Warming Aids Arctic Economies, but Short of 'Cold Rush'

Posted by Michelle Howard
Thursday, August 28, 2014
Photo: Northern Sea Route Information Office

Climate change is aiding shipping, fisheries and tourism in the Arctic but the economic gains fall short of a "cold rush" for an icy region where temperatures are rising twice as fast as the world average.


A first cruise ship will travel the icy Northwest Passage north of Canada in 2016, Iceland has unilaterally set itself mackerel quotas as stocks shift north and Greenland is experimenting with crops such as tomatoes.

Yet businesses, including oil and gas companies or mining firms looking north, face risks including that permafrost will thaw and ruin ice roads, buildings and pipelines. A melt could also cause huge damage by unlocking frozen greenhouse gases.

"There are those who think that growing strawberries in Greenland and drilling for oil in the Arctic are the new economic frontiers," said Achim Steiner, head of the U.N. Environment Programme.

"I would caution against the hypothetical bonanza that some people see," he told Reuters of Arctic regions in Russia, Nordic nations, Alaska and Canada. U.N. studies say global warming will be harmful overall with heatwaves, floods and rising seas.


Fewer Fur Coats
In 2002, however, Russian President Vladimir Putin mused that warming might benefit Russia - thereby easing pressure to curb greenhouse gas emissions. He joked that warmer temperatures could mean fewer fur coats in northern regions.

More than a decade later, researchers see the Arctic as a test case for the impacts of climate change. It is warming fast because a thaw of white ice and snow exposes darker ground and water below that soak up more of the sun's heat.

"So far, I believe the benefits (of Arctic warming) outweigh the potential problems," said Oleg Anisimov, a Russian scientist who co-authored a chapter about the impacts of climate change in polar regions for a U.N. report on global warming this year.

Others say it is hard to discern benefits. Factors such as improved drilling technology or relatively high oil prices around $100 a barrel may be bigger drivers for change than a thaw in a chill, remote region shrouded in winter darkness.

Off Alaska, for instance, oil company bids for leases in the Arctic Chukchi and Beaufort seas since 2005 have totalled about $2.7 billion. But a previous round in the 1980s - before global warming was an issue - attracted similar sums, according to data from the U.S. Bureau of Ocean Energy Management.

"There are subjective interpretations of development costs and benefits (tourism, fishing, oil and gas, shipping) but it will be some years before there are enough trends and data," said Fran Ulmer, President Barack Obama's chair of the U.S. Arctic Research Commission.

Indigenous peoples doubt there are benefits. Aqqaluk Lynge, a Greenlander and ex-head of the Inuit Circumpolar Council, said vital dogsleds were useless in some areas because of the thaw.

"People think the economy is Wall Street but it's the local economy that's feeling the pressure," he said.

Among new activities, 71 cargo ships used a short-cut shipping route between the Pacific and Atlantic oceans north of Russia in 2013. Roughly the same number is likely in 2014, said Sergei Balmasov of the Northern Sea Route Information Office.

In a sign of more tourism, Crystal Cruises will send its Crystal Serenity ship from Anchorage to New York in 2016 past icebergs and polar bears north of Canada - priced from $19,755 per passenger and with an escort vessel as an ice-breaker.


Cruises, Cargo
The route was first navigated in 1903-1906 by Norwegian explorer Roald Amundsen, but has only been ice-free in some recent years. Paul Garcia, spokesman for Crystal Cruises, said there had been a high volume of bookings so far.

Tourism has benefited in some areas. The number of nights spent by visitors to the Arctic archipelago of Svalbard north of Norway rose to 107,000 in 2013 from 24,000 in 1993.

And cod, haddock, herring and blue whiting are among fish stocks expanding north. Iceland has set new, unilateral quotas for mackerel, including almost 150,000 tonnes in 2014.

"The biomass sum of all types of species is increasing, and will continue to increase in the Arctic," said Svein Sundby, of the Institute of Marine Research in Norway.

Among oil companies, Exxon Mobil began drilling in Russia's Arctic on Aug. 9 despite Western sanctions on its Russian partner Rosneft over Ukraine crisis.

But Royal Dutch Shell dropped plans for drilling in 2014 after spending $5 billion on exploration since 2005, following protests and accidents off Alaska.

And despite any gains, a 2013 study in the journal Nature said the Arctic has a hidden economic time bomb.

A major release of methane trapped in the frozen seabed off Russia could accelerate global warming and cause $60 trillion in damage, almost the size of world GDP, it said. Costs would be from more heatwaves, floods, droughts and rising sea levels.

