Economy of the White Sea watershed area 1 page

This chapter characterizes the main aspects of the economy of the White Sea Basin, focusing on recent trends and prospects. Section 7.1 describes its natural resources, including minerals and other types of resource. Section 7.2 summarizes the popula- tion and demographic characteristics of the region. Economic indicators are described in Section 7.3. Section 7.4 describes the sectors and branches of the regional economy in the region. Investments in the White Sea region are summarized in Section 7.5. Section 7.6 identifies socio-economic indices and integration of the relevant data into a database. Finally, Section 7.7 identifies and substantiates the most probable scenarios for industrial development in the White Sea region.

7.1 NATURAL RESOURCES

7.1.1 Mineral resources

The specific geological structure of the White Sea region has determined its mineral resources: 80% of the area (Komi Republic, Vologda, and Arkhangelsk Oblasts) accommodates Palaeozoic deposits of the Russian Platform. The remaining 20% are Archaean and Proterozoic crystalline rocks of the Baltic (Fennoscandian) Shield. Mineral resources are the richest in the Kola Peninsula. Some examples are deposits of copper-nickel ore, iron ore, aluminium, rare metals, apatite-nepheline ores, etc. Iron ore and building material deposits are exploited in the Republic of Karelia. The Arkhangelsk Oblast is known for its resources in diamonds and building materials. A brief nomenclature of the mineral resources residing within the administrative units, completely or partly encompassed by the White Sea watershed area, is given in Figures 7.1 and 7.2 (see color section).

Table 7.1. Estimates of resources of some minerals in the Murmansk Oblast.

From Economic Geography .. . (1999).

The Murmansk Oblast

In terms of mineral resources, the Murmansk Oblast is the leader not only in the north-west of the country, but also in the entire Russian Federation and even the greater Commonwealth of Independent States (CIS). Over 200 deposits of 40 types of minerals have been explored. A total of about 700 minerals and elements (i.e., over one-quarter of all that are known), have been found there. For example, this area is rich in phosphorus, iron, copper, nickel, cobalt, sulphur, aluminium, titanium, vanadium, sodium, potassium, zirconium, niobium, tantalum, and others. The Murmansk Oblast contains 35% of the CIS reserves of phosphates, 30% of non-ferrous metals, 80% of rare metals, 75% of phlogopite, 93% of kyanite, 37% of feldspar and pegmatite, and 4% of the iron ore. Large reserves of nickel-copper ores, alumina, rare metals, titanium, construction materials, and semi-precious stones are also found in the region. The Murmansk Oblast is the world s largest producer of phosphate fertilisers (Figure 7.1, Table 7.1). The products of ferrous and non-ferrous industries are of great importance to the Russian Federation. In 1994, the Murmansk Oblast produced 100% of the apatite concentrate, 41.2% of nickel, 13.0% of copper, and 9.8% of the ferrous ore in the Russian Federation

(Economic Geography .. ., 1999).

Among the richest and most valuable sources of mineral raw materials in the Murmansk Oblast are:

• 11 deposits available to the fertilizer industry, including the integrated apatite- nepheline Khibiny and Kovdor deposits of unique scope and quality, and some others with overall reserves of phosphorus-bearing ores amounting to 16 billion tons.

• 7 apatite-nepheline mines in the Khibiny mountains with reserves sufficient for 60-100 years of mining. The ores contain 45-55% apatite, 35-40% nepheline, 6-10% aegirine, and 2% titanium-magnetite.

• Deposits of apatite-magnetite ores and micas in the Kovdor massif, containing

600 million tons of high-ferrous apatite-magnetite ores, 188 million tons of low- ferrous ores, 7.86 million tons of phlogopite, and 4.32 million tons of vermicu- lite. Total resources of mica in the Kola Peninsula are estimated at 24 million tons and ceramic raw materials at 400 million tons.

• Africanda and Lovozero deposits of titanium ores with total reserves in excess of 10 billion tons.

