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The Natural and Societal Challenges of the Northern Sea Route. A Reference Work. Editors: Østreng, Willy (Ed.) Free Preview. The natural and societal challenges of the Northern Sea Route: a reference work. Willy Østreng (Editor). Dordrecht, Boston, and London: Kluwer Academic.
Specifications Publisher Springer. Customer Reviews. Write a review. See any care plans, options and policies that may be associated with this product. Email address. According to the Russian NSR Guidelines, a mandatory insurance is required and financial security issued for potential liability in case of marine environmental pollution. The fact that nuclear powered icebreakers are widely used in NSR created a specific problem related to insurance cover.
The marine insurance underwriters excluded insurance coverage for any kind of consequences of damages from radiation of nuclear materials. On the other hand, and in accordance to the Russian regulations, the Russian nuclear powered icebreaker operators do not have any liability insurance which would cover for any kind of consequence of nuclear related incidents. The following response was presented:. Thus any kind of nuclear related incident or liability would be sorted out in a way that bona fide ship owners would be held harmless.
Uninsured nuclear risks are alien to western operators and an obstacle to make reliable risk assessment for investors. Moreover, their concern was related to the fact that the assisted vessel cannot choose what kind of fuels that are used on icebreakers. The higher premium was made due to the fact that there has not been any major hull damage in past operations. Even if this was a practical case for the insurance industry, it reacted with a high risk assessment, due to lack of available statistics. Recently, the German company, Beluga Shipping transits of the NEP during August and September , was one practical experiment that would be of interest to insurance companies relative to their need for reliable data in their risk analysis.
One of them related to certain time- and cost-saving advantages in using the NSR over the Suez Canal routes.
However, the exact economic advantages were not known. This was also due to the lack of detailed knowledge related to costs for icebreaker assistance and ice navigators, real time ice data, reliable weather forecasts and administrative procedures and acceptance in the Russian bureaucracy. However, the Beluga case gave some indications in that respect. Another factor that must be added to the calculation is the cost related to icebreaker escort and navigation.
According to Beluga Shipping representatives the two Beluga ships had Russian Ice Navigators steering the ships through the passage. In addition, two nuclear powered icebreakers were hired during the transits.
Furthermore, the ice breaker assistance for parts of the voyage was something that the client and the insurers as well paid great attention to. According to Beluga, special meetings were held between their experts and representatives of the insurers.
Nonetheless, Beluga was not willing to give details about the extra premium, since that was part of private negotiations. Another aspect that would reduce the risk and high insurance premium of transiting the NEP is how the project was organized and prepared in advance. In that respect, Beluga had gone through detailed preparations and procedure for the voyages i.
In addition, Beluga had three full time employed meteorologists with access to up-to-date satellite pictures and analyses of the ice situation on a daily basis. During the transits, they provided the captains with daily routing suggestions avoiding ice contact as best as possible to minimize the risk. In addition, it is interesting that the Beluga Headquarters in Bremen are planning the process for using the NSR again in , then perhaps with up to six vessels during the possible six to eight weeks in the Russian summer.
This will create another new dimension for the utilisation of the seaway that has just opened up. Although the insurance cost in the case of Beluga are unknown, it might only be a speculation, but if the financial savings are as significant as they suggest, it is also possible that they are willing to pay a relative higher insurance premium, as opposed to ARCDEV project in which the insurance was regarded as an economic obstacle.
However, Beluga was quite restrictive regarding the insurance issues. The largest amount of accidents was found in August - September during the easiest ice conditions. Moreover, it was stated that The rest was caused to propellers, shafts, steering. Gold, E.
A Reference Work. In Ragner, C. Legal and Administrative Issues on Arctic Transportation.