The Norwegian state-owned coal company Store Norske Spitsbergen Kulkompani (SNSK) announced on Thursday that it would be shutting down its last Arctic coal mine in 2023.
SNSK said it will be closing its Mine 7 on the Arctic Svalbard archipelago, with the settlement planning to temporarily switch to diesel in 2023 before ultimately establishing permanent renewable energy resources, Reuters reported.
“Now that the contract to supply the power plant has been terminated there will no longer be a basis for operating the mine,” SNSK chief executive Morten Dyrstad said.
Reuters noted that the company has shut down its major mines of the archipelago over the past 20 years but continued to keep Mine 7 open in order to supply local coal-fired plants as well as make some exports. The closure of Mine 7 will result in the loss of 80 jobs.
Before it closes down, Mine 7 will increase its output of 90,000 metric tons a year to more than double at 125,000, Reuters reported, with the company seeking to take advantage of high global prices in the remaining two years of the mine’s operation.
Coal mining has been central to Svalbard’s economy ever since Norway gained sovereignty over the island in 1920. Though the island is managed by Norwegian legislation, the Svalbard Treaty from 1920 gives other signatory countries the right to exploit resources on the island.
As The Barents Observer noted in 2017, the closure of Norwegian coal mining operations could lead the way to other countries moving in and taking over operations.
“Mining companies from other signatory countries can raise demands for the licenses and start up mining in the former of SNSK,” Norwegian author and business consultant Per Arne Totland told the Observer. “And these companies might be subsidised by their national government and consequently not be dependent of commercial interests.”