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Lawsuit planned in mining dispute

Austre Adventfjord AS is now giving notice it intends to file a lawsuit after the ruling in Longyearbyen this week. FOTO: Eirik Palm

Lawsuit planned in mining dispute

Austre Adventfjord AS is now giving notice it intends to file a lawsuit after the ruling in Longyearbyen this week.



The mood was tense inside the room on the second floor of the post office and bank building in Longyearbyen on Tuesday. For more than a year the quarrel about rights has endured, partly into open microphones. In the front sat representatives from Store Norske. In the rows of seats behind them were Austre Adventfjord representatives including, among others, Mining Director Bjørn Fjukstad, and attorneys Pål M. Andreassen and Sveinung O. Flaaten. Flaaten told Svalbardposten the company will now prepare for litigation.

"It is the only procedure allowed by the Mining Code," he said. "The respondents here will be both the industry and fisheries ministry, and Store Norske."

There are seven claims totaling 61.1 square kilometers stretching across most of Operafjellet, plus a little of Hiorthfjellet. These claims that were awarded on Tuesday to Store Norske are located on Austre Adventfjord property and owning company Austre Adventfjord AS had itself applied for the coal mining rights there.

During the Tuesday meeting there were two ruling sessions. During the morning it was clear Store Norske would be allotted seven claims, which are mainly located on Operafjellet.

Three hours later, it became clear that Austre Adventfjord AS would receive the rights to the remaining ten. These are claims on Hiorthfjellet adjacent to Operafjellet.
The state-owned mining company has up until now carried out nine core drill-downs on Operafjellet.

"It's part of the preparations," said Morten Often, Store Norske's exploration manager. "A mining company is dependent on having a long-term perspective and we look at Operafjellet as a resource that will be natural to take on after the activity at Svea is concluded. We must begin to study now."

Preliminary estimates are Operafjellet contains about ten million tons of recoverable coal, but this may change as the investigations progress. For comparison, the estimated amount of coal at the Lunckefjellet mine is 8.4 million tons.

The coal in the part of Operafjellet known as Bassen is also the only known certain deposit of large size Store Norske has when Lunckefjellet, Svea and Ispallen are gradually emptied.

"Our problem now is that we have no other deposits in sight," Often said. "A big challenge for us is that we are apparently not allowed to look in new areas."

He adds that Store Norske has coal reserves for a couple of decades into the future that the company projects today can be produced profitably and that the company will be allowed to extract.

"However, as exploration manager, I would say that it is frustrating not be allowed to look for new resources," he said.

Locked up
Austre Adventfjord does not intend to give up the struggle for the resources and Flaaten said the company will pursue a lawsuit within the six-month period.

In addition, the lawsuit will reference claims at Hallwyfjellet further inland on the opposite side of Adventdalen. Austre Adventfjord AS does not have claims there because Store Norske has the rights.

The company is expressing doubt Store Norske will ever proceed with mining at Operafjellet. In a letter to the Norwegian Directorate of Mining with the Commissioner of Mines at Svalbard, Flaaten wrote that it is contrary to the Mining Code to accept petitions for claims "that are intended to keep others away and earmark areas where despite the ruling work activity will not be initiated."

The letter was delivered on the same day as the rulings, and Flaaten points out Store Norske historically has filed a very large number of claims and that well over 90 percent of them have been left untouched.

Both sale and operations
The allocation of Operafjellet, moreover, also undercuts the plans of Austre Adventfjord AS, according to the company.

"The area of the contested seven claims will have a direct impact on the planning and facilitation of mining on the ten remaining claims, so that the activities of the ten claims will depend on the status of the other seven," Flaaten wrote. "Therefore, that is also unacceptable in light of (Store Norske) actually being able to prevent the commencement of operations at the ten uncontested claims by delaying operations at the contested area until 2028."

What's the point of trying to start mining operations if the property is to be sold?

"The Mining Code distinguishes between property rights on the one hand and the rights to mining on the other. There is no need for ownership in order to operate. The goal of Austre Adventfjord AS is both the sale and mining," said Flaaten, who states the company is prepared to take the time that is necessary.

Morten Often said he disagrees.
"I obviously cannot say anything about what Austre Adventfjord is going to do," he said. "I guess I can only say that as far as I can understand, we have fulfilled the requirements for the formalities in this process. I find it hard to see that there are grounds for protest."

What did he think about the mood in the audience during the rulings?

"There has been some media controversy in this case," he said. "The atmosphere was a little tense, but to a certain extent interesting. We have not any problems with talking together. There was openness and I have no difficulty in that there are more who are interested in the rights."

If Austre Adventfjord is not successful in court, the landowner has one year in which to give notice it will participate in the mining project by up to 25 percent.

The sale of the property is still unclear, but the Ministry of Trade, Industry and Fisheries has been working hard on the case.

On Monday, Minister of Trade and Industry Monica Maeland, a Conservative Party member, will see the disputed property for herself when she makes her first minister visit to Svalbard.

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