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 September can be found here.

In this issue:

NORTHERN SEA ROUTE AND SHIPPING
1. Vessels Without Ice Class Continue to Navigate the NSR Amid Early Ice Formation
2. Russia Increases Oil Exports to China via the Northern Sea Route
3. First Meeting of the Russian-Indian Working Group on the Northern Sea Route Held in India
4. Russian Ministry Highlights Shortages in Ice-Class Vessels, Unprofitability of Icebreaker Assistance, and Lack of Arctic Infrastructure Funding

HEIGHTENED INDUSTRIAL ACTIVITY IN THE RUSSIAN ARCTIC
5. State Duma Extends Zero Tax Rate on Gas Production for Ammonia and Hydrogen Across the Arctic Zone
6. Russian Government Allocates Over 5 Billion Rubles for Baimskoye Gold-Copper Deposit Development in Chukotka
7. Gazprom Shifts Geological Exploration Focus to the Kara Sea Shelf
8. Russia Aims to Increase Coal Production by 235 Million Tons by 2036
9. Manganese Ore Mining to Resume at Parnokskoye Deposit in Komi

INTERNATIONAL SITUATION IN THE ARCTIC AND SANCTIONS AFFECTING RUSSIAN ACTIVITIES IN THE ARCTIC REGION
10. U.S. Imposes New Sanctions on Companies Linked to Arctic LNG 2 Project
11. Arctic LNG 2 Suspends Operations Amid Growing U.S. Sanctions
12. Russia’s Shadow LNG Fleet Acquires New Tankers
13. LNG Tankers from Arctic LNG 2 Remain Ununloaded in Foreign Ports
14. Russia Plans Ship-to-Ship LNG Transfers in Arctic Seas to Free Up Ice-class tankers for the Arctic LNG 2 Project
15. Power Plants from China Delivered to Arctic LNG 2 Project

ENVIRONMENTAL AND CLIMATE ISSUES IN THE ARCTIC
16. Scientists Predict Up to 10-Degree Temperature Rise in the Arctic and Permafrost Loss in Murmansk and Arkhangelsk Regions
17. American Scientists Described the Negative Impact of Climate Change on Polar Bears

ACCIDENTS AND EMERGENCIES IN THE RUSSIAN ARCTIC

Northern Sea Route and shipping

Vessels Without Ice Class Continue to Navigate the NSR Amid Early Ice Formation ↑

Despite active ice formation beginning earlier than usual this year, vessels without an ice class have continued to transit the Northern Sea Route (NSR). Ice formation started in late September, with the most significant activity observed in the eastern Arctic, including the Laptev Sea, East Siberian Sea, and Chukchi Sea. Ice was also reported in the Kara Sea and near the Severnaya Zemlya archipelago.

The NSR Administration officially allowed vessels without an ice class to navigate the NSR until October 15, 2024. However, Norwald Kjerstad, a Professor of Marine Sciences at the Norwegian University of Science and Technology, has criticized this decision as reckless, arguing it places these ships at significant risk.

According to the Barents Observer, at least 11 vessels without ice class transited the NSR in early October. These included bulk carriers such as Platos, Portia, Dodo, Great Wenchang, Libra-XS, Smoke, and Tand Land, as well as oil tankers Aquatica and Meru, none of which are designed for operation in such challenging climatic conditions.

Additionally, in October, the heavy-lift vessel Ocean-28—which was transporting modules for the Arctic LNG-2 project—and the 264-meter-long container ship NewNew Panda 1, both without ice class, navigated the NSR. Notably, Ocean-28 entered the NSR from its eastern side on October 14 and crossed its western boundary on November 3, nearly three weeks after the official permit for non-ice-class vessels expired.

Russia Increases Oil Exports to China via the Northern Sea Route ↑

In 2024, Russian oil companies increased oil exports to China via the NSR by 30%, reaching a total of 1.9 million tons. The primary export routes included shipments through the ports of Murmansk and the Baltic region, as well as from the Prirazlomnoye and Novoportovskoye fields, both operated by Gazprom Neft.

