European Geologist Journal 41

Defining Mineral Deposits of National Interest – The Case of Sweden

By Linda Wårell and Elisabeth Häggquist, Economics Unit, Luleå University of Technology, SE-97187 Luleå, Sweden

Abstract

The exploitation of minerals in Europe is a necessary activity for securing continued growth and development of the European society. In order to ensure this, it is vital that access to mineral deposits is safeguarded, which is why there is currently an increased focus on “defining mineral deposits of public importance” in Europe. However, there are a number of countries that have already defined mineral deposits of public interest on a national level, for example Sweden. The main purpose of this paper is to analyse the definition of mineral deposits of national interest in Sweden. The paper further aims at discussing the value of geological information in this process.

Introduction

Minerals are indispensible for our daily life, considering all the products that we use, but also regarding infrastructure development (e.g., roads and buildings) in the region that we live in. The exploitation of minerals in Europe is thus a necessary activity for securing continued growth and development of the European society. In order to ensure this development it is vital that access to mineral deposits is safeguarded, in a similar manner as to many other land use interests (such as e.g. nature protection). The project MINATURA2020, funded by Horizon 2020, was created as a response to this need. This project has the overall objective to “develop a concept and methodology for the definition and subsequent protection of ‘mineral deposits of public importance’ in order to ensure their ‘best use’ in the future”. [1]

A number of EU membership countries have already defined mineral deposits of public interest, but on a national level. One of these countries is Sweden, which has had a national definition of mineral deposits of national interest since the 1980s (SGU, 2016). Sweden has a long tradition of mining and is currently one of the EU’s leading ore and metal producing countries. For example, it is the largest producer of iron ore and lead, and the second largest producer of silver and zinc (SGU, 2015). During the most recent commodity boom the mining industry has experienced strong growth, and the mining industry is of substantial importance to the country’s economy. From a regional perspective, it provides job opportunities in parts of the country with otherwise low growth prospects. A large part of Sweden is part of the Fennoscandian Shield, which is a rock formation that contains large ore deposits. The mineral deposits are further considered to be of high quality from a building and material perspective. Sweden is thus a country with large mineral potential, and it has a long history of negotiations between mining interests and other competing land use interests.

From a European perspective it is important to consider previous knowledge and experience in regards to defining mineral deposits, as important lessons can be learnt. The main purpose of this paper is thus to analyse the definition of mineral deposits of national interest in Sweden. The paper further aims at analysing the value of geological information in this process.

Sweden’s mineral strategy

The main objective of the Swedish mineral strategy, presented in 2013, is to provide a future vision and policy of the Swedish mining industry. One of the main goals of the strategy is to strengthen Sweden’s position as one of EU’s leading mining and mineral countries. It is further recognised that Sweden’s mineral resources should be exploited in a sustainable way, considering long-term impacts on the environment and the social and cultural situation. In order to achieve this strategy, five strategic objectives are identified as crucial, and different measures to achieve these are discussed (Government Offices of Sweden, 2013).

In the mineral strategy it is further stated that, according to estimates from the Geological Survey of Sweden (SGU), there is potential for 30 active metal mines in Sweden by 2020, and 50 active mines by 2030. This should be compared to the current number of 17 active mines. These estimations are based on appraisals of mining capacity in mining projects that have been granted or applied for mining permits (exploitation concessions). The mining potential numbers thus assume that these projects will in fact become active mines (Government Offices of Sweden, 2013). When the mineral strategy was presented, these estimates were considered ambitious. Today, a few years after the strategy was introduced, it can be concluded that Sweden will not reach 30 active metal mines by 2020. In that sense, the mineral strategy can be seen as a failure. However, the strategy can still be seen as an important statement from the Swedish government, i.e., that the mining industry is of high importance for the country.