• 10 iron ore deposits with total reserves over 3.2 billion tons (the Zaimandrovsky ore-county, Olenogorsk, Kirovsk).

• Cromite ore deposits in the Apatity and Monchegorsk districts.

• A polymetallic sulphide ore deposit containing copper, nickel, cobalt, selenium, tellurium, and precious metals in the Pechenga-Allarechensk area.

• Some promising finds of precious metals in the Kola Peninsula: gold in the Kandalaksha district, and dispersed gold, silver, and molybdenum mineraliza- tion in the Kolmozero-Voronia greenstone belt.

• Platinum-group metal deposits in the central Kola Peninsula.

• Some deposits of rare metals and zirconium.

• 23 deposits of kyanite with total reserves of 3.4 billion tons in the Keivy Ridge.

• Many deposits of semi-precious stones.

• Many deposits of building materials. Total reliable reserves are estimated at 21 billion tons, including 21 deposits of facing and decorative building stone (granites, kyanites, gabbro, norites, marbles, periodites, quartzites), 52 sand and sand-gravel formations, and some clay deposits (Economic Geography .. ., 1999).

Arkhangelsk Oblast

The main mineral raw material resources in the Arkhangelsk Oblast are bauxites, fluorites, and diamonds. There are also large deposits of various building materials such as clay, gypsum, and limestone (Figure 7.2, see color section). The main deposits found in the Archangelsk Oblast are:

• Deposits of bauxites in the south-west of the oblast, with the total reserves of up to 120 million tonnes.

• Deposits of fluorites in the north-east of the oblast, with total reserves estimated at 60 million tonnes.

• The first major diamond deposit in Europe within the Kuloy-Belomorskiy Plateau (over 50 kimberlite pipes; diamonds have already been found in 32 pipes).

• A prospective diamond deposit in the Zolotitsa River group of diatrems, called the Lomonosov deposit.

• New diamond deposits in the areas of the Onega River and Karpogory in the Kanin Peninsula. The total reserves of all deposits are estimated at 130 million carats of very high-quality diamonds.

• A large variety of building materials (e.g., the large Savinskoye limestone deposit, the Tesskoye clay deposit, the Zvo gypsum deposit, and others) (Economic Geography .. ., 1999).

Republic of Karelia

The Republic of Karelia encompasses 227 known deposits of 25 kinds of minerals (Figure 7.1, see color section). The greatest one being exploited at present is the Kostomuksha iron-ore deposit, where the large ore-dressing mill Karelsky okatysh operates. The Korpangskoye and Mezshozerskoye iron deposits are also quite promising. There is a good chance of finding composite titanium-magnetite ores in the Kojkaro-Pudozhgoskaya ore region, in the Yeletozero and Tikshozero massifs. A number of skarn deposits of tin were discovered in southern Karelia (Kitelya, Lyupikko, Uuksa, Pitkaranta).

Karelia has already explored large reserves in muscovite mica and pegmatite, which are concentrated on the White Sea coast (Louhi and Kem districts). Also known are manifestations of potstone and carbonaceous talc ores (the Svetlozers- koye deposit in the Segezha district).

Many districts of the republic have explored and are exploiting deposits of high- quality building and facing stone such as granite, gabbro, quartzite, and marble. Other actively exploited minerals are sand and gravel. Building and facing materials are of national significance. One of the most valuable materials from Karelia is shungite, which is used for a multitude of purposes.

Karelia was also found to be promising in terms of reserves in other commer- cially valuable minerals, such as platinum, silver, gold, diamonds, polymetals, nickel, chromium, cobalt, titanium, wolfram, vanadium, and tin.

7.1.2 Forest resources

One of the main natural resources in the White Sea watershed area is forest. It serves as a basis for the development of wood and the pulp-and-paper industry in the region and other parts of European Russia. Besides, large volumes of timber products are exported.

