Sunday, December 28, 2014


Oscar Elton Sette.
 Photo: NOAA


  Many commercial maritime organizations have bought into the global warming concept despite contraindicative facts and are investing in planned future High Arctic Operations. While we are highly skeptical of future growth in through transit cargo operations in the High Arctic we believe that destination cargo, cargo bound for actual Arctic destinations will increase over time and in fact is increasing now. There are special risks associated with cold region navigation and increasingly the marine insurance industry is having to ascertain and consider insuring against these inherent risks. Affordability of insurance is always a factor in the growth of a trade route. At this stage of development the balance between risk and reward for insuring against the inherent risks of ice region navigation is still evolving. Some insurance companies are underwriting some risks based on information that they would like to see improved. One of the IMO's 2014 initiatives has been the "Polar Code" a set of minimum safety standards for vessels operating in Arctic and Antarctic waters. It is thought that by 2016 it will be impossible to insure a vessel that is not Polar Code compliant for Ice region voyaging. Many standard marine policies today preclude travel above 72 n. 

 Most ship owners need special riders on policies for travel north of 72 n, and many insurance companies are reluctant to underwrite such voyages. The "Polar Code" is expected to change that. Most insurers don't believe that properly equipped ice capable ships will incur significantly more losses in terms of accident than those transiting more temperate sea routes. But insurers fear that costs of salvage and environmental clean up in the High Arctic will be astronomical. The remoteness, lack of existing salvage resources, and difficult weather all indicate that the insurers are right to worry about the these enhanced costs. The evolution of the High Arctic Shipping routes requires more than just increased ice free weeks if they are to become competitive with the various toll canals as "paths between the seas".  It is going to take quite a while for insurers to feel comfortable in these waters. More over, trend is so often not future. The climatic indicators for the last 18 years have not been as convincing of Global warming as those who have invested on that premise would like us to believe. The climatic indicators for the past 36 months and looking into the next 24 months are not conducive to trust in ever lengthening ice free seasons.   We have long advised our commercial readers to not invest heavily in plans that rely on increased High Arctic through traffic. You can't rely on the long term climatological conditions or the business conditions at present.  Logistical support to increasing numbers of High Arctic out posts will increase. These are specialty operations carrying "destination' cargoes". Before buying into schemes that purport to be based on increasing High Arctic cargo statistics, check carefully to insure that what you are looking at isn't inflated by cargoes that are delivered to the Arctic, vice through an arctic shipping route. As always we advise that if you are responsible for spending other peoples money that you avoid the Al Gore Cool Aid.

                    ICE NAVIGATION BOOK SHELF
At the "Ice Navigation Book Shelf" You May Find Titles On Technical Ice Navigation And Also Epic Stories Of Arctic And Antarctic Navigation Both Ancient And Modern, Including Voyages Under Sail And Under The Ice By Submarines.

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