Challenges of Trans-Arctic Navigation

(from AMSA Report 2009)

For more than three centuries explorers and entrepreneurs have envisioned a direct route across the top of the world between the Pacific and Atlantic oceans. However, the Arctic sea ice cover – more than 2,100 nautical miles of sea ice present except in summer – has always been a significant physical barrier to developing such a global trade route. Although no commercial cargo ship has yet to cross the central Arctic Ocean, there have been trans-Arctic voyages during the summer season along the Russian Federation’s Northern Sea Route and the Northwest Passage in the Canadian Arctic. Support was normally required by modern icebreakers leading ice-strengthened merchant ships in convoy. This system of transport was particularly the norm during the era of the Soviet Union when cargoes were carried during a short summer navigation season across the length of the NSR. In recent years, there were no cargo ships undertaking trans-Arctic voyages along either the NSR or NWP. Several ice-strengthened cruise ships and icebreakers have carried tourists on recent trans-Arctic voyages in summer. The fact remains that only six, high-powered polar icebreakers (nuclear and diesel-powered) have successfully navigated across the central Arctic Ocean and each of these voyages was conducted in summer.

The AMSA is focused on marine safety and environmental protection consistent with the Arctic Council’s mandates of environmental protection and sustainable development. Neither the Arctic Council nor this assessment are the appropriate vehicles to determine the economic viability of any potential Arctic trade route, whether destinational or regional, intra-Arctic or trans-Arctic using the NSR, NWP or the central Arctic Ocean. For the purposes of the AMSA, the marine safety and environmental protection measures to be developed and implemented in accordance with international laws are essentially independent of the mode of Arctic marine transport. It is the global maritime industry that will decide if and when the potentially shorter Arctic routes can be safe, efficient, reliable and economically viable in comparison to other routes across the world’s oceans. The marine insurance industry and ship classification societies will have significant influence in these route determinations, as will a host of other stakeholders and actors including investors and shipbuilders.

The AMSA has indicated, using a scenario-based strategic approach, that the primary mode of marine transport throughout the Arctic Ocean is destinational traffic related to natural resource development and regional trade. New economic linkages in the Arctic to global markets are influenced by commodities prices for scarce natural resources such as oil and gas, nickel, zinc, palladium, copper, platinum and high grade ore. Current and new Arctic marine transport systems and commercial ship traffic are primarily tied to the global demand for these resources.

The international media and proponents continue to provide broad visibility to the possibility of trans-Arctic navigation, postulating that commercial routes will be viable and fully functional in the near future. This premise is based in large measure on the recent and extraordinary retreat of Arctic sea ice that has garnered worldwide attention. Touted are the large distance savings on global trade routes by using the Arctic Ocean; one example is the nominal 11,200 nautical mile route between Rotterdam and Yokohama (using the Suez Canal), versus a 6,500 nautical route across the top of the world. Many maps are shown promoting these potential marine trade routes without indicating a key factor - that the Arctic’s sea ice cover will be present for a majority of the year during the century. Just how plausible is trans-Arctic shipping given that the Arctic sea ice cover remains, but is a less imposing physical barrier?

The Presence of Arctic Sea Ice

The observed record of Arctic sea ice indicates decreases in both extent and thickness during the past five decades. Global climate model simulations of Arctic sea ice indicate trends of increasing areas of the coastal Arctic Ocean that may be partially ice-covered or even open water. No credible scientific source, though, is arguing that there will be a complete disappearance of the Arctic sea ice cover. The models do indicate a strong possibility of an ice-free Arctic Ocean for a short period of time in September sometime in the future. Again, the significance of this physical change is that multiyear ice would disappear - no sea ice would survive the summer melt season and only new ice would grow through the autumn and winter months during the long polar night. It is uncertain how long the ice-free period will be during the late summer or exactly when it will occur in any given year. It could be a window of time as brief as a few days or several weeks, or nearly ice-free conditions could last longer in the central Arctic Ocean. However, most of the potentially navigable spring, summer and autumn months should remain ice-covered with ice that may be thinner, but more mobile, than in previous decades. The year-to-year variability of sea ice in coastal seas and straits, such as those along the NSR and NWP, will surely remain a challenge in evaluating risk for insurance purposes and determining the overall reliability of Arctic marine routes. The length of the navigation season in all Arctic regions remains uncertain from a sea ice perspective, before other factors such as ship performance and icebreaker support systems are applied.

Key Questions for Trans-Arctic Shipping

The complexity of the trans-Arctic navigation can be viewed through the lens of a range of key questions and issues:

Q From the previous discussion, if all or some regions of the Arctic Ocean will remain ice-covered for much of the year, the need for polar ships designed for at least limited ice operations is obvious. The question of whether these ships will be icebreaking carriers in their own right and capable of independent ice operations is important. Will such ships require icebreaker convoy support and who will pay for the escorting icebreakers? Both are significant economic and safety issues. Relevant is the issue of whether polar icebreakers in support of navigation would be funded by commercial interests or Arctic state governments. Such commercial polar ships will also be more expensive to build and operate, and many questions remain as to their utilization beyond the Arctic Ocean on potentially long marine routes in the open ocean. Shorter routes in the Arctic imply that there is a potential for lower stack emissions into the lower Arctic atmosphere during transits. However, the presence of sea ice may require higher propulsion levels and ultimately similar or greater emissions during voyages compared with open ocean routes.