Mineral planning policy

The mineral planning policy in Sweden is based on national interests. National interests originate from the physical planning process first presented in the Governmental report “Land and Water” (SOU, 1971:75). The main motivation for the development of national interests was that between 1950 and 1970, economic growth was exceptionally strong in the country, which led to a major urbanisation process. This development increased claims on natural resources, which in turn increased the pressure to consider different areas of national interests in Sweden. The purpose of the national planning process was to gain a better understanding and knowledge of Sweden’s natural resources. The Natural Resources Law, which entered into force in 1987, was strongly linked to spatial planning. In the same year the Planning and Building Act was introduced, in which the municipalities were granted primary responsible for the planning of land and water areas. When the Environmental Code came into force in 1999 the national interests were transferred there (SGU, 2016).

There are 11 national interests defined in Sweden, of which mineral deposits (in Sweden defined as “deposits of substances or materials”) is only one. Areas containing deposits of substances or materials that are of national interest shall, according to the Environmental Code, be protected against measures that may hinder their extraction. Requirements for a deposit to be considered as of National Interest are that it is of great importance for the country’s security of supply, that proper documentation of the deposit exists, and that the deposit has special characteristics. In such areas, the local and state authorities are not allowed to plan for, or allow, operations that can prevent or significantly hamper utilisation of the resources. SGU are responsible for the deposits of national interest and they identify deposits of ores, industrial minerals, aggregates and natural stones. There are a total of 145 deposits of national interest already defined in Sweden (as of March 2016), and the majority of these are in the categories of ores and industrial minerals. Of the defined deposits of national interest, 85 are mapped in detail (SGU, 2016).

SGU performs continuous work to demarcate deposits that are defined to be of national interest. This involves deposits that had previously only been marked with coordinates, but also newly discovered deposits being assessed can be classified as of national interest. SGU also works continuously to revoke deposits that may no longer be considered to be of national interest under Chapter 3, Section 7 of the Swedish Environmental Code. A detailed demarcation begins with SGU developing geological background material about the deposit. Information such as production and material properties can also be obtained from the deposit’s owner or those operating on the deposit. Following this, SGU personnel inspect the deposit and a preliminary demarcation is drawn up.

A deposit is considered to be of national interest if it satisfies the following criteria:

• the deposit is relevant to the needs of society on a national level, or of particular regional importance, in terms of employment, economic development and resource supply in the long term.
• the deposit has particularly valuable properties, as regards e.g. purity, composition, quality, appearance, technical features or volume,
• the area containing the discovery of the deposit is well defined, examined and documented.

Further noted in the process of defining deposits of national interests is that a long-term perspective should be applied, with a planning horizon of between 50-100 years (SGU, 2016).

The first guiding criterion for the definition of deposits of national interest focuses on long-term raw material supply. The deposit has to be important from an economic perspective (for the needs of the community). Knowledge of where the deposits are located is important in the municipal planning processes, in order to avoid planning activities that will hinder future exploration. It is further noted that in case of conflict between different interests an economic assessment of the different activities should be performed. Furthermore, it is stated that the impact on employment and economic growth should be given great significance, and it is important that long-term expansion of production, investment and employment are made possible. The implications for regional balance and the distribution of living standards in the country must also be considered in the assessments.

Regarding raw material supply, i.e., aggregates, rock (crushed or natural stone) and gravel, the above criterion implies that the needs of society, including employment and economic development, are in focus. The region’s population structure and growth rate, e.g., construction of housing and infrastructure, need to be accompanied with a secure supply of aggregates. Furthermore, infrastructure and housing in a metropolitan region are of importance for the entire country, which implies that raw material supply in this region can be of national interest. Infrastructure investments, construction projects, or industries are often strategically valuable both for the region and the nation. The definition of national interest is in this context an important tool for the planning of material supply.

The second criterion is that the deposit in question must be of a certain volume and/or quality in order to be able to support the country, or part of the country, in the long run. Included in the concept “valuable substances or materials” are those substances and materials that are valuable from an economic point of view. The deposit should thus be “economically recoverable” mineral raw materials, which are needed in industry, energy supply and construction works. In addition to ores, this can include industrial minerals, mineral raw materials on the seabed, and sand and gravel that are available in urban areas. Regarding raw materials supply, valuable properties of the materials that are necessary for the intended use are considered, such as their homogeneity, composition, particle size distribution, technical features, appearance, colour, fractures, structure and volume.

