September, 2013

Viktor Olersky,

the Deputy Minister of transport of the

Russian Federation

September 26, 2013

Yury Melenas – Permanent Representative of THE RUSSIAN FEDERATION to IMO

Federal law of 28-th of July 2012 No. 132-FZ «On amending certain legislative acts of the Russian Federation in the part of the state regulation of trading navigation in the water area of Northern sea route» Navigation in the waters of the Northern sea route, the historically established national transport communications of the Russian Federation, is carried out in accordance with the generally recognized principles and norms of international law, international treaties of the Russian Federation, this Federal law, other Federal laws and issued in accordance with them other normative legal acts Order of the Government of the Russian Federation of 15-th of March 2013 No. 358 Federal state institution «The Northern sea route Administration» was created and attributed to the management of Federal Agency of maritime and River transport Order of Ministry of transport of Russian Federation of 17-th of January 2013 No. 7 «About approval of Rules of navigation in the water area of Northern sea route» Procedures and requirements for vessels engaged in shipping in the water area of Northern sea route established

Legal regulation

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Zero meridian

180 meridian

Northern polar circle

Appendix 1 NSR Depth Chart

Kara Gate Strait

Kara Sea

Vilkitskogo Strait

Laptev Sea

Longa Strait

East Siberian Sea

Barents Sea

Sounding works

• As a result of sounding works in 2011 and 2012 the route to the North of the Novosibirsk

Islands was surveyed, allowing the passage of vessels with deep (up to 15 m) draft;

• The sounding works allowed large-capacity tankers of Aframax class navigate in the water

area of Northern sea route for the first time in history.

22 476 km of sounding works carried out by September 2013

(planned for 2013 – 34 600 km)

About 205 thousand kilometers of the survey planned to be done by 2019.

Legend:

sounding works 2011

sounding works 2012-2013

the main route of Northern sea route

the alternate route of Northern sea route

The use of wind turbines and solar panels as autonomous power sources

2012 – 2013 - 180 autonomous power sources were installed on the

navigational objects in the Northern sea route area

Мурманск

Dixon

Naryan-Marr

Varandey

Кандалакша

Dudinka Tiksi

Pevek

Hatanga

Зеленый Мыс

Анадырь

Resources for Search and Rescue operations in the Arctic zone of the Russian Federation (State Marine Rescue

Service – SMRS)

Provideniya

Ледоколы с АСИ и МСП

Icebreakers with emergency and rescue equipment

Branch SMRS

Dixon

2013

Branch SMRS

Tiksi

2013

Branch SMRS

Pevek

2013

Branch SMRS

Provideniya

2013

Branch SMRS

Amderma

(after 2014, with the

increase of cargo

transportation)

Branch SMRS

Murmansk

Branch SMRS

Arkhangelsk

Мурманск

Архангельск

Диксон

Онега

Мезень

Нарьян-Мар

Варандей

Кандалакша

Дудинка Тикси

Певек

Хатанга

Зеленый Мыс

Анадырь

Scheme of dislocation of Maritime Rescue Coordination Centre (MRCC) and Maritime Rescue Sub-Centres (MRSC)

in the Arctic zone

MRSC Pevek

Провидения

The search and rescue

region of MRCC of Dixon

The search and rescue

region of MRCC Murmansk

September 2012

October 2012

August 2011

MRSC Tiksi MRCC Dixon

Nuclear Ice-breakers Fleet

and Further Development

Nuclear Ice-breakers Fleet of Russia

Nuclear Ice-breakers of “Taimyr”

type:

Propulsion Capacity – 35 MW;

Water displacement 21000 t;

i/b “Taimyr” – 30.06.1989

i/b “Yaygach” – 25.07.1990

Nuclear ice-breakers of “Arktika” type:

Propulsion Capacity – 54 MW;

Water displacement – 23000 t;

i/b “Rossia” – 21.12.1985

i/b “Sovetsky Soyuz” – 29.12.1989

i/b “Yamal” – 28.10.1992

i/b “50 Let Pobedy” – 23.03.2007

Average Operational Period of Nuclear Ice-breakers

(with Nuclear Power Plant resource of 150-175 000 hours)

- Linear ice-breakers operational period

- Low-draught ice-breakers operational period

- New universal ice-breakers operational period

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Name Year entered into service