This year has seen significant shifts in established logistics routes. While shipments from the Baltic ports have declined, those from Murmansk have surged, accounting for over 70% of all oil delivered to China via the NSR. Additionally, direct deliveries from Arctic fields contributed approximately 150,000 tons to the total.

According to Kommersant, cargo flows from Arctic fields are increasingly being redirected along the NSR, partly due to the need for scheduled repairs of the Russia’s tanker fleet. Before Russia’s full-scale invasion of Ukraine, these vessels were serviced in European ports. Now, it appears they are being sent to China for maintenance, which is reshaping logistics patterns in the region.

First Meeting of the Russian-Indian Working Group on the Northern Sea Route Held in India ↑

On October 10, the first meeting of the Russian-Indian working group on cooperation regarding the NSR took place in New Delhi. The Russian delegation was led by Vladimir Panov, a representative of Rosatom, while the Indian delegation was headed by Rajesh Kumar Sinha, Deputy Minister of Ports and Shipping. The meeting focused on joint projects, setting targets for Russian-Indian cargo transit via the NSR, training opportunities for Indian sailors in polar navigation, and a draft memorandum of understanding on maritime transportation within NSR waters.

Rosatom is also exploring the construction of four non-nuclear icebreakers for the NSR in India, with an estimated cost exceeding 60 billion rupees (approximately 670.5 million EUR).

Besides India, Russia plans to build vessels for NSR in China. On October 11, during the XXII Forum of Strategists in St. Petersburg, Sergey Chemko, a representative of Rosatom’s Arctic development project office, announced plans to construct five Arc7 ice-class container ships. These vessels are part of a joint venture with the Chinese company NewNewShipping Line and are designed to establish a year-round container shipping route. The route aims to connect Chinese ports with the Big Port of St. Petersburg and the deep-water zone of the Arkhangelsk port.

Russian Ministry Highlights Shortages in Ice-Class Vessels, Unprofitability of Icebreaker Assistance, and Lack of Arctic Infrastructure Funding ↑

On October 22, during the strategic session of the Ministry for the Development of the Far East and the Arctic titled “On the Development of the Arctic Zone of the Russian Federation,” Yuri Trutnev, the Presidential Representative in the Far Eastern Federal District, highlighted critical issues facing the NSR.

Trutnev reported a significant shortage of high ice-class cargo vessels, with a deficit of at least 70 ships. Current projections suggest that Russian shipyards will only be able to construct 16 such vessels by 2030, far below the required number.

He also addressed the escalating costs of icebreaker escorts, linked to the rising financial burden of constructing new icebreakers. This has rendered icebreaker assistance economically unviable at the planning stage, further complicating navigation along the NSR.

In addition, Trutnev emphasized insufficient funding for satellites for the monitoring systems of the the NSR. Only 11 satellites are currently monitoring the ice and hydrometeorological conditions across the NSR’s vast 3 million km² water area, which is inadequate. He also noted the need for additional funding to establish centers for the Ministry of Emergency Situations and to develop a comprehensive environmental monitoring system for the region.

Bellona’s comment:

«In October, the summer-autumn navigation season for vessels without an ice class and those with an ice class of up to Arc5 along the NSR ended earlier than usual. While precise data on voyages and cargo flow during this period are still forthcoming, preliminary observations suggest that cargo turnover on the NSR did not grow as significantly as anticipated by the Russian government. Most of the activity was driven by redirecting export shipments to China.

The NSR remains the primary maritime route for exporting minerals from the Russian Arctic. This role of the NSR is expected to continue unchanged in the coming years.

China’s and India’s interest in the NSR largely revolves around importing affordable energy resources from Russia. Indian sources confirmed that. While the NSR remains the main export corridor for Russian Arctic resources, the country is taking on higher risks. This includes allowing non-ice-class vessels to transit in challenging weather conditions and concealing ships belonging to the shadow oil and gas fleet.

Russia’s reliance on China is further deepened by its limited domestic shipbuilding and ship repair capacities.»

