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Preparing to downsize

Coal is being transported from Svea by AF Arctic. Now the are preparing for cuts. FOTO: Birger Amundsen

Preparing to downsize

AF Arctic is among those who are preparing for the crisis at Store Norske.



29.11.2014 kl 00:15

"We know very little, but it has serious consequences for us, there is no doubt about that, so this will be a sharp downsizing of us," said Svenn Bertelsen, AF Arctic's project leader.

The company has a contract with Store Norske at Svea to provide, among other things, transportation of coal. Today there are 50 employees and Bertelsen said they are already meeting with their employer.

The same applies to the 24 employees at Sodexo, whose duties include taking care of cleaning, catering and concierge services at Svea. It is also not clear there how many must go and the company is waiting until that is determined before giving Svalbardposten an official comment.

Holding back
In addition, the downsizing is spreading uncertainty in the local community.
Although LNSS does not have any major contracts with the coal company, Administrative Director Frank Jakobsen said they will probably postpone the construction of a new apartment building at Elvesletta. There will be one building, but the next must be considered thoroughly.

"We must hold on and see how the market ahead is," he said.

General Manager Trond Hellestad at Sparebank1 Nord-Norge said he believes the housing market will be frozen for a period and there may be a price drop when operations at the cornerstone company are scaled down. He also emphasized that depends on how Store Norske attempts to resolve its crisis. He also advised people who may be facing payment problems to contact the bank quickly.

Hellestad said he also thinks some businesses will experience a drop in demand and sales.
"But the work is very good in political circles and the business association is on the court," he said. "One can only hope that those who will decide are aware of their responsibilities."

READ MORE: She must make cuts

Afraid of flight prices
In the tourism industry there is concern that flight deals may be reduced. Visit Svalbard is reporting fear among member companies that airlines will suspend flights, and it therefore will become more difficult and expensive to come to Svalbard.

"If the traffic base becomes significantly weakened there is reason for concern," said Ronny Brunvoll, director of the tourism agency. "For us it is very important to protect the traffic base."

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