The area of forested land in north-western Russia is 85.7 million ha (Table 7.2). This constitutes 11% of the State Forest Fund of the Russian Federation and over 40% of European Russia. Forested lands and timber stocks are ample in the Komi Republic (45.0 and 45.3% of the territory, respectively). In the Arkhangelsk Oblast, forested lands and timber stocks account for 33.6% and 37.6% of the territory. In the Republic of Karelia and the Murmansk Oblast these number are 13.9% and 14.1%, and 7.5% and 3.0%, respectively (Table 7.3). The Komi Republic possesses the greatest proportion of mature and overmature forests (75% of the total stock). As has already been mentioned, the White Sea watershed area is crossed by four vegetation zones differing in their conditions for floral development: tundra, forest- tundra, northern, and middle taiga. Table 7.4 demonstrates that most of the forest is

Table 7.2. State Forest Fund of the Russian Federation and north-western Russia as of 1 January, 1998.

From Economic Geography .. . (1999).

North-western Russia encompasses the Murmansk, Arkhangelsk, Vologda, Leningrad, Novgorod and Pskov Oblasts, the Republics of Karelia and Komi, and the city of St. Petersburg.

Data from the Institute of Economic Studies, Karelian Research Centre, RAS.

Table 7.3. Timber resources of the White Sea regions as assessed in 1993 and 1998.

From Economic Geography ... (1999) and data provided by the Institute of Economic Studies, Karelian Research Centre, RAS.

Total timber Coniferous Mature and over Share of total Forested area resources species mature forests timber resources

Region (1,000 ha) (million m3 ) (million m3 ) (million m3 ) (%)

Total 63,439 66,769 6,156 6,531 - - - - - -

Table 7.4. Distribution of forests by vegetative zones in the White Sea region.

From Economic Geography ... (1999).

Forest distribution by vegetative zones (%)

Region Tundra Pre-tundra Northern taiga Middle taiga Mixed forests

Table 7.5. Forest classification in the White Sea region performed in 1993 (1,000 hectares).

From Economic Geography ... (1999).

found in northern and middle taiga. Coniferous forests dominate in the area. This is true for all three forest groups (Table 7.5).

Coniferous and deciduous species typical of the White Sea area are shown in Table 7.6. One can see that pine (Norwegian and Siberian) prevails in the species composition in all administrative units except Karelia. Pine stocks are particularly significant in the Arkhangelsk Oblast and Komi Republic. The leader among deciduous species is birch (Silver, Downy, and Karelian species), for which stocks are much greater than those of other deciduous species.

The proportion of mature and overmature forests in the area is similar to the average for Russia, being over 55% (Table 7.7). Yet, it differs significantly across different republics and oblasts.

7.1.3 Agriculture

There is some, albeit minor, farmland in the catchment of the White Sea. The agricultural production volumes there are quite low however. This is due firstly to unfavorable natural conditions (especially the climate), and secondly, to poor infra- structure (sparse road networks, underdeveloped mechanization and automation, insufficient electric power and chemical supply, problems with water supply and sewage, etc.).

Table 7.6. Volumes of standing timber distributed by main tree species in the White Sea region as assessed in 1993 (million m3).

7.1.4 Fuel and energy resources

Fuel and energy resources in north-western Russia are represented by oil and gas, coal, oil shales, and peat. The White Sea Region proper possesses practically none of its own resources in oil and gas, although the demand for them in the regions is high. In the immediate vicinity, however, in the areas adjacent to the White Sea catchment, there are a number of exploited and prospected oil and gas deposits of large reserves. They are politically situated mostly in the Komi Republic and the Nenets Autono- mous Okrug of the Arkhangelsk Oblast, which partly falls into the White Sea catchment. This is the Timan-Pechorat province, where over 70 oil, gas, and gas condensate deposits have been assured. The total resources of gas are estimated at more than 600 billion m3, and of oil at more than 4,800 million tons.

