9 Industrial, mining and commercial activity

9.1 Coal mining – Store Norske Spitsbergen Kulkompani AS

9.1.1 Company history

Store Norske Spitsbergen Kulkompani AS (abbreviated to Store Norske or SNSK) was founded in 1916 and mines coal in Svalbard. In 1973, the Norwegian state acquired a third of the shares in the company, and since 1976, the state has owned a 99.94 per cent stake. The Ministry of Trade and Industry manages the state’s holding in SNSK.

At present, the mining operations are mainly located in the Svea Nord mine at Svea, a mining community at the head of the Van Mijenfjord. In addition, SNSK operates the smaller Mine 7 near Longyearbyen.

Up to 1989, coal mining was the dominant industry in Longyearbyen, and the SNSK group was responsible for operating the infrastructure and providing many of the services there. In Report No. 50 (1990 – 91) to the Storting on industrial measures for Svalbard, the Government advocated a policy of trying to increase the diversification of profitable economic activities. Through a reorganisation of SNSK in 1989, the activities related to community services (housing, roads, energy supply, etc.) and tourist activity were spun off in wholly-owned subsidiaries, Svalbard Samfunnsdrift AS (SSD) and Spitsbergen Travel AS. An economic development company was also established. In 1993, the state purchased all the shares in Svalbard Samfunnsdrift from Store Norske. Thereafter, SNSK was supposed to concentrate on coal mining and related activities and not perform activities that could better be handled by others.

For many years, SNSK’s coal mining operations at Longyearbyen operated at a loss and were maintained with subsidies from the national budget. The reasons for the state’s involvement in the company and the financial support it provided were mainly national considerations. The coal mining operations were regarded as an important policy instrument for ensuring Norwegian activity and settlement in Svalbard. The jobs related to the coal mining operations made substantial contributions to a stable, year-round Norwegian industrial activity and settlement in Longyearbyen.

In 1997, SNSK launched a study of the possibilities of continuing the coal mining in Svea Nord, a large coal field about 5 km North of Svea. The deposits in Svea Vest, which had been mined since 1997, were played out, and the mine was closed down in October 2000. The remaining reserves in Mine 7 were small. If there were to be any long-term continuation of coal mining, it would have to be in Svea Nord. The only alternative was a controlled liquidation of SNSK. Future operations at Svea Nord would be dependent on the employees commuting between Longyearbyen and Svea. In the revised National Budget for 1999, SNSK was allocated NOK 27 million to initiate the work on an exploration drift in Svea Nord, cf. Proposition No. 67 (1998 – 99) to the Storting on new priorities and supplementary allocations in the 1999 National Budget.

9.1.2 Developments in the company since the previous Report to the Storting on Svalbard

In the autumn of 2001, SNSK commenced production in Svea Nord. Previous studies and pilot operations indicated that the Svea Nord field had resources that could provide the basis for 20 – 30 years of operation. In the consideration of Proposition No. 2 (2001 – 2002) to the Storting on Store Norske Spitsbergen Kulkompani AS and the Svea Nord project, cf. Recommendation No. 67 (2001 – 2002) to the Storting and the Storting’s resolution of 19 December 2001, it was established that the mining operations should be commercially viable and independent of state support. Furthermore, approval was granted to spin off the mining operations in Svea at year-end 2001 into a wholly-owned subsidiary of SNSK, which was given the name Store Norske Spitsbergen Grubekompani AS (SNSG). At the same time, the Storting approved an allocation of NOK 50 million in new share capital to SNSK. It was assumed that these funds would be used as equity in SNSG.

In recent years, SNSK has been confronted with major challenges in the Svea Nord mine: water penetration, fire and other disruptions of operations. In 2003, a miner died after being struck by a falling rock, and in July 2005, a miner died as a result of oxygen depletion after a gas accident. On 30 July 2005, a fire broke out in the main shaft in the Svea Nord mine. The fire caused extensive damage to mining facilities and equipment, and the operations in Svea Nord did not commence again until 1 April 2006 after an eight-month shutdown.

In the period before the conclusion of the insurance settlement, the need arose to give the company a capital infusion. This was done in the form of a subordinated loan of NOK 250 million from the state. This loan was supposed to be repaid when the insurance settlement was concluded. The company redeemed the subordinated loan in September 2008.

