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Monthly Highlights from the Russian Arctic, June 2024

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Publish date: August 7, 2024

Written by: Bellona

In this news digest, we monitor events that impact the environment in the Russian Arctic. Our focus lies in identifying the factors that contribute to pollution and climate change.

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. Subscribe to our mailing list to make sure you don’t miss the next digest.

Our previous monthly highlights for May can be found here.

In this issue:

ENVIRONMENTAL AND CLIMATE ISSUES IN THE RUSSIAN ARCTIC
1) In June, fires in the Arctic, especially in Yakutia, led to record CO2 emissions
2) Scientists have found that the rapid reduction of Arctic ice in Russia increases the risk of forest fires in Eastern Siberia
3) Russian government approves regulations for state permafrost monitoring; Yamal and Chukotka monitoring outposts ready to go

HEIGHTENED INDUSTRIAL ACTIVITY IN THE RUSSIAN ARCTIC
4) A gas chemical plant and a railway with access to the Northern Sea Route will be built in Vorkuta
5) Komi has decided to resume coal mining in Inta
6) The development of the Kolmozerskoye lithium deposit in the Murmansk region could harm fisheries resources

INTERNATIONAL SITUATION IN THE ARCTIC AND SANCTIONS AFFECTING RUSSIAN ACTIVITIES IN THE ARCTIC REGION
7) Russia’s Arctic LNG and oil projects fall under new US sanctions
8) The European Union has introduced new sanctions limiting the export of Russian LNG and oil
9) A Chinese company refused to supply modules for the Arctic LNG 2 project and suspended activities in Russia
10) Russian LNG exports to Europe increased in the first half of 2024
11) “Shadow fleets” carrying Russian LNG suspected

NORTHERN SEA ROUTE AND SHIPPING 
12) The Ministry of Emergency Situations opened the first Arctic integrated emergency rescue center in Pevek, Chukotka
13) Rosatom proposed expanding the NSR to Petropavlovsk-Kamchatsk from the east and to St. Petersburg from the west

ACCIDENTS AND EMERGENCIES IN THE RUSSIAN ARCTIC

Environmental and climate issues in the Russian Arctic

In June, fires in the Arctic, especially in Yakutia, led to record CO2 emissions ↑

The Copernicus Atmospheric Monitoring Service (CAMS) reported that most of the fires in the Arctic Circle occurred in Yakutia. Scientists have noted that the northeastern Arctic region is experiencing the largest increase in extreme wildfires in the last two decades. 

According to the Russian Air Forestry Service, as of June 28, there were 180 natural fires on the territory of Yakutia covering a total area of over 629 thousand hectares. On June 11, due to fires in the region, a regional emergency was declared, and on July 1, a federal emergency was declared. Forest fires in the Northern Hemisphere typically reach their peak in July and August. CAMS estimates that these fires have already released 6.8 megatons of CO2. Over the past two years, emissions were higher only in 2020 and 2019. 

In addition, smoke from wildfires affects air quality at high latitudes and can lead to surface deposition of aerosols in the smoke. Deposition of black carbon and soot from wildfires can potentially darken snow and ice surfaces, reducing their albedo and causing them to absorb more solar energy, making them more prone to melting. 

Forest fires near the village of Belaya Gora, Yakutia. Photo: vk.com/newsykt

Scientists have found that the rapid reduction of Arctic ice in Russia increases the risk of forest fires in Eastern Siberia ↑

An international team of climate scientists has studied the causes of wildfires in Siberia and found a link between declining sea ice in the Arctic and increasing wildfires in the high latitudes of Eastern Siberia. The scientists published a corresponding study in the journal Nature Communications

Arctic warming and blocking climate anticyclones create conditions for fires as precipitation decreases, soil and surface air dry out, and lightning occurrences increase. 

Russian government approves regulations for state permafrost monitoring; Yamal and Chukotka monitoring outposts ready to go ↑

Published on June 30, 2024, the document establishes rules for long-term observations, analysis and forecasting of the state of permafrost, which occupies about 65% of the territory of the Russian Federation. Climate change modeling based on monitoring is also intended to ensure the trouble-free operation of infrastructure in permafrost areas. 

