BarentsObserver has over the latest few years reported about mining investment plans worth billions of euros over the next decades. Prospects and soon-to-start mining explorations are found in all four Barents countries Sweden, Finland, Russia and Norway.
The questions investors asked last week was obvious: Are the upstarting costs too high to gain sustainable economy into new mining in the high north?
It was last Thursday that Northern Resources had to tell its investors that it has identified a large funding shortfall and is planning an offering of new debt and equity to raise up to €316 million. Investors that until last week strongly believed in the company’s iron-ore mine in Kaunisvaara were all shocked. The stock has since then fell by 86 percent and continued down Monday morning, with a drop by 20 percent at the stock market in Frankfurt and 26 percent in Oslo the first hour of trade.
Kaunisvaara is just outside Pajala in the Swedish, Finnish borderland. Another mine is planned to open later in Hannukainen near Kolari on the Finnish side of the border.
Northland Resources says in a press-release that the additional funding will be used for fund capital and operating expenditure related to the Kaunisvaara Project and associated logistic chain, and general corporate purposes, including the Hannukainen project and transaction costs.
The production start-up phase has so far been way more expensive than expected.
Another iron-ore mine that is experiencing higher start-up costs and more challenging technical difficulties is Sydvaranger Gruve in Kirkenes near Norway’s border to Russia. After production re-started some few years ago, the company was forced to issue new shares to fund operational improvements and provide financial flexibility for its operation. Several of the mine’s shareholders are now looking for a way out and are offering to sell if they get the right prize.
Sydvaranger Gruve is own by Northern Iron Limited, registered on the Australian stock exchange.
August 9th, the Barents Region celebrated the UN International Day of the World’s Indigenous Peoples. The day was commemorated in several parts of the region, including Karasjok in Northern Norway and Teriberka in Northwestern Russia.
Sports in the Barents region have joined forces and established Barents Games. This weekend athletes from all over the region met in Oulu to compete in 14 differents sports during the Barents Summer Games. See our slide show from the competitions.
People participating in culture-, sport and Barents cooperation projects can from October apply for visa to Norway without paying a single ruble, says Marit Egholm Jacobsen with the Norwegian Consulate General in Murmansk.