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Impacts of an Ice-Free Northeast Passage on LNG Markets and Geopolitics

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Abstract

We examine the relevance of an ice-free Northeast Passage as a shipping route, especially for LNG-supplying and -consuming countries. Four aspects are considered in-depth: (1) Develop-ments in natural gas production in the Russian Arctic; (2) Trends and strategies of major Asian LNG-consuming countries; (3) Geopolitical significance of the Northeast Passage; (4) Geo-graphical and climatic particularities of the Arctic. The analysis also comprises an assessment of the competitiveness of Russian LNG exports along the Northeast Passage, a discussion of the impacts on LNG transport routes and markets, and an evaluation of the geopolitical impli-cations of this new shipping route. We find that an ice-free NEP is relevant for maritime bulk and particularly LNG shipping, and thus of great geopolitical importance and strategic interest for countries such as Russia, the US, China, Japan, and South Korea.

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  • Schach, Michael & Madlener, Reinhard, 2017. "Impacts of an Ice-Free Northeast Passage on LNG Markets and Geopolitics," FCN Working Papers 4/2017, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
    • Handle: RePEc:ris:fcnwpa:2017_004
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    1. Schach, Michael & Madlener, Reinhard, 2017. "Impacts of an Ice-Free Northeast Passage on LNG Trading: Transport Routes and Optimal Capacity Planning," FCN Working Papers 12/2017, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
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    Cited by:

    1. Meza, Abel & Koç, Muammer & Al-Sada, Mohammed Saleh, 2022. "Perspectives and strategies for LNG expansion in Qatar: A SWOT analysis," Resources Policy, Elsevier, vol. 76(C).
    2. Shuaiyu Yao & Mengmeng Chen & Dmitri Muravev & Wendi Ouyang, 2021. "Eco-Efficiency Analysis for the Russian Cities along the Northern Sea Route: A Data Envelopment Analysis Approach Using an Epsilon-Based Measure Model," IJERPH, MDPI, vol. 18(11), pages 1-16, June.
    3. Specht, Jan Martin & Madlener, Reinhard, 2018. "Business Models for Energy Suppliers Aggregating Flexible Distributed Assets and Policy Issues Raised," FCN Working Papers 7/2018, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
    4. Mingyu Li & Kjetil Fagerholt & Peter Schütz, 2023. "Maritime inventory routing with transshipment: the case of Yamal LNG," Flexible Services and Manufacturing Journal, Springer, vol. 35(1), pages 269-294, March.
    5. Pereira, Guillermo Ivan & Specht, Jan Martin & Silva, Patrícia Pereira & Madlener, Reinhard, 2018. "Technology, business model, and market design adaptation toward smart electricity distribution: Insights for policy making," Energy Policy, Elsevier, vol. 121(C), pages 426-440.
    6. Hendrik Schmitz and Reinhard Madlener, 2020. "Direct and Indirect Energy Rebound Effects in German Households: A Linearized Almost Ideal Demand System Approach," The Energy Journal, International Association for Energy Economics, vol. 0(Number 5), pages 89-118.
    7. Mendez, Alvaro & Alden, Chris, 2019. "China in Panama: from peripheral diplomacy to grand strategy," LSE Research Online Documents on Economics 101599, London School of Economics and Political Science, LSE Library.
    8. Heesen, Florian & Madlener, Reinhard, 2021. "Revisiting heat energy consumption modeling: Household production theory applied to field experimental data," Energy Policy, Elsevier, vol. 158(C).
    9. Shapovalova, Daria & Galimullin, Eduard & Grushevenko, Ekaterina, 2020. "Russian Arctic offshore petroleum governance: The effects of western sanctions and outlook for northern development," Energy Policy, Elsevier, vol. 146(C).
    10. Dai, Lei & Jing, Danyue & Hu, Hao & Wang, Zhaojing, 2021. "An environmental and techno-economic analysis of transporting LNG via Arctic route," Transportation Research Part A: Policy and Practice, Elsevier, vol. 146(C), pages 56-71.
    11. Höwer, Daniel & Oberst, Christian A. & Madlener, Reinhard, 2017. "Regionalization Heuristic to Map Spatial Heterogeneity of Macroeconomic Impacts: The Case of the Green Energy Transition in NRW," FCN Working Papers 13/2017, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN), revised 01 Feb 2019.

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    More about this item

    Keywords

    LNG Markets; Geopolitics; Northeast Passage; Arctic; Russia; Asia;
    All these keywords.

    JEL classification:

    • Q30 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - General
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General

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    This paper has been announced in the following NEP Reports:

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