Ensuring complete and reliable access to environmental information in Russia has never been fully guaranteed. Following the Russian invasion of Ukraine on February 24, 2022, it became even more difficult. Some information ceased to be published altogether, such as daily oil production data and annual reports from certain industrial companies. Independent environmental organizations have been banned or closed.  

The Arctic region plays a crucial role in comprehending the process of global climate change. Russia owns approximately one-third of its territory, including the exclusive economic zone of the Arctic Ocean. To understand and examine trends, we monitor new legislation, the plans of industry, the Northern Sea Route, international economic sanctions, accidents, and emergencies in the Russian Arctic, as well as provide commentary on the news.  

Our previous monthly highlights for April can be found here.

In this issue:

ENVIRONMENTAL AND CLIMATE ISSUES IN THE ARCTIC
1. Emissions of carbon dioxide from thawing permafrost are 5.5 times more intense

HEIGHTENED INDUSTRIAL ACTIVITY IN THE RUSSIAN ARCTIC
2. Environmental protection not a priority in the development of the Russian Arctic Zone
3. Mining volumes are increasing in Chukotka

INTERNATIONAL SITUATION IN THE ARCTIC AND SANCTIONS AFFECTING RUSSIAN ACTIVITIES IN THE ARCTIC REGION
4. New US sanctions against Russian LNG and mining and metallurgical sectors in the Russian Arctic

NORTHERN SEA ROUTE AND SHIPPING
5. Subsidized coastal lines to load the Northern Sea Route
6. Expansion of port infrastructure in the Murmansk and Yamal regions
7. Agreement with Chinese companies on sea transportation along the Northern Sea Route in 2024
8. A Russian-Chinese subcommittee on the development of the Northern Sea Route
9. Earthquakes stimulate iceberg formation in the Arctic, negatively impacting shipping

ACCIDENTS AND EMERGENCIES IN THE RUSSIAN ARCTIC
10. Diesel fuel spill in Yakutia

Environmental and climate issues in the Arctic

Emissions of carbon dioxide from thawing permafrost are 5.5 times more intense ↑

A study published in Nature Geoscience by the Chinese Academy of Sciences explores the impact of thawing permafrost on CO2 emissions from the soil as the climate warms. The researchers found that CO2 emissions from the soil become 5.5 times more intense in thermokarsts—areas of soil that have subsided from thawing permafrost—compared to adjacent non-thermokarst landforms.

Although the study was conducted on the Tibetan Plateau in China, which is covered by permafrost, the results may also apply to the Arctic, where permafrost is also subject to thawing and subsidence. The study highlights that a warming climate and thawing permafrost may mutually reinforce each other by releasing carbon dioxide from the soil, leading to more warming, which in turn leads to more emissions.

Heightened industrial activity in the Russian Arctic

Environmental protection not a priority in the development of the Russian Arctic Zone ↑

On May 14, Minister for the Development of the Far East and Arctic Alexey Chekunkov, during a speech to State Duma deputies, named ten key priorities for the development of the Far East and Arctic until 2030. These priorities include the implementation of 38 master plans for the development of support settlements, 16 of which are located in the Arctic zone of the Russian Federation (AZRF), including the construction of almost 1,000 new facilities; development of transport corridors, including the Northern Sea Route (NSR); construction of new energy-generating capacities; tourism promotion; increasing trade and investment with China, India, and other countries in the Asia-Pacific region. As a final priority, Alexey Chekunkov identified support for the so-called “Special Military Operation.”

Mining volumes are increasing in Chukotka ↑

On May 6, the Governor of the Chukotka Autonomous Okrug, Vladislav Kuznetsov, addressed deputies with a report on the results of 2023. He reported that gold production in Chukotka increased by 9% and silver production by 19%.

The increase in gold and silver production continues in 2024. From January to April, gold production in Chukotka increased by 6.2% compared to the same period of the previous year, amounting to 6.1 tons, and silver production by 2%, amounting to 33.8 tons.

On May 29, news appeared in the media about the start of development of a new placer gold deposit in the Vstrechny stream section in the Vetvistaya river basin in the Anadyr region by the Chukot-Mineral company. Production should be at least 35 kg of gold per year.

Bellona Comment:

«“Concerns about the environment are gradually fading from the rhetoric of Russian officials while economic stimulus measures and the easing of environmental controls for mining projects in the Arctic are bearing fruit. It is noteworthy that the war with Ukraine was included in the list of priorities for the Arctic and Far Eastern regions, located thousands of kilometers away, but environmental protection in the territories of these regions themselves was not.

