FLOOD OF TAXPAYER MONEY: Extra funds for flooded Mine 7, avalanche/flood protection in Longyearbyen and dismantling of Svea/Luckenfjell mines highlight Svalbard priorities


The Norwegian government’s spending plans for next year are unsurprisingly all the place thanks to the COVID-19 pandemic disrupting all concepts of normal (indeed, at some point we’re going to tire of putting that disclaimer in every story).

But in the midst of avalanche of emergency and special allocations, a lot of signs of “normally abnormal” pre-virus times are in the proposed official budget for 2021 unveiled this week, including major allocations to cover losses for Store Norske’s Mine 7 where operations have been halted for months due to climate change-induced flooding, further dismantling of the company’s two largest coal mines, and more avalanche and flood protection measures in Longyearbyen.


Store Norske employees set up a drainage hose in a glacier area above Mine 7. Record heat in July caused meltwater from the glacier to flood the mine, destroying electrical equipment and making passages inaccessible. Repair work has been underway since and officials hope to reopen the mine later this month. Photo courtesy of Store Norske.

Among the sizeable and notorious other allocations is 110 million for the government-owned Statsbygg to take over all student housing from The University Centre in Svalbard. Also significant is Svalbard entities are now eligible to apply for a special fund originally established in 2016 for climate-related projects that reduce emissions, which is set for 100 million kroner in the proposed 2021 budget.

Among the disappointments for local leaders was no new funding proposed for new energy production projects as Longyearbyen continues a long-term effort to determine its future power source when the existing coal plant shuts down, potentially 10 to 15 years from now.

“It is clear that we could have wished for more money for investment areas such as energy, but one may have to look at the budget in a larger context,” Longyearbyen Mayor Arild Olsen told High North News.

The government asserts in its budget press releases “the Arctic is our most important area of strategic responsibility,” similar to declarations in recent years, and in a separate announcement of what it considers Svalbard highlights includes the following:

• 40 million kroner for Store Norske to com­pen­sate for ex­pected losses in Mine 7 operations “which is suf­fer­ing from gen­er­ally high costs and ad­di­tional prob­lems due to flood­ing with glacial melt­wa­ter after the hot sum­mer days in July. The gov­ern­ment is also aiming at se­cur­ing the sup­ply of Longyear­byen’s coal power plant with local coal.”

• 61.1 million for further measures protecting Longyear­byen against snow avalanches and river floods (“both are very im­por­tant is­sues for Longyear­byen”).

• 412.8 million to continue the complete removal of mining infrastructure and natural restoration of the Svea and Lunckefjell sites.

• 1.5 million for Sval­bard Mu­seum to “strengthen the mu­seum and stim­u­late more ac­tiv­ity,” particularly in the wake of the ongoing tourism crisis caused by the pandemic.

• Additional funds for The Governor of Svalbard to, among other things, establish an attorney dealing with prosecutorial and police matters that are ultimately send to the mainland to go through the full legal process.

• The Labour Inspectorate will be strength­ened with a proposed allocation of one mil­lion kro­ner. A number of labor law violation and issues have come up in Svalbard in recent years, including subcontractors on major renovation projects failing to meet worker safety and compensation requirements.

As is the case with almost any annual government budget, the proposed spending comes down to a long list of winners, losers and status quo – each of which is seen as vitally important to the entities/people affected. That’s all the more the case this year due to the crippling financial impact the COVID-19 pandemic has had on Svalbard – the worst of any region in Norway, due to the extreme steps taken to prevent the virus from reaching here – and while the Norwegian government is providing vast sums of special assistance related to the crisis, many locals say Svalbard is an afterthought for many local requests.

The city of Longyearbyen, for instance, while not getting the additional money sought for power plant purposes, did receive 20.4 million kroner in supplemental funding this year to deal with virus-related expenses and lost income.

Meanwhile, the government also provided 25 million kroner in supplemental virus-related funding this fall to help tourism businesses that have suffered a near total loss of business for many months. But Visit Svalbard is expressing disappointment the government is basically proposing a “status quo” budget for next year for the agency – 3.15 million, up from 3.05 million this year – which means that because of the drastically reduced income from businesses this year and next the organization will likely have to lay off half of a staff that now equates to about eight full-time positions.

Similarly, the large allocation to buy the student housing at UNIS will do little to benefit the university’s academic programs, which are looking at maintaining the status quo rather than a hoped-for expansion due to a largely status quo proposed amount next year.