Rosatom legislation to control the Arctic faces more pushback

arctic-ice-melt1 Glacial melt. Credit: Still from Obama Administration White House video

In a legal blow, Russia’s accounts chamber, parliament’s independent financial oversight body, has challenged legislation that would give Rosatom, Russia’s state nuclear corporation, nearly exclusive control over developing the Arctic’s storied Northern Sea Route between Europe and Asia, news reports have said.

The accounts chamber’s annual report, released last week, said the Rosatom-authored bill, which has yet to be considered by the parliament, doesn’t present a realistic budget for developing port infrastructure along the icy 6,000 kilometer route, and says that state funds for doing so won’t be available from the federal budget until 2020.

The accounts chamber report spells the latest sign of trouble for Rosatom’s Kremlin-sponsored legislation, which was drafted last November at the behest of President Vladimir Putin.

Yet, as is becoming clear, the bill also leaves numerous things unresolved, including which part of Russia’s sprawling transport structure would be responsible for issuing permits to commercial freighters wishing to traverse the East-West passage. The chamber also said the bill fails to spell out how Rosatom would pay for administering route.

In its current form, the vague and sweeping bill would hand Rosatom near total control over a central economic goal the Kremlin – so much so that Putin last week decreed that the route must be outfitted to handle some 80 million tons of cargo traffic a year.

As such, the legislation lays out in bold strokes a plan under which Rosatom would have the authority to oversee and regulate shipping through the Russian Arctic, as well as designate, build and manage ports along the way.

The legislation would also give Rosatom the say-so over which ships are allowed to sail through the corridor, as well as oversee reporting on weather and ice conditions. It would also make Rosatom responsible for organizing rescue operations, and for designating the circumstances under which icebreakers must be used for convoys.
But  in its report, the accounts chamber said the Rosatom bill failed to specify where the funds to support this massive administrative shift would be coming from, and added that the federal government wouldn’t be able to pay for it for at least two years.

For its part, Rosatom has said that it doesn’t need further financing from the government to enact the legislation, and that the funds would materialize after it was handed the administrative reigns for overseeing the route, which is currently the responsibility of  the Ministry of Transport.

But Viktor Olersky, Russia’s deputy transport minister has challenged the bill as well. Earlier this month he argued that his agency should maintain the responsibility of issue permits to sail through the Northern Sea Route.

Rosatom has argued that it should be the one issuing permits, as it oversees Atomflot, Russia’s nuclear icebreaker port, whose vessels are responsible for blazing trails for commercial freight vessels through the Arctic’s waters.

Russia has long viewed the Northern Sea Route as the hinge on which the country’s economic future hangs. Northern Siberian oil and gas ventures line its shores, and Moscow is investing billions of dollars in new nuclear icebreakers to accompany what it insists will be a bonanza of sea traffic between European and Asian ports.

But there is little evidence to suggest such long cargo hauls will be drawn away from the cheaper and more established Suez Canal. Nevertheless, as liquefied natural gas projects on the Yamal Peninsula have spurred a traffic uptick between Central Siberia and ports in South Korea and China.

But climate change has made even those journeys easier. Last summer, the Christophe de Margerie gas tanker made the entire journey through the route from Hammerfest, Norway to Boryeong in South Korea in 19 days without the aid of Atomflot’s nuclear icebreakers.

Still, Rosatom legislation would doubtless see more icebreakers, as well as the fulfillment of some of the nuclear sector’s more extravagant dreams.