In 2007, Store Norske Boliger AS was spun off from SNSG and organised as a wholly owned subsidiary under SNSK. The objective was to protect the residential properties in Longyearbyen from a possible bankruptcy of SNSG. The Store Norske group currently consists of a parent company, Store Norske Spitsbergen Kulkompani AS, and the wholly-owned subsidiaries, Store Norske Spitsbergen Grubekompani AS, Store Norske Gull AS and Store Norske Boliger AS. At year-end 2008, the group had a total of 386 employees, of which 337 were employed in the mining company.

Store Norske is the largest private landowner in Svalbard and owns 2006 km² of land, including the land in Longyearbyen. The company has entered into a cooperative agreement with the Longyearbyen Community Council concerning management of the land, cf. section 4.3.6.

Store Norske is also the largest claim-holder in Svalbard with 316 claims. After the introduction of the Svalbard Environmental Protection Act in 2002, large areas in the archipelago were protected. The areas that were protected were also subject to claim, and altogether 98 of the group’s claims were subject to restrictions due to protection. At the same time, a graduated claims fee was introduced in the protected areas, and the protection was defined as the basis for receiving dispensation from the obligation to work the claims. The group has chosen to retain the claims that are located in currently protected areas.

SNSK has mineral deposits in areas in Svalbard that are not protected, and the purpose of founding Store Norske Gull AS in 2003 was to continue to work these deposits. Store Norske Gull currently conducts the company’s mineral prospecting in Svalbard.

In addition, SNSG has conducted surveys in Finnmark County and on the island of Senja. The results of these surveys caused SNSK to approve a new objects clause for the company at the ordinary general meeting in June 2007. Article 1 of the Articles of Association was given an addition that reads as follows:

“The company can utilise its skills in environment-friendly resource exploitation in Svalbard and in Finnmark and Troms counties.”

9.1.3 Coal mining at present

In Report No. 13 (2006 – 2007) to the Storting, An Active and Long-term State Ownership (the State Ownership Report), Store Norske Spitsbergen Kulkompani AS is classified in objective category no. 3. That entails that the state in its capacity as owner shall manage the company so as to enable it to achieve commercial goals and other specifically defined goals. In the consideration of Recommendation No. 167 (2006 – 2007) to the Storting, the Storting endorsed these goals. In the State Ownership Report, it is stated that the object of the state’s ownership of SNSK is:

“to help maintain and further develop the society in Longyearbyen in a way that supports the overriding goals of Norwegian Svalbard policy. The company shall be run according to commercial principles with the aim of achieving a market rate of return on invested capital.”

As mentioned in the introduction to this chapter, the mining operations in SNSG are mainly concentrated in the Svea Nord mine. About 95 per cent of the coal production is exported. In addition, Store Norske has a smaller mining operation in Mine 7 near Longyearbyen, where about 35 per cent of the coal is delivered to the local energy utility.

SNSK’s cost level is persistently high. To a certain extent, this is due to conditions that company has to accept as given, such as the business’s location, operating conditions, safety requirements, general wage pressure and other conditions. Nevertheless, the cost trend has been worrisome in recent years and is a challenge for the company.

Proposition No. 2 (2001 – 2002) to the Storting on Store Norske Spitsbergen Kulkompani AS and the Svea Nord project states that the surveys that were available at that time indicated resources in the Svea Nord field that provided the basis for 20 – 30 years of operations, given a production volume of between one and two million tonnes a year. For various reasons, the production volume has been considerably higher than that. In 2003, SNSG won approval to invest in a tunnel from Svea Nord to Braganzavågen, cf. Proposition No. 65 (2002 – 2003) to the Storting, Supplementary allocations and new priorities in the national budget including the national insurance in 2003. The proposition states that:

“In order to ensure profitable operations, the mining company will have to have a higher annual production and sales volume than previously assumed. SNSG is now going in for a production volume of 2.5 million tonnes in the period 2003 – 2005 and then 2.0 million tonnes a year after that. This entails that the remaining lifetime of the deposit will be about 15 years.”

After the fire in the mine in 2005 and the accident in 2006, Store Norske regarded it as important to regain confidence in the company and to exploit a good coal market to improve its liquidity by increasing production to 4 million tonnes in 2007. Production for 2008 came to 3.4 million tonnes. According to SNSK’s operating plans with the current production volume of about three million tonnes per year, it is now estimated that the coal deposits in Svea Nord will be played out in another 5 – 6 years.

