22 February 2013, 16:16

Russia's Arctic strategy: development and innovations

Russia's Arctic strategy: development and innovations

With many countries having their eyes on the Arctic and its rich resources, the region is becoming the intersection of strategic interests and economic ambitions.

Countries of the Artic rim should be aware of the worst-case scenario and work closely together to avert it. Experts polled by the Voice of Russia agree that Russia’s new strategy for the development of its Artic territories, which was rubberstamped by President Vladimir Putin this week, is a major step forward along this path.

A project of unprecedented scale in Russia’s post-Soviet history, it outlines the key Arctic policy priorities and sets a wide range of tasks from socio-economic development and ecological security to tighter border protection and the expansion of international ties. Those are the ambitious targets that Russia must work towards consistently if it wants to secure its positions in the Arctic. Inland mineral resources are rapidly shrinking and will be fully exhausted in 30-40 years, scientists warn, while hidden beneath the untapped Arctic shelf are vast reserves of hydrocarbons. Melting Arctic seas are making them easier to get at. Sergei Pikin is Director of the Energy Development Fund.

"The Arctic is a Klondike for decades ahead. All future energy wars will be fought around the Arctic shelf. Therefore, it’s important to attract both Russian companies and foreign partners to the geological exploration and industrial development of the Arctic – the sooner, the better. But it should be remembered that offshore exploration creates environmental risks. To minimize them, everything must be done within the frames of a single strategy. That’s the purpose."

With 70% of Russia’s hydrocarbon reserves located in the Arctic shelf, the government’s decision to form a strategic reserve of oil and gas fields in the Arctic region to guarantee national energy security is of utmost importance. Sergei Pikin:

"The above reserve will help stabilize the situation on international markets. Excess supply pushes gas prices down but affects the interests of exploration and extraction companies. On the other hand, supply deficit pushes prices up, but then the demand goes down. Such reserves will keep the situation stable for both producers and consumers, making development more sustainable. But that requires a detailed exploration database."

Offshore exploratory drilling will begin shortly in the Barents, Pechora and Kara Seas and in the Yamal and Gydan Peninsulas. Simultaneously, a major Arctic infrastructure program will be launched. The Northern Sea Route will be the main artery and the core of the future Arctic transportation and supply network, says Vasily Gutsulyak, an expert at the Institute of State and Law of the Russian Academy of Sciencfes:

"As larger areas of Arctic ice are melting away due to global warming, all-year-round navigation without icebreakers will no longer be impossible. Naturally, transportation costs will be considerably cheaper than now because we still have to use icebreakers. Also, faced with the increasing piracy threat, ship owners will search for alternative routes. This opens up great prospects for the Northern Sea Route. Japan has already shown interest in it."

Another important task is to settle the international formalities regarding the disputed outer border of Russia’s Arctic shelf. Russia will soon file all the necessary documents with the United Nations to substantiate its claims. The case in point is about 10% of the country’s territory. The entire strategy is designed for 2020, but the first stage is to be completed by 2015.

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