There are several obstacles on the road to the battery cell factory. Lack of funding or a mining tax planned by the government may be such.
Matti Hietanen, Managing Director of Suomen Malmijalostus Oy, believes that Finland has all the prerequisites to become a leading country in the mining and battery industries.
In terms of Finland’s economic development, investing in a battery cell factory would be a significant industrial investment.
Suomen Ore Processing Ltd is currently preparing, together with its industrial partners, investments in the various stages of the battery value chain: the production of precursor materials, cathode active materials and battery cells. This is a major investment worth around EUR 1.5 billion.
Full-time jobs would generate 9,100 man-years a year and tax revenue of around € 500 million each year.
Suomen Ore Refining Ltd is a state-owned specialty company dedicated to responsible maximization of the value of domestic minerals. The company works as an active owner and technology developer of Finnish mining and battery companies and as a builder of the value chain for electric car batteries.
Is there a financing available for the battery cell factory?
However, the investment requires significant funding from the state. According to Hietanen, as a minority owner, Suomen Malmijalostus Oy’s share of the investment would be in the order of EUR 200-300 million.
However, according to Hietanen, Finnish ore refining now has to prioritize projects and for the time being cannot invest in new Finnish mining projects.
“The ongoing preparations for investing in new mining projects are now on hold, and we are focusing our available resources on our existing portfolio companies as well as on the preparation of investments in the battery value chain,” says Hietanen.
However, there are uncertainties about the financing due to the change of government in the battery cell factory, says Talouselämä.
The mission of Suomen Malminjalostus Oy is to attract companies operating in the value chain of battery production in Finland. Finnish Ore Refining would serve as a minority investor in companies investing in Finland in battery and mining companies.
According to Matti Hietanen, the company needs EUR 200-300 million in capital for this task.
Hietanen recalls that before the elections, SDP MPs issued a government program initiative in which they proposed the capitalization of Suomen Malmijalostus Oy. The Center also took a positive view of the issue. According to Hietanen, there is also reason to believe that, for example, the Greens are investing in responsible production of lithium-ion batteries for climate change prevention in Finland.
Will the road rise due to mining tax?
Changes are planned in the taxation of mining activities so that the electricity tax category of mines will change. This will increase the cost of mines and weaken the mining industry’s ability to electrify its equipment, Hietanen warns.
The government has also planned a new mining tax.
“The magnitude of the euro change in electricity taxes is largely in line with the estimates made before the elections about the possible mining tax. Nonetheless, the government program also includes an entry to investigate the introduction of the new mining tax. ”
According to Hietanen, new tax burdens will shorten mines’ operating times and may discourage new investment, so that in the long run, tax revenues will not increase by the full amount of additional taxes.
According to Hietanen, careful preparation and international comparisons to ensure that Finland remains a viable mining country are essential for the development of mining regulation and taxation.
“In addition to the mining industry, this is important for the raw materials processing industry and for the Finnish technology industry, which is based on the mining industry. The merger between Metso Minerals and Outotec, announced in early July, highlights the importance of this. ”
According to Hietanen, one of the major competitive advantages of Finnish mining in the global market is its strong sense of responsibility.
Antti Rinne’s Government Minister for Economic Affairs Katri Kulmuni (Center) tells Talouselämä that no decisions have been made on the capitalization of the Finnish Ore Refinery.
“The need for recapitalization needs to be assessed separately in the near future,” Kulmuni comments