Heightened industrial activity in the Russian Arctic

State Duma Extends Zero Tax Rate on Gas Production for Ammonia and Hydrogen Across the Arctic Zone ↑

On October 22, the State Duma approved regulations extending the zero tax rate on mineral extraction for natural gas and gas condensate used in ammonia and hydrogen production to the entire Arctic Zone of the Russian Federation.

Previously, this tax incentive was limited to gas extraction projects in Yamal and Gydan, located within the Yamalo-Nenets Autonomous Okrug. With this extension, new projects throughout the Arctic Zone now qualify for the benefit, aiming to stimulate resource development and production in the region.

Russian Government Allocates Over 5 Billion Rubles for Baimskoye Gold-Copper Deposit Development in Chukotka ↑

On October 14, Prime Minister Mikhail Mishustin signed an order allocating over 5 billion rubles in federal subsidies to support the development of the Baimskoye gold-copper deposit in the Chukotka Autonomous Okrug. These funds will be used to construct overhead power transmission lines and other energy infrastructure essential for the extraction and processing of multicomponent ores at the deposit. Authorities anticipate that this infrastructure will facilitate the establishment of new mining and processing plants, boosting the region’s investment appeal and economic growth.

As noted in the May digest, the Baimskaya Mining Company was added to the U.S. sanctions list on May 1. The Baimskaya area contains 12 promising deposits of copper, gold, and silver. While the project was initially slated for launch in 2027, sanctions have delayed the commissioning of both the Baimsky Mining and Processing Plant and the floating nuclear power plant supporting it, pushing the timeline to 2028.

Gazprom Shifts Geological Exploration Focus to the Kara Sea Shelf ↑

On October 8, at the Marintec Russia Offshore Conference—dedicated to shipbuilding and high-tech equipment for Arctic and continental shelf development—Sergey Chuzhmarev, Deputy Head of Gazprom’s Department, announced that the company is increasingly focusing its geological exploration efforts on the Kara Sea shelf.

Gazprom’s exploration activities in the Kara Sea are concentrated on the western part of the Yamal shelf, where the Leningradskoye and Rusanovskoye natural gas fields were initially discovered in the 1990s. Between 2019 and 2020, three additional gas fields were identified in the region: V. Dinkov, Nyarmeyskoye, and 75 Years of Victory. Gazprom has also conducted further exploration of the Leningradskoye gas condensate field, uncovering new gas deposits, while continuing geological exploration at the V. Dinkov field.

The company’s growing interest in this region stems from its strategy to use these fields as a replacement for the depleting resource base in the Nadym-Pur-Tazovsky District. However, falling gas exports to Europe and the high costs associated with developing offshore fields in the harsh conditions of the Kara Sea have prompted Gazprom to delay the completion dates for several projects. Originally planned for 2029–2032, these projects were moved to 2033–2036.

Russia Aims to Increase Coal Production by 235 Million Tons by 2036 ↑

Deputy Prime Minister Alexander Novak, in an article published in Energy Politics magazine, outlined Russia’s plans to boost coal production by 235 million tons annually by 2036. This expansion will be driven by new projects in Eastern Siberia and the Far East. By 2030, Russia aims to increase coal exports to Asia-Pacific countries by 75 million tons annually.

Novak emphasized that coal remains one of the most abundant and accessible fossil fuels globally, with a projected 6% increase in global demand by 2036. Domestically, coal accounts for approximately 12% of Russia’s energy balance and is a critical economic driver for several regions. Consequently, the government is prioritizing not only sustaining domestic coal consumption but also expanding export volumes.

However, forecasts for global coal consumption vary. While consulting firm GlobalData predicts relatively stable coal demand through 2030, the International Energy Agency (IEA) expects a decline in consumption as early as 2026, reflecting uncertainties in the global market.

Manganese Ore Mining to Resume at Parnokskoye Deposit in Komi ↑

Roman Polshvedkin, a representative of the Project Office for Arctic Development in Komi, announced plans to restart industrial manganese ore mining at the Parnokskoye deposit in the Intinsky District of Komi by the end of 2026. The deposit, inactive since the mid-2000s, is licensed to the Chelyabinsk Electrometallurgical Plant.