After the Svea Nord mine came into operation, coal prices rose considerably up to the end of 2008, when prices fell. Higher coal prices gave the company the freedom to make investments and determine volume and the number of employees. This has been crucial for a good utilisation of available resources and the commercial success of the coal mining so far – despite the fire, accidents and other interruptions in operations.

9.1.4 Safety and environment

The Government stipulates that safety and environmental considerations must be given the highest priority in all assessments related to the mining operations.

Safety

In December 2007, the Office of the Auditor General initiated a study of the management of the state’s ownership interests in SNSK. One of the reasons for doing so was two fatal accidents in Svea Nord in 2003 and 2005. In particular, the Office of the Auditor General questioned whether the safety work had been carried out in accordance with the Storting’s requirements and whether NHD had sufficiently monitored whether the company had complied with the Storting’s requirements in this area in the period 2001 – 2005. The Office of the Auditor General submitted a report to the Storting on 14 October 2008, cf. Document No. 1 (2008 – 2009) The Office of the Auditor General’s report on the annual audit and control for the 2007 fiscal year.

Maintaining adequate safety in connection with mining operations is the most important task for the company’s management and board of directors. It is the Northern Norway Labour Inspection Authority that monitors the safety regulations for the coal mines in Svalbard. However, the Ministry that owns the company conducts a special monitoring of safety in connection with the mining operations by regularly monitoring the work on social responsibility in general and safety in particular. The HSE conditions are a top priority topic in the Ministry’s contacts with the company’s management and will be brought up, for example, at the regular quarterly meetings and at the company’s general meetings. In 2008, the company developed a comprehensive HSE system for internal control. According to the company’s management, the system is being implemented according to plan.

Environment

On an equivalent basis with other activities in Svalbard, coal mining must be conducted in accordance with the ambitious environmental objectives and the environmental regulations that are in effect in the archipelago. The environmental constraints for industrial operations are discussed in greater detail in section 7.4.3. With regard to the goal of preserving the natural wilderness in Svalbard, it is especially important that the coal mining not reduce the extent of wilderness areas or have a negative impact on important conservation values.

9.1.5 Store Norske’s plans for future coal mining in Svalbard

Resource base

SNSK is now making plans for future coal mining in other deposits to replace the current operations in the Svea Nord mine. Future coal mining in Svalbard under the direction of SNSK will be submitted to the Storting as a separate item of business when the project has been fully studied.

The company has made major investments in connection with the development of Svea Nord and associated facilities for the transport and shipping of coal. Major investments have also been made in the infrastructure of the Svea area. In the event of coal mining in other, smaller deposits, it is probably a necessary condition for profitable operation and preservation of the environment that the infrastructure in Svea can continue to be used. Substantial new investment will be necessary for coal mining even in the case where existing infrastructure can be used.

After the planned closing of the Svea Nord mine in 2014, SNSK will assess possible further operations in four new locations in the Svea area, where existing infrastructure can be used. These are Lunckefjell (9), Svea Øst (4), the fringe zone of Svea Nord (6) and Ispallen (11), where the numbers in parentheses indicate the estimated size of the coal reserves in millions of tonnes. Remaining reserves in Svea Nord are estimated at 15 million tonnes. Thus, in the company’s estimation, there is currently a total of about 45 million tonnes of remaining surveyed coal reserves in the Svea area.

Source SNSK

Planned coal mining at Lunckefjell

Based on geological surveys of the resources at Lunckefjell, which is located northeast of the Svea Nord mine, it is estimated that the field will yield 9 million tonnes of recoverable coal. This will provide a basis for operation for somewhere between four and eight years. If there should be mining operations at Lunckefjell, it will be necessary to build a transport road between Svea Nord and Lunckefjell across the Märthabreen Glacier, i.e. a stretch of about two kilometres. According to the company, the discharges of environmentally hazardous substances will be modest, and it is planned that when the mining is terminated as many of the traces of the mine as possible will be removed. To this must be added the openings out of Svea Nord and into Lunckefjell. The development will occur right up to the border of the national park in the Reindalen valley. Discharges of mine water can drain into the park.

