Putin lays out port infrastructure priorities

Russian Prime Minister Vladimir Putin has outlined the priorities in the development of port infrastructure of Russia’s North-West. Among them - the development of the Ust-Luga port, Murmansk transport hub project, transport infrastructure for the development of northern offshore oil deposits and shipment of LNG, as well as measures to support domestic shipyards.

Bunch of projects

Vladimir Putin set forth the plans at the inter-regional United Russia’s conference “The Strategy of Social and Economic Development of North-West of Russia until 2020. The Program for 2011-2012."

In his speech, Mr. Putin highlighted two main areas of development - first, the creation of a port and industrial cluster in Leningrad region-based Ust-Luga port, and secondly, the construction of infrastructure for the Shtokman offshore field development and production of liquefied natural gas (LNG). Noteworthy, Russian PM did not mention the disputable projects, we have written about, namely, the project of new deepwater ports in Arkhangelsk and on the Balga peninsula in Kaliningrad region.

Mr. Putin speaking about Ust-Luga expressed his confidence that the port’s annual throughput may reach 180 million tons by 2018. The figure, however, appears to be too optimistic. The lack of developed railway sidings (current railway capacity, experts say, enables the port handling only 30 million tons of cargo a year), harsh winters and competition from foreign rivals on the Baltic limit the capability of the Ust-Luga. Besides, creation of outer harbors in St. Peterburg (construction of such port Bronka has been underway) may also limit Ust-Luga competitive ability.

Anyhow, Ust-Luga has a great potential for its development. One of its advantages is the availability of vast hinterland that allows the creation of the first in Russia industrial and logistics cluster around the port, a very common practice elsewhere. There have been scores of projects announced for development of the area around the port of Ust-Luga. First, this is the project of Ust-Luga Company itself, which involves the construction of a new town for port employees with its developed infrastructure, and an industrial park adjacent to the port. Second, the company Multimodal Complex of Ust-Luga also submitted a project of creation of its offices, warehouse and transport facilities around the port.
 

Vitaliy Chernov