Workers are reducing salaries to save the mine

Iron ore producer Sydvaranger Gruve is located in Bjørnevatn outside Kirkenes.

All workers and managers at struggling mining company Sydvaranger Gruve are willing to cut salaries to keep their workplace up and running.

Prices on iron ore have been plummeting for quite a while now, putting Sydvaranger Gruve and owner Northern Iron in a difficult situation. The Northern Iron has not made net profits since it started up mining in Arctic Norway in 2009, and deficits are steadily growing.

All employees at Sydvaranger Gruve have agreed to reduce salaries for the next six months in an attempt to uphold and secure today’s activity, newspaper Finnmarken reports.

“It is fantastic to see the will and enthusiasm the employees show when it comes to achieving further improvements – both in operational safety, increased production and reduced costs,” the company writes in a press release. “Employees on all levels have come up with suggestions, many measures have already been taken and others are under consideration.”

Chief Development Officer Harald Martinsen has on his own initiative decided to leave his position, continuing only to represent the mining company as press spokesperson. “We have said that we will leave no stone unturned, and in this case it was my turn,” Martinsen said according to Finnmarken. Martinsen last year had a total salary of NOK 3.3 million (€391,761).

Northern Iron invested about 50 million Norwegian kroner in the re-opening of the Sydvaranger mines in Bjørnevatn and today has 420 people working to bring ore to the markets. The ore is brought by railway to a processing facility in Kirkenes and from there further taken by ships to buyers. In 2014, the entire company production was sold to European buyers.

According to the company, an increase in output is of crucial importance for sustainable future operations. Over the last years, production has gradually grown and is expected to reach 2,8 million tons of iron ore concentrate in the near future. However, the production increase is not without controversy. The company dumps a significant volume of tailings into the local fjord, and the local community is increasingly questions the level of payback to the society.