Sokli would create new jobs and tax revenue in Lapland and all of Finland

Finnish Minerals Group has commissioned an assessment of the regional economic impacts of the Sokli mining project, which it wholly owns. The unique mineral deposit located in Savukoski, Northern Finland, contains phosphate, iron, rare earth elements (REE), manganese, vermiculite, niobium and copper. These resources could significantly strengthen Finnish raw materials production and enhance Europe’s self-sufficiency in critical raw materials.

According to the assessment, the construction phase, which is expected to last approximately three years, would employ thousands of full-time equivalent workers, or person-years, across Finland. During operation, the mine would generate annually over EUR 700 million of new revenue and create a labour demand of approximately 1,300–1,500 person-years in Finland, depending on how the mining project will be executed.

The assessment focused on the impacts arising during construction and production. Based on this, the direct regional economic impacts and the multiplier effects of production and consumption were evaluated.

The regional economic analysis prepared by the consulting company Ramboll assessed the processing chain from ore to concentrate. Later, the plan is to also assess the further processing chains of the products, as they would significantly increase the impacts.

The project would create a significant number of jobs in Savukoski, Lapland and Finland as a whole

The analysis of the mine’s operational phase shows that on-site processing in Sokli would result in the economic benefits concentrating strongly in the municipality of Savukoski, while processing in another municipality would bring benefits to the Lapland region more widely. In total, the project would create approximately 814–826 person-years of employment in Savukoski and the rest of Lapland, depending on how the mining project will be executed.

According to the assessment, the mine would create strong demand for new labour also in other regions of Finland, for example, in land transport, in processing, such as the chemicals industry and metal products manufacturing, as well as in the repair and maintenance of machinery and equipment.

“The Sokli project would bring significant economic growth to Finland. It would enable us to produce, process and sell minerals needed by the modern world. At the same time, we would increase employment and tax revenue, and would be able to strengthen the development of new business networks and the Finnish minerals cluster,” says Matti Hietanen, CEO of Finnish Minerals Group.

The mining project would improve the infrastructure and supply of services in the region

If all operations were to be concentrated in Savukoski, the project would generate annually approximately EUR 10.2 million of local tax revenue, consisting of municipal tax (EUR 2.3 million), real estate tax (EUR 1.9 million), as well as the municipality’s corporation tax apportionments (EUR 5.5 million) and taxes on mined minerals (EUR 0.48 million).

The annual tax revenue during production was estimated to total approximately EUR 16.5 million in the rest of Lapland and around EUR 25.8 million elsewhere in Finland. Value added tax (VAT) would account for the majority of the tax revenue in the rest of Lapland and elsewhere in Finland.

“The Sokli project would be a significant boost especially for the economy of Eastern Lapland. The project itself would directly employ plenty of people and generate several millions of euros in tax revenue each year. At the same time, the project would increase the demand for, among others, accommodation and restaurant services in the region, creating multiplier effects for various industries such as retail,” states Pasi Heino, Project Director at Sokli Oy.

According to the assessment, the mining project would also improve the region’s infrastructure and supply of services in general, increasing the region’s attraction, for example, among tourists. This, in turn, would create a need for new labour as well as new business in the region.

More information for the media:

Pasi Heino, Project Director, Sokli Oy
firstname.lastname(at)mineralsgroup.fi, +358 50 553 5032

Jani Kiuru, SVP, Raw Materials, Finnish Minerals Group
firstname.lastname(at)mineralsgroup.fi, +358 40 823 8471

www.sokli.fi
 

Key terms used in the assessment

Person-year
In the assessment, employment refers to gross employment, which is measured in person-years. For example, one full person-year equals two employees working half-time or for six months. Person-years can be converted into an average number of jobs by dividing them by the duration of the lifecycle phase reviewed. The assessment does not specify to what extent the demand for labour is covered by existing vs new jobs.

Direct impacts
Direct impacts were assessed for the operational phase, where the impacts arise from the direct operations of the planned mine. In practice, this covers, for example, the revenue and employment generated by the operations, value added, as well as the taxes and tax-like charges deducted from employees’ wages.

Total impact
The total impact describes the combined impact of direct impacts, the multiplier effects of production, and the multiplier effects of consumption.

Multiplier effects of production
The multiplier effects of production are the effects of the planned mining operations in Savukoski on other industries. In practice, this means that the implementation and maintenance of operations require goods, services and raw materials in the upstream value chain, creating new demand for other industries.

Value added
The value created by a unit participating in production. In market production, it is calculated by deducting the intermediate products (goods and services) used in production from the unit’s output, and in non-market production, by adding up employee compensation, fixed capital expenses and possible taxes on production and import. Value added is the proportion of a company’s production that is subject to value added tax.

 

 

Finnish Minerals Group

The mission of Finnish Minerals Group is to responsibly maximise the value of Finnish minerals. We manage the State’s mining industry shareholdings and strive to develop the Finnish value chain of lithium-ion batteries. Through our work, we contribute to Europe moving towards electric transport and a more sustainable future. www.mineralsgroup.fi