At the Magnitny-1 site, preparatory work is set to begin in 2025, with mining operations expected to continue until 2044. The Magnitny-2 site is scheduled to commence operations from 2036 to 2048, with an anticipated production level of 80,000 tons per year.

According to the Russian Ministry of Natural Resources, no industrial manganese ore mining occurred in Russia from 2013 to 2020. Low ore quality and insufficient infrastructure in the deposit area had previously rendered mining and processing unprofitable. As a result, Russia relied on manganese ore imports from South Africa, Gabon, and Kazakhstan. However, the 14th EU sanctions package, enacted in June 2024, included a ban on exporting manganese ores to Russia.

On July 11, 2024, the Russian government approved an updated strategy for developing the country’s mineral resource base through 2050. The strategy prioritizes securing domestic supplies of scarce strategic mineral resources, including manganese.

Bellona’s comment:

«To sustain domestic production and secure export revenues, Russia is increasingly focusing on previously unprofitable mineral deposits and expanding resource extraction, even in sectors with uncertain future demand. This includes plans to mine low-margin manganese ores, coal, and natural gas, highlighting the country’s continued reliance on raw materials in the absence of diversified exports, especially under the weight of international sanctions.

Sanctions on Russian gas, coupled with an exessive production of natural gas, have pushed companies to explore alternative products that could attract global buyers. Ammonia production has emerged as a primary focus, but whether global demand for ammonia will grow sufficiently to ensure long-term Russian exports remains uncertain.

These shifts in the Russian mining industry mean that companies will cut their costs in order to make at least some profit in difficult economic conditions. In such a situation, the easiest way to do this is usually to cut social and environmental programs.»

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

U.S. Imposes New Sanctions on Companies Linked to Arctic LNG 2 Project ↑

On October 30, the United States announced additional sanctions targeting companies from the UAE and Singapore involved in supporting the Arctic LNG 2 project.

The sanctions specifically affect entities engaged in transporting specialized equipment and procuring tankers for the project. U.S. citizens and legal entities are now prohibited from conducting business with these companies.

The following entities were added to the SDN (Specially Designated Nationals) blocking list:

• Smart Solutions: A supplier of equipment for the Arctic LNG 2 project. The company has previously chartered vessels such as Audax and Pugnax, which are already under U.S. sanctions.
• New Transshipment FZE (Singapore): A subsidiary of NOVATEK involved in leasing gas carriers. The sanctions extend to its affiliated companies, including LNG Alpha Shipping PTE, LNG Beta Shipping PTE, LNG Delta Shipping PTE, and LNG Gamma Shipping PTE.

Arctic LNG 2 Suspends Operations Amid Growing U.S. Sanctions ↑

Bloomberg reports that the Arctic LNG 2 project has suspended commercial gas liquefaction due to mounting sanctions pressure. In October, gas production at the field significantly decreased, with daily volumes dropping nearly by half compared to September, reaching 5.3 million cubic meters. Some processing continues for technological reasons.

Russia’s Shadow LNG Fleet Acquires New Tankers ↑

Bloomberg reports that Dubai-based Matias Ship Management has acquired three LNG tankers, in what appears to be an effort by Russia to bypass Western sanctions.

The vessels Velikiy Novgorod, Pskov, and La Perouse, previously managed by Gazprom and Sovcomflot, were transferred to Matias Ship Management in September. The company shares an address with Nur Global Shipping, another firm suspected of aiding Russia in assembling shadow fleet vessels.

LNG Tankers from Arctic LNG 2 Remain Ununloaded in Foreign Ports ↑

According to Bloomberg, by the end of October, none of the eight LNG cargoes shipped from the Arctic LNG 2 plant since early August had been unloaded at foreign ports.

The tankers Nova Energy, Pioneer, and Asya Energy, carrying sanctioned Russian gas, are stationed off Russia’s Far East coast. As of October 30, Asya Energy has been drifting in the Sea of Japan for ten days, while Pioneer is anchored near Nakhodka and Nova Energy remains nearby, based on ship tracking data.