"The size (of drawbacks) is likely to dwarf any kind of benefits," said Chris Hope of the Judge Business School at Cambridge University, who was among the authors.

The U.N.'s panel of climate experts says that it is at least 95 percent probable that human activities are the main driver of warming since 1950. But many voters are doubtful, suspecting that natural variations are to blame.

(By Alister Doyle, Environment CorrespondentEditing by Tom Heneghan)

Maritime Reporter March 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Cruise Ship Trends

Costa Concordia Used For Mafia Drug Smuggling

The doomed Costa Concordia was carrying a huge shipment of Mafia-owned cocaine when it set off on its final voyage, AP reports quoting investigators who have collected evidence.

Viking Enters Ocean Cruise Industry

Viking Ocean Cruises has announced it took delivery of Viking Star, marking the company's official arrival into the ocean cruise industry.   The delivery ceremony

VIKING LifeCraft Presented at IMO

This week, VIKING Life-Saving Equipment took a step towards gaining approval for the VIKING LifeCraft, its alternative life-saving appliance (LSA) for passenger ships.

Finance

BMT Partners with Aage Hempel

BMT SMART (BMT),  has announced  that Aage Hempel has become an accredited service partner.  This agreement will provide both organizations with the opportunity

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

U.S. Port Delay Boost February Air Freight

Global air freight volumes rose 11.7 percent year-on-year in February, driven by the Chinese New Year, the International Air Transport Association said on Wednesday.

Environmental

Focus on Environment at Suny Maritime

The State University of New York Maritime College’s 140th Anniversary Speaker Series presented a panel discussion on March 26 in the College’s Maritime Academic Center.

EU Takes Tough Stance on Ship Scrapping in South Asia

The EU is set to ban owners from scrapping ships on South Asian beaches, according to news report in Reuters.   The new rules will require that EU-registered

H2O’s Owens CrapZapper Offers More

H2O’s Owens CrapZapper marine sanitation device has dual certification to the latest IMO and USCG standards for operation anywhere in the world.   Features include low maintenance,

Energy

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

Focus on Environment at Suny Maritime

The State University of New York Maritime College’s 140th Anniversary Speaker Series presented a panel discussion on March 26 in the College’s Maritime Academic Center.

Knightsbridge, Golden Ocean Merger Completed

Knightsbridge Shipping Limited has completed its previously announced merger with Golden Ocean Group Limited. In connection with the closing of the merger, Knightsbridge

News

SeaZip Takes Delivery of Damen Crew Suppliers

On 28 March, SeaZip Offshore Service named two new Damen Fast Crew Suppliers (FCS) 2610 at Damen Shipyards Gorinchem.   The two vessels, named SeaZip 3 and SeaZip 4,

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

U.S. Port Delay Boost February Air Freight

Global air freight volumes rose 11.7 percent year-on-year in February, driven by the Chinese New Year, the International Air Transport Association said on Wednesday.

Arctic Operations

U.S. DoI Upholds 2008 Shell Arctic Lease

The U.S. Interior Department on Tuesday upheld a 2008 lease sale in the Chukchi Sea off Alaska, moving Royal Dutch Shell a step closer to returning to oil and gas

Rolls-Royce Propulsion Package for Polar Ship

Rolls-Royce has been awarded a contract by ship builder Fincantieri to supply a fully integrated propulsion system for Norway’s new Polar Research Vessel, which

USA Urged Not to Delay Arctic Drilling

The U.S. should immediately begin a push to exploit its enormous trove of oil in the Arctic waters off of Alaska, or risk a renewed reliance on imported oil in the future, reports AP.

Logistics

BMT Partners with Aage Hempel

BMT SMART (BMT),  has announced  that Aage Hempel has become an accredited service partner.  This agreement will provide both organizations with the opportunity

SeaZip Takes Delivery of Damen Crew Suppliers

On 28 March, SeaZip Offshore Service named two new Damen Fast Crew Suppliers (FCS) 2610 at Damen Shipyards Gorinchem.   The two vessels, named SeaZip 3 and SeaZip 4,

Tanker Backlog Builds at Basra

Ships face up to a three week wait; bad weather in February delayed loading, created backlog. * April intake to be reduced to clear backlog By Keith Wallis SINGAPORE,

 
 
Maritime Contracts Maritime Security Maritime Standards Navigation Pod Propulsion Port Authority Ship Repair Shipbuilding / Vessel Construction Sonar Winch
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.3149 sec (3 req/sec)