2. Table of contents
Arctic snapshot
Arctic countries and non-Arctic stakeholders
Arctic shipping and logistics
Overview
Northern Sea Route (NSR)
Northwest Passage (NWP)
Barents Region
Railroads
Roads
Arctic mining
Overview
Arctic mining by country
Mining – logistics
Processing Arctic metals & minerals
Raw material transportation & mining infrastructure
Business opportunities for Finnish companies
3. Arctic snapshot
One of the last unexplored
frontiers rich in natural resources,
minerals, oil and gas
Melting sea ice opens new
shipping routes and business
opportunities
Increasing interest in Arctic
resources from non-Arctic
countries specifically export-led
Asian economies of China,
Japan, Korea and Singapore
Delicate environment and hostile
conditions require advanced
skills, technologies and
equipment for environmentally
safe and sustainable operations
Significant potential, significant costs
4. Arctic countries and non-Arctic stakeholders
Arctic Council
• Founded 1996 as
high-level,
intergovernmental
cooperation forum in
Arctic issues
• Members: 8
geographically Arctic
countries, non-Arctic
observer members
with Arctic interests,
6 organizations
representing
indigenous people of
the Arctic and 6
working groups of
experts, agencies &
researchers
Arctic Council
Members
• Canada
• Denmark/
Greenland
• Finland
• Iceland
• Norway
• Russia
• Sweden
• USA/ Alaska
Non-Arctic
Observer Members
• China
• India
• Japan
• South Korea
• Singapore
• United Kingdom
• EU members:
Germany, France,
Poland, Italy,
Spain, Holland
• EU’s application is
pending
5. USA/ Alaska
Economy relies on oil, gas & mining industries
Significant mineral potential: gold, silver, copper,
coal, zinc & lead
Access to resources possible as technologies develop
Road-to-Resources projects connect mining sites to
existing road & rail systems
Umiat, Ambler & Nome projects
Existing 800-mile trans-Alaska pipeline for crude oil
transportation, deterioration due to melting permafrost
& lower oil flow volumes in pipeline
Plans for LNG pipeline from Prudhoe Bay down south to
Kenai: Cost $45-$65 billion
Possibility to export to Asia
Plans include a multi-billion liquefaction plant and export
terminal in Nikiski area
Exxon Mobil, BP & Conoco-Phillips
Long-term investment needs for ports, icebreaking
capabilities, improved satellites and road & pipeline
maintenance
$8M allocated for icebreaker research and planning
No current deep-water ports along the Arctic coast, 14
possible sites proposed and investigated
Nome & Port Clarence/ Teller front runners on the west coast as
first developments
6. Canada
Territory dispute over shipping in Northwest Passage –
Internal vs. international waters
World’s second largest uranium producer, large supplier of
gem-quality diamonds
Major mining destination with significant new potential for
mining & natural resources development in Nunavut and
Northwest Territories (NWT)
Geomapping problem in the north
NWT economy is mining, oil & gas dominated, further
potential and growth in mining diamonds, rare earths, cobalt,
silver, nickel, gold and zinc; 300 developed wells and 70
exploration wells for oil and natural gas
Nanisivik deep-water port in Nunavut under development
Emerging clean energy giant, support responsible and
sustainable development of oil & gas industry in the North
Corridors for Canada project – Plan for strategic
investment in NWT transportation infrastucture: Mackenzie
Valley Corridor valued at $1.7 billion, also $65 for bridge
rehabilitation & repair, $600 million for transportation
infrastructure
Nunavut region attracts mineral exploration
Looking to launch a new polar ice breaker within the next
decade
7. Greenland
Autonomous state economically dependent on Denmark
New Government in 2013 – pro-mining, lift uranium ban and allow extraction &
export of radioactive uranium.
Subject to Denmark’s approval
Mining industry supports government’s efforts towards economic independency,
growth and improvement in the country’s social status
Attractive mining destination as ice sheet shrinks and mining season becomes
longer – potential for lower-cost mining, one-stop regulatory system (Bureau of
Minerals and Petroleum), year-round access to ocean transportation
Rich in natural resources and potentially hydrocarbons, large deposits of rare
earth elements, uranium, iron ore, gold, diamonds, lead, nickel, copper and
zinc
Currently 20 exclusive and 25 non-exclusive hydrocarbon exploration licenses
offshore
Over 30 new prospecting licenses for mining in 2012
Nalunaq gold mine, owned by Angel Mining, only producing mine
Possibility of hydroelectric power in mining activities
Alcoa planning an aluminum smelter
Interest from Chinese, Korean & Western mining companies
London Mining has $2.35 billion mining project in Isua
Pollution and environmental risks of mining raise concerns
No roads between towns, all transportation via sea or air, currently two ice-free
ports: Nanortalik and Sisimiut
Possibilities for new ports along the coast with access to deep water
8. Iceland
Large aluminum industry with 3 smelting
plants operated by U.S. companies –
powered by inexpensive hydropower
Planned expansions include 2 new plants
Abundent geothermal & hydropower
resources – potential for an energy hub
Feasibility studies on possible underwater
power cable to export unused power to
Europe
Potential shipping/transhipping hub
Gateway to Northwest & Polar Passage,
Northern Sea Route & Atlantic
New deep-water port under construction
in Finna Fjord, northeastern Iceland by
German Bremenports in cooperation with
Icelandic government
Port is free of ice year round, close to
regional oil, gas & mineral deposits north
and west of Iceland
Possible refining center for imported
minerals from Greenland & Canada where
refineries are far from mining sites but ocean
access is a possibility
9. Finland, Sweden & Norway
Finland
• Knowhow in Arctic
maritime technology,
onshore & offshore,
icebreaking
• Arctic oil recovery
• World leader in
icebreaking technology
• New Oblique Icebreaker by
Aker Arctic Technology
• Ice management
knowhow and expertise
• Large mining industry
with growth potential,
seeks international
investments
• Infrastructure
developments
• Promote exports and
attract foreign
investments
Sweden
• Significant mineral
deposits with growth
potential
• Expertise in Arctic
shipping
• Mining and petroleum
sector support
activities: experience,
systems, machine
suppliers
• Focus on Arctic
transportation
infrastructure
developments
• Ice breaking resources
and expertise
Norway
• Economy relies on
hydrocarbons – Nearly
all energy from
hydropower
• Energy: Oil & Gas
exporter
• Significant offshore wind
power potential
• Shipping: Arctic ports in
Narvik and Kirkenes
• Cooperation with Russia
as a priority
• $200m budgeted for
Arctic initiatives
• Svalbard islands major
coal producer
• Mapping of mineral
resources in the north
10. Russia
Energy giant: Oil and
gas industry, significant
hydrocarbon reserves
Oil & gas production on
the shelf offshore and on
land – Energy security
Large mining industry
Develop infrastructure
along the Northern Sea
Route
Economic growth: Link
between Northern Sea
Route as international
cargo route and
economic development of
northern Russia
Provides permits, port
services & icebreaking
services for the NSR
Transport LNG from
Russia to Asia in 2018
Energy
•
•
Development plans by
2020: Timano-Pechora
oil & gas provinces and
hydrocarbon fields on
the continental shelf in
the Barents, Pechora
& Kara seas and the
Yamal and Gydan
Peninsulas.