Q Can the trans-Arctic routes be used year-round in a reliable and safe manner? This is a significant question as many global fleets would wish to integrate seamlessly the new route with established marine routes. If an Arctic route is only viable for part of the year, will it be economically viable to use Polar Class ships on other routes? How viable and competitive would be a two to three month Arctic navigation season? How will shippers change and adapt their global shipping flows to a potentially seasonal operation along new and shorter Arctic routes? And what might be the response by the Suez and Panama canals to a seasonal route across the Arctic? Might they adjust their fee structures to accommodate this new competition?

Q Are Arctic routes economically viable today or in the near future? For nearly two decades the NSR has been open for international business under a fee structure. However, a limited navigation season presents the most significant challenge to the global maritime industry. The economic viability of all trans-Arctic options will be based in part on what ship speeds can be maintained in both ice-free and ice-covered waters to take full advantage of the shorter transit distances involved.

Q What are the risks assumed with using Arctic routes? For the marine insurers the risks could be higher if ships confront voyages of hundreds of nautical miles in ice. Higher risks for ice damage to ships and potential damage to cargoes in extreme cold temperatures, and the insufficient maritime infrastructure in the Arctic (such as salvage, ports and emergency response) will most likely be factors in determining future insurance rates. Navigation risks may also be compounded by operations in the polar night or during the spring/ autumn seasons where night operations in ice will be required. Shippers may also face risks with the possibility of schedule disruption and other reliability issues due to the inherent uncertainty of Arctic ship navigation. Many of these risk factors can be mitigated with the use of highly capable polar ships with experienced Arctic mariners.

Q Trans-shipment of cargoes may be a plausible option for using the Arctic Ocean for trans-Arctic shipments. Which ports would be likely termination points at the ends of the Arctic voyages is a key question. The investment in terminals and in a fleet of Arctic ships that would operate year-round across the Arctic Ocean would be sizable. However, a key factor would be that the Arctic ships would be fully and solely employed on Arctic voyages. The addition of trans-shipment ports in the northern latitudes could add a new dimension to global trade routes and might add options for select cargoes to be carried from the Pacific to European ports, depending on the time delays associated with cargo transfers.

Potential Operators on Trans-Arctic Trades

The variability of Arctic sea ice and the uncertainties associated with sailing times make predictions for use by marine operators and certain vessel types (and trades) highly speculative. During the assessment’s scenarios creation effort, it was identified that large LNG carriers and oil tankers would not likely use trans-Arctic routes for trading. Today, all such ships sail from western Siberian ports and northern Norwegian ports westbound for North America and European ports. Future pipelines across Eurasia and additional pipelines to central Europe appear to be strong competitors to oil and gas carriers potentially sailing eastbound along the NSR.

The challenges for container traffic and carriers using trans-Arctic routes are many, including schedule reliability and the need to satisfy very tight customer supply chains. The potential safety of the ships and cargoes, and the actual fuel costs and time savings (with ice navigation required on portions of the routes) are significant considerations that are not well understood. The investment in ice class ships would also be a major issue since their operation would be sub-optimal in non-Arctic trades if year-round Arctic operations could not be achieved.

It is plausible that several types of dry bulk and break-bulk carriers could conceivably use seasonal trans-Arctic routes. Bulk metal ores and concentrates (many can be stockpiled at the mine or the destination port) could be shipped along the NSR and even across the central Arctic Ocean if spot charters could be arranged on an opportunistic basis. However, suitable ice class ships would have to be built or be readily available for charter. Break-bulk carriers of forest products and pulp might use the Northern Sea Route to trade from northern Europe to Pacific and North American ports. It is reasonable to assume that experimental voyages of a commercial icebreaking carrier could take place within the decade to test the operational and technical challenges associated with trans-Arctic navigation.

The Need for Economic, Comparative and Technical Studies

There is a dearth of rigorous economic studies related to the evaluation of trans-Arctic shipping routes. Comprehensive economic studies using cost-benefit-risk analyses are needed for all three potential routes of trans-Arctic shipping (central Arctic Ocean, NWP and NSR). Such studies need to fully identify the global demands and key economic needs for use of these polar routes. Additional related studies are necessary to determine the economic benchmarks and indicators for viable seasonal and year-round trans-Arctic traffic. What might be the key commodities suitable and economically viable for trading during even a partial or summer navigation season? Further economic research should be conducted on the potential for trans-shipment of cargoes across the Arctic Ocean in icebreaking carriers. An important component of such an analysis would be the economics of trans-shipment terminals/ports in Alaska, Iceland, northwest Russia and northern European sites.

Operational and technical studies are also lacking. A comparative analysis of icebreaker-assisted convoys versus independently operated, icebreaking carriers for all trans-Arctic options is required as new Arctic ship technologies emerge. Risk assessments related to Arctic ship operational challenges, the general lack of marine infrastructure throughout the Arctic Ocean and the potential for ice damages would be useful to the marine insurance industry and all ship owners contemplating trans-Arctic navigation. Cost effectiveness studies for different icebreaking propulsion systems, including nuclear propulsion, should also include analyses of future emissions controls that are socio-economic responses to global climate change. The increasing size of ships (on global trade routes) may also have significant implications for all modes of Arctic marine transport including the trans-Arctic option. Studies should identify any maximum limitations, technical challenges and operational constraints for these very large ships on Arctic trade routes.

The uncertainties and complex interactions of many driving forces of trans-Arctic navigation require significant research. While it may be technically feasible to cross the Arctic Ocean today by modern icebreaker or even using an advanced icebreaking carrier, the operational, environmental and economic implications and challenges for routine trans-Arctic voyages are not yet fully understood.

Arctic Council, 2009, Arctic Marine Shipping Assessment (AMSA), Arctic Council.©