Russia Plans Ship-to-Ship LNG Transfers in Arctic Seas to Free Up Ice-class tankers for the Arctic LNG 2 Project ↑

On October 22, Reuters reported that Russia plans to conduct ship-to-ship LNG transfers in the Barents and Bering Seas to free up high ice-class tankers for transporting LNG from the Arctic LNG 2 project via the Northern Sea Route.

The project is commissioned by Obskiy Ammoniac, a subsidiary of NOVATEK. According to project documents, each transshipment facility is expected to handle 4.1 million m³ of LNG and 1.4 million m³ of gas condensate annually, provided ice conditions do not hinder operations.

This move aims to mitigate the impact of EU sanctions, which from March 2025 will ban the transshipment of Russian LNG for re-export to third countries through European ports, and to bypass restrictions on accessing tankers essential for LNG transportation along the NSR.

Power Plants from China Delivered to Arctic LNG 2 Project ↑

Chinese ships Ocean 28, Nan Feng Zhi Xing, and Hunter Star transported power plant modules built by Wison New Energies to supply power to the Arctic LNG 2 project.

On October 30, Ocean 28 and Nan Feng Zhi Xing arrived at the Utrenny terminal, followed by Hunter Star on November 12, after navigating challenging ice conditions. The vessels, which lacked the required ice class, were escorted by the icebreaker Sibir (Hunter Star and Nan Feng Zhi Xing) during the final stages of their journey. While Nan Feng Zhi Xing has a small Ice1 ice class, allowing it to remain on the Northern Sea Route until October 20, Ocean 28 has no ice class.

Despite increasing sanctions on the Arctic LNG 2 project, Wison New Energies—the manufacturer of the modules—has so far avoided direct penalties. In July, however, the company announced it was suspending its activities in Russia due to the risk of secondary U.S. sanctions.

Bellona’s comment:

«There have been no major developments in international sanctions or their effects on enterprises in the Russian Arctic zone. Companies linked to the Arctic LNG 2 project continue to be gradually added to the U.S. sanctions list.

Russia remains focused on circumventing gas sanctions, but so far, it has been unable to secure buyers for Arctic LNG 2 products. With no global shortage of natural gas, companies and countries appear unwilling to risk secondary sanctions.»

Environmental and climate issues of the Arctic

Scientists Predict Up to 10-Degree Temperature Rise in the Arctic and Permafrost Loss in Murmansk and Arkhangelsk Regions ↑

A study conducted by the P.P. Shirshov Institute of Oceanology and the Institute of Water Problems of the North at the Karelian Research Centre of the Russian Academy of Sciences analyzed Arctic climate trends since 1940 and modeled changes through 2099. The findings predict a temperature increase of 6–10 degrees in the Arctic by the end of the 21st century.

The most significant impacts are expected in the northern parts of the western Russian Arctic, including the Murmansk and Arkhangelsk regions, where permafrost is projected to disappear entirely. This will lead to major ecological and infrastructural changes, including alterations in the water balance, increased snow and water runoff, and a higher frequency of landslides. These changes could pose serious threats to transport routes and engineering structures critical to the region’s development.

American Scientists Described the Negative Impact of Climate Change on Polar Bears ↑

A study published on October 22 in the journal Ecology by researchers from the University of Washington highlights the detrimental effects of climate change on polar bears in the northernmost Arctic. The research indicates that warming-induced changes in sea ice are causing polar bears to suffer lacerations, fur loss, and ice buildup on their paws, impairing their ability to move.

Accidents and emergencies in the Russian Arctic ↑

• October 7: An oil spill occurred in Krasnoyarsk Krai as diesel fuel leaked from a non-self-propelled barge into the Khatanga River.
• October 23: In the Komi Republic, a pipeline rupture at Nizhneomrinskaya Neft caused an oil spill that contaminated approximately 5,800 m² of land. Oil spread into a swamp and a stream, and a resulting fire destroyed 330 m² of forest.

Also there were several incidents of grounding and getting stuck in ice in October. On October 6, the dredging vessel Nordic Giant ran aground near Teriberka. On October 28, it became known that a barge carrying fuel and a power plant for the village of Gyda became stuck in ice in the Yamalo-Nenets Autonomous Okrug.