Exports to Europe and
Asia
Mining
•
•
•
Main Arctic areas: Kola
Peninsula, East Siberia
& Russian Far East
Most current
production is for
domestic use
Iron ore, coal,
bauxite, copper,
gold, nickel &
diamond - lower grade
& quality diminish
value
Shipping
•
•
•
Support to construction
of icebreaking, rescue
& support fleets,
coastal infrastructure
16 current ports
needing upgrades +
Sabetta &Teriberka
under construction
1 new nuclear powered
ice breaker under
construction costing
€1.1BN, 2 more
planned
11. China
Strategic buyer of Arctic resources
Interests in energy, minerals and new
shipping lanes – China has capital &
willingness to pay
Targets Greenland, Canada, Russia
and Iceland
Increasing demand for energy – Future
strategic buyer of Arctic energy from
U.S., Canada & Russia
Capital to support Arctic projects, export
labor
Buying shares from Arctic resource
development companies to gain foothold
5 Chinese mining companies currently in
Greenland
Natural resources are vital to China’s
modernization efforts
95% international market share in rare
earth elements – Leader in refining
rare earth elements
China offers to invest in infrastructure
projects in Greenland in exchange for
mineral extraction licenses
Free trade agreement with Iceland –
Interest as a shipping hub, access to
Arctic waterways, NSR
NSR offers China faster access to
European markets
China will double oil imports from Russia
and explore 3 artic offshore areas for oil
with Russian Rosneft
Possible oil & gas pipelines from Russia
to China
Bought Canadian oil & gas company
Nexen in 2013 for $15bn
Chinese firms have invested $400m in
small scale mineral & petroleum projects
in Canadian Arctic
12. Japan
Arctic energy importer
Japan is the largest importer of
liquefied natural gas (LNG), the
second largest importer of coal and
the third largest of oil.
Arctic Ocean's hydrocarbon resources
as a potential alternative energy supply
source to Middle East
Possibility of developing and
transporting natural resources in the
Arctic
LNG shipments planned from Norway
& Russia to Japan in 2018
Seeks to increase presence in
resource development in the Arctic
and Arctic commercial shipping
NSR: shorter distance from Japan to
Europe
Import of raw materials for industrial
purposes
Focus on the effects of Arctic shipping
Possibly design & develop ice class vessels
Follow China & Korea and maintain
marine transport capacity in the Arctic
Japan-Russia relationship development
Science and technology consultation
agreement to provide further economic and
industry development of Japan and Russia
13. Roles and interests of other non-Arctic countries
Korea
Singapore
India
• Interest in energy, minerals & shipping
•
Shipping stakeholder
•
• Maritime industry: Shipbuilding,
transportation and logistics
•
Member of International Maritime
Organization (IMO), Strong interest in
global shipping development
Views itself as an Arctic
stakeholder
•
Interest in Arctic energy
•
Fast growing domestic energy
consumption
•
Oil & gas for energy security
• Experience in building ice-strengthened
cargo ships
• Acquired Aker Finnyards & their
technology for ice navigation: the
double-acting ship - provide cargo ships
for Barents and Kara seas
• Daewoo to build up to 16 ice-class
LNG tankers to NovaTek (RUS)
•
•
Interest in Arctic shipping and
offshore activities
•
Expertise in major port facilities
•
Potential for the Offshore & Marine
Industry – Singapore's Keppel
Offshore and Maritime & Sembcorp
Marine have technologies for offshore
drilling in hostile environments
• Interested in shipping along the NSR
and Arctic mineral & energy
resources
• Depends on imported natural resources
• Greenland exploration deal for rare
earth elements, tungsten & cobalt
• Emerging rare earth refineries in Korea
• Port development along the NSR in
cooperation with Russia
Global maritime knowledge hub by
2025
•
Keppel and Marine delivered 2
Arctic icebreaking vessels to
Russia's Lukoil in the Barents Sea
•
2013: Keppel & ConocoPhillips
designing a pioneering jack-up rig for
offshore Arctic drilling
•
Growth in related industries
(supply vessels, logistics IT
repair & support)
•
Imports 80% of energy
•
Plans pipelines to tap into Arctic
oil and gas reserves in Russia
•
Natural resources for food &
resource security
•
New shipping routes as India
grows and becomes a bigger
player in international trade
•
Significant interest in climate
change research in the Arctic –
direct impact on Indian monsoon
•
Arctic research station on
the Svalbard Islands
14. Roles and interests of other non-Arctic countries
United Kingdom
•
New shipping routes create
opportunities for ports
•
Stornoway port in Scotland a
possible European Arctic gateway
hub for shipping, refueling station
EU
•
EU Commission’s observer status to
Arctic Council is currently pending
•
Presence through Germany, France,
Italy, Spain and Poland as non-arctic
observer members; Finland, Sweden
and Denmark as Arctic members
•
Insurance and re-insurance agencies
for Arctic shipping companies
•
•
New sources of oil, gas, minerals and
fisheries
Main interest stems from climate change
and its impacts on society
•
•
Commercial interests: BP & Shell oil
and gas exploration and drilling in
Arctic regions
Environmental sustainability as a
driving force behind Arctic development
•
EU is a large consumer of Arctic energy
and minerals
•
Leased an icebreaker in the Arctic
•
Political and security concerns over
increased interest in Arctic resources and
transportation channels
17. Arctic logistics overview
Arctic logistics focus on the transfer of resources to and from Arctic locations via shipping lanes, roads and railroads.
