Shipping Risk Management Strategy for the Arctic Area

Xie Zhengxiang Jiang Huanbao Xu Li

Shipping in the Arctic area involves wide risks and thus is in demand of a structured and allaround risk management strategy. The risks are mainly related to technology, weather, operation,environment, reputation and human related.

Operation of ships in arctic area is highly risky, however few accidents have happened to ships trading in this area.Nonetheless, the more serious ice condition, deeper water area and exploration in further remote area pose new challenges, and the key to resolve these problems lies in research cooperation and an active attitude. Collecting information and the existing solutions will be the core for future development. But in the face of greater business challenge and increasing number of accidents in this area, there is a need for a more effective barrier and a structured risk management method. The key factors are listed as follows in the order of importance:

Firstly, taking effective measures to eliminate dangers and damage (for instance, services completely limited in certain areas); secondly, taking precautions to reduce the possibility of occurrence of problems or reduce the possibility of damage; thirdly, taking measures to reduce risks and control the effect of accidents; fourthly, external aid (this in essence is only second to measures based on self-supporting and post steady operation).Technical measures (prevention) to prevent and reduce accident damage should be based on definite guiding principles. Under the ever-changing condition of the arctic area, it is of vital importance to keep continuous summary of ship damage status, renewal of risk register book and active use of risk analysis and guiding principles in decision-making.

To better assess risks, it is necessary to confirm the ice classes of ships. According to Finland-Sweden ice class rule and its own polar experience, Bureay Veritas proposed corresponding strategies for navigation and ice class. DNV GL also developed an interactive north pole risk map to help ships avoid risks when sailing in the arctic area.

The north-pole northeast route is significant to China as a large foreign trade nation as it shortens distance and reduces cost. There is a need to understand risks related to north pole development and shipping in order to provide reasonable bases for decision-making to make risk strategy analysis and risk reduction. The North Pole risk map provides all-around information and at the same time the strategic analysis as how to reduce risks and keep sustainable development of the arctic area. In addition,cross-industry cooperation should be encouraged to meet the challenge and risks.