Why Sweden and Finland

Sweden is a significant producer of metals in the European Union and ranks tenth in world iron ore production. Figures for 2001 are as follows:

In 1992 the Swedish government introduced a number of economic policies and legislative changes to provide a better business environment and to encourage foreign companies to invest in Sweden’s mineral potential. One major change was the new mineral policy which ended government-funded exploration. This has proved very successful in encouraging private sector exploration programmes since it was adopted.

Another notable policy change was the abolition of Crown shares, which formerly gave the state a free 50 per cent. share of all newly discovered ore deposits. This opened up Sweden for exploration as up until this point the State-owned mining companies and the Swedish mining group, Boliden AB, had dominated exploration.

Other changes included the reduction of the corporate rate of income tax (now 28%). The mining industry does not have to pay any further Swedish taxes or royalties. Sweden now has an open attitude towards foreign investment which is evident from its support of free trade and the ability to remit capital internationally. There are no restrictions on foreign companies obtaining either exploration permits or exploitation concessions, the only obligation being that a local office has to be set up.

In 2001 exploration in Sweden remained at almost the same level as in 2000. Exploration expenditures rose marginally to SEK193 million (US$18.71 million) from SEK 190 million in the previous year. The number of exploration permits granted mainly for ore minerals fell substantially from 169 in 2000 to 137 in 2001. The area covered by the permits was 2,630 km2. There were also some permits granted for diamond exploration. The total area covered by permits related to ore minerals at the end of the year was 11,328 km2 (21,616 km2 including diamonds). Active companies in exploration include the major mining companies Anglo American plc, BHP-Billiton plc and Rio Tinto plc, as well as junior companies such as Tertiary Minerals plc of London and Equinox Resources Limited of Australia.

Finland likewise has a very favourable legal and fiscal code for exploration and mining. Expenditure on mineral exploration totalled some US$35 million in 2002, which was a 4.4% increase on 2001. New claim reservations increased substantially in 2002, being the highest level since 1994. There were several new entrants to the exploration scene, including some large international mining companies. Gold Fields of South Africa exercised its first right of refusal on the Arctic Platinum Project with Outokumpu Mining Oy for US$30 million (US$60 million attributable value pre-mining) to acquire the share it did not previously own. In 2003 the companies spent some US$6 million on the project. Total declared resources of the Arctic Platinum Project are currently estimated at:

218.7 Mt grading 1.54 g/t Palladium, 0.38 g/t Platinum, 0.13 g/t Gold, 0.08% Nickel and 0.18% Copper.

The project is the subject of an ongoing feasibility study and an Environmental Impact Study. Proposed development is open pit mining with on-site process facility to produce a Cu-Ni-PGM concentrate.