2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027

Тaimyr 1989

Vaygach 1990

Rossiya 1985

Sovetskiy Soyuz

1989

Yamal 1992

50 Let Pobedy

2007

Commission of Universal Nuclear Ice-breakers (IB-60 type)

1st IB-60 2017

2nd IB-60 2019

3rd IB-60 2021

- If prolonged up to 175 000 hours

- If prolonged up to 175 000 hours

Universal Nuclear Ice-breaker

Nuclear ice-breaker of new generation

Length overall 173,3 m

DWL length 160,0 m

Breadth overall 34,0 m

DWL breadth 33,0 m

Draught of the ice-breaker:

for a long work on Northern Sea Route - 10,5 m

for periodically work in shallow water - 8,7 m

1. Ice-breaker type: Universal nuclear turbo-electric ice-breaker with propulsion capacity on the shafts of 60 MW. 2. The purpose of universal nuclear ice-breaker: Leading convoys and single vessels year-round in the Western part of the Arctic. Ice-breaker assistance in the shallow parts of the Yenisei river (Dudinka) and the Gulf of Ob. Towing of ships and other floating facilities in ice and open water. Providing rescue operations in ice conditions and clear water. 3. Maximum thickness of the pack ice overcoming ice-breaker at speed of 1,5-2 knots at full capacity of power plant is 2.9 m 4. Autonomy and the cruising range: provisions - 6 months, the cruising range is unlimited. 5. The crew of ice-breaker - 75 people. 6. Lifetime – 40 years. Due to the ability to change the draught, the new ice-breaker will be able to replace the «Arctic»-type ice-breakers and

shallow-draught «Taimyr»-type ice-breakers.

The keel of the first ice-breaker was laid in November 2012.

In accordance with the Decree of the Government of the Russian Federation dated August 19, 2013 No. 715 State

Corporation ROSATOM has allocated funds from Federal budget for construction of two more serial universal nuclear ice-

breakers.

Total of Transit Voyages in 2010-2013 2010 2011 2012 2013*

Total Volume of

Transit Cargo, t

111 000 820 789 1 261 545 489 653*

Total Number of

Transit Voyages

4

(2 of them in

ballast)

34

(10 of them in

ballast)

46

(13 of them in

ballast)

31*

(11 of them in

ballast)

NSR Transit 2012 Cargo

Cargo Type Number of

Vessels Volume, t Displacement, t

Cargo Volume

Eastbound, t

Cargo Volume

Westbound

Liquid 26 894 079 661 326 232 753

Bulk 6 359 201 262 263 96 938

Frozen Fish 1 8 265 8 265

Ballast 6 472 075

Repositioning 7 78 351

Total: 46 1 261 545 550 426 923 589 337 956

* As per beginning of September 2013

First Commercial Transit Voyage of a non-Russian flag vessel via

the Northern Sea Route

mv Beluga Fraternity & mv Beluga Foresight in 2009

Saved more than 3000 miles and 10 days compared to the Suez Canal

1. 21.08.2009 – left p. Vladivostok, Russia

2. 31.08.2009 – joined by ice-breaker «50 Let Pobedy»

3. 03.09.2009 – ice-breaker Rossiya joined the convoy

4. 07-11.2009 – offshore discharging in Novyy Port / port of Yamburg

5. 16.09.2009 – exit from the NSR in the West

2

1

3

4

5

Transit Voyages 2010

SCF Baltica:

NSR period: 16.08 – 27.08.2010

(10,5 days)

Tanker deadweight:117000 tons

Cargo: 70000 tons of gas condensate

Nordic Barents:

NSR period: 8 days

Bulker deadweight:43372 tons

Cargo: 41000 tons of iron concentrate

4 transit voyages were made in 2010

Total amount of transit cargo: 111 000 tons

In ballast: 2 voyages

The voyage by Swedish supply ice-breaker Tor Viking II escorted by nuclear

ice-breaker Rossiya was made a month after the official completion of summer-

autumn navigation on the NSR. This successful transit voyage made in late

December proved that it is possible to extend the period of Arctic navigation on

the NSR to winter months.

