Russia is planning a fleet of floating and submersible nuclear power stations to exploit Arctic oil and gas reserves, causing widespread alarm among environmentalists.

A prototype floating nuclear power station being constructed at the SevMash shipyard in Severodvinsk is due to be completed next year. Agreement to build a further four was reached between the Russian state nuclear corporation, Rosatom, and the northern Siberian republic of Yakutiya in February.

The 70-megawatt plants, each of which would consist of two reactors on board giant steel platforms, would provide power to Gazprom, the oil firm which is also Russia's biggest company. It would allow Gazprom to power drills needed to exploit some of the remotest oil and gas fields in the world in the Barents and Kara seas. The self-propelled vessels would store their own waste and fuel and would need to be serviced only once every 12 to 14 years.

In addition, designers are known to have developed submarine nuclear-powered drilling rigs that could allow eight wells to be drilled at a time.

Bellona, a leading Scandinavian environmental watchdog group, yesterday condemned the idea of using nuclear power to open the Arctic to oil, gas and mineral production.

"It is highly risky. The risk of a nuclear accident on a floating power plant is increased. The plants' potential impact on the fragile Arctic environment through emissions of radioactivity and heat remains a major concern. If there is an accident, it would be impossible to handle," said Igor Kudrik, a spokesman.

Environmentalists also fear that if additional radioactive waste is produced, it will be dumped into the sea. Russia has a long record of polluting the Arctic with radioactive waste. Countries including Britain have had to offer Russia billions of dollars to decommission more than 160 nuclear submarines, but at least 12 nuclear reactors are known to have been dumped, along with more than 5,000 containers of solid and liquid nuclear waste, on the northern coast and on the island of Novaya Zemlya.

The US Geological Survey believes the Arctic holds up to 25% of the world's undiscovered oil and gas reserves, leading some experts to call the region the next Saudi Arabia. But sea ice, strong winds and temperatures that can dip to below -50C have made them technologically impossible to exploit.

Russia, Norway, Denmark, Canada and the US have all claimed large areas of the Arctic in the past five years. Russian scientists used a mini-submarine to plant a flag below the North Pole in 2007 and have claimed that a nearby underwater ridge is part of its continental shelf.

Last week, ministers from many Arctic countries heard scientists and former US vice-president and Nobel prize winner Al Gore say that the Arctic could be free of ice in the summer within five years, with drastic consequences for the world's climate and human health.

But many countries bordering the Arctic see climate change as the chance to exploit areas that were once inaccessible and to open trade routes between the Pacific and Atlantic.

According to a new report by the Arctic Council, an intergovernmental forum, Russia is considering other nuclear plants for power-hungry settlements. "The locations that have been discussed include 33 towns in the Russian far north and far east. Such plants could be also used to supply energy for oil and gas extraction," says the report by the Arctic Monitoring and Assessment Programme.