Plans for a pellet plant in Narvik

The companies have signed an agreement with the municipality of Narvik to build a pellet plant on a site in the Narvik airport area. Last week, politicians in Narvik were informed of the letter of intent, Norwegian broadcaster NRK reported.

For Kaunis Iron, which mines iron ore in Pajala, it is about selling a larger part of its production at home in Sweden and Norrbotten, i.e. to the future steel plant in Boden that Stegra is currently building. It would also mean increased processing, from today's ore in the form of fines, to pellets.

For Stegra, it is about getting Swedish raw material for the steel plant in Boden, and avoiding importing iron ore from Canada and Brazil. The company is not allowed to buy ore from LKAB. Negotiations have stalled on the issue of capacity on the Ore Line between Malmfälten and Luleå/Boden.

Investment in a new pellet plant is about SEK 10-12 billion. Therefore, the parties need an industrial third partner who wants to enter the project, writes Dagens Industri. To make a new pellet plant profitable, a production of at least 6 million tonnes of ore is required. Kaunis Iron currently produces 2 million tonnes.

"We have and have had dialogue with potential partners. It's a matter of getting the right constellation together," Klas Dagertun, CEO of Kaunis Iron, told Dagens Industri.

The goal is to start production in 2030.

Lennart Håkansson

editor@northswedenbusiness.com