Plans for new mining operations will require an environmental impact assessment pursuant to Section 59 of the Svalbard Environmental Protection Act. In June, the Governor of Svalbard in consultation with the Directorate of Mining established a research programme for the Lunckefjell project that would focus on the topics of natural environment, society and climate. In this research programme, the question of runoff into the national park will be an important one. It is also specified in the research programme that an overview shall be prepared of coal mining’s contributions to emissions of greenhouse gases. Among other things, this overview shall include emissions of greenhouse gases from the combustion of mined and sold coal.

A zero alternative including the consequences associated with closing down the coal mining operations shall also be studied. SNSK plans to submit the environmental impact assessment and application to the Governor in the autumn of 2009. According to plan, the Governor shall circulate the environmental impact assessment for comment in October 2009 with a two-month deadline for inputs. The environmental authorities’ resolution, including any permits, is expected in the third quarter of 2010. In order to facilitate coal mining at Luncke­fjell, a necessary investment on the order of NOK 1 billion has been estimated. The company is currently assessing various production paths and methods of operation. Among other things, the Lunckefjell project’s estimated profitability is sensitive to changes in expected start-up date, the price of coal, the exchange rate on the dollar and the cost level, including the number of employees.

If the project goes ahead and a permit is issued, the main project will be prepared with a view to the start-up of operations in the actual deposits around the middle of 2013, with the transport of construction equipment and road building beginning in 2010. The start-up is thus planned to be coordinated with the removal of the remaining coal panels in the Svea Nord mine.

The Government’s work on the Lunckefjell project

Essentially, the Lunckefjell project is an investment decision for SNSK’s Board of Directors. However, the project constitutes a substantial investment that is associated with a relatively large financial risk and will have a significant effect on the company’s equity and dividend capacity, among other things. These are key questions for the owners, and thus it is natural that the project be submitted to the general meeting.

In keeping with the administration of ownership, it is clearly a necessary condition that SNSK’s coal mining should be commercially profitable. The Ministry of Trade and Industry wants to evaluate the Lunckefjell project on the basis of its own assessments of the company’s calculations and by hiring an independent adviser. Final consideration in the ministry also requires that the project be issued a permit pursuant to the Svalbard Environmental Protection Act. According to the schedule, this may occur in April 2010 or alternatively in the autumn of 2010. Before then, the environmental impact assessment and the company’s application to the Governor will have been completed. In addition to commercial profitability, key evaluation criteria for the Government will include the project’s effect on the settlement in Longyearbyen and its environmental impacts. Future coal mining must also be carried out in a way that conforms to the ambitious environmental objectives in Svalbard. The Government further specifies that safety must be given the highest priority in all assessments related to mining operations. Profitability must not come at the expense of safety or the environment.

Future coal mining and the Svalbard community

SNSK envisions that the resources in the Svea area can sustain coal mining until 2023. However, this time horizon assumes the opening of new mines in Lunckefjell and Ispallen, which is dependent in turn on commercial profitability and the projects being environmentally acceptable.

The company is currently evaluating production paths for the remaining resources in Svea Nord and likewise in Lunckefjell in the event of any operations there. If the production volume is reduced to 2 million tonnes per year, the resource base can be further extended. According to the company, it ought to be possible to achieve this without substantially reducing profitability. The company has expressed a manpower goal of 310 employees in 2010. This assumes that the downsizing will occur through natural wastage. As mentioned, the group had a total of 396 employees at year-end 2007, 337 of which were employed in the mining company. To this can be added a considerable number of externally hired crews.

The commercial and social analysis for Svalbard for 2007 shows that SNSK makes a good contribution to stability, year-round activity and family community in Longyearbyen. Coal mining is by far the largest basic industry in Svalbard, and when derived activities are included, coal mining accounts for 40 per cent of the total full-time equivalents (FTEs) in Longyearbyen and Svea.

At the request of the Ministry of Justice and the Police, the Norwegian Institute for Urban and Regional Research (NIBR) has analysed the relationship between production and employment in SNSK and the social development in Longyearbyen. Although most jobs related to coal mining are in Svea, and a large percentage of the employees in SNSK commute to the mainland, NIBR report 2008:22 makes it clear that a possible disappearance of coal mining will have major ripple effects in the local community. According to the NIBR report, these effects may be limited to some extent by encouraging alternative activities, such as research, education and ecotourism.