Remoteness and harsh conditions of Arctic locations bring costs of new infrastructure developments in the area very
high. However, infrastructure developments are a prerequisite for successful and safe Arctic resource exploitation.
Arctic logistics include shipping routes, roads and
railroads, also pipelines for oil and gas transportation
Shipping routes, NSR & NWP need significant
investments in port facilities
Rehabilitation of existing ports, more capacity &
services
New deep-water port construction
Search & Rescue preparedness
Mapping, navigation & communication technologies
Roads: Alaska & Canada have long-term investment
plans for infrastructure developments in the North
American Arctic
Connect mining sites to existing road networks
Railroads: Focus in Barents region where different rail
standards in Finland, Sweden, Norway and Russia pose
a challenge to cross-border transfer of raw materials
Selected logistics developments
Barents Region Arctic deep-water ports: Narvik, Kirkenes &
(NOR, SWE, FIN & Murmansk, new railroads and increased capacity to
northwestern Russia support mining activities
Alaska
Road-to-Resources: Umiat, Nome & Ambler; Deepwater ports: 14 suggested sites, Nome & Port
Clarence most advanded developments
Canada
Corridors for Canada: NWT infrastructure
developments
Greenland
Shipping hub: Possible port development, quick
access to deep water
Iceland
Shipping hub: Finna Fjord deep-water port
construction
Russia
Rehabilitation and upgrading of existing ports, 2
new deep-water port sites (Sabetta &Teriberka),
development of new pipelines
18. Arctic shipping
Melting sea ice has increased
traffic in the Arctic waters
Arctic could be ice-free by 2050
Export opportunties for natural
resource, energy, oil & gas
transportation
Shorter maritime distance
compared to Suez- and Panama
Canals results in faster
shipping times and potential
cost savings
Challenges:
Port infrastructure
Ice management
Icebreaking services & high costs
Ice Class vessel requirements
Short operating season
Inadequate mapping of Northwest
Passage
Navigational challenges
Lack of emergency preparedness
Search & rescue services
Environmental issues
19. Northern Sea Route (NSR)
2500
Northern Sea Route Traffic
2000
2000
2013
620 ships had permits to sail parts of NSR in 2013
1300
1500
1000
500
260
34
46
2010
0
4
2011
2012
Number of transits
2015
2020
Avoids unrest of Suez Canal, seasonal supplement, current season
is from July to November
Energy-hungry Asian markets - shipments of liquified natural gas
(LNG) and oil from Barents Sea & Siberia
Russia investing in infrastructure along the route: 16 current ports &
2 ports under development (Sabetta & Teriberka)
Increased commercial traffic in NSR link to economic development of
Russian Arctic
Shipping costs potentially competitive with time savings if large
ships can sail with full cargo loads
Ice breaker escort through NSR $200,000 (Lloyds)
Major opportunities
500
71
2013
From Barents Sea to Bering Strait
Year-round navigation since 1978 in western NSR
Vessel traffic rapidly increasing from 4 vessels completing the
route in 2010 to 71 in 2013
71 vessels sailed the whole route and transported 1,355,900 tons of cargo in
2030
potential number of transits
www.arctic-lio.com, Northern Sea Route Information office
Ice Class vessel development
Port and pier infrastructure, safety and service development
Mapping, navigation and communications technology
Energy, oil and natural gas transportation to Asia
5-15% of China’s European trade could use NSR by 2020
LNG trasport from Norway to Japan possibly in 2018
20. NSR vs. Suez Canal
NSR is up to 50% shorter in distance
It can cut down 12-15 days of shipping
time compared to Suez Canal
Capacity restrictions due to narrow
straits & ice conditions – vessels cannot
be wider than icebreakers
Additional costs of NSR
Icebreaker assistance cost depends on
Ice class of the vessel
Ice conditions in the area
Distance of escort
Time of navigation
Insurance
Variability in transit time due to weather
conditions
Construction standards and crew training
Current shipping costs are significant and
uncertain conditions along the route
discourage shipping time sensitive cargo.
However, future potential remains.