Vast fuel and energy resources are also concentrated in the Arctic Shelf zone of Russia (the Barents-Kara Sea province), belonging mostly to the Nenets Autono- mous Okrug, as well as to the Murmansk Oblast and the Komi Republic. Prospected gas resources in the Barents Sea are estimated at 10,000 billion m3. Prospecting for oil has also started in the area, though the shelf resources are barely used at present, and can be considered merely as reserves. The most explored is the Stockmanovs- koye gas and condensate field, in which large Russian and foreign companies are

t The Timan-Pechora oil and gas region is within the boundaries of the Komi Republic and Nenets Autonomous Okrug.

Table 7.7. Partitioning of the forested area by tree age in the White Sea region as assessed in 1998 (1,000 ha).

From Economic Geography ... (1999).

very interested. Its total reserves are estimated at 3,000 billion m3, and the potential annual yield is 100-150 billion m3.

In addition to the two regions discussed above, fuel and energy resources are also found in the Komi Republic: 200 billion m3of natural gas, 30 million tons of gas condensate, 520 million m3of oil. Prospecting for oil in the Pechora Sea also holds promise.

The Komi Republic and the Nenets Autonomous Okrug hold explored and prospected deposits of coal, for which total reserves are estimated at more than 10 billion tons. About one-half of it is high-grade caking coal.

Oil shale resources are confined to the Komi Republic. The best grades there are worked from the deposits located in the Sysolskiy, Yaregskiy, and Izhemskiy regions.

Peat reserves are abundant in all republics and oblasts of the White Sea region. Several dozens of deposits are currently exploited and large amounts of peat are used as fuel (Economic Geography .. .,1995; Economic Geography .. ., 1999).

7.2 DEMOGRAPHY

The total population of the oblasts and republics constituting the White Sea region is 5,531,000 persons (or 4,240,000 if the Vologda Oblast is not included). It produces the greatest impact on the White Sea ecosystem. Table 7.8 displays the main demo- graphic indices for the regions. Note that all indices are for the administrative units as such, but not for the White Sea watershed area only.

It should be emphasized also that the preliminary results from the 2002 national

Table 7.8. Demography of the White Sea region on 1 Jan, 2003.

Under working age less than 15 years; males at working age (16-59 years), females at working age (16-54 years); above working age for males (>60 years), for females (>55 years).

census differ somewhat from the current statistical data. The difference is due to the impossibility of monitoring migration rate, so that the population of the northern regions prove to be lower than expected (by 8% in Komi, by 8% in the Murmansk Oblast, by 6% in the Arkhangelsk Oblast, by 4% in Karelia, and by 2% in the Vologda Oblast) (http://www.gov.karelia.ru/power/ministry/economy/econom_OO.html [in Russian]; http://www.hkki.fi/-vbi/summary_ru.pdf [in Russian]).

7.2.1 Population structure

The age and sex structure of the population in the three regions is very similar, as summarized above (Table 7.8). According to the official statistical reports, in the Republic of Karelia the majority of the population are male (52.7%). In the Vologda Oblast, males constitute 52.9% of the population. The other three regions have a more balanced population sex structure. The Murmansk Oblast, in turn, has the largest economically active population in north-western Russia: about 68.8% of the population is of working age. The Republic of Karelia has the greatest proportion of pensioners, with 18.5% of the population being above the working age (in the Vologda Oblast it is 20.7%).

The degree of urbanization is high in the White Sea region, amounting on average to 76.5%, and being as high as 91.5% in the Murmansk Oblast. The majority of the population centers depend on the economic prosperity of one or a few local industrial enterprises. This centralization of the population in north- western Russia is largely a result of the settlement and industrialization policies of the former Soviet Union. The settlement pattern in north-western Russia is very

Table 7.9. Change in population of the White Sea region during the 1991-1999 period.

From Socio-economical Development ... (2003).

Cumulative changed during

Population (1,000) people 1991-2002

different from that of the northern parts of, for example, Scandinavia where the population settlement is more evenly spread over the territory.

Date: 2016-03-03; view: 706