Written by James Burns and Tom Gorrard-Smith for Insurance Day. They look at international rules for ships crossing Arctic and Antarctic waters, expected to come into force in 2017.
While the decline in global oil prices has gone some way to dampening speculation regarding the future of the Arctic as a potential oil and gas production hotspot to rival the Middle East, maritime activity in the region continues to increase. Following on from many years of deliberation, the International Code for Ships Operating in Polar Waters (the Polar Code) has now been adopted by the International Maritime Organisation.
The Polar Code covers the full range of shipping-related matters relevant to navigation in Arctic and Antarctic waters, including ship design, vessel equipment and operational and training concerns, search and rescue, and environmental protection.
As the Polar Code deals with both safety and environment issues, related amendments have been made to the International Convention for the Safety of Life at Sea and the International Convention for the Prevention of Pollution from Ships to mandatorily impose the Polar Code. It is anticipated the Polar Code will come into force in January 2017.
While activity along the Northern Sea Route – the shipping lane across Russia's coastline connecting Europe to Asia – decreased last year owing to unusually heavy ice along the passage, a significant increase in traffic is forecast in upcoming years, with Chinese officials suggesting as much as 15% of China's projected international trade would use the route by 2020.
Along with the anticipated increase in polar tourism, the heightened risk for vessels operating in remote waters where icebergs remain an ever-present threat has led the Polar Code to require ships intending to operate in polar waters to apply for a Polar Ship Certificate, which would classify the vessel as a category A ship (designed for operation in polar waters at least in medium first-year ice), category B ship (designed for operation in polar waters in at least thin first-year ice) or category C ship (designed to operate in open water or in ice conditions less severe than those in categories A and B).
To obtain the necessary certificate to sail in Arctic and Antarctic waters, a shipowner must be able to show its vessel has sufficient stability when subject to ice accretion, has been constructed using materials suitable for polar temperatures and its hull ice-strengthened. The issuance of a certificate would require an assessment, taking into account the anticipated range of operating conditions and hazards the ship may encounter in the polar waters. The assessment would include information on identified operational limitations, and plans or procedures or additional safety equipment necessary to mitigate incidents with potential safety or environmental consequences.
The Polar Code also requires masters, chief mates and officers of vessels operating in such waters to have undertaken necessary training related to navigating in icy waters and for vessels to have special equipment for ice removal and fire safety equipment operable in cold temperatures.
While the implementation of the Polar Code is a significant step towards ensuring vessels are equipped to respond in the event of a casualty, the threat of collision with icebergs, combined with the lack of infrastructure in the Arctic and Antarctic, means the risks for ships remain significant and, until casualty response times are improved, insurers will continue to remain sceptical when providing cover to vessels operating in polar waters.
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