The Arctic This Week Take Five: Week of 24 November, 2024

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Russia Pushes Forward with Sanctioned Arctic LNG Project

As reported by High North News on 22 November, Russia’s state-owned shipping company Sovcomflot is preparing to operate the first Arc7 ice-class liquefied natural gas (LNG) carriers for the Arctic LNG 2 project, despite Western sanctions. Construction of these vessels began in November 2020 at the Zvezda Shipbuilding Complex in Eastern Russia, but progress has been delayed due to sanctions restricting access to technology and financing. Recent photos show a Sovcomflot logo painted on the lead vessel, Aleksey Kosygin, while a second vessel, likely named Sergei Witte, has moved under its own power within the shipyard. Production at Arctic LNG 2 has stalled due to a lack of operational tankers and difficulties securing buyers for sanctioned LNG. (High North News) 

Take 1: Russia’s efforts to continue this project highlight its determination to maintain Arctic energy development, even under international pressure. The Arctic region is central to Russia’s long-term economic and geopolitical goals, with longstanding plans to increase resource extraction and expand shipping routes to strengthen its regional dominance. These ambitions, however, identify the difficulties of sustaining large-scale operations in a heavily sanctioned and politically complex environment. The situation raises fundamental questions about the future of Arctic energy development and its role in an increasingly polarized global landscape. Economically, the project reflects Russia’s reliance on the Arctic as a driver of its energy strategy. A recent report by Business Index North reveals that Russia accounts for 50-60% of all Arctic investments, while the remaining 40-50% is distributed among the rest of the seven Arctic nations. However, the current geopolitical and economic landscape has diminished Russia’s capacity to meet the region’s demanding requirements effectively. A suggestion by industry experts that unsold gas cargoes might be repurposed to support vessel operations highlights the challenges in maintaining steady progress. Geopolitically, Russia’s pursuit of Arctic projects in defiance of sanctions signals its ambition to assert regional dominance. Russia challenges the cooperative frameworks that have historically underpinned Arctic development by pushing forward independently. While this approach might give immediate benefits, it carries profound risks. Russia’s unilateral approach could lead to short-term economic gains but risks undermining long-term sustainability and regional stability. (High North News, Reuters, Royal United Services Institute)

Finland, United States, and Canada Collaborate on Arctic Icebreaker Development 

As reported by Arctic Today on November 26, Finland, the United States, and Canada signed a memorandum of understanding (MOU) to collaborate on the development of polar icebreakers. The agreement builds on the Icebreaker Collaboration Effort (ICE Pact) introduced during the NATO Washington Summit in July, which pledged to strengthen icebreaking capabilities among the three nations. Finland, whose shipyards have built 60% of the global icebreaker fleet and designed 80% of all such vessels, has been a key driver of the partnership. (Arctic Today)

Take 2: For over a decade, Finland has proposed leasing its advanced icebreakers to address gaps in the U.S. fleet, which currently includes only two operational Polar-class vessels nearing the end of their service lives. Combining expertise and resources, the United States, Canada, and Finland are laying a foundation for a resilient shipbuilding sector that meets increasing demands for Arctic and polar icebreakers. The signed Ice Pact, now operational, focuses on three primary goals: to enhance information sharing between Canada, Finland, and the United States, develop a skilled workforce for icebreaker production, and encourage allies and partners to purchase icebreakers built by these nations. This partnership arises at a crucial time, reflecting the growing urgency to address escalating Arctic competition. In contrast to the aging U.S. fleet, Russia, with more than 40 operational icebreakers in its nuclear-powered fleet, has aggressively expanded its Arctic presence, promoting the Northern Sea Route as a rival to global shipping lanes. Meanwhile, China has increased investments in Arctic infrastructure, further intensifying competition. The Arctic Sea ice is receding, opening new shipping routes and increasing strategic competition and this partnership indicates a shift in the West’s Arctic Strategy. It strengthens Finland’s role in Arctic cooperation and shipbuilding while providing the United States and Canada an alternative to slow domestic production. Beyond the immediate benefits, this initiative can establish a blueprint for broader international partnerships in other Arctic critical sectors. (Center for Strategic and International Studies, Reuters, United States Department of Homeland Security)

Finland’s Exit from Barents Cooperation—A Call for New Alliances

As reported by High North News on November 27, 2024, Finland has announced it will withdraw from the Barents Euro-Arctic Council (BEAC) after 2025, citing the suspension of cooperation with Russia as a driving factor. The Barents Euro-Arctic Council serves as a platform for intergovernmental collaboration among member states in the Barents region, with additional engagement from nine observer countries. Regional leaders in Northern Norway have called for a new framework to sustain cooperation in the Nordic north, citing the importance of Finland’s involvement for regional stability and collaboration. Discussions are now underway to establish an alternative structure encompassing both national and regional levels. (High North News)

