An Optimist’s Take on Global Climate Change: Russia as a Winner

by Colin Chilcoat

Global climate change, or more specifically, anthropogenic global warming, is a topic as polarizing as it is nuanced. To date, much of the discussion has centered on whether or not it in fact exists. The scientific community is closer than ever to a consensus opinion that man-made climate change is real and dangerous, but the public perception is still very much divided. For the purposes of this article I will rely on the assumption that the climate change phenomenon is an unavoidable side effect of ever increasing global carbon emissions and other greenhouse gases (GHG). I am also of the belief that not all change is bad. These two assumptions form the basis of my article and lead me to believe that climate change will present winners just as it will losers. That is, climate change is not inherently bad for all, and for a select few, it presents some interesting possibilities. Among these “winners” I posit that the Russian Federation has perhaps the most to gain demographically and economically from such climate shifts. Agriculture will benefit from both an increased growing season and additional arable land. More importantly, easier access to Arctic hydrocarbons and the growing viability of the Northern Sea Route will provide sustenance for Russia’s energy-focused economy. This is a cautious proclamation, however, as they will also face significant challenges, which will require careful planning and timely action to overcome.

Extent To Which the Climate is Changing

First, it is necessary to define climate change and outline the scope and significance of its reach. To a certain extent, climate change is natural; fluctuations of the climate system over long periods of time (centuries not decades) may occur as the balance between incoming solar radiation and outgoing infrared radiation ebb and flow. Continental drift and changes in solar irradiance are but a few of the possible “forcing mechanisms” for natural climate change. Naturally occurring “carbon sinks”, like forests and oceans, act as a filter of sorts for harmful GHG’s. Through a process known as carbon sequestration, carbon sinks remove carbon dioxide from the atmosphere thereby reducing the greenhouse effect. However, since the Industrial Revolution the amount of GHG’s, specifically methane, carbon dioxide and nitrous oxide, expelled into the atmosphere has steadily increased beyond the manageable level of natural carbon sinks alone. Artificial means, such as reforestation and carbon capture with storage devices, exist but current international agreements and policies are too weak to spur sufficient sequestration. Burgeoning economies in Asia and a rising standard of living globally place additional burden on both natural and artificial carbon sequestration methods.

The Russian Federation has perhaps the most to gain demographically and economically from such climate shifts 

Figure 1: Summary of global warming impacts

Recent headway in the development of renewable energy represents some positive momentum in regards to climate change mitigation. However, reliance on fossil fuels remains largely unaffected and the rising popularity of unconventional hydrocarbons, like shale oil and gas, likely means the prolongation of such carbon heavy activity in overall energy consumption. Barring a dramatic reversal, we appear destined for global temperature increases of approximately 2˚ C or more above pre-industrial levels in the relatively near future. What exactly does this mean though? A global rise in temperature of 2˚ C has long been considered the threshold, after which any further warming will have disastrous impacts on current climate systems and ecosystems. Consequently, this threshold has been the focus of previous climate treaties and international agreements regarding GHG emissions. However, updated research from the Intergovernmental Panel on Climate Change suggests that even a 1˚ C increase poses similarly dangerous environmental and social threats. The infographic above provides a brief summary of the impacts of climate change in relation to temperature.

On average, the warm period in Russia’s grain zone may experience an increase of one month; southern regions could see an almost two month increase…

Among the territories likely to be most affected by global climate change are those in the arctic and subarctic regions. Glacial melting is one of the most visible signs of global warming and consequently receives most of the attention. Deglaciation has already begun in earnest on the Greenland and West Antarctic ice sheets, posing real danger for island nations and low-lying coastal regions. Approximately 40 percent of the world’s population lives within 100km of the coast and subsequent population shifts as a result of sea level rise present social dilemmas in addition to obvious logistical problems. Perhaps more important than what is above are the problems associated with ocean acidification taking place below the surface. As the largest and most active carbon sink, the ocean, and its ecosystems, feel the impact of increased emissions more than most; approximately 30% of anthropogenic-caused emissions end up in the ocean. Decreasing pH levels pose serious threats to marine food chains, upon which a significant proportion of the world’s population, especially those in low-income countries, depend. Changes to the frequency of weather events are harder to predict, but it is largely hypothesized that changes to general weather patterns will result in fewer very cold days and more very hot days coupled with an increase of global average precipitation. The transmission of vector-borne diseases like malaria is highly subject to climate variables, but overall the combination of general warming and increased average precipitation presents conditions for more widespread distribution of these diseases. It should be noted, however, that the effects of global climate change are/will not be uniform. In general, they will be characterized by varying degrees of severity and localization.

Climate Changes on Russian Territory

In Russia, the effects of global climate change are likely to be as diverse as the terrain itself. As the world’s largest country, much of which is located in the arctic and sub-arctic regions, Russia possesses a wide array of climates, vegetation, and soils. Consequently, my brief assessment will avoid specific, though no less important, local changes and will instead focus on the general trends and those changes, which will have the most impact. As Russia is also a very cold country, its crop yields are limited by long winters and the possibility of frost in nearly every month. A study from the Russian Federal Service for Hydrometeorology and Environmental Monitoring predicts warming and precipitation trends in Russia will exceed the global averages. The winter months in particular will experience warming almost double that of the spring and summer months. Precipitation is also up across the board, with a majority of the new rainfall coming in the spring months. On average, the warm period in Russia’s grain zone may experience an increase of one month; southern regions could see an almost two month increase allowing for the possible introduction of a second crop with a short-growth period. The Russian agricultural sector has still not fully recovered from the collapse of the Soviet Union and subsequent transition to a market economy. Accordingly, agriculture as a share of GDP has been relegated to an afterthought in Russia’s energy driven economy. However, an increase in total arable acreage coupled with a general northerly shift of the grain zone has the potential to redefine the region and restore some geopolitical significance to Mackinder’s “Heartland.”

Figure 2: Hazard due to permafrost thaw

Warming Temperature Causing Problems For Existing Infrastructure

Climate change presents categorically more significant implications for Russia’s energy industry, which comprises a dangerously high share of the country’s GDP. Russia continues to struggle with diversification, especially in high-technology sectors, and as a result Russia’s future is very much dependent on oil and gas. High market volatility suggests this is a high stakes existence. Climate change does little to better the odds and in some regards may steepen the learning curve. Permafrost is a natural starting point for our discussion as its fate is of immeasurable importance to the oil and gas industry. Approximately 60 percent of Russian territory is covered with permafrost of varying depths. Some seasonal thawing is normal and is typically limited in terms of depth to the “active layer.” Warmer temperatures in the Arctic, however, disrupt these seasonal patterns, increasing both the thaw period and depth of the “active layer,” which sits above the permafrost.

…infrastructure maintenance associated with climate change and permafrost thaw is likely to cost the state of Alaska between $3-6 billion from now to 2030.

Figure 3: Oil and gas infrastructure – producing and prospective fields.

This creates obvious problems for the man-made structures built atop the permafrost, including homes, hundreds of kilometers of pipeline, and other natural resource extraction related infrastructure. Construction standards in such areas have evolved to allow for minor seasonal thawing. However, keeping up with the paces associated with global warming will be difficult and above all, costly. Figures 2 and 3 illustrate both the hazard areas for permafrost thaw and the oil and gas infrastructure associated with producing and prospective fields.

It is believed that 80% of Russia’s remaining oil and gas reserves are located offshore.

Ecological concerns surrounding compromised oil and gas infrastructure are not unfounded. The 1994 oil spill in Russia’s Komi Republic, the worst ever on land, was the result of harsh conditions and poor pipeline management. Subject to worsening conditions another spill becomes less a matter of if, but rather when. Estimates for Russia are unavailable, but infrastructure maintenance associated with climate change and permafrost thaw is likely to cost the state of Alaska between $3-6 billion from now to 2030. By mid-century, Russia’s permafrost region is expected to decline by one third with associated costs far greater than those borne by Alaska. Identification of the hazard zones and affected infrastructure must become a top priority for not only the affected industries, but also the state. Mitigation efforts undertaken today will be far cheaper than those 30-40 years from now. However, permafrost and arctic ice melt does not necessarily spell financial ruin. The opposite may in fact be true.

Permafrost Thaw Means More Accessible Hydrocarbons and Arctic Sea Routes

Untapped hydrocarbons are lying in abundance in the far reaches of Siberia and below the waters of the Arctic seas. Drilling through permafrost is a difficult task and softer soil increases the accessibility of such northern positioned resources. In any case, onshore developments may be irrelevant as more exciting opportunities appear to be located offshore, where it is believed 80 percent of Russia’s remaining oil and gas reserves are located. As with permafrost, considerable declines in both area and thickness are expected for ice in the Arctic by mid-century. In terms of development, less ice means fewer obstacles and accordingly the Arctic has become a hotbed of activity involving the Russian “national champions,” Gazprom and Rosneft, and nearly every international major of note. Lacking significant offshore experience, Russia and Rosneft now have partnerships with Statoil, Eni, and ExxonMobil, who have long maintained offshore operations and desire access into the highly promising, though not yet lucrative, Arctic. The partnership between Rosneft and ExxonMobil has already yielded the Arctic Research and Design Center for Offshore Developments (ARC), which is tasked with handling all of the problems the companies will face when developing the shelf deposits.

In November of last year, three icebreakers from Rosatom’s fleet accompanied the Gazprom-chartered LNG tanker, Ob River, marking the first shipment of such gas supplies through the Arctic.

Tax regime changes are also underway; of particular note are the proposed changes to the Mineral Extraction Tax. New legislation seeks to lessen the tax burden borne by companies working offshore in an effort to stimulate development. The tax break, currently in the draft stages, works on a gradient and will offer lower rates to those who tackle greater risk. Despite several disruptions from Greenpeace, Gazprom looks positioned to begin the first commercial arctic production later this year in the Pechora Sea with their state-of-the-art ice-resistant Prirazlomnaya platform (approximately 30 of the environmental activists are still in jails around Murmansk awaiting charges for an attempted boarding of the platform in September). Retreating and thinning ice do not diminish the need for such specifically engineered platforms, but they do allow for easier exploration and production. Just how much of a boost to Arctic production climate change will provide is impossible to quantify, but any lessening of capital expenditures is to its benefit.

Besides production, thinning Arctic ice also clears the way for increased distribution. The Northern Sea Route connects the Atlantic and Pacific Oceans by way of the Russian Arctic coast and through the Bering Strait. The route significantly reduces transit time compared to the traditional route through the Suez Canal. Historically, ice has made the route impassable for upwards of ten months per year. However, significant ice melt is extending the transit season; continued temperature rises could triple or quadruple the navigable period. In addition to increased shipping efficiency, Russia also stands to gain from the growing traffic. Traffic through the Northern Sea Route has increased every year this decade and the past two years have seen over 75 percent of the traffic carrying oil or gas. Icebreaker escorts are still required to safely pass, however, and Russia’s Rosatom is the primary supplier of nuclear-powered icebreakers for such purposes. The state-owned company is looking to establish itself as the premier provider of safe transport through the Arctic and recently signed a long-term contract with Russia’s leading independent gas producer, Novatek. In November of last year, three icebreakers from Rosatom’s fleet accompanied the Gazprom-chartered LNG tanker, Ob River, marking the first shipment of such gas supplies through the Arctic.

The evidence supporting anthropogenic climate change is now stronger than ever. That being said, it is not conclusive and several natural variables are similarly important and just as difficult to predict. This scientific discrepancy is an enormous hindrance to positive action and minimizing it in the coming years is of great importance. It is important to note that the above discussion, while based on the most recent scientific conclusions, does include assumptions and represents one of many possible outcomes.

Moreover, the side effects and/or benefits of climate change will not be known for several decades. Russia’s status as a “winner” is not unconditional; rising sea levels and thawing permafrost present challenges that must be faced head on. However, increased agricultural capacity coupled with the treasures located in the Arctic provides optimism in a time of uncertainty.

Colin Chilcoat is an MA candidate at European University at St. Petersburg. He recently completed his thesis titled, “Unconventionals in an Institutional Trap: Alternative Hydrocarbon Development in the Russian Federation.”


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