Per Helge, Rebirth of Sydvaranger Gruve

2008-11-11

As one of the Norwegian oldest industries (some of the working mines were opened 300 years ago), mining is still a great contribution to the economy of Norway. Mining took place in Sør-Varanger from 1906 till 1997 when it stopped to be cost-efficient as far as the prices for ore concentrate were relatively low. The mining here ceased but in ten years it was reopened due to the fact that ore prices grew up significantly. Presently in Norway there are about 30 operating mines mainly covering European and Chinese steel industry.

– There are two obvious reasons for reopening, says Per Helge Høgaas, general manager operations of Sydvaranger Gruve AS, – one is the price of iron, it’s obvious because this is the market; the other thing is the infrastructure in the mine which is still here after ten years. It can be modernized and thus become operational again so it does not demand a lot of capital investments comparing to building something new.

Sydvaranger Gruve is currently undergoing the construction phase that flows into a pre-production phase and finishes by June 2009. The Company through its subcontractors is currently preparing two ore deposits to implement the pre-production phase this winter, i.e. removing the top soil and the trees, building small roads for the access to the pits so that bigger equipment can come on site in March.

Since the production phase starts, there will be a demand for specialized people, thus in autumn Sydvaranger Gruve is starting the recruiting campaign to find specialists in many areas, mostly welders and constructors, electricians, etc.

– There is no manpower shortage for the time being, says Mr. Høgaas, – Russian labour market is very interesting for us in future. On the opposite side of the border we have Nikel plant and Zapolyarny and we know that they have similar activities, they have open pits, a concentrator, and they have electrical and chemical competence that we need. No Russians are currently working here in Sydvaranger Gruve… we have some Romanians and Lithuanians beside Norwegians. Anyway, we receive a lot of inquiries from the Russian side, and particularly – from Murmansk area, Pechenga, Nikel and Zapolyarny. And also there are some Norwegian people who claim that they have contacts in Russia and they can set up ways to communicate between the Russian side and our area. For future we plan to employ Russian specialists.

First production phase of 2009 expects 7 million tons of production that splits into 4 million of non-valuable materials and 3 million tons of iron concentrate exported then from the harbour area to European countries. The phase two plans to double the output from 7 to 14 million tons. All the activities are regulated by Norwegian pollution agency in Oslo and other Norwegian authorities monitoring the quality of water, the emissions of dust and safety of people.

Major Norwegian shareholder of Sydvaranger Gruve AS is Tchudi owning 51.5% of the stock in Australian holding company Northern Iron Ltd which was formed to acquire the Sydvaranger Iron Project.

by Kazakov Andrey

Source: www.barentsnova.com


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