Take 3: Finland’s decision to leave the BEAC by 2025 adds new uncertainty to an already uneasy framework of Arctic cooperation. The Council has historically served as a key platform for fostering stability and sustainable development in the Barents region. However, losing key participants reflects a shift in regional dynamics influenced by changes in the European security landscape and broader international relations. Finnish Minister for Foreign Affairs Elina Valtonen emphasized that the Barents cooperation, while effective in the past, no longer aligns with current needs. With Russia’s exit and shifting dynamics, the Barents cooperation appears to struggle with addressing challenges effectively. Proposals like expanding a Cap of the North Council or creating a High North forum aim to sustain Arctic coordination, but the extent of Finland’s participation is still to be determined. Finland has historically played an essential role in fostering regional partnerships through its participation in the BEAC and as a bridge between Nordic nations. Its absence weakens cross-border coordination, especially given Finland’s role in tackling shared subjects such as sustainable development and infrastructure. Norwegian officials’ “wait-and-see” approach indicates the delicate balance required in managing the evolving dynamics. The future of the Barents cooperation relies on its ability to adapt to these shifting dynamics and maintain relevance in a rapidly changing Arctic. Finland’s exit from BEAC emphasizes the need for alliances to address the Arctic’s interconnected political, environmental, and economic complexities. (Arctic Today, Ministry for Foreign Affairs of Finland)

Rising Acidity in the Barents Sea Puts Marine Ecosystem at Risk

As reported by Norwegian public broadcasting corporation NRK on November 24, new research from the Norwegian Institute of Marine Research reveals that the Barents Sea is becoming increasingly acidic, with CO₂ levels rising significantly faster than in other oceans. Analysis of 20 years of water samples shows a rapid decline in pH levels, driven by Arctic ice melt and increased carbon dioxide absorption. This process, known as ocean acidification, poses risks to marine life dependent on calcium for shells and skeletons. The researchers warn that these changes could disrupt the Barents Sea ecosystem, as acidification continues to spread deeper into the water column. (NRK)

Take 4: Conducted over 20 years, the study establishes a detailed time series that not only maps the rapid pace of acidification but also identifies its root causes, raising urgent concerns for the region’s marine ecosystems. Scientists attribute this rapid acidification to a combination of rising CO₂ emissions, melting sea ice, and inflows of carbon-rich Atlantic waters. The Barents Sea, characterized by cold Arctic waters, has a higher capacity to absorb carbon emissions compared to warmer oceans. Melting sea ice exposes more of the ocean surface, accelerating absorption. Additionally, carbon-rich Atlantic currents worsen the issue by bringing substantial amounts of human-generated CO₂ into the region. These changes have a severe impact on calcium-dependent marine organisms, such as shellfish, fish larvae, and coral reefs, which form the foundation of the Arctic marine ecosystem. Coral reefs, for instance, act as nurseries for many fish species, while shellfish and larvae are crucial food sources for larger predators, including commercially important fish like cod. As these organisms struggle to adapt, entire food chains, local fisheries, and Indigenous livelihoods face threats. Local fisheries, an essential economic driver in the region, are at risk as acidification undermines the resilience of marine populations, threatening food security and income for many Arctic inhabitants. The Barents Sea’s acidification reflects broader challenges of climate change, providing an example of how environmental shifts can destabilize ecosystems, economies, and livelihoods, particularly in vulnerable regions like the Arctic. It calls for urgent action to mitigate emissions and develop adaptive strategies to protect marine biodiversity and the people who depend on it. (Norwegian Institute of Marine Research, United Nations)

Green Transition in Arctic Kiruna Postponed

On November 27, High North News reported that Swedish state-owned mining company Luossavaara-Kiirunavaara Aktiebolag (LKAB) is delaying its plan for fossil-free sponge iron production in Kiruna to the 2040s. This decision comes as LKAB prioritizes mining expansion after discovering new regional deposits. (High North News)

Take 5: LKAB, Sweden’s leading mining company, and Europe’s largest iron ore producer, has been the foundation of economic development in the Arctic towns of Kiruna and Gällivare for over a century. In 2023, the company announced the discovery of Europe’s largest deposit of rare earth elements in Kiruna, highlighting the Arctic’s importance in supplying critical materials for renewable energy technologies. The postponement of fossil-free sponge iron production demonstrates the complex realities of sustainable industrial transformation in Arctic regions. While the company remains committed to its formal 2045 zero-emissions goal, the delay points to obstacles such as securing electricity supplies and improving transport capacity on the Iron Ore Line, a key rail link connecting mines in Northern Sweden to ports in Norway and Sweden for ore exports. With global demand for raw materials projected to increase fivefold by 2050, these challenges will likely intensify, requiring innovative solutions and strategic planning. Industrial projects like LKAB’s must navigate logistical challenges and broader questions about responsibly developing Arctic resources. The LKAB’s operations are not just a Swedish issue but part of a broader Arctic dynamic where resource-rich territories balance economic opportunity with environmental safekeeping. On one hand, the region benefits from job creation and the economy; on the other hand, the delay in adopting green technologies risks worsening climate vulnerabilities. It illustrates a fundamental dilemma faced by many Arctic Industries. As demand for rare earth elements and other minerals grows, the Arctic finds itself at the intersection of global economic interests and the urgent need to address climate change. (Arctic Economic Council, High North News, LKAB)