Meanwhile, more and more companies are taking advantage of preferential conditions for mining in the Arctic zone, including newly registered companies with no relevant experience. Alluvial gold mining causes significant harm to the environment, and allowing companies without previous experience, such as, for example, Chukot-Mineral LLC, registered in 2021,

increases the risk of incidents and violations of environmental legislation.”»

International situation in the Arctic and sanctions affecting Russian activities in the Arctic Region

New US sanctions against Russian LNG and mining and metallurgical sectors in the Russian Arctic ↑

On May 1, the US Treasury published an updated version of the SDN (Specially Designated Nationals and Blocked Persons) list. Inclusion on this list is considered the most stringent form of American sanctions as it prohibits its participants from making any payments in US dollars and creates the threat of imposing secondary sanctions on counterparties of the companies included in the list.

With this round of sanctions in the SDN list were included shipping companies and specialized heavy-duty vessels that transport modules and equipment from China for Russian Arctic LNG projects. Among them are Singapore’s Red Box Energy Services PTE and Hong Kong’s CFU Shipping Co., as well as their vessels.

The list also includes now the Audax and Pugnax vessels owned by Red Box Energy Services PTE. They were built in 2016 specifically for the supply of Chinese modules for Novatek projects. The last delivery of LNG modules for the Arctic LNG 2 project occurred at the end of February 2024 after sanctions were imposed on Arctic LNG 2 and NOVATEK-Murmansk. And another vessel – the cargo ship HUNTER STAR owned by CFU Shipping Co., which delivered the last LNG module for the second production line of the Arctic LNG 2 project.

In addition, the sanctions included the Russian companies Eco Shipping and Transstroy, as well as sea vessels transporting cargo in the Arctic seas: Andrey Osipov, Arktika-1, Arktika-2, Barents, Bering, Mangazeya, Mikhail Britnev, Mys Dezhneva, Mys Flora, Mys Schmidta, Mys Zhelaniya, and Vasily Lanovoy.

Among the companies in the mining and metallurgical sector in the Arctic, the Baimskaya mining company, which is preparing to develop a large gold-copper deposit in Chukotka, and the Karalveem Mine enterprise, which mines gold in Chukotka, were included in the SDN list.

Baimskaya mining company holds a license for metal mining within the Baimskaya area in the Chukotka Autonomous Okrug. The license area spans 1.3 thousand km² and contains 12 promising deposits of copper, gold, and silver. It was assumed that the project would launch in 2027, with ore processing capacity of 70 million tons per year, and average annual copper production of 300 thousand tons and gold production of 490 thousand ounces (13.9 tons) during the first ten full years of operation. However, at the end of 2022, due to sanctions, the launch of the Baimsky mining and processing plant and the commissioning of a floating nuclear power plant, which should provide it with energy, was postponed to 2028.

Bellona Comment:

«“The United States continues to consistently add Russian and foreign companies and vessels with even the slightest economic ties to the “Arctic LNG-2” project to the sanctions list. Another major project, the Baimskaya Mining and Processing Plant, has now been included in the sanctions list. It is much easier to prevent planned but not yet implemented projects from developing than to impose restrictions on already operating companies that have secured their niche in the global market.

The lack of strict sanctions, which would threaten secondary sanctions on third countries, against the operating ex. “Yamal LNG” and “Norilsk Nickel,” as well as the weak sanctions on Russian oil exports, show how reluctant the United States is to disturb the global energy and metals markets. Preventing the opening of new resource extraction and export projects successfully reduces Russia’s plans to increase profits in the medium and long term. However, unfortunately, this does not have a significant impact on the income from already operating fields now, in the short term, which is crucial for undermining the military budget and withdrawing Russian troops from Ukraine.”»

Northern Sea Route and shipping

Subsidized coastal lines to load the Northern Sea Route ↑

The Ministry of Roads and Transport of the Magadan Region announced the opening of cabotage lines between the seaports of the North-West Arctic and Far East through the waters of the Northern Sea Route. These lines are intended for internal maritime traffic to transport goods between various Russian ports, and will be carried out at preferential rates due to subsidies from the federal budget.

The program for subsidizing Arctic cabotage transportation along the Northern Sea Route started in 2022. Initially, subsidized flights served four ports, and in 2024, their number increased to 14.

Expansion of port infrastructure in the Murmansk and Yamal regions ↑

On May 4, the Government of the Russian Federation published a decree on expanding the boundaries of priority development territories (PDT) in the Far East and the Arctic zone, including the PDT “Capital of the Arctic” in the Murmansk region. The expansion of this PDT is intended to provide special preferential conditions for the construction of the Western Transport and Logistics Hub, which should include a terminal as well as two deep-water berths for transshipment of cargo between ice-class and non-ice-class vessels traveling along the Northern Sea Route.