The Latest Transit via NSR December 16-25, 2010

Escorting of mt Perseverance on the NSR in 2011

Eastbound Voyage:

Tanker deadweight: 75000 tons

Cargo: 61000 tons gas condensate

NSR navigation period: 30.06 – 15.07.2011

(14,9 days)

Average speed: 7,6 knots

Return Voyage:

Tanker deadweight: 75000 tons

Cargo: 64000 tons jet fuel

NSR navigation period: 09.09 – 16.09.2011

(8 days)

Average speed: 13,7 knots

Escorting of mt Vladimir Tikhonov on the NSR The Largest Vessel ever transited through the NSR

Tanker deadweight: 160 000 tons (Suezmax)

Cargo: 120 000 tons gas condensate of JSC NOVATEK

NSR navigation period: 23.08 – 30.08.2011

Average speed: 14,0 knots

Escorting of mv Sanko Odyssey on the NSR The First Panamax Bulk Carrier that transited NSR

Bulker deadweight: 75 000 tons (Panamax)

Cargo: 66 500 tons of iron ore by JSC EUROCHEM

NSR navigation period: 03.09.2011 – 10.09.2011

Average speed: - 13,7 knots

NSR Convoy

July 2012

Mv Nordic Odyssey, ttb Vengeri, mt Marilee, mv Kapitan Danilkin

escorted by ice-breaker Yamal and Vaygach July 12 – 22, 2012

LNG Ob River in Transit via NSR LNG Ob River

Ice Class 1A (Arc 4)

Displacement 116 325 t

Cargo Capacity: 149 755 m3

Flag: Marshall Islands

Ballast:

Westbound 08-16.10.2012

Laden:

Eastbound 09-18.11.2012

134 738 m3 LNG

Cost Efficiency of LNG tanker

“Ob River” laden voyage via NSR

Comparative Analysis of Cost Efficiency

for NSR and Suez Canal Transit

The slide is provided by Gazprom Marketing & Trading

Estimated Economic Efficiency for LNG tanker voyage

via the Northern Sea Route

Hammerfest -Tobata Suez NSR Difference

Distance 12100 m 6100 m 50%

Time (maximum speed)* 26 days 17 days 35%

Time (optimal speed)** 39 days 21 days 54%

Fuel Consumption Cost Efficiency***

Maximum Speed* 53%

Optimal Speed**** 55%

Remarks:

* For the purpose of evaluation the average speed of 19.5 knots was used, except for the voyage via NSR (2450 m), where the average speed was 12 knots.

** For the purpose of evaluation the average speed of 19.5 knots was used, except for the voyage via NSR (2450 m), where the average speed was 12 knots.

*** Estimated economic efficiency for the transit via NSR compared to the transit via Suez Canal

**** For the purpose of Suez Canal transit evaluation maximum speed of 19,5 knots was used. For the purpose of NSR transit th optimal speed of 13 knots was used.

The slide is provided by Gazprom Marketing & Trading

Future plans for cargo flow through the Northern Sea Route

Hammerfest

Narvik

Oulu

Primorsk,

Ust-Luga

Murmansk

p. Vitino

p. Sabetta

Hokkaido

Kobe Busan Qingdao

Prince Rupert

Vancouver

Beaufort Sea

Petropavlovsk-

Kamchatsky

West-East East-West

LNG(p. Sabetta, Hammerfest)

Iron Ore (Murmansk, Narvik)

Crude Oil (Primorsk)

Gas condensate (Ust-Luga, p. Vitino)

Coal (Prince Rupert, Vancouver)

Fish (Petropavlovsk-Kamchatskiy, Hokkaido)

Light oil products (Busan, Inchon)

Seasonal container cargoes (Busan, Hokkaido)

Total: min.10 mln. transit tons per year + 15 mln. LNG from p. Sabetta + 10 mln. tons

of oil from Novyy Port

Inchon

Transit min.10 mln. tons LNG from Yamal p-la 15 mln.

tons 10 mln. tons of oil

Total turnover on the Northern sea route: 2010 – 1,8 million tn.

(of them transit – 0,11 million tn.) 2011 – 3,25 million tn.

(of them transit – 0,83 million tn.) 2012 – 3,87 million tn.

(of them transit – 1,2 million tn.)

Yamal LNG

Port Sabetta Construction Site

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Thank you for your attention!