Kirkenes/Murmansk – China
• NSR is 16 days faster
• Requires 750-1,000 tons less fuel,
savings up to $650,000
Dailan (CHN) – Rotterdam
• NSR is 9 days and 2,800 nautical
miles shorter
• Average cost of mandatory
icebreaker escort $200,000 (Lloyds)
Yokohama – Rotterdam
• Suez has lower costs per container
due to capacity restrictions in NSR
Yokohama - Rotterdam
Route
NSR
Suez Canal
Distance
7,600 nautical miles
11,300 nautical miles
Time
26 days
36 days
Capacity
2,000 containers
6,500 containers
Total cost
$2.5 million
$3.5 million
Cost per container
$1,250
$538
21. NSR shipping development
Cargo increase from 1.4 million tons in 2013 to up
to 4 million tons by 2015
Sort out all navigational blank spots, and
upgrade all navigation maps with route depth
data by 2016
€23.4 million invested in 10 emergency and
rescue centers along NSR by 2015. Main
centers Murmansk (2013), Naryan-Mar
(operational in 2013), Dudinka (2012), and
Anadyr. Subdivisions planned for Arkhangelsk,
Vorkuta, Nadym & Tiksi
Extra aircraft (10 helicopters & 8 aircraft) to
stations in Murmansk, Novaya Zemlya, Dikson and
Mys Shmidta
Development plans: new Arctic rescue ship,
military ice-capable transport, new icebreakers to
replace aging fleet - €1.1BN ice breaker under
construction in St. Petersburg, 2 more planned
Vision of NSR as a key transport route in global
scale
Public-private collaboration for financing
Sabetta port (construction underway)
Part of Yamal-peninsula LNG project
€1.82 billion, funded as a public-private partnership,
majority govt funding
Capacity of 30 million tons annually by 2020
LNG shipments to Europe, Asia & Americas
Teriberka Port
Construction depends on Shtokman LNG
development
Port for exporting LNG from Shtokman field in the
Barents Sea
Costs $2 billion
Planned capacity of 30 million tons annually
22. Northwest Passage (NWP)
•
•
•
•
NWP extends along northern Canada from Baffin • No current deep-water ports along the route
• Port development plans are in place for Alaska’s
Bay to Beaufort Sea
Suffers from poor mapping and uncertain ice
Arctic coast (Nome & Port Clarence) and
conditions
Nanisivik in Nunavut, Canada
Mostly used for community supply, minimal
• Need for mapping, navigation & communication
commercial traffic
technologies
• First commercial bulk carrier sailed the route from
• Increased traffic from NSR has increased traffic in
Vancouver to Finland in 2013 carrying 25% more coal
Bering Strait between Russia & Alaska – need for
than possible through Panama Canal
more visible U.S. presence off the coast of Alaska
Need for more icebreaking capabilities
Bering Strait traffic
Northwest Passage traffic
25
22
21
18
20
7000
19
5000
15
10
6000
6000
Number of
transits
4000
7
Potential
number of
transits
3000
5
2000
0
2009
2010
2011
2012
Number of vessels
2013
1000
425
400
3000
480
0
2010 2011 2012 2017 2020
23. NWP shipping developments - Alaska
Alaska’s advanced Arctic deep-water port developments in
Nome and Port Clarence are motivated by increased vessel
traffic in Bering Strait, 60% foreign vessels
Increased activity requires increased presence
In 2012 480 ships transported 3 million tons of cargo, in 2020 up to 50
million tons as NSR traffic from Russia increases
Within the next 10 years U.S. will have a need for 2 new ice
breakers ($1BN / piece), new air station in Point Barrow with
3 helicopters and a deep water port with response presence
and infrastructure
Proposed deep water port
sites in Alaska
St. Paul Island
St. Lawrence Island
Nome
Port Clarence/ Teller
Kotzebue/ Cape Blossom
Mekoryuk
Cape Thompson
Wainwright
Port Franklin
Barrow
Prudhoe Bay
Mary Sachs Entrance
Bethel
Cape Darby
24. NWP shipping developments - Canada
•
•
•
Infrastructure developments
are needed, high costs
postpone plans, reduce scope
of projects
NWP mainly used for
community supply and
tourism, majority of vessels
private yachts
Canadian Space Program
supports Arctic developments
•
•
•
•
•
Security and safe navigation
Atmospheric and weather
forecasting
Deep-water port
development in Nanisivik
Route development
significantly lacking
compared to NSR
Commercial potential
remains low
25. Arctic shipping – Role of Arctic countries
and non-Arctic stakeholders
Russia sees Northern Sea Route (NSR) traffic China, Japan and Korea need resources,
as a key to economic development in northern
Russia
Norway has Arctic ports for cargo
transportation in Narvik and Kirkenes
Iceland as a potential shipping/ transshipping
hub for access to NSR, NWP and Atlantic
Greenland has potential for deep-water ports
Finland is world leader in cutting-edge
icebreaking design and technologies, deep
expertise in ice management
Sweden has technologies for icebreaking and
Arctic shipping
U.S. sees increased international vessel traffic
in Bering Strait – Need for increased presence
Canada lacks infrastructure along NWP
energy and raw materials, NSR is a viable
option for shipping through politically unstable
Suez Canal
China: Potential to ship 5-15% of exports to
Europe through NSR by 2020
26. Arctic shipping - Options and possibilities
Port & pier infrastructure development along
Arctic shipping lanes in Russia, Canada and
USA, also Iceland and Greenland
New and updated facilities and services
Mapping technologies for NSR & NWP
Navigational and communication
technologies development, also better vessel
monitoring and surveillance to increase safety
Search and rescue centers, emergency
preparedness in case of oil spills and pollution
is needed
Ice management for improved safety and
mitigation of environmental risks
Forecasting, monitoring & detecting
Detect first-year ice vs. multi-year ice
Physical ice management (ice breaking, iceberg
towing)
Icebreaking technologies: Icebreakers,
icebreaking services, ice-class cargo vessels
