Eight years after Norilsk Nickel and the Nordic Investment Bank signed the agreements on loan and financial support to the Kola Mining and Metallurgical Company the company in November informed Norway to forget about the deal. The company instead propose to renegotiate both the time-frame and the environmental demands, the Norwegian Ministry of Environment writes on their website.
Under the deal Norilsk Nickel now has withdrawn from, the company should reduce the emission of sulphur dioxide (SO2), dust and heavy metals by 90 percent compared with the emission in 1999.
The emission of SO2 was 97,7 thousand tons in 2008, or five times as much as the entire Norwegian emission of SO2, according to the company’s own environmental report for last year. In the hills around Nikel an ecological desert spread towards the horizon. The forest is dead or heavily damaged tens of kilometres from the plant. Also on the Norwegian side of the border, the environmental impact is considerable.
BarentsObserver has earlier reported that the highest concentrations of SO2 pollution in Norway are found along the border to Russia n the north.
Under the 2001-agreement, Norway was supposed to provide a grant of 270 million NOK (€32 million) and a 10-year loan of $30 million from the Nordic Investment Bank. The grant from Norway was also handled by the Nordic Investment Bank.
According to the contract, Norilsk Nickel was to invest $35 million of its own money to carry out the modernization of the Kola Mining and Metallurgical Company, Norilsk Nickel writes on their website.
So far, no modernization has taken place at the smelter in Nikel. The sulphur dioxide smoke is still blowing by the wind over the harsh and fragile Arctic environment. It is 19 year since Norway first offered Russia financial assistance to clean the smoke from Nikel. Back then, the Norilsk Nickel company was stated owned and its financial opportunities were limited. In 1996, the company was privatized and the margin of profit has sky rocked. In 2005, the net profit of Norilsk Nickel was $2,4 billion.
Parts of the Norwegian grant are however already sent over to Norilsk Nikel. The Norwegian Ministry of Environment says 48 million NOK (€5,65 million) is paid out to the company. According to the ministry, most of this grant is spent on the modernization of the Kola division’s roasting plant in Zapolyarny, also located near the border to Norway.
BarentsObserver reported in September that the modernization of this roasting plant first will be completed in 2012 – two years after schedule.
Most interesting regarding Norilsk Nikel’s back out from the environmental deal is that the reduction of SO2 emission from the modernized roasting plant in Zapolyarny only will lead to more SO2 emission at the smelter in Nikel. The sulphur in the ore roasted in Zapolyarny will stay in the pellets instead of being emitted. But, when the pellets are smelted in Nikel, the sulphur will be emitted as sulphur dioxide, and with no cleaning facility, the SO2-smoke will pollute the environment.
The pollution from Nikel has been a thorn in the Norwegian-Russian relations all the time since the breakup of the Soviet Union. Norwegian Environmental-, Foreign- and Prime Ministers have brought up the issue with their Russian counterparts over the years as occasion offers.
Last occasion was earlier this autumn, at the Barents Council meeting in Murmansk. Norway’s Foreign Minister, Jonas Gahr Støre, confronted the Russian Foreign Minister; Sergey Lavrov, with the extensive environmental problems from Norilsk Nickel’s factory in Nikel.
-This is just not good enough, Sergey, Støre told Lavrov at the joint press-conference after the Barents Council meeting on October 15th, according to the newspaper Aftenposten. Jonas Gahr Støre’s comment come after Lavrov said it is less pollution from Nikel today than before.
On their way to the Barents Council meeting in Murmansk, both Støre and his Swedish colleague Carl Bildt made a short stop in Nikel.
-It was sad to see the factory in Nikel, which alone is still polluting five times as much SO2 as the entire Norwegian amount of SO2 annually, the Norwegian newspaper Aftenposten quoted Støre saying.
In November, the Norwegian Government Pension Fund announced their decision to exclude Norilsk Nickel from their portfolio because the company’s factories on the Taimyr Peninsula in northern Siberia are afflicting environmental damages which clashes with the fund’s guidelines, as reported by BarentsObserver.
-This is deemed to be in breach of the ethical guidelines for the fund, Norway’s Ministry of Finance says in a press statement published on the ministry’s website.
