In the government program that fell under the interest rate crisis, the ore processing industry remained a small million-dollar entry, but in the recently published supplementary budget, the situation changed completely.
On Tuesday night, the government announced that it would distribute additional funding of EUR 450 million to the battery industry of the state-owned Suomen Malmijalostus Oy.
According to the plan, two new plants would be built in Finland, which would process, among other things, two important components of batteries used in electric cars, precursor and cathode active material.
Negotiations are still underway to get the battery cell factory to Finland itself.
For the precursor plant, Vaasa, Kotka, Kokkola and Hamina, which are at the end of good logistics connections, are planned as construction sites. The options for the cathode plant are Vaasa and Kotka. Environmental impact assessments are underway in all four locations.
A new field of technology to Finland
Examples of raw materials used in batteries are nickel, cobalt and lithium. All of these are in Finnish soil, but the importance of recycled raw materials is growing all the time.
Precursor powder is obtained from nickel, cobalt and, for example, manganese sulphates. In the next step, the cathode active agent is processed from the precursor together with lithium-based materials.
The participants would be Finnish Ore Refining and private companies. In some cases, negotiations are already under way with a number of parties. If both production plants move forward, the total investment will be more than half a billion euros.
- If we start the production of these, the value added will increase, and at best a completely new field of technology will be created in Finland, says Mika Niemelä, CFO of the Ministry of Employment and the Economy.
- The aim is to promote the emergence of a battery cluster in Finland through Finnish Ore Refining. We have a good situation, Finnish soil has a lot of raw materials and reasonably priced renewable energy.
Of the EUR 450 million announced on Tuesday evening, EUR 150 million is direct capitalization for the state-owned Finnish Ore Refining portfolio companies and new investments. The largest of the portfolio companies is Terrafame and in addition there are Keliber and Sotkamo Silver.
Terrafame has been a kind of rescue company for the infamous Talvivaara. Five years ago, the state founded Terrafame and took it a couple of years ago to a larger mining cluster, under the Finnish Ore Processing Plant.
The state's capitalization of EUR 150 million will not be directed at the listed company Sotkamo Silver.
- We are negotiating with industrial partners who are already active in the sector. They would invest with us in Finland, says Matti Hietanen, CEO of Finnish Ore Processing.
- At the moment, there are practically no first of these factories in Europe. On the battery side, there are projects underway.
High hopes for employability
If all went well, the investment decision could come in about a year, and after a while, the construction phase would be reached.
According to the impact assessments, with a production capacity of 50,000 tonnes, it would employ 4,400 person-years during the construction phase, including indirect effects. During use, the figure is in the same category with its indirect effects.
Estimates are very preliminary, and output and employment effects may also be significantly lower.
The larger EUR 300 million in the supplementary budget is a so-called authorization for subsequent supplementary budget financing, which will enable Finnish Ore Refining to start taking projects and contract negotiations forward.
According to Niemelä and Hietanen, pre-production plants would help attract the battery cell factory to Finland.
The much talked about battery factory would already be in the billion-dollar range. There is not yet a so-called gigafactory in Europe, which produces a measurable amount of battery capacity per gigawatt-hour per year.
Skellefteå, Sweden, was chosen as the location for Northvolt's giant battery cell plant, founded by former Tesla executives.
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