Transshipment hubs where cargo will be
loaded for rail, road or smaller vessel
shipments
27. Barents region shipping – Norway & Russia
Barents region ports are used to export products
from mining, oil & forest industries to Europe,
America and Southeast Asia
Murmansk
Base for Arctic icebreaker fleet
Expansion of railroad capacity to port
Transshipment hub
Expansion possibilities to western shore,
warehouse and cargo terminal facilities
Arkhangelsk
Bulk cargo gateway
Need for extensive icebreaker assistance –high
operating costs
Possible new deep-water area
Kirkenes
Potential transhipment hub
Primarily iron ore to EU
Possible connection to Russian railway system
Tromsø
On-going development and capacity expansion
Narvik
Strategically important bulk cargo port
Expansion to continue
28. Barents region shipping – Finland & Sweden
•
•
•
•
Gulf of Bothnia offers access to the Baltic Sea and
towards southern Europe
Mainly for raw material transportation
Shipping is more economically feasible for the
industries in the area than using the rail network
Potential for growth
www.regjeringen.no/pages/38466475/JointBaren
tsTransportPlan200913r.pdf
Challenges
Shallow waters
Fairways and port must be dredged
regularly
Icebreaking
Winter ice increases shipping costs
Sulphur directive
Increase shipping costs 25-40%,
effective 2015
Umeå
Forest products & general goods
Connection to Vaasa for passenger and
freight traffic
Luleå
Large volumes of bulk cargo
Funding granted for capacity expansion
studies
Oulu
Moderate bulk cargo volumes
29. Finland’s expertise in Arctic shipping
Ice management expertise
Aker Arctic Technology (AARC)
Designed over 50% of world’s
Forecasting, prediction & tracking technologies
Detection & monitoring technologies
Satellites, areal surveillance, ship-based
systems, radar technologies
Ice management vessel operations
Online ice load monitoring, data archiving and
continuous training
World leader in Ice breaking
60% of the world’s ice breakers built in Finland
80% of icebreakers designed in Finland
Nearly 100% of icebreaker propulsion units done in
Finland
Ice Class vessel design & technologies
Ice strengthened cargo ships
Ice Class vessels for mineral transportation
Innovation in environmental technology for oil
spill recovery
Oil spill clean-up products
Oil recovery vessels
icebreakers
Arctic & Antarctic research vessels
Cargo vessels & offshore structures for
harsh climates
Unique technologies (double-acting
vessels, reduced energy usage through
electric azimuthing thrusters (Azipods),
oblique icebreakers
Technologies to meet new emission
standards
New design on Arctic floaters and
multipurpose and ice management
icebreakers
Conceptual and basic design work for
new polar icebreakers for Canada and
China
30. Arctic logistics - Railroads
Barents region
Railroads for mineral and
mining industry
transportation
Challenge: Two different
rail gauge standards in
Finland, Sweden, Norway
and Russia
Electrification of railroads
Possible 60km rail link
between Salla and Alakurtti
to connect Finnish and
Russian rail networks
Possible railway from
Rovaniemi to Sodankylä to
support mining industry in
central Lapland
Norway: Nordland line
along the coast – remote
control, increase in
capacity planned
31. Arctic logistics - Roads
Barents Region - Map
Cross-border freight traffic expected to increase
significantly
Narrow roads limit traffic volume growth
Inadequate accessibility and road safety – lacking
by-pass lanes, central barriers
Bottlenecks – Poor horizontal and vertical curvature,
difficult gradients
Norway
Tunnels and bridges need rehabilitation
E6 construction EUR 50M
E8 high priority, EUR 53M for the next 4 years,
significant increase in funding up to 2023
Mo i Rana from Umeå EUR 48M
Bodø National road 80 EUR 250M 2014-2017
Russia: Murmansk – Kirkenes
Export of goods, passenger traffic between
Russia & Norway
E105 construction: EUR 46 million in Norway &
EUR 40-65 million in Russia
Different vehicle regulations regarding weight &
lenght
Cross-border cooperation is a prerequisite for
economic growth
Canada: Corridors for Canada
Total investment of $600M
$415M Provincial-Territorial fund
$185M National Infrastructure Fund
Finland
Add capacity Kilpisjärvi – Palojoensuu (EUR 50 million)
Sweden
National road 99 reconstructed 2013-2015 due to
mining expansion in Kaunisvaara
Northwest Territories transportation
Mackenzie Valley Corridor
Alaska: Road to resources
Umiat oil and gas fiel access road
Ambler mining distract access road
Road to Nome – Tanana access road
33. Corridors for Canada – Mackenzie Valley
Corridor consists of existing marine
resupply route and winter road,
and proposed all-weather
highway and fiber optic link
Largest single investment in
Northwest Territories
$600 million over 10 years to
improve air, marine & road
transportation infrastructure
Mackenzie Valley Corridor total
estimated value $1.7 billion
$127M allocated to improve
Mackenzie Valley Highway (National
Infrastructure Fund)
Includes bridge rehabilitation and/or
construction
Completion of HW from Wrigley to
Tuktoyaktuk on the Arctic coast
Back to logistics
34. Road to Resources - Alaska
Ambler
Ambler Mining district access
Brooks Range East Corridor
225-mile long from Dalton HW to
Coldford
$430 million
Umiat
Oil and gas field access
$10M allocated
Nome
Road to Nome – western Alaska
access would cost $3BN
Road to Tanana project (part of
Road to Nome) $10M allocated
Back to logistics
36. Arctic mining overview – opportunity vs. uncertainty
+ Mining industry growth is driven by
+
+
increasing global demand for resources,
minerals and energy
Arctic coastal regions are more attractive
due to ocean transportation possibilities
– lower development costs
Technological improvements
+ arctic mining technically feasible and
commercially viable