In the course of creating a state system for background monitoring of permafrost, scientists from the AARI Roshydromet have already launched 30 observation points for the permafrost zone in Russia. According to the Minister of Natural Resources and Environment, Alexander Kozlov, by the end of 2024 there will be 78 of them. 

Commentary by Bellona:

«It is noteworthy that the regulation on background monitoring of the state of permafrost states that only current and emergency information on the degradation of permafrost soils will be freely available. Other information from monitoring results may be subject to the law on state or commercial secrets, with limited access and will not be published.

The Russian authorities have never been ready for complete openness regarding environmental information, which is confirmed by their non-adherence to the Aarhus Convention, and now, during a full-scale war against Ukraine, this is becoming even more noticeable. Even information about the state of permafrost is apparently considered a state secrets.
»
The first well of the permafrost monitoring system in the Arctic Zone of the Russian Federation. Photo: Ministry of Natural Resources of the Russian Federation

Heightened industrial activity in the Russian Arctic  

A gas chemical plant and a railway with access to the Northern Sea Route will be built in Vorkuta ↑

On June 14, at a meeting of the Council for Improving the Investment Climate and Export Development in the Komi Republic, the head of the region, Vladimir Uiba, presented the projects included in the master plan for the development of the Vorkuta agglomeration. Key initiatives include the construction of a gas chemical plant and a railway connecting Vorkuta with the Northern Sea Route. According to the head of the region, these projects will turn Vorkuta into a powerful transport hub. 

The new oil and gas processing plant will allow the region not only to extract but also to process oil and gas, and produce polyethylene and fertilizers. The plant in Vorkuta will use Gazprom’s Bovanenkovo-Ukhta gas pipeline. 

Komi has decided to resume coal mining in Inta ↑

On June 14, the head of Komi, Vladimir Uiba, announced the resumption of coal production in the Inta mines, which were stopped in 2018 due to unprofitability. After many years of research, it was found that coal reserves would last for at least 30 years, which makes mothballing the mines ineffective. Funds for the modernization of mines have been allocated from the federal budget. Negotiations are currently underway with potential investors to launch an industrial complex. 

The former city-forming enterprise of JSC Intaugol in Inta was liquidated in 2019 due to bankruptcy. However, some employees continue to work at the mine, though it is a dangerous production facility. In 2023, it was planned to mothball the Intinskaya mine due to the threat of contamination of the artesian aquifer that feeds the city.

Commentary by Bellona:

«The head of the Komi Republic, part of which is located in the Arctic zone, is actively attracting investors. This became especially noticeable after 2023, when Vorkuta, the third-largest city in Komi, was included in the list of support settlements of the Russian Arctic (a total of 16 such support centers were designated). At the same time, it seems that investments are being attracted to everything, without a preliminary assessment of their feasibility, effectiveness, and especially the impact on the environment.

The resumption of coal production in a mine that was closed due to unprofitability six years ago, whose main buyer switched to another fuel (most of the coal was supplied to the Cherepovets State District Power Plant, which completely stopped using coal in 2021), does not look like an attractive investment proposal. But since the Intinskaya mine is located in the Russian Arctic, new investors can apply for government benefits and support. The state is ready to help any business in the Arctic, even those that are economically unprofitable and pollute the environment.
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The development of the Kolmozerskoye lithium deposit in the Murmansk region could harm fisheries resources ↑

The Arctic Development Project Office published the results of an ethnological examination of the development of the Kolmozerskoye deposit. The study showed that the development and operation of beneficiation facilities could negatively impact the aquatic community, especially Atlantic salmon and brown trout. Additionally, due to the impact of production wastewater, whitefish and its other river species found within the basin may suffer. 

The ethnological examination was launched in the spring of 2023 with the aim of analyzing the potential impact of the Kolmozerskoye project on the traditional way of life, crafts and culture of the indigenous peoples and reindeer herders of the Lovozero district of the Murmansk region. 
 
