Important Decision for LKAB, Swedish Government Forces Exemption Act

At a press conference on Tuesday 21 September, Swedish Enterprise and Innovation Minister Ibrahim Baylan (S, left) and Environment and Climate Minister Per Bolund (MP) explained why the Swedish government choses to proceed with an exemption act for Cementa despite the Council on Legislation’s rejection of the proposition. (Screen shot from regeringen.se)
Despite criticism from the Council on Legislation, the Swedish government choses to proceed with an exemption law that allows Cementa to continue production beyond October. That is good news for the mining company LKAB, which is still looking for a new cement supplier.

“The proposals of this proposition aim to mitigate a serious situation”, Swedish Enterprise and Innovation Minister Ibrahim Baylan (S) said at a press conference Tuesday morning.

At the press conference, it was announced that the Swedish government choses to continue the process with its law proposal granting Sweden’s largest cement producer, Cementa, an extended time-limited permission to continue its Gotland limestone quarry beyond October this year.

Enterprise and Innovation Minister Baylan explained that if Cementa’s limestone quarry were to halt operations this fall, it could become a quite serious situation with extensive consequences for society.

Cementa runs a limestone quarry on the island of Gotland in the Baltic Sea, however, an environmental court last summer rejected Cementa’s application about continued limestone extraction after 1 November this year. The decision was based on the effect on ground water in the are not being sufficiently investigated.

The Swedish government now choses to submit its proposition to the parliament, Riksdagen, despite the Council on Legal Affair’s rejection of the proposed act last week. The Council is tasked with assessing the government’s law proposals prior to their being submitted to parliament and the Council argued a.o. that the proposal violated the generality requirement as well as the principle about a law not being created to solve one single company’s problem.

“The Council on Legislation’s criticism is serious and not something the government takes lightly. What the government has done is that in only a short time and in a complicated case, we have suggested proposals to mitigate a serious situation. Halt in housing development, many infrastructure projects, and parts of the industry would entail major consequences. The government has under these conditions made the assessment that the requirements to preparedness and generality are met based on the time frame and the time horizon we have had available”, said the minister.

“We do not do this for one company; we do this for Sweden to function well”, he added.

Important for LKAB’s mining

Cementa is Sweden’s largest cement producer and accounts for 75 percent of cement supplies in Sweden. The LKAB mining company, which runs iron ore extraction operations in North Bothnia in Northern Sweden buys almost all its cement from Cementa.

Press Manager Anders Lindberg of LKAB has stated that the company acquisitors are looking into several markets to replace the supplies.

“We are working on a number of solutions. However, we have not yet found alternatives that can replace deliveries from Cementa”, Lindberg recently said to High North News.

If supplies to LKAB were to come to a halt, it would have to reduce production by 50 to 80 percent.

The government’s proposal is now submitted to parliament and the changes to the law are proposed to enter into force on 15 October 2021.

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This article was originally published in Norwegian and has been translated by HNN's Elisabeth Bergquist.

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