+ Uncertainty about access to resources in
+
−
other regions in the world attract investors
to the Arctic
Mining offers long-term economic
development opportunities for the Arctic
Development is guided by commodity
prices
Falling prices can cancel, delay or scale back
arctic mining projects
− Infrastructure lacking in most of the
Arctic region
Photo courtesy of Diavik Diamond Mine in Canada
37. Arctic mining – Barents region
Norway, Sweden, Finland
& northeast Russia
Strong mineral potential
Area contains nearly 600
mineral deposits, 110 are
currently active mines
More than 40 active metal
mines, 10 opened or
reopened in the last decade
Current year-round Arctic
ports for mineral
transportation in Narvik &
Kirkenes in Norway and in
Murmansk, Russia
New infrastructure
developments for roads,
rails and sea transportation
to support economic growth
38. Arctic mining – Finland, Sweden & Norway
Sweden and Finland have
significant mining industries while
Norway relies mostly on its
hydrocarbon reserves
2011: Sweden & Finland
provided 28% of EU’s gold
production, 27% of zinc, 17.5%
of silver and 11% of copper
Governments pro-mining,
encourage exploration and seek
new investments – international
financing is needed to exploit new
mining potential
Geological information on
deposits is readily available in
Finland & Sweden
Transportation Infrastructure
investments are needed for longterm resource development
Significant increase in transport
volumes as new mining developments
take place
Mining snapshot
18
16
16
14
Large active mines
13
Potentially large
deposits
12
10
10
8
6
Large unexploited
metal deposits
8
6
6
5
4
4
4
2
0
Finland
Sweden
Norway
39. Mining in Norway
Deposits of industrial minerals, building materials, stone,
metallic ores and energy minerals
Industrial minerals provide growth
Coal production in Svalbard
Iron ore production declining due to exhausted reserves
Producer of aluminum, cadmium, cobalt, copper,
ferroalloys, nickel, steel and zinc – Production is
decreasing
60% of mineral production is exported
International companies dominate the market
Domestic share of mineral production supports local mineral
processing industry (plants & smelters)
Goal to increase exploration activity
Annual budget of EUR 3.3 million to increase knowledge about mineral
Large active
mines
Potentially large
deposits
Large unexploited metal
deposits
Bjomevatn
Brattbakken
Engebofjellet
Fisketind Ost
Gallujav'ri
Lauvneset
Kjellmannsåsen Grinder
Nordli
Ortfjell
Selvåg
Tellnes
Rai'tevarri
resources in the region
Geological survey is mapping minerals of northern Norway
Nordic cooperation in mineral research
40. Mining in Finland
•
Gold, chromium, zinc, copper and nickel
•
Long mining tradition and readily available geological data
support mining industry
EUR 300 billion worth minerals in Finnish bedrock
Total of 50 mines and quarries operating in 2012
62% of EU’s cobalt production comes from Finland
Growth requires increase in transportation capacity
Internationally valued competences and equipment
manufacturing for mineral industry
Continuous growth needs international investments
•
•
•
•
•
•
•
All chromium to Outokumpu in Tornio for steel production
Large active mines
Potentially large deposits
Hitura
Jokisivu
Kemi
Kevitsa
Kutemajärvi
Kylylahti
Laivakangas
Pahtavaara Au
Pampalo
Pyhäsalmi
Siilinjärvi
Suurikuusikko
Talvivaara
Akanvaara LC
Akanvaara UC
Akanvaara ULC
Koitelainen LC
Perämaa
Sakatti
Soidinvaara
Sokli Nb
Large unexploited metal
deposits
Ahmavaara
Koitelainen UC
Konttijärvi
Lumikangas
Siika-Kämä
Sokli
41. Mining in Sweden
Sweden is the largest producer of iron ore in the EU – also a major producer of
copper, zinc, lead, gold and silver
Mines in northern Sweden produce iron ore, zinc, copper and gold
Mining employs 82% of workforce in the north
Plans to expand current production and open several new mines
Potential to increase mineral production three-fold by 2025 – greatest potential in
iron ore
Requires better infrastructure for goods transportation and more efficient permitting process
Large active mines
Potentially large deposits
Large unexploited metal deposits
Aitik
Björkdal
Dannemorafjältet
Garpenbergsfältet
Gruvberget Fe
Kankberg nya
Kiirunavaara
Kristineberg
Lovisagruvan
Malmberget
Maurliden Västra
Maurliden Östra
Renström
Svartliden
Tapuli
Zinkgruvan
Akkavare
Häggån
Myrviken
Ranstad
Routivare malmfält
Rönnbacken
Smålands Tabergs gruvfält
Sundsberget
Tåsjö
Vinberget
Fäboliden
Lappmalmen
Laver-nya
Norra Kärr
Palotieva
Pattok
42. Arctic mining - Russia
One of the largest mineral producers
Continuous exploration for new
mineral deposits
Exceptionally rich in mineral resources
More than 700 minerals have been
discovered
Apatites, iron ores, nickel, rare earths,
semi-precious stones, diamonds
Year-round deep-water port in
Murmansk – access to north Atlantic
Vast mineral processing industry
Iron
Nickel
Aluminum
Apatite ore
2008 over 8 million tons of ore and 110
000 tons of nickel produced in Murmansk
county
Kola peninsula & Karelia
27 active mines
World’s largest apatite deposit
35 potentially large deposits
38 large unexploited metal deposits
Smelters and refineries
Suffer from poor environmental
standards
Pollution problem
Growth in coal production in Siberia
& Far East
Nornickel (Kola peninsula & Taymyr
peninsula)
World’s largest nickel producer is
looking to invest $35bn by 2025 in
non-nickel mineral resource
production (chromium, coal, iron ore)
43. Mining in Alaska
•
•
•
•
•
Large deposits of gold, silver, copper, coal, lead and zinc
2012 mineral production valued at $3.4BN ($1.43BN north
Alaska)
3 refineries for gold and 1 for silver
Minerals are exported mainly to Asian markets
Road-to-resources: Ambler mining district (North) & Road
to Nome/Tanana (West) current projects