The company’s working hour arrangements are important for the community in Longyearbyen. Through the employee organisations, a proposal was submitted a couple of years ago for an arrangement with 14 days on the job and 14 days off, and it has been possible to institute this as a trial scheme. SNSK’s Board of Directors decided in the spring of 2008 to continue this arrangement for an interim period lasting until January 2010. The arrangement gives the employees better opportunities to travel from Svalbard to the mainland and was initially a trial scheme for one year. One reason for the introduction of this trial scheme was the lack of family dwellings in Longyearbyen and of jobs for spouses or cohabitants.

Studies show that about half of SNSK’s employees currently commute to the mainland on their time off. Increased commuting may make Longyearbyen seem more like a commuter society as opposed to the family community that has evolved over a period of time. This can lead to problems with keeping the school and day care institutions open and will weaken some of the basis for a robust local community. Store Norske has now gone in for devising arrangements for working hours and dwellings so that there will be less commuting and the company’s residential properties will be more fully utilised. The company is also signalling its intention to develop a new recruitment policy, suited to attracting more miners to settle in Longyearbyen. Together with the company, the Ministry of Trade and Industry will review the experiences from the trial scheme and evaluate on this basis whether it may be relevant to discuss continuing such arrangements with the Board of Directors.

Coal mining as a policy instrument in the Svalbard policy

One of the five main objectives of Svalbard policy is the maintenance of Norwegian communities in the archipelago. This objective has been met through the family community in Longyearbyen. At present, more than 100 years after its foundation, coal mining is still the most important mainstay for this community. However, coal mining is based on a non-renewable resource. It is also vulnerable to fluctuations in the price of coal, and recent history has shown that unforeseen events may have major consequences for this activity.

Coal mining has traditionally taken place in the vicinity of established communities and throughout history has also formed the basis for Longyearbyen and other communities in the archipelago. At present, Norwegian coal mining is mainly based in the Svea area. There are also mining operations in Longyearbyen. Based on the current situation, as mentioned above, there can be a basis for mining in the Svea area up to 2023. This assumes that it is commercially viable to open new mines in the Svea area, with Lunckefjellet the first development project after Svea Nord is played out, or alternatively the fringe zone, Ispallen and Svea-Øst. It is also a necessary condition that the projects separately and aggregately are acceptable on the basis of environmental considerations and the goal of preserving the natural wilderness in Svalbard the way this has been regulated through the Svalbard Environmental Protection Act.

Continued coal mining is essential for maintaining Longyearbyen as a family community. It is the Government’s view that coal mining should continue within the strict constraints set by environmental legislation and commercial profitability and in a manner that supports the objective of Store Norske Spitsbergen Kulkompani to help support a robust community in Longyearbyen. Existing infrastructure for coal mining operations should be used where possible. At the same time, it is important to support existing and new, diversified activities in Longyearbyen. This is especially true of the activity at UNIS, a further development of Svalbard as a platform for research and education and further development of tourism and space-related activities. Developments in the various areas must be considered in context and assessed in view of the overriding objectives of Svalbard policy, including the ambitious environmental goals for the archipelago.

Source Bjørn Frantzen

The Mining Code for Svalbard

The right to apply for, acquire and exploit natural deposits is regulated by the Mining Code for Svalbard, laid down by the Royal Decree of 7 August 1925. The Mining Code is based on two principles: equal access to conduct exploration and mining operations on the basis of the principle of non-discrimination and first finder’s right to be issued a so-called claim (area where the right to mining operations is granted). As previously mentioned, SNSK currently has 316 claims in Svalbard, which cover a total area of about 3,000 km². In 2007, there were a total of 382 claims, and the Russian company Trust Arktikugol is the second largest claim holder with 50 claims. Pursuant to Section 15 of the Mining Code, a claim holder is obligated to commence mining operations within the claim. However, this obligation to work the claim is not absolute, and dispensation can be applied for on terms that are further specified. The Commissioner of Mines makes his/her recommendation on the matter to the Ministry of Trade and Industry, which can issue dispensation from the requirement concerning the obligation to work the claim. If the claim holder does not fulfil the obligations pursuant to Section 15 or dispensation is not granted, the claims will lapse. Others can then apply for a claim in the area. This means that if SNSK on the basis of various assessments decides upon permanently closing down the mining operations in Svalbard, the claims will lapse in time and may be exploited by others. However, the restrictions on the possibility of carrying out infrastructure development that has an impact on the natural wilderness and the protected areas in Svalbard will be the same for other players as they are for Store Norske. These restrictions are discussed in greater detail in section 7.4.3.

