Arctic Ice Melting

Save a hundred thousand dollars: Take the Northern Sea Route

Geogrande.com / Published March 31, 2013

MURMANSK, RUSSIA - In the next few years the Arctic ice mass is expected to have melted back enough to allow large cargo ships to regularly pass through the Arctic Ocean.  This will give ships shorter routes from eastern Asia to the west coasts of Europe and North America.  Several thousand miles are saved by going through the Arctic instead of along the current southern routes through the Suez Canal or Panama Canal. Two main Arctic shipping routes will be used — the Northern Sea Route that extends along the northern coast of Russia and the Northwest Passage located along the northern coast of Canada.
Arctic Shipping Routes - Global Map

A third shipping route through the Arctic that extends over the very top of the North Pole through the middle of the Arctic Ocean may open up by the year 2050 when all Arctic ice is expected to melt away at least every other summer.  This amount of Arctic melting is predicted in computer modeling research conducted by Laurence C. Smith, a professor of geography at the University of California at Los Angeles, and his co-worker, PhD candidate Scott R. Stephenson. "Nobody's ever talked about shipping over the top of the North Pole. This is an entirely unexpected possibility," says Smith.

Polar Express Photo

 

Although some of the ships plying the waters of the Arctic will be container ships carrying manufactured goods — most are likely to be either bulk carriers hauling ore or commodities, or tanker ships carrying oil or liquefied natural gas.  Bulk carrier ships typically operate on a more flexible schedule than container ships which is more suitable for the Arctic shipping routes.  Container ships operate on a rigid schedule set long ahead of time as they call on ports to pick up containers of manufactured goods and deliver the containers on time to a destination port.



 

A ship can cut seven days off of a trip from China to Rotterdam by taking the Northern Sea Route, rather than the traditional route through the Suez Canal.  According to the U.S. Coast Guard, the first Suezmax tanker ship passed through the Northern Sea Route in August 2011, cutting seven days shipping time off its voyage.

 

Cutting seven days off a trip would save a ship operator $105,000 (US) on just the ship hire (rental) costs, based on a current typical charter rate of around $15,000 per day for a Suezmax-size bulk carrier or tanker ship.

Additional savings would result from burning less fuel at roughly $25,000 per day, and elimination of a canal passage toll of around $30,000.  Savings could be partially offset by the added cost of an ice-breaker escort of, say, $100,000.  Overall, the net savings from going on the Northern Sea Route instead of through the Suez Canal would be more than $100,000.

Christian Bonfils, Managing Director of Danish shipping company Nordic Bulk Carriers said in a 2010 newsletter that when his company carried 41,000 tons of iron ore on the Northern Sea Route from Murmansk in western Russia to China, "The fuel savings alone add up to approximately $180,000."