The third criterion regards the geological conditions of the deposit, i.e., how it is estimated spatially. This is an important parameter for the definition. It is clear from the legislative history that only natural resources that are well documented should be given protection. SGU produces documentation of cases through systematic work in which they combine geological knowledge of the deposit with the information that companies report from prospecting and extraction of mineral substances. However, it is always SGU that is responsible for the documentation that forms the basis of a national interest classification.

The value of geological information

The value of high quality geological information is obvious in the process of defining mineral deposits of public importance, as it is a prerequisite to the actual definition. In the Swedish definition of mineral deposits of national interest, the third criterion in fact states that the discovery of the substance or the material has to be well defined, examined and documented. In Sweden SGU is responsible for advanced geological data. Material produced during state-financed mineral exploration over the last one hundred years is stored at the SGU Mineral Resources Information Office in Malå. Since state-financed exploration ended in 1993, only private companies carry out exploration in Sweden (although LKAB is a state-owned company). In 2012 the Government allocated extra funding to SGU of SEK 30 million (EUR 3.6 million) per year over four years, in order to further improve geological data in the northernmost counties of Västerbotten and Norrbotten (the Barents Project). Measures that should be implemented included the digitalisation of archive material and the scanning of core samples (Government Offices of Sweden, 2013).

From a European perspective the quality of geological information is an important aspect to consider when defining mineral deposits of public importance. There is thus a need to assure that member countries have high quality geological information, since a definition based on poor quality data will not be accepted by the public. From an economic perspective geological information possesses clear public good features, such as being non-rival (Häggquist, 2015). The information is non-rival since use by one individual does not reduce availability to others. The information can be restricted through licensing, which leads to the definition of a quasi-public good. This influences the assessment of the economic value, since it is not limited to the financial profitability of a given project alone; rather its value to a broad range of users should be acknowledged. Furthermore, the perceived benefits of using geological information differ across users according to which interest they represent (Longhorn and Blakemore, 2008).

The public good feature of geological information implies that it is often difficult to finance production of data, as the individual value of the information is much lower than the public value of this good. Due to this reason, national geological surveys are often state financed. However, there is a tendency, which for example is the case in Sweden, that the geological survey no longer produces mineral data. In Sweden, the companies that do exploration work in the country are required to provide their data to SGU. This is, however, not the case for all European countries. This development is recognized as a potential problem for the subsequent definition of mineral deposits of public importance.

Conclusions

The main aim of this paper was to analyse the definition of mineral deposits of national interest in Sweden. The definition of mineral deposits of national interest in Sweden is recognized in the Environmental Code, which implies that the safeguarding minerals are at a statutory level. Furthermore, the implementation is done in a land use planning context. This is something which would be beneficial also from a European perspective. Another important conclusion is that high quality geological information is a prerequisite for the actual process of defining mineral deposits of public importance in Sweden, as it is recognised that it is difficult to assess the ‘national interests’ of something that is not well defined. However, considering the public good feature of geological information, in combination with the current trend of less state-financed production of geological information, there is a risk that the quality of geological information will not be sufficient in all European countries.

[1] For more details about the MINATURA2020 project, see http://minatura2020.eu/.

References

Government Offices of Sweden (2013), Sweden’s Mineral Strategy – For sustainable use of Sweden’s mineral resources that creates growth throughout the country, Swedish Ministry of Enterprise, Energy and Communications, N2013.06.

Häggquist, E. (2015), The Economic Value and Adoption of Geological Information in Sweden, Licentiate thesis, Luleå University of Technology.

Longhorn, R. and M. Blakemore (2008), Geological information: Value, pricing, production and consumption, Boca Raton: CRC Press.

SGU (2015), Statistics of the Swedish Mining Industry 2014, Geological Survey of Sweden, Publication 2015:1.

SGU (2016), Mineral deposits of national interest, Retrieved: 2016-03-11, http://www.sgu.se/en/mineral-resources/mineral-deposits-of-national-interest/

SOU (1971), Land and Water, Statens Offentliga Utredningar 1971:75, Governmental Offices of Sweden.

This article has been published in European Geologist Journal 41 – Sustainable land use: How geology can contribute.