9.2 Tourism

In Report No. 50 (1990 – 1991) to the Storting on industrial measures for Svalbard, the Government wanted to facilitate the development of tourism as a basic commercial activity in Svalbard. It was established that the development should occur within the constraints set by considerations with regard to the vulnerable natural environment. Since the early 1990s, there has been a rapid growth in tourism in Svalbard. The number of registered commercial guest nights at hotels or guest houses has risen from barely 20,000 in 1991 to over 86,000 guest nights in 2007.

The support of tourism was followed up in Report No. 9 (1999 – 2000) to the Storting, Svalbard, where it was established that tourism had become an important basis for settlement and economic activity in the archipelago and especially in Longyearbyen. At the same time, it was also shown that increased traffic and visits to certain locations had resulted in increased wear on vegetation, soil and cultural monuments in addition to greater noise and disturbance of fauna.

Together with coal mining and R&D activities, tourism is currently one of the basic industries in the archipelago. The Government thinks that a further development of tourism in Svalbard is important. This may contribute to a more diversified economic structure in Longyearbyen and may provide a basis for increased economic growth. Together with other industries and activities, tourism will contribute to a robust settlement and less dependence on coal mining. In order for tourism to make further contributions to a more robust and diversified family community, it is important that more year-round jobs be developed.

At the same time as the Government arranges for a further development of tourism in Svalbard, it is an overriding objective that Svalbard shall be one of the world’s best managed wilderness areas and the best preserved High Arctic tourist destination in the world. The ambitious environmental objectives and environmental legislation for Svalbard will continue to provide the framework for the development of tourism.

The growth in tourism in Svalbard, in terms of visitors, employment and the number of companies has been considerable in the past decade. The growth has occurred in waves. The growth in the period 1999 – 2001 was especially rapid, before it levelled off in the period 2001 – 2005. The last few years have seen another increase in the number of guest nights (cf. table 9.1) 1.

In 2007, the tourism industry directly employed 211 persons and contributed to 83 FTEs in derived activities. The industry had a turnover of about NOK 317 million (cf. tables 9.2 and 9.3) and generated a turnover in local purchases amounting to about NOK 88 million. Since 2003, the growth in the number of FTEs and in turnover has been significant, even though the number of available beds in Longyearbyen has remained about the same.

A sizeable programme of activities and other experiences has been developed in Longyearbyen in the last twenty years. Taking into consideration the size of its urban population, Longyearbyen can currently offer a highly diverse tourist product. Much of this involves activities in connection with the natural environment, such as guided hikes in the vicinity of the town, kayak trips, ice caving beneath glaciers or snowmobile and dog-sled safaris. Guest surveys indicate that it is precisely these activities that most tourists want to experience. Out of consideration for the environment and the tourists’ safety, the Government thinks that the tourist product must be developed within strict safety and environmental constraints. Cruise tourism constitutes an important part of the tourism in Svalbard. Cruise tourism can be divided into two main segments: overseas cruise tourism, where the boats come from far away, and expedition cruise tourism, where Longyearbyen is the start and endpoint of a cruise in the waters of the archipelago. The tourists and the staff from overseas cruise ships are more or less self-sufficient, but contribute to the trade in goods in Longyearbyen and Ny-Ålesund during disembarkations. The expedition cruises are combined to a great extent with accommodation in Longyearbyen before and after departure and thereby contribute to a somewhat greater extent to local economic growth. Cruise tourism is aimed at affluent customers. Therefore, it is important to develop a good programme that persuades the cruise passengers to choose to make use of this commercial and cultural offering.

Svalbard has been devoted considerable international attention in recent years. The opening of the Svalbard Global Seed Vault in 2008 was covered by a large international press corps. Furthermore, it is expected that marketing, such as the BBC documentary about Northern Norway and Svalbard in the autumn of 2008 and Lonely Planet’s listing of Svalbard as one of the ten destinations that ought to be visited in 2009, will result in an increased influx of foreign tourists in the coming years. The efforts to evaluate whether areas in Svalbard should be nominated for the list of the world’s natural and cultural heritage are discussed in section 7.4.5. Possible status as a World Heritage site may result in increased interest in Svalbard as a tourist destination.

