and (4) the capital cost difference between a hired and a self-owned vessel. Classical case studies of shipping routes between Shanghai and Rotterdam are adopted for comparison. We explain how different factors impact the shipping costs and to what extent can the NSR be economically viable. Occasional usage of NSR (e.g., one time transit) is unlikely to be more profitable given the higher unit transportation cost, but the route could be economically competitive in terms of the total profits earned for continuous usage. A more aggressive scenario which requires ships on the NSR to switch to much cleaner fuel would erode this route's competitiveness, but extra environmental benefits should be taken into consideration if future carbon emission trading schemes include the shipping industry.

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Section: Resultsmentioning

confidence: 97%

Energy-Saving Potential and an Economic Feasibility Analysis for an Arctic Route between Shanghai and Rotterdam: Case Study from China’s Largest Container Sea Freight Operator

Wan

Chen

2018

Sustainability

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“…And more special purpose ice-reinforced ships would have to be built. Today's so called Ice Class a ships are probably not strong enough to withstand the rough conditions that typically are prevalent at the NSR [4]. And, due to relatively shallow waters, through one area of narrow passage in particular, the size limitation for container ships would be a mere 4.500 TEU.…”

Section: The Northern Sea Route (Artic Ne Passage)mentioning

confidence: 99%

Innovations and Computer-based Support: Illustrated by Five Cases

Lorange¹

2018

TOTJ

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Introduction: This article discusses four alternative transportation links between China and Europe – the classical sea route through the Suez Canal, the N.S.E. (Artic) train passage through Russia, and ship and train via Genova – in terms of transportation costs, time spent, and reliability. Conclusion: It is concluded that the classical sea-route via Suez is likely to remain the preferred one for most shippers for a long time, when it comes to its relatively low cost, as well as increasingly improved time feature.

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“…At present, Sabetta can be expected to be constrained by the limitations of the NSR traffic which concentrates on bulk export of natural resources (oil, gas, and minerals), import of construction materials and equipment to the extraction sites, as well as supplies for the communities (Kiiski, 2017). The sparsity of population and lack of non-extractive industries limit the supply capacity of the NSR maritime system (Kiiski et al, 2016). Regarding other revenues, Sabetta is not likely to engage in deep logistics due to the extreme weather conditions.…”

Section: Constraintsmentioning

confidence: 99%

Policy environment analysis for Arctic seaport development: the case of Sabetta (Russia)

Gritsenko

Efimova

2017

Polar Geography

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In this paper, a structuration model is developed to evaluate opportunities and constraints that may arise for a port authority operating a port in the Arctic. The study builds upon the new institutionalist approach to transport infrastructure policy. It argues that given the specificity of operational conditions in the Arctic, as well as the expectations of the resource-driven future transformations, the conventional port development models cannot accurately depict factors of Arctic port activity. The proposed structuration approach focuses on how four dimensions of the policy environment (physical, economic, institutional, and environmental) enable and constrain policy choices available to a port authority. Application of this model to the case of Sabetta, a deep-sea multifunctional port constructed in the Ob estuary of the Yamal peninsula (Russia), demonstrates the inextricable links between actions and institutions and pinpoints the uncertainty factors that affect Arctic port development "from scratch." The practical objective of this research is to introduce a dynamic multi-factor model for systematic evaluation of the policy environment in Arctic port development. Given that industrial activities in the Arctic region will proceed at the current speed or accelerate, lessons learned from the case of Sabetta will be relevant to other port infrastructure projects in the Arctic.

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Long-term dynamics of shipping and icebreaker capacity along the Northern Sea Route

Cited by 41 publications

References 33 publications

Energy-Saving Potential and an Economic Feasibility Analysis for an Arctic Route between Shanghai and Rotterdam: Case Study from China’s Largest Container Sea Freight Operator

Energy-Saving Potential and an Economic Feasibility Analysis for an Arctic Route between Shanghai and Rotterdam: Case Study from China’s Largest Container Sea Freight Operator

Innovations and Computer-based Support: Illustrated by Five Cases

Policy environment analysis for Arctic seaport development: the case of Sabetta (Russia)

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