Finnish government plans $113 mln funding for nickel mine

The government took control of the mine last year, aiming to avert a closure at the site in northern Finland where around 950 people including contractors worked as of the end of March.

The Finnish government is planning to inject around 100 million euros ($113 million) into Terrafame Mining, the state-owned company that runs Talvivaara’s former nickel mine, but may eventually still have to close the operation, sources said.

The government is planning to propose this month that parliament approve the funding, which would keep the mine running until the end of the year, two sources who declined to be named told Reuters.

“A closure of the mine is an option that will be considered,” a government source said.

The government took control of the mine last year, aiming to avert a closure at the site in northern Finland where around 950 people including contractors worked as of the end of March.

Talvivaara was originally aiming to become Europe’s biggest nickel mine by pioneering an extraction process called bioheap leaching — using bacteria to extract nickel.

Repeated production problems were compounded when the mine leaked waste water in 2012, raising uranium and metals levels in nearby lakes and rivers.

In 2014, Talvivaara Mining Company filed for debt restructuring while its key subsidiary that owned the mining assets filed for bankruptcy protection.

The government has so far injected close to 250 million euros into Terrafame, and said last year it might still close the mine if it cannot find investors by 2017.

The search for investors has become even more difficult after a Finnish administrative court last month decided to make the mine’s environmental permit temporary.

“It is practically impossible to find private funding after that decision,” another source said.

Terrafame Chairman Lauri Ratia told Reuters he believed that from the taxpayers’ point of view, it would be better to try to expand the mine.

“A closure would cost at least 300 million euros,” he said. ($1 = 0.8815 euros)

Source: Reuters