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Selected Issues on Regional Economic Development along the Northern Sea Route

(By Sverre Hoifodt, Vigdis Nygaard, Margrethe Aanesen, Geir B. Honneland ; INSROP Working Paper No. 54 – 1995, III.02.3)

 

The Working Paper is the second part of a joint research project dealing with future prospects for four basic industries in Northern Norway and Northwest Russia. In this part of the project we have concentrated on three of the four industries; fisheries, timber, and oil and gas.

There is an excess in demand for fishspecies such as mackerel, salmon and herring on the markets in the Far East. This is partly covered by import from Norway. Today the fish is transported either by plane (fresh, frozen salmon) or by boat through the Suez channel, which takes 28 days. For the NSR to be a competitive alternative to the seaborne transportation it must be either considerably cheaper or have a sailing time considerable shorter than 28 days. The reason is that it will probably not be able to compete on factors which are regarded as the most important for the present exporters and importers of fishproducts; namely punctuality and stability.

The transportation of round timber from the forests in the republic of Komi to the timber based industry in White Sea and Pechora ports has decreased dramatically. Export of round timber, sawn timber and timber based products from Komi to the markets in Europe and elsewhere are usually transported on railway southward, and eventually by boat from Black Sea ports or the port of St.Petersburg. River transportation to the Arctic ports and further transportation by boat is normally not a competitive alternative to the railway. It is not possible, on the basis of present information, to estimate whether or not the NSR could be developed as a competitive transportation alternative in the future.

The present production of oil and gas in Northwest Russia (Murmansk, Arkhangelsk, Komi and Nenets) is sent southward by pipeline, and have consecuently no effects on the NSR. Other fields, planning to be developed, intend to transport crude, oil and gas products by sea along the NSR to markets in Europe and the USA. This will also affect the use of the route for transport of equipment, supply during production and related transport. However, this geographical area is not at present the most important for oil and gas industry in Russia. Transport from the giant gas fields in Yamal further east will have bigger effect on the use of the NSR in the first years.

Bibliography



    Sverre Hoifodt, Vigdis Nygaard, Margrethe Aanesen, Geir B. Honneland, 1995, Selected Issues on Regional Economic Development along the Northern Sea Route, INSROP.©