The tunnel under the Bering Strait from Siberia to Alaska story has resurfaced again. Bloomsburg report that Russia plans a tunnel that will include both transport links, and a pipeline to allow the export of oil to the United States:
The planned undersea tunnel would contain a high-speed railway, highway and pipelines, as well as power and fiber- optic cables, according to TKM-World Link. Investors in the so- called public-private partnership include OAO Russian Railways, national utility OAO Unified Energy System and pipeline operator OAO Transneft, according to a press release which was handed out at the media briefing and bore the companies’ logos.
The cost? Oh, just a cool $10-12 billion.
I’m sceptical that the tunnel will be built in the near future – if ever – but I’d still love to see it happen. I’d be the first to hop on the train from London to New York.
The picture on this post, found on Flickr, was taken by Lukeii.
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I’d be the first to hop on the train from London to New York.
That’s awfully European of you. Were it built my plan to drive the Alaska highway would morph into a much longer trip in which Fairbanks would just be a stop on a much longer trip. Maybe from here to ?
The article that I found mentioned $55 billion once you include the railway links. Maybe one day you will be able to take a land trip from Scotland to Argentina. But no thanks, I’ll just fly, and leave the railway for the oil and gas. BTW, Andy, I missed that you found this first, so I will link back to your article also….
History provides us with several examples of “monster projects” such as the proposed Bering Straits Tunnel. See the Suez and Panama Canal, and more recently the Channel Tunnel between France and Great Britain, all of which are still going strong and prove extremely useful.
Yet each of these projects proved a major disaster for the inital investors, because when they thought were buying a right to cash in on commercial traffic via a particular canal or tunnel, it turned out they had in fact paid for the right to be liable for unknown or misrepresented building costs which invariably rocketed way over and above what they were gullible enough to believe in the prospectus.
This age-old principle has proved itself time and time again.
We must be particularly wary when Russia is involved.
Viktor RAZBEGIN of the Russian Economy Ministry tells us not to worry because “the governments will act as guarantors for private money”.
A century ago more than a million French households massively invested in Russian government, infrastructure, utilities, and railway bonds.
They all came with a Russian government guarantee.
Not a single one has ever been paid back.
Today the Russian Federation still refuses all form of contact with 400000 present day bondholders. The total amount outstanding is in excess of US$90 billion.
Instead of honouring herself by settling her overdue debt as she has the means to do today, Russia refuses all contact and prefers resorting to shady evasion tactics used by doubtful businessmen, which forces her to behave in a manner unworthy of a great State: in 2002 the SEDOV, a magnificent training ship for cadets of the Russian navy, a veritable floating embassy for Russia, had to precipitously leave Marseilles harbour under cover of darkness at 2 a.m., without waiting to host the official receptions planned for the following day, to avoid the impounding order about to be served by French bondholders. Thus Russia debases herself to behave like a vulgar misdemeanour culprit running away from a restaurant without having paid the bill.
How could anyone trust Mr. RAZBEGIN and his chiefs?
Mr. RAZBEGIN, before offering a new doubtful Russian government guarantee you must first deliver on the outstanding ones.
Refusing contact with your creditors is a gross miscalculation; Russia will never be really accepted as a country governed by the rule of law and contract enforcement until she makes good on her universally recognised duties. Imagine the massively positive impact worldwide of a Foreign Ministry statement such has “the Russian Federation has agreed to start talks with holders of Czarist debt”. And you would no longer need to leave harbour at 2 a.m.
US$ 90 billion is a lot of money (7 or 8 Bering tunnels), but Russia is now free to develop her massive power and resources, and has the means to pay; it need not be all at once (although last summer Russia paid a lump sum of US$ 23 billion to the Paris Club and since then is claiming to be “debt free” – I say: no! Russia still owes French bondholders US£ 90 billion!).
Delivery can be spread out over time: 10 years, or twenty if she wants. Allocate just 1% of your oil and gas production to it. Russia could even offer to exchange Czarist bonds for modern ones. Perhaps we would accept!
To do this Mr. RAZBEGIN Russia must speak to her creditors.
Without this your government’s guarantee is worth nothing at all.
Good night, Mr. RAZBEGIN – until 2 a.m.
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