Oct. 30 (Bloomberg) -- When the Danish-owned Nordic Orion became the first bulk carrier to transit the Northwest Passage, it relied on an escort for part of the route by the Canadian Coast Guard’s most capable icebreaker, the Louis S. St-Laurent.
The ship’s voyage, completed this month, symbolized the Canadian government’s plan to bolster its claim to Arctic waters as polar ice melting makes more shipping possible. It also symbolized how much the government needs to do: the 45-year-old Louis S. St-Laurent is one of only two Canadian icebreakers capable of making sure the 1,450-kilometer (900-mile) trip can be done safely.
While Canada says a warming climate will help clear icy waters, boosting both the prospect for increased shipping and the country’s claim on the Northwest Passage, the government hasn’t backed its words with actions, said Michael Byers, author of “International Law and the Arctic” and who researches global politics at the University of British Columbia.
“There’s a real irony here because the government is talking the talk, but they haven’t done anything to support shipping in the region,” Byers said in a phone interview from Salt Spring Island, British Columbia.
The existing Canadian icebreaker fleet, which also includes four medium-sized vessels, is “old and under-performing” and wasn’t designed to assist commercial ships, Byers said. Canada should be matching the efforts of Russia, which is expanding use of its own Arctic shipping route by upgrading its fleet of five nuclear-powered icebreakers, he said.
Having those escorts is crucial to unlocking the benefits of Arctic shipping. The Nordic Orion, with 73,500 tons of metallurgical coal, shaved 1,000 nautical miles and six days off the trip from Vancouver to Finland, saving $200,000 in tolls and fuel costs, according to the ship’s owners. It went through the Northwest Passage in September and arrived at the port of Pori earlier this month.
“We had a Canadian icebreaker supporting us and the government there was really very supportive, very helpful,” said Ed Coll, chief executive officer of Newport, Rhode Island-based Bulk Partners Ltd., which operated the ship.
Canada maintains it has historic rights over the Arctic as its ships escort foreign vessels and its military enforces laws in the waterways adjacent to Canadian lands. Like Russia’s assertion of control over the Northern Sea Route between the Kara and Bering straits -- an Arctic passage that allows ships to avoid the Suez Canal -- Canada’s claims are disputed by countries, including the U.S., that argue the Northwest Passage is international waters.
Prime Minister Stephen Harper has described Canada’s policy on Arctic sovereignty as, “We either use it or lose it.” The country plans to build as many as eight Arctic offshore patrol ships, with construction contracts slated for 2015, and establish a deep-water port. Canada also plans to replace the Louis S. St-Laurent. Under the national shipbuilding procurement strategy, Irving Shipbuilding Inc. of Halifax, Nova Scotia and Vancouver Shipyards Co. Ltd. of North Vancouver, part of Seaspan Corp., have been selected to build combat and non-combat vessels.
Simply replacing one icebreaker with another “is not enough to escort ships through the Northwest Passage,” said Malte Humpert, executive director of the Arctic Institute, a Washington-based research organization. “A lot of the waters are not well charted, the depths aren’t really known, the GPS global positioning system doesn’t work well above 70-degree latitude.”
The Northwest Passage, sought by explorers for centuries as a shortcut between Europe and Asia, links the Atlantic and Pacific oceans north of the Arctic Circle. Irish naval officer Robert McClure is credited with discovering the link and first completing the route, by ship and sled, in the 19th century.
The route has a place in Canadian lore, and was been commemorated in song by folk singer Stan Rogers. British explorer Sir John Franklin and 128 members of his 1845 expedition died after their ships became trapped in ice while trying to complete the passage. Harper’s government promised to “work with renewed determination and an expanded team of partners to discover the fate of Sir John Franklin’s lost Arctic expedition.”
Scientists have flagged melting Arctic sea ice in recent years. The European Space Agency documented the route’s opening in the warmest months of 2007 with satellite images. Arctic sea ice shrank to its lowest level in September 2012 since measurements began three decades earlier, the agency said.
In anticipation of more traffic, Canada has made safe shipping one of its priorities as it leads the eight-nation Arctic Council from 2013 to 2015. Canada will push “responsible Arctic resource development, safe Arctic shipping and sustainable circumpolar communities,” said Leona Aglukkaq, Canada’s environment minister and member of parliament for the Arctic district of Nunavut, who represents Canada at the council. Aglukkaq declined to comment on Canada’s sovereignty in the region, and what steps it is taking to create a shipping route along the passage, in an e-mailed statement Oct. 28.
At the International Maritime Organization, a United Nations agency responsible for improving ship safety and cutting maritime pollution, Canada is working to develop a mandatory polar code for ships. This would be a global law to govern the region that includes the Northwest Passage, John Babcock, a Department of Foreign Affairs spokesman, said in an e-mail.
The Nordic Orion’s trip was a trial run, Coll of Bulk Partners said in a phone interview. Coll plans additional trips through the Northwest Passage next year using so-called ice class ships, which have thicker steel and more powerful engines than normal vessels.
The Northwest Passage can extend the need for ice class ships, which are currently used primarily to transport cargo in icy waters around the Scandinavian region during the winter, Coll said. The ships, which cost more to manufacture, command a freight premium, he said.
The Nordic Orion’s voyage caught people by surprise, said Rob Huebert, a University of Calgary political scientist who researches Arctic security. “Basically what everyone is doing is looking at the vast expansion of the Northern Sea Route on the Russian side.”
Russia has advantages over Canada as it used its route frequently to supply Arctic communities during World War II and the Soviet era. It has ports where ships can stop along the route and the path is less ice-covered than the Northwest Passage, said Humpert of the Arctic Institute.
Russia’s infrastructure is also superior to Canada’s, with five nuclear-powered icebreakers allowing it to keep the Northern Sea Route open year-round. Russia also has a dedicated Arctic search and rescue service, with two icebreakers containing diving equipment and oil spill response gear. The country plans to build three more ice-breaking rescue vessels with landing pads for helicopters.
While the Nordic Orion was the first bulk carrier to traverse the Northwest Passage, and four tankers have made the trip since 1969, there have been about 40 transits of Russia’s Northern Sea Route so far this year alone, according to government data.
To be sure, the Arctic routes will be limited to ice class ships during a shorter summer season, compared with the traditional trips through the Suez or Panama canals. Shippers will be wary of experimenting with new routes, said Eirik Haavaldsen, an analyst with Oslo-based Pareto Securities AS. Missing a scheduled port slot can put a ship at the back of the line and force delays for several days, he said.
“If you go on voyages like this, there’s a lot on unknown complications potentially impacting the duration,” Haavaldsen said. “You need to have a cargo owner who’s willing to risk this.”
Canada’s Northwest Passage will probably remain a niche path for ice class ships until it’s ice-free for longer periods and supported by more infrastructure, Tero Vauraste, CEO of Arctia Shipping, said in a phone interview from Helsinki. Arctia provides icebreaking services in the Baltic Sea.
“My personal view is that there will be an increased demand in the next 15, 20 years,” Vauraste said, citing the potential for use by developers of Arctic minerals and oil and natural gas reserves. The route promises to shave costs by as much as 40 percent as the shorter path means fuel savings, he said.
Those benefits will come with a cost to Canada, Peter Pamel, a partner at Borden Ladner Gervais LLP who specializes in Canada’s Arctic region, said in a phone interview from Montreal. It’s unclear whether Canada should develop the Arctic because it requires building ports, roads and airports, financed with money that may need to come from private investors. “We’re great at announcing things but we’re not that good with the follow through.”
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