Nine years later: Decision on the Kallak mine

The Government’s decision on Tuesday to give the green light for the mine in Kallak is an important message for the mining and mineral nation Sweden. The message is received with mixed feelings by the industry.
– Kallak has become a heavy symbol of the opportunity to develop mines in new places, even outside the classic mining regions. We are relieved today, but it has been an unreasonably long processing time for this case, says Maria Sunér, CEO of Svemin.

A granted processing concession gives the company the exclusive right to the deposit and that Sweden considers that the place where the deposit is located is suitable for mining. The Government’s announcement yesterday now gives the company the opportunity to proceed with detailed examinations before the next step, the environmental permit.

It is very unusual for a processing concession to be conditional in the way that has now been decided in the case with Kallak. These are twelve far-reaching requirements that must be met.

– Our basic attitude is that several interests must be able to coexist within a geographical area, this also applies to mines and reindeer husbandry, says Maria Sunér. – Protective measures for the reindeer husbandry and conditions for after-treatment that are now relevant are usually addressed in the environmental permit within the framework of the environmental assessment.

At the latter stage – the environmental assessment – there is a more comprehensive basis for decisions and a clearer picture of how the business will be conducted.

The question is whether it is wise to establish comprehensive and detailed conditions already in the concession phase because it entails a risk that the project will ultimately not be conducted in the most suitable way. This is a complex matter. We need to analyse in more detail what this means for the mining industry in general, says Maria Sunér.

The need for metals is increasing sharply throughout the world

When society now frees itself from dependence on fossil sources, we instead become dependent on metal and mineral raw materials. Wind turbines, solar panels, batteries, electric cars – they all require access to metals and minerals. Studies, for example from the International Energy Agency IEA, show that the single most important driving force for increased demand for most metals by 2050 will be the climate transition. Thus, the level of ambition in the climate transition will greatly affect the demand for these metals – the faster the reduction in climate emissions, the higher the increase in the need for metals and minerals. This applies not only to so-called critical raw materials, but also to the highest degree also copper and iron.

– From that aspect, it is welcome that the Government now takes responsibility, says Maria Sunér. In addition, the ongoing war in Ukraine has further highlighted the importance of increasing the European degree of self-sufficiency in metals and minerals in order to reduce import dependence. Ukraine is also an important iron ore producer and the damage the other day at Azovstal, one of Europe’s largest steelworks, will be significant far beyond the country’s borders.

Sweden is the EU’s largest producer of iron ore, in 2020 we accounted for 93% of the entire EU’s total iron ore production. At the same time, just under 30% of the EU’s need for iron ore is met by European sources, so the need for imports to the EU is great.

System review necessary

The vicissitudes surrounding a mine in Kallak have been both many, long and complex (see fact box below). The recent political downturn in mineral issues in recent terms of office has contributed to Sweden’s attractiveness as a mining country has plummeted on the internationally recognised ranking list from the Fraser Institute. In recent years, Sweden has fallen from place 8 to place 36 on the global list.

The industry has long criticised the current system and therefore in the autumn of 2021 developed a Reform Package (Swe.), directly aimed at political decision-makers.

– The fact that the government has now granted a processing concession for Kallak does not reduce the need for a proper review of the entire current system. Sweden’s rich bedrock provides unique opportunities to sustainably extract the metals that climate change is completely dependent on. We are ready to invest in the future with billions in investments, says Maria Sunér.

FACTS

Processing concession – just one of several permits on the way to a mine

A processing concession is an important step on the way to being able to open a new mine. The process of obtaining an environmental permit is now underway, which will take a number of more years. Only when the environmental permit is granted, mining can start.

Very simplified, the process can be divided into three steps.

• 1 Examination permit. Decided by the Chief Mining Inspector, i.e. the head of The Mining Inspectorate of Sweden. Provides the exclusive right to investigate (prospect) the area. Normally valid for three years.
• 2 Processing Concession. Decided by the Chief Mining Inspector, after consultation with the County Administrative Board (CAB). In the event that the Chief Mining Inspector and the CAB do not agree, the matter is transferred to the Government, which decides on the matter. A processing concession is normally valid for 25 years.
• 3 Environmental verdict. Decided by the Land and Environmental Court, which decides whether the environmental impact statement meets the requirements in Chapter 6. the Environmental Code. The conditions for the activity are also established here, for example how the environment may be affected, for example regarding emissions, handling of chemical products, waste, etc. that is needed to prevent or limit the activity from causing damage or inconvenience to human health or the environment.

FACTS

Kallak – a protracted case

1948 – The Kallak deposit is identified by SGU, the Swedish Geological Survey.

2010 – British Beowulf Mining begins test drilling for iron ore in Kallak in Jokkmokk municipality in Norrbotten.

2013, April – The company applies for a processing concession. The County Administrative Board of Norrbotten considers itself unable to take a position on the application and rejects it. The proposed mine is located in a reindeer grazing area and is considered to indirectly risk affecting the Sami culture in Laponia, which has several Sami villages and national parks and has been classified as a World Heritage Site since 1996.

2014 – Beowulf Mining completes the application but receives a new no from the County Administrative Board on the grounds that mining can result in damage in the area as transport routes would cross winter pastures and migration routes used by Sami villages for a long time. The Mining Inspectorate of Sweden, which does not share the County Administrative Board’s assessment and considers that Kallak is an economically significant iron ore deposit, decides that the Government should decide the issue.

2015 – The County Administrative Board complements its position and says yes to the concession, but only for the mining area (the concession area).

2016 – The Government re-submits the application, following a ruling in the Supreme Administrative Court which states that it is not enough to only examine the concession area. The Mining Inspectorate of Sweden requests a new statement from the County Administrative Board, which replies that the existing data does not adequately answer how Laponia can be affected. The County Administrative Board also wants Unesco to investigate the issue, which The Mining Inspectorate of Sweden does not agree with. After discussions between The Mining Inspectorate of Sweden, the County Administrative Board, the Swedish Environmental Protection Agency, the National Heritage Board and Beowulf Mining, it is decided that the County Administrative Board will comment on the case again.

2017 – The County Administrative Board announces that no new opinion will be issued, the World Heritage issue must be investigated further. The Government decides, at the request of The Mining Inspectorate of Sweden, that the County Administrative Board must comment by 1 December 2017. The County Administrative Board is in favor of mining.

2020 – The Government decides to turn to Unesco to find out if the mine threatens Laponia’s World Heritage status.

2021 – Since 2017, the matter has been on the Government’s table. Apart from the question to Unesco, no visible administrative measures have been taken. The delay is considered unacceptable, according to the Constitution Committee’s review.

2022 – The Government decides to grant a processing concession for the Kallak iron ore deposit

More details at beowulfmining.com, for example here.

MORE INFO

See the press conference at regeringen.se (Swe.)

See the Ministry of Trade and Industry’s press release (Swe.)

See the Minister of Trade and Industry, Karl-Petter Thorwaldsson’s presentation slides from the press conference (Swe.)