Until recently, the transshipment of such cargo was carried out in European ports, but under the sanctions restricting the transshipment operations which is discussed now in the EU, the Western logistics hub should become an alternative to European ports. The corresponding decision was made at the end of 2023.

On May 25, 2024, the Government of the Russian Federation published a decree on expanding the territory of the Sabetta port in Yamal. According to the decree, Arctic LNG – 1 owned by Novatek will create an artificial land plot adjacent to the Gydansky Peninsula and build a remote cargo terminal on it, which is necessary for the development of the Geophysical oil and gas condensate field owned by Novatek and located nearby in the middle of the Gydan Peninsula. Construction of the new terminal is scheduled to begin in 2026; it is expected that it will be able to receive 1.6 million tons of various cargo annually.

In addition, the construction of a rescue center for the Ministry of Emergency Situations is underway in Sabetta, which will ensure the safety of the logistics infrastructure in the eastern direction of the Northern Sea Route and will reduce the time to respond in case of emergencies. The launch of the emergency rescue center is planned for the end of 2025.

Agreement with Chinese companies on sea transportation along the Northern Sea Route in 2024 ↑

On May 8, the governor of the Arkhangelsk region signed a multilateral agreement on cooperation in the field of maritime transport along the NSR from Arkhangelsk to the ports of China with the Chinese shipping company Hainan Yangpu New New Shipping. The Chinese company, in partnership with the Russian transport and logistics company Torgmall LLC, plans to make 10-12 flights in 2024 to deliver Chinese cargo to Arkhangelsk and load lumber back.

It is expected that this partnership will be long-term, will increase the number of container shipments through the Northern Sea Route from the port of Arkhangelsk, and will also increase the volume of cargo handling at the port. According to the Governor of the Arkhangelsk region, Alexander Tsybulsky, the Arkhangelsk seaport can handle 11 million tons of cargo per year, which is approximately twice as much as it currently handles.

A Russian-Chinese subcommittee on the development of the Northern Sea Route ↑

After Vladimir Putin’s meeting with Chinese President Xi Jinping on May 16, Russia and China released a joint statement announcing the creation of a subcommittee on the development of the Northern Sea Route within the framework of the Russian-Chinese commission for preparing regular meetings of heads of governments. The subcommittee on the Northern Sea Route will be headed by Rosatom General Director Alexey Likhachev and the Minister of Transport of China Li Xiaopeng.

The joint statement highlighted the following areas of cooperation:

• Promote the NSR as an important international transport corridor. Alexey Likhachev estimated the potential of Chinese transit along the NSR at 50 million tons/year by 2030.
• Encourage companies to increase cargo transportation along the NSR and build logistics infrastructure.
• Deepen cooperation in the field of Arctic shipbuilding, including technological cooperation.

Earthquakes stimulate iceberg formation in the Arctic, negatively impacting shipping ↑

Scientists from the Federal Research Center for Integrated Study of the Arctic named after Academician Laverov published the results of studies on seismic activity in the area of the Severnaya Zemlya archipelago, revealing a direct relationship between seismic activity and the formation of icebergs. Such real-time data may be necessary for safe navigation in the waters of the Northern Sea Route.

Galina Antonovskaya, head of the seismology laboratory, noted that the seismic monitoring network in the Russian Arctic is at a very low level. Cape Baranova is the only station that collects data for the Severnaya Zemlya archipelago, while Norwegian seismologists have dozens of sensors on the Spitsbergen archipelago.

Bellona Comment:

«“Despite failure of plans for significantly increasing cargo turnover and navigation along the NSR, Russian authorities are striving to economically stimulate private companies and attract Chinese government and private investment to use NSR. Russian officials still have dreams of large volumes of transit traffic from China to Europe, although in the context of Western sanctions in response to the Russian military invasion of Ukraine and poor infrastructure development along the Northern Sea Route, it is unlikely that China will seriously invest in this direction. Transportation from China to Russia and back may increase, but will mean the export of resources from Russia and the import of finished products. Domestic transportation along the NSR also requires substantial economic stimulation as does the construction of port infrastructure.”»

Accidents and emergencies in the Russian Arctic

Diesel fuel spill in Yakutia ↑

On May 26, a diesel fuel spill occurred in the village of Aleko-Kyuel, Srednekolymsky district of Yakutia, due to a deteriorating tank at a local power plant. About 5 tons of petroleum products spilled into the environment over an area of 4000 m2. Representatives from the Ministry of Ecology of Yakutia were delayed in responding due to the village’s inaccessibility at this time of year, lacking regular air transport and being unreachable by water or land transport.