Producing mines
Red Dog: Zinc, lead & silver
Fort Knox: Gold
Greens Creek: Silver, zinc, gold, lead
Kensington: Gold
Pogo: Gold
Usibelli: Coal
Nixon Fork: Gold, copper
$330M invested in exploration projects
(90% from Canada)
$34M northern Alaska
$90M eastern interior
$16M western Alaska
$340M in development projects
$40M in northern Alaska
$162M eastern interior
$37M in western Alaska
Advanced exploration projects in Pebble,
Livengood and Donlin Creek (59% of
exploration expenditures), Bokan
mountain, Chuitna, Niblack, Upper Kobul
and Wishbone Hill
44. Mining in Canada
World’s largest mining countries
Mineral exploration & mining: key drivers of
economic growth in the north
Since 2004 Canada has attracted 16-19% of the
world share of mineral exploration
Half of income in NWT from mining
Significant deposits of gold, iron ore, diamonds,
uranium, base metals, cobalt, zinc and rare
earth elements
Geoscience problem: 73% of Nunavut is
unmapped or has inadequate geological maps –
geoscience information is critical for exploration
Geological mapping is strongly supported by the
government
Geoscience efforts north of 60 degrees
Canadian Space Program activities support Arctic
developments
Space-ground infrastructure to advance the utilization of
satellite data
Inadequate public infrastructure - obstacle to
growth in resource sector
Long & complicated regulatory process -
$140 billion in mining projects over the next
decade
Broad supplier network for mining industry
challenge to new investments
Aging smelters and refineries in southern Canada
45. Geomapping (GEM) project areas
Geomapping for Energy and Minerals Program (GEM)
$100 million investment 2008-2013
$38.6 million in Nunavut
$15.6 million in Northwest Territories
46. Mining in Canada
Advanced Exploration Projects in the
Northwest Territories and Nunavut
Natural resource development in the northern
regions faces social, economic, infrastructural,
environmental and regulatory challenges
NWT has 4 procuding mines: 3 diamond & 1
tungsten + 2 advanced developments and 7 other
mineral projects – 2000 new mining jobs projected
by 2020
Main regions: Dehcho region & Slave Geologic
Province
Nunavut: Growth in investments, Hope Bay and
Mary River projects combined value $ 6 billion
Mary River investment estimate $40 billion by 2040
Corridors for Canada projects for transportation
infrastructure developments
Transportation access challenge
Exploration costs in areas that are distant from
transportation are significantly higher than costs
closer to transportation networks
Energy access challenge
Nunavut relies on diesel
NWT benefits from hydropower (36% of total)
(Statistics Canada, 2012)
47. Mining in Greenland
Significant deposits of gold, uranium, iron ore, zinc and
rare earth elements
Government pro-mining, lifted 25-year uranium ban in
2013 (subject to Danish approval)
Bureau of Minerals and Petroleum only stop for permits
and licensing
Year-round access to ocean transportation, mineral
deposits close to shore
Development depends on new infrastructure and
international investments
One producing gold mine, tens of exploration projects
and potential developments
Deposits hold high-grade metals and minerals
Possibility of using hydropower
Alcoa’s Aluminum smelter development
Limited infrastructure significantly increases exploration
and mining costs
Isua development by London Mining valued at $2.35
billion, includes a processing plant, 105km pipeline to
deep-water port and water & wastewater treatment plants
Greenland Minerals & Energy is developing $810
uranium & rare earths mine in Kvanefjeld, production to
start in 2017
Lack of skilled labor, environmental concerns
More information and detailed, interactive maps www.geus.dk
48. Mining in Iceland
Scarce mineral resources
Abundant renewable energy
resources
Hydropower & geothermal
energy
Large aluminum and
ferroalloy industries
3 current aluminum smelters
and 2 new planned by Alcoa
& Century Aluminum
Plants rely on imported raw
materials and inexpensive
geothermal and hydroelectric
energy
Finna Fjord deep-water port
to support mineral shipping,
access to NSR & NWP
49. Arctic mining summary
Minerals in
Economy
Outlook
Canada
Industrial mineral mining $4.3
billion, metal mining $3.6 billion,
coal $900m
Exploration projects in Nunavut
& NWTerritories, infrastructure
development
Access to energy and
transportation networks, short
construction season, high costs
Nunavut: Hope Bay gold mine $2
billion & Mary River iron ore mine
$4 billion
Finland
Processor and refiner of copper,
nickel and zinc
Production of nickel & zinc likely
to increase, market interest in
rare earths
Attracting international
investments, transportation
capacity bottlenecks
Hannukainen iron ore mine (part of
Kaunisvaara in Swe), Sokli
phosphate mine
Greenland
Dependent on subsidies from
Denmark. Mineral industry to
promote economic
independency
New mineral deposits likely to
be discovered, govt pro-mining,
new prospecting & exploration
licensed issued
Lack of skilled workers, high
development costs
Isua iron ore mine by London
Mining $2.35 bn, Ilimaussaq rare
earths mine $2.3bn, Kvanefjeld
rare earths $2.3bn
Iceland
Exports 2% of global aluminum
& 1% ferrosilicon
Oil & gas exploration offshore,
aluminum industry to expand
Shortage of skilled workers
2 new aluminium smelting plants
Norway
Natural gas and petroleum
sectors dominate. Mostly for
exports
Exploration drilling in the
Barents Sea, hydropower,
industrial minerals
Attracting international
investments, geological mapping
of the north
Potential in Repparfjord in
Finnmark for copper
Russia
Mining contributed $273.3
million to GDP.14.6% of all
investments in economy to
mining industry.
Expansion in production &
holdings. govt regulation to
benefit beryllium, rare earths &
tin.