To develop the Kolmozerskoye lithium deposit, Rosatom and Norilsk Nickel established a joint venture, Polar Lithium, which will mine ore, enrich it and produce materials for batteries. The first stage of the mining and processing plant, designed to produce 400 thousand tons of ore, is planned to be commissioned in 2026. Reaching the design capacity of 2 million tons is planned by 2030. 

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


Russia’s Arctic LNG and oil projects fall under new US sanctions ↑

On June 12, the US Treasury published new sanctions lists aimed at limiting Russian income financing military operations in Ukraine. The list includes NOVATEK’s LNG projects Arctic LNG – 1, Arctic LNG – 3, Obski Gas Chemical Complex LLC in the Yamalo-Nenets Autonomous Okrug, as well as Murmansk LNG and Murmansk – Transgaz – projects for gas production and transportation in the Murmansk region. 

The restrictions also included 7 of the 15 Russian ice-class gas tankers Arc7, which are being built at the sanctioned Zvezda shipyard. The vessels Alexey Kosygin, Pyotr Stolypin, Sergey Witte, the Zvezda 044 and Zvezda 045  are nearly complete while the Zvezda 046, and Zvezda 047 are still in the midst of their builds.

In addition, four companies associated with the logistics of the Vostok Oil project were sanctioned: Yamaldorstroy, TBS-Logistics, GT Morstroy and the Belokamenka Oil Terminal. Vostok Oil is a Rosneft project aimed at developing oil fields in the Krasnoyarsk Territory and building infrastructure for the development and transportation of oil to the Taimyr Peninsula. 

Shipbuilding complex “Zvezda”. Photo: kremlin.ru

The European Union has introduced new sanctions limiting the export of Russian LNG and oil ↑

On June 24, the European Union approved the 14th package of sanctions aimed at increasing pressure on the Russian energy sector and combating circumvention of previously introduced restrictions. 

This is the first time European sanctions have targeted LNG. They provide for a ban on the transshipment of Russian liquefied natural gas for the purpose of re-export to third countries through the ports of the European Union. The ban will come into force after a 9-month transition period. At the same time, LNG supplies from Russia to the EU are not subject to sanctions. 

In addition, the European Union banned investments and the provision of goods, technologies and services to complete the construction of Russian LNG projects: Arctic LNG 2, Murmansk LNG, etc. 

The sanctions also included 27 tankers of the so called “shadow fleet,” — vessels Russia uses to transport oil and petroleum products to bypass the price ceiling. These vessels are now prohibited from entering European Union ports. 

Sovcomflot, the largest shipping company in Russia, specializing in the transportation of oil, petroleum products and LNG in difficult climatic and ice conditions, was also included in the EU sanctions list. 

In June 2024, the UK imposed sanctions on Ingosstrakh, which became one of the main insurers of tankers transporting Russian oil.

A Chinese company refused to supply modules for the Arctic LNG 2 project and suspended activities in Russia ↑

On June 21, the management of Wison New Energies decided to suspend its activities in Russia. This happened after a number of Chinese companies came under secondary US sanctions due to cooperation with Russia. 

Wison New Energies was involved in the design, supply of equipment and components to Russia, and was also one of NOVATEK’s key technology partners in the construction of shipyards and modules for the Arctic LNG 2 project. The Wison subsidiary was to build a 1.5 GW onshore power plant for Arctic LNG 2, using turbines from the Chinese manufacturer Harbin Gaungham Gas Turbine. 

Russian LNG exports to Europe increased in the first half of 2024 ↑

According to the analysis Center for Research on Energy and Clean Air (CREA), from January to June 2024, Russian LNG exports increased by 9% year on year. The European Union remains the largest importer of Russian LNG, purchasing 50% of total exports during this period. In second place is China with 20%, and in third place is Japan with 18%. Among European countries, France became the largest buyer of Russian LNG in the first half of the year, Belgium and Spain were in second and third place, respectively. 

The International Energy Agency (IEA), in its report on the gas market, noted that the Yamal LNG plant has become the main driver of growth in Russian LNG exports, although small projects also contributed to the increase in exports. Also, according to Kpler analysts, due to restrictions on LNG supplies through the Red Sea, NOVATEK’s Yamal gas is becoming more accessible to the EU than gas from the Middle East. 

