Svalbard gets cash to restructure businesses

“It is important that we maintain business and settlement on Svalbard. The mining company contributes to the society in Longyearbyen. The money will give the local community a better possibility to change,” says Minister of Trade and Industry Monica Mæland in a press-release.

The Government gives NOK 110 million (€11,6 million) for 2016. With the cash, the coal miner Store Norske will prepare for pausing its operations in Svea and Lunckefjell. Deep diving coal prices have deep economic impact for the mining that is no longer profitable.

Store Norske is state-own. For Norway, it is of geopolitical importance to maintain business on Svalbard. Longyearbyen is the largest settlement, while the dormitory town of Svea houses most of the coal miners.

Except for mine No. 7 outside Longyearbyen, mining will be halted for a 3-years period. But the Government still keeps the door open for re-launching in case of sharp growing prices for coal on the world markets.

The hope is to stimulate new business developments on Svalbard, an archipelago where science and tourism have increased substantially over the last decade. 

There are 2,667 inhabitants on Svalbard of which 2,189 live in Longyearbyen. The second largest settlement on the archipelago is the Russian mining town of Barentsburg.