Arctic railway not commercially viable, report says

“According to all the finance models used, the project would not be commercially viable,” the conclusions in the report reads.  

The working group says transport volume would have to be around 2.5 million tonnes per year to cover the annual maintenance costs of such railway.

“Such volumes cannot be regarded realistic without any significant changes in business in the area or in the costs of different transport modes,” the report says, but underlines that the conclusions are based on preliminary data.

“During the preparation work, the preconditions for the Arctic railway project and the requirements for completing it have been reviewed with different parties,” Anne Berner, Minister of Transport and Communications of Finland, said when receiving the report on Monday.

The working group has looked into different scenarios for future transport volumes.

A best case scenario, the report reads, links the Arctic railway from Kirkenes on the Barents Sea coast to Rovaniemi along with the planned Helsinki-Tallinn tunnel and the Rail Baltica project.

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EU funding 

This “could be significant for entire Europe by opening a fast connection from Central Europe to Northern Europe and further to Asia via the Northern Sea Route,” the report says, but underlines:

“This however requires that the planning and background work in these projects have to be of very high quality and must be carried out so that also the European Union is behind this entirety of several infrastructure projects.”

The working group further calls on ways to finance such railway. “The Arctic Railway along with the other projects mentioned, requires funding from several sources.”  

The working group says it is now for the politicians in the two countries to take the next step.

“In order to be able to launch the planning, a political decision on the implementation of the project would have to be made in both countries.”

Railway vs. reindeer herding 

According to the report, the Arctic railway would have diverse impacts on the environment and the Sámi people. Highlighten in the study are the uniqueness and sensitivity of the natural environment in the north which requires special attention. “This is widely known,” the report reads. 

Liisa Holmberg is from a Sámi family of reindeer herders in Sevettijärvi, northern Finland. Like other reindeer herders, Holmberg says it is important that the Sámi voices are heard when such a railway is planned.  

First after the end of the joint Finnish-Norwegian working group’s term, the Ministry of Transport in Helsinki and the Sámi Parliament conducted negotiations concerning the possible railway.

The report concludes that if the railway project was to be promoted the participation of the Sámi “must be ensured so that no irrevocable damage would be caused to their culture or livelihoods.”

Since the study has solely focused on preconditions for a railway, no decision is considered in regards to a possible rooting of the tracks. The distance from Rovaniemi to Kirkenes is about 500 kilometers, of which more than 90% is within Finland if the tracks are built west of Lake Inari.

Last September, the Saami Council made a resolution saying a railway would affect the income and existence of reindeer herding communities in the entire area from Rovaniemi to Kirkenes.

“I can clearly state that there is no way for a railway from Rovaniemi to Kirkenes to be built without harming Sámi culture, traditional Sámi reindeer herding and fishing,” President of the Saami Council, Åsa Larsson Blind, told the Barents Observer.

With today’s report, the Arctic railway will be put on hold.