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XII Mining conference ESTONIAN MINERAL POLICY
Case:
Raw materials and industry in Scandinavia Friday, May 3rd 2013 Pekka Suomela FinnMin
What’s up in Finland today?
• Mining industry is boomingAlso tomorrow?
• Need of human resources with qualityAnd we know that?
• Metals Industry in Finland• Dialogue with regulators and authorities• Expectations for the future are bright but
some clouds....
What FinnMin?
• FinnMin is a recognized representative of the Finnish metals and minerals mining industry
• The association's main objective is to promote the industry and to maintain its relations with National and European institutions at all levels
• FinnMin also fosters contacts with the mining community in Nordic countries and in Europe
Mining in Finland:
• 12 metal mines in operation in 2012• 31 active industrial mineral mines • Total turnover of the mining industry in
2011 was about 1,5 billion €
1.3.2010
I. To contribute to the increase of employment, economic growth and welfare through vital mineral sector
II. To find solutions to global challenges of raw-material chains through Finnish innovations
III. To decrease total environmental impacts of mining industry
Main targets for the Finnish mineral strategy
7.10.2011 7
0
10
20
30
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50
60
70
80
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100
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
0
5000
10000
15000
20000
25000
Kansainvälisesti Suomimilj. € US $ milj.
Malminetsintäpanostus kansainvälisesti yhteensä sekä Suomessa 1995-2012
Suomi vasemmalla (lähde TEM)
kansainvälisesti oikealla asteikolla (lähde Metals Economics Group)
Lähde: Tukes 2013Kaivokset ja yhteiskunta:
18.3.2013, Ossi Leinonen, Terho Liikamaa 8
19501953
19561959
19621965
19681971
19741977
19801983
19861987
19921995
19982001
20042007
20100.00
5.00
10.00
15.00
20.00
25.00
30.00
35.00
40.00
MetallimalmitKarbonaattikaivoksetTeollisuusmineraalit ja muutYhteensä
Ore mining and mineral quarring 1950-2012 (milj. tn)
Lähde: Tukes 2013
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Sweden’s share of EU27’s total mine production of gold 2002–2011.
EU27 in redSweden in blueGold, tons
25 20 15 10 5 0
Operating in Nordic Regions
Low sovereign risk Long history of mining No mining royalties Low corporate tax rate (Sweden -
26.3% Finland - 24.5%) Major mining, smelting and mining
equipment industry Finland rated best country for mining
investment - ResourceStocks 2011 World Risk Survey
Pampalo Gold Mine - completed on schedule and in line with budget
Investment 20 M€ in line with the budget
Commercial production commenced Feb 2011 as scheduled
Currently employing 80 own + 30 contractors – 70 % locals
Plant Nov 9 2010Plant Feb 2, 2010
25th May 2011
Start Oct 22,2009
Plant Jan 11.2011
14
Strong focus on Health-Safety-Environment
0
10
20
30
40
50
60
LTIFR
LTIFR= accident number / 1 000 000 working hour
Pampalo safety statistics - LTIFR
Endomines
Contractors
Total
Average LTIFR in Finnish mining industry was 25 for the period 2008-2011Own personnel 550 accident free daysContactors 200 days accident free days
Personnel
April 2012
Management 12
Senior Staff 51
Staff 72
Operators 305
Contractors 180
Agnico-Eagle Finland Oy Contractors Total
Geology 20 97 117Mine 179 23 202Mill 54 1 55Maintenance 93 4 97
Administration 73 32 105Projects 5 11 16Exploration 13 12 25AEF 3 0 3Total 440 180 620
Economic Impact on the Region
The economy of the Kittilä municipality is based on two pillars: 1. tourism Tourism provides ca. 1100 jobs for Kittilä residents 42 % of Kittilä’s total manpower resources In total 1800 jobs during high season
2. Kittilä mine Kittilä mine provides 600 jobs Approximately 50 % from Kittilä 22% of Kittilä’s total manpower resources
The unemployment rate in Kittilä is below 10 % on average - during high season 6 %
The Kittilä annual municipal tax income ca. EUR 4 million and equal amount to the state
Annual real estate tax paid by the Kittilä mine EUR 0.25 million
Annual royalty payment to the State will be ca. EUR 3 million
Corporation tax will be ca. EUR 15 - 20 million
Kittilä mine’s B 2012 turnover is over EUR 190 million – Tourism’s turnover is ca. EUR 200 million.
Key task for the mineral policy:
How to improve business environment of mining industry in a global context ?
And at the same time take into account the needs and requirements of national, regional and local societies?
In case of Finland
with strong Nordic democratic traditions with high percentage of private land
ownership with high demands of environment protection
21
Special Inputs
Technology
Associated
services
Primary products
Related industries
Consumers
• Ores and concentrates
• Industrial minerals
• Aggregates• Natural stones
and stone products
• Mining machineries• Enrichment technology• Stone processing
machines• ICT • Environmental expertise
• Exploration and junior companies
• R&D and Education• Financing
• Excavation contractor
• Transport• Rock engineering• Design and
Architecture• Energy production• Residential services
• Location and Infra• Mineral resources• Geological data
• Basic metal industries
• Chemical industry• Construction
materials industry• Construction
Finnish mineral cluster
VALUATION OF
Economic benefits Environmental impacts and Effects on prosperity
That result from mining activities- Working Paper 138 by PTT
I. Benefits are clearly greater than their adverse external impacts
II. Individual adverse experience by local people can be quite significant
III. Mining projects with their local characteristics are quite different
MINING POLICY and SOCIAL LICENCE
- times are changing
Pro mining
Media headlines in capital letters
Mining tax ?