According to data from the Kpler vessel tracking system, the Yamal LNG plant began using four new Arc4 class tankers – North Air, North Mountain, North Sky, and North Way. Apparently, these tankers were originally intended for the Arctic LNG 2 project, but due to sanctions that prevented the start of shipments, they were retrofitted for Yamal LNG. 

Yamal LNG capacities in Sabetta. Photo: KadnikovValerii

“Shadow fleets” carrying Russian LNG suspected ↑

According to Bloomberg, growing evidence indicates that Moscow is creating a shadow fleet to transport liquefied natural gas (LNG), much as it created a shadow fleet to transport oil after imposing sanctions and price caps on its exports. 

The founder of the Arctic Institute think tank, Malte Humpert, notes a number of signs pointing to the creation of such a fleet – the purchase of old gas carriers, the transfer of ice-class vessels to companies from Dubai and a record number of permits to use the Northern Sea Route. Over the past three months, analysts have discovered at least eight vessels transferred to little-known companies in Dubai. Four ice-class vessels have already received Russian approval to sail in the Arctic this summer, and the vessel North Way arrived at the Zeebrugge terminal in Belgium to receive a shipment of Russian gas. 

Another sign of a shadow fleet is that three of the tankers have insurance agents listed as “unknown” in the International Maritime Organization database. 

Commentary by Bellona:

«The EU’s 14th package of sanctions on Russian oil and gas largely mirrors last month’s US sanctions on Russian LNG and metals projects – targeting oil and gas production and facilities under construction in the Arctic rather than those already in operation.

This makes it difficult for Russian companies to expand exports but does not immediately affect income from current sales. Sales of LNG, as well as pipeline gas from Russia to the EU, remain at a high level, despite the fact that two and a half years have passed since the beginning of Russia’s military invasion of Ukraine. There is a clear political inability of the EU countries that use Russian gas (primarily France, Belgium, Hungary, Slovakia, and the Czech Republic) to refuse it.

Back in March 2022, Bellona, together with other environmental organizations, conducted an analysis and issued recommendations on how to completely phase out Russian gas by 2025. If European politicians began to actively stimulate the development of renewable energy sources (RES) and projects to improve energy efficiency, then by 2025, EU countries would be able to stop buying 66% of Russian gas. The remaining 34% could be purchased from alternative suppliers using the existing LNG terminal infrastructure.

The ban on transshipment of Russian LNG in European ports for its sale to third countries provides for a long period of nine months, during which Russia may well find alternative ways, including using the new transshipment terminal in Murmansk and the shadow fleet, and minimize the negative effect of sanctions.

Sanctions against vessels of the shadow fleet seem belated and insufficient. According to CREA, the Russian shadow oil fleet consists of at least 213 vessels, so the 27 tankers on the EU sanctions list are only a fraction of what is needed to block the possibility of selling Russian oil in circumvention of sanctions.

Against the background of the relative success of the shadow oil fleet, the creation of a shadow fleet for transporting LNG in the face of a possible tightening of sanctions looks quite logical for Russia. If old tankers with unknown owners and dubious insurance have been successfully transporting Russian oil for two years, then LNG can also be transported in this illicit way, although transporting LNG requires more specialized ships than transporting oil.

One good thing is that the threat of secondary US sanctions is working against Chinese companies cooperating with Russia. Despite the joint development of the NSR by Russia and China promoted in the Russian press, in reality, it seems that Chinese companies are very cautious about sanctioned projects and companies.
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Northern Sea Route and shipping

The Ministry of Emergency Situations opened the first Arctic integrated emergency rescue center in Pevek, Chukotka ↑

The opening of a new type of Arctic emergency rescue center of the Ministry of Emergency Situations took place in Pevek. The center combines a division of the Ministry of Emergency Situations, the Federal Medical and Biological Agency and the Marine Rescue Service. Over the next year, the center in Pevek will operate as part of a trial operation, as its operational algorithms will be tested and developed. 