Remote locations,.high costs
Norilsk mining centre $3bn 10- year
investment plan
Sweden
Metal mining & metal products
dominate, leading mineral
exporter in EU
Base-metal, gold and iron ore
deposits are developed and
exploited actively,
Attracting international
investments, increasing
transportation capacity
Kaunisvaara (Sahavaara and Tapuli
mine sites) iron ore mine
Alaska
Exploration, development
investments and value of
mineral products $3 billion
Over $300m invested in
exploration + $300m in
development annually
Mining site access, remote
locations, high development costs
Ambler mining district (copper,
zinc, gold, silver, lead) includes $2.7
bn Road-to-Resources
Major Challenges
Biggest Projects
51. Processing Arctic metals and minerals
•
•
•
•
Mineral refineries and smelters require large amounts of
energy
•
Locations with access to inexpensive
hydropower attract mineral processing industry:
Iceland, Norway, Greenland, possibly Canada
Transportation challenge
•
Many Arctic mining sites are in remote locations,
transportation infrastructure requires significant
investments in roads, railroads and ports
China has significant processing industry with smelters
and refineries – Need for raw materials
Options: Refine locally or export raw materials for
further processing, infrastructure investments are
required regardless
•
•
•
•
•
•
•
•
Alaska: Processing plants, smelters and
refineries in lower 48 states
Canada: Aging refineries and smelters in south
Finland: Processor of copper, nickel & zinc
Sweden: Smelters for copper, gold, lead & zinc
Norway: Processing industry for domestic supply,
mine sites along the coast – ocean transportation
access
Russia: Large smelting & processing industry in
Kola peninsula
Iceland: 3 aluminum smelters + 2 new planned,
hydropower
Greenland: Ocean access, hydropower potential,
potential future mineral processing site
Mine, smelter and refinery production of copper
53. Barents raw materials transportation developments
Russia, Finland, Sweden and
Norway’s joint planning
Efficient Barents Region
transport system
Internal connectivity
External links to world markets
Facilitate development and
opportunities for key industries
Gulf of Bothnia
Different national regulations on
lenght and weight of vehicles
Different railway gauges
Lack of flight services east-west
– Major bottleneck
Main priorities
Biggest challenges
Bothnian corridor: Oulu –
Low standard on sections of
Road 766km & rail 800km
Luleå – Narvik
Road 520km & rail 473km
Vorkuta – Kotlas – Syktyvkar –
Arkhangelsk – Vartius – Oulu
Road 1729km & rail 1517km
Map
roads and railways
Arctic winters and winter
maintenance
Lack of deep-water ports in the
Haaparanta/Tornio – Umeå
54. Barents – raw materials transportation
In northern Sweden iron ore is
transported via the Iron Ore line
(Ofoten) for further shipment
Two-thirds is shipped from the
port of Narvik to Rotterdam
One-third is shipped from the port
of Luleå to the steelmill across the
Gulf of Bothnia in Raahe
Iron Ore line, port of Narvik and
port of Luleå are critical to the
industry, along with the
connecting road network
Port of Luleå handles 9 million
tons of goods annually, including
5.5 million tons is iron ore
Port of Narvik is central for
Swedish and Finnish mining deep, ice-free port - handles 18
million tons of iron ore a year
Main smelters and refineries
Steel
Luleå (SSAB)
Raahe (Ruukki)
Tornio (Outokumpu)
Copper – Skellefteå, Harjavalta
Nickel - Harjavalta
Zinc - Kokkola
Ferrochrome - Tornio
Iron - Mo i Rana (Norway)
Aluminum - Mosjøen (Norway)
56. Mining infrastructure in Alaska
•
•
Anchorage is the main export port in
Alaska followed by Fairbanks
Main destination is China followed by
Japan, Korea and Canada
DeLong Mountain Transportation
System (DMTS) supports Red Dog
mine where ore is transported via
52-mile all-weather industrial road
to Red Dog/Kivalina port for
storage and further shipping
Region is completely isolated, port has
no services
Road-to-Resources projects in
Umiat, Ambler and Nome/Tanana
provide better access to mining
sites and more affordable raw
material transportation options
Alaska Industrial Development
and Export Authority (AIDEA)
actively supports and offers
financing to mining industry
logistics developments
Responsible for Delong Mountain
development
57. Mining infrastructure in Canada
Current issues are wide-ranging
Aging and inefficient community power
plants
Limited broadband availability
Short and unpaved airstrips
Underdeveloped services at industrial
sites
Most roads end north of 60 degrees
Cooperation between different leves
of government and the private sector
is needed to develop infrastructure in
the northern regions
International cooperation to
harmonize geo-reference standards
Government support to capacity-
building and infrastructure in the north
Communities are not served by all-
Suggested Northern Infrastructure
Nunavut: Mine start-up costs up to
Initial investment of $1 billion over a
season roads
$1.6 billion (vs. Yukon $200 million)
because companies need to build
supporting infrastructure (roads, rail
& ports)
Alaska-Canada rail link, $11 billion,
as a possible option for resource
transportation
Fund (NIF)
5-year period
Finance transportation, energy and
community infrastructure needed for
resource development
58. Mining infrastructure in Greenland & Iceland
Greenland
Ocean and air transportation
only
No roads or railroads between
towns
Deep-water port potential
Current year-round ports in
Nanortalik and Sisimiut
Mining sites along the coast
1 operating gold mine, several
developments underway, active
prospecting
Alcoa is planning an aluminum
smelter on the west coast south
of Nuuk
Availability of low-cost hydroelectric
energy
Significant infrastructure
investments required
Iceland
3 current aluminum smelters
2 on the west coast & 1 in the
east coast
Finna Fjord deep-water port
development driven by
forecasted increase in shipping
in NSR
Potential to support oil and gas
industry north and west of Iceland
Developments in Greenland’s
mineral industry are a potential
source of business for the port
59. Business opportunities for Finnish companies
Arctic Ports
Arctic Mining
Working in
the Arctic
•
•
Mapping and navigation technologies, satellites
Icebreaking services, leasing icebreakers, designing and building
icebreakers (US, Canada, China & Japan)
Arctic marine tehcnology expertise, onshore & offshore
Ice management technologies
•
•
•
•
Cargo handling equipment and cranes
Port engineering and infrastructure equipment
Navigation technologies
ICT applications
•
Arctic
Shipping
•
•
Solution for sustainable mining: Energy efficiency,
recylcling, water treatment, technologies for minimizing
environmental impacts
Technologies, expertise & equipment for exploration, exploitation,
mine construction and mining activities
•
•
Wear-resistant special steels, ex. for mining equipment in harsh
arctic conditions (Ruukki)