9.2.1 Operators

The tourism industry in Svalbard consists of a number of large and small companies that offer various products for both summer and winter tourism. Most of the companies are locally based and have their entire activity based in Svalbard, but foreign operators also offer tourist products in the archipelago, e.g. expedition cruise companies.

The Svalbard Tourist Board was established in 1996 as a cooperative body for companies involved in tourism and tourism-related activities in the archipelago. The Svalbard Tourist Board was established in order to facilitate cooperation on marketing, quality assurance, competence building, product development and environmental measures in the tourism industry. Info-Svalbard, which comes under Svalbard Næringsutvikling AS, had the secretariat function for the Tourist Board until 2001. Starting in 2001, Info-Svalbard changed its name to Svalbard Reiseliv AS and was acquired by the Svalbard Tourist Board. Svalbard Reiseliv AS currently has three permanent employees and is supposed to function as the coordinating body for tourism in the archipelago. Svalbard Reiseliv AS operates on the basis of action plans approved by the Svalbard Tourist Board and is the secretariat for the Tourist Board. Its areas of responsibility include the general marketing of Svalbard as a destination through the production and distribution of information material and statistics in addition to the operation of the tourist information office in Longyearbyen.

The Svalbard Tourist Board has prepared separate internal guidelines for organised tours with snowmobiles and consults with local authorities in Svalbard on guidelines for other types of traffic. The members have obligated themselves to comply with these guidelines.

In the previous Report to the Storting on Svalbard, it was emphasised that the industry itself should be given greater responsibility for the development of tourism in Svalbard through the current Svalbard Reiseliv AS, which was assumed to be an important partner for the authorities in the development of tourism. This has been a good strategy, which the Government will continue.

The Svalbard Tourist Board cooperates well with the authorities in Svalbard with regard to the development of an environment-friendly tourist product. The Government is in favour of continuing and further developing this cooperation.

The Svalbard Tourist Board currently has 60 member companies, all of which are located in Svalbard. In 2006, Svalbard Reiseliv AS, the public space in the Svalbard Museum and the Governor’s Environmental Information Office were co-located in the newly constructed Svalbard Research Centre in Longyearbyen. It is important to the Government that the synergy effects made possible by this kind of co-location be utilised in a good way.

Since 2001, Svalbard Reiseliv AS has received an annual subsidy of NOK 2 million from the Ministry of Trade and Industry. For 2009, this subsidy has increased to NOK 2.1 million. In addition, the member companies in the Svalbard Tourist Board contribute a user fee in connection with trade fairs, seminars and a separate training programme for guides that is organised by Svalbard Reiseliv AS on behalf of the Tourist Board.

Another form of cooperation in the tourism industry is the organisation, Association of Arctic Cruise Operators (AECO). This is an amalgamation of companies that operate expedition cruise vessels in the areas around Svalbard, Jan Mayen and Greenland. The secretariat of AECO is located in Longyearbyen, while the member companies are located in seven different countries, including Norway. The members operate a total of just over 20 vessels, everything from sailing vessels to cruise ships with more than 300 passengers. AECO is an interest group, but has also established its own internal guidelines for the member companies with regard to safety and the environment when conducting tour programmes. These guidelines have been developed after contact with the national authorities in the areas where the ships operate, and they have requirements that are stricter at times than those that have been incorporated in national legislation. The members have obligated themselves to comply with both the laws and regulations that are in force in the areas where the ships operate and with AECO’s internal guidelines.

The tourism industry plays an important role in raising awareness of and informing visitors about the environmental challenges in the Arctic. Tourism in Svalbard has shown considerable responsibility in limiting possible impacts on the environment and maintaining the safety of the visitors through the development of its tourist products and guidelines for traffic in Svalbard’s natural environment and with regard to informing visitors about the vulnerable environment in the Arctic. It is important that there be good contact between the tourism industry, the scientific community and the authorities. Mutual information and communication help ensure both compliance with the existing regulations and the development of a better understanding of the importance of attending to safety and environmental considerations. For a further discussion of the cooperation between the tourism industry and the Governor of Svalbard, cf. section 6.3.1.

9.2.2 Education and competency requirements for guides and tour leaders

In various contexts, Norwegian authorities have pointed out that quality and expertise in the tourism industry in Svalbard are