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Arctic city hopes to cash in as melting ice opens new sea route to China

 
Shipping in Arctic

Ocean freighters in the icy waters of the Arctic. Photograph: Stockbyte/Getty Images

 

Powered by Guardian.co.ukThis article titled “Arctic city hopes to cash in as melting ice opens new sea route to China” was written by John Vidal, for The Observer on Saturday 1st February 2014 12.24 UTC

The city of Nadym, in the extreme north of Siberia, is one of the Earth’s least hospitable places, shrouded in darkness for half of the year, with temperatures plunging below -30C and the nearby Kara Sea semi-permanently frozen.

But things are looking up for this Arctic conurbation halfway between Europe and China. Over the next 30 years, climate change is likely to open up a polar shipping route between the Pacific and Atlantic oceans, cutting travel time to Asia by 40% and allowing Russia’s vast oil and gas resources to be exported to China, Japan and south Asia much faster.

Nadym stands to benefit from a warmer climate more than any other Arctic city – the Russian government plans to connect it by road and rail to other oil and gas centres; Gazprom, the world’s largest gas company, is building a port nearby with French oil major Total; and if the new northern sea route is open for even six months of the year, Nadym will find itself on the 21st-century equivalent of the ancient silk route.

“The entire centre of gravity of the world economy is shifting to Nadym,” said the mayor, Stanislav Shegurov, a former gas worker, at a recent meeting of Arctic leaders in Norway.

Expectations are high that the route will complement the Suez canal as a key waterway for trade to and from Asia. “The Arctic is our home and our future. We will make full use of the northern sea route. We are building infrastructure, we are making history. We have ambitious plans,” said Anton Vasiliev, Russian ambassador for the Arctic.

Only 71 large ships, working mostly with Russian icebreakers, navigated the route in 2013, but Russia expects a 30-fold increase in shipping by 2020 and ice-free water over most of its length by 2050. The summer ice has declined by nearly 50% in 40 years and by 2050, say Laurence Smith and Scott Stephenson of the University of California, ordinary vessels should be able to travel easily along the northern sea route and ice-strengthened ships should be able to pass over the pole itself.

Confidence that the Arctic will become economically important is seen in the rush of countries and companies to claim a stake. Eleven countries, including Poland and Singapore, have appointed Arctic ambassadors to promote their national interests.

Gazprom last week launched in South Korea the first of four giant “ice-class” natural gas carriers for the sea route. The Russian government plans to spend more than $3bn reopening a military base on the Novosibirsk Islands and is building new icebreakers and navigational centres. Oil giant Rosneft and ExxonMobile will start drilling for oil in the Kara Sea this year.

Norway and the other Nordic countries have all made Arctic development a priority. “The Arctic is changing rapidly. It will be our most important foreign policy area. Climate change is putting Norway under pressure,” said its prime minister, Erna Solberg.

Finland, which has no access to the northern sea route, has proposed a railway linking its mines to the Russian coast. “Finland needs a new Nokia. The Arctic could be it,” said its Arctic affairs ambassador, Hannu Halinen.

American, Canadian, Japanese, South Korean and British companies all intend to use the sea route to mine across the region, but no country hopes to gain more than China, according to Wang Chuanxing, polar researcher at Tongji University, Shanghai. “China’s economy is 50% dependent on trade. The development of the northern sea route would have a major impact on its economy. One-third of China’s trade is with the EU and the US. The opening of the northern sea route is vital for China,” he said. Japan also hopes to benefit. “Ten per cent of the world’s unexploited crude oil and 20% of its natural gas is said to be in the Arctic. Recent changes because of climate change are attracting people in Japan. We want to actively participate. We are researching the Arctic sea route,” said Toshio Kunikata, the Japanese ambassador in charge of Arctic affairs.

“A great chess game is being played with countries staking claims to the Arctic to make sure they are not left out. Climate change is taking place at twice the global average speed in the Arctic. Some countries, like China, are looking 50 years ahead,” said Malte Humpert, director of the Washington-based thinktank the Arctic Institute.

 

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