The center in Pevek is the first of four planned rescue centers that will be located along the coast of the eastern part of the Northern Sea Route. Similar centers are planned to be opened in Sabetta, Dikson, and Tiksi. The construction of these centers is provided for in the development plan of the Northern Sea Route until 2035. 

Until recently, the rescue infrastructure in the Arctic region was represented by centers in Murmansk, Arkhangelsk, Vorkuta, Naryan-Mar and Dudinka, while the eastern part of the region remained without adequate coverage. In Sabetta, the center will be built in cooperation with Novatek; in Dikson – in cooperation with Rosneft, Norilsk Nickel and Northern Star; and in Tiksi – with support from the federal budget. 

During the St. Petersburg International Economic Forum in June 2024, a representative of the Russian Ministry of Emergency Situations, Alexander Bondar, noted that the Ministry of Emergency Situations, together with Rosatom, is considering the possibility of basing the aviation of the Russian Ministry of Emergency Situations on nuclear icebreakers, so that it can be used to reach any point in the Arctic region. 

Rosatom proposed expanding the NSR to Petropavlovsk-Kamchatsk from the east and to St. Petersburg from the west ↑

On June 7, during the St. Petersburg International Economic Forum, Rusatom Arctic General Director Vladimir Panov proposed using the concept of “Great Northern Sea Route” , which would cover ports geographically and economically associated with high-latitude logistics – St. Petersburg, Kaliningrad, Vladivostok, Petropavlovsk-Kamchatsky and a number of others. The emergence of a new term may mean the inclusion of new ports in infrastructure programs for the development of the Northern Sea Route. 

Petropavlovsk-Kamchatsky is located almost one and a half thousand kilometers south of the Arctic Circle, and St. Petersburg is around 700 km south of it. 

Petropavlovsk-Kamchatsky, which Rosatom proposes to include in the Great Northern Sea Route, is located approximately 1,500 km south of the Arctic Circle. Photo: Kokhanchikov

Commentary by Bellona:

«The organization of coastal points of the Ministry of Emergency Situations along the NSR is an inevitable measure, without which an increase in maritime traffic is dangerous both for the crews of ships moving along the NSR and for the environment. However, the construction of ground stations is not enough for this. In addition to them, a search and rescue fleet in sufficient numbers is needed, including icebreakers, but Russian shipbuilding, under the conditions of international sanctions, is experiencing difficulties due to a lack of imported components.

The NSR development strategy provides for the construction of 46 rescue vessels by 2030, 16 of which are expected to be commissioned in 2024. As of May 2024, 9 of the 16 ships are under construction at Russian and Turkish shipyards, but their delivery date has been pushed back to 2025. Therefore, the work on the construction and commissioning of emergency rescue vessels for the NSR will clearly not be completed on time.

The geographical expansion of the Northern Sea Route and the inclusion of ports that are not located in the Arctic zone most likely mean the desire of Rosatom and other parties involved in the use of the NSR to take advantage of Arctic subsidies for investments in other ports. In other words, as long as the state provides money to the Arctic, everyone is interested in being involved in Arctic activities, therefore, the administrative boundaries of the Arctic zone of the Russian Federation are constantly expanding, and now the NSR will also expand.

In addition, thanks to the inclusion of additional non-Arctic ports in the NSR, it will be possible to achieve cargo turnover targets that would definitely not be achieved otherwise. This will not be the first time for Russian bureaucracy that it is easier to change the methodology to demonstrate progress than to actually work on improving indicators.

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Accidents and emergencies in the Russian Arctic ↑

In June, the media covered the following oil spills and fires at industrial facilities: 

  • On June 2, a fire broke out at the Ukhta oil refinery owned by Lukoil in the Komi Republic. 
  • On June 3, an oil spill occurred in the Komi Republic as a result of depressurization of the Yareganeft oil pipeline, a subsidiary of Lukoil. 400 kg of oil products got into the environment, about 1 thousand km2 were polluted, and oil got into the Voyvozh stream. 
  • On June 14, an oil spill occurred on the Pyakupur River in the Yamalo-Nenets Autonomous Okrug. Traces of oil and dead fish were found in the river.