State nuclear corporation Rosatom has been selected by Moscow to develop the Arctic seaway that it wants to turn into a new Suez Canal.

Alexey Likhachyov, the corporation’s director general, told Reuters that the NSR requires 735 billion roubles in investment, with the state budget providing a third and the rest coming from companies and banks.

“As soon as we create commercially attractive cargo shipment, people will be ready to invest in roads, railways, ports and terminals as this will become profitable,” Likhachyov said. 

The NSR is a potential shipping route along the Russian Arctic coast from the Kara Sea to the Bering Strait.

Parts of it are free of ice for just two months per year, but it is likely to become far more accessible due to melting Arctic ice caps – potentially transforming sea traffic between Asia and Europe.

Rosatom has now agreed with the Russian Direct Investment Fund, nickel and palladium producer Nornickel, and the global port operator DP World to jointly develop the NSR. 

The nuclear agency will lead its development but also be responsible for the nuclear icebreakers that create passages for ships through the thick Arctic ice.

The Zvezda shipyard in Russia’s far east is developing a new class of nuclear icebreaker to smash through the Arctic ice, which is scheduled for completion in 2026.

It is expected that by 2024 about 80 million tonnes of cargo per year will be shipped via the NSR to Europe and Asia. 

The route is seen by Moscow as particularly important for the shipment of liquefied natural gas to Europe and Asia, a sector that Russia aims to dominate.

Russia’s biggest private gas producer Novatek is already using the NSR to ship LNG, and Gazpromneft, Russia’s third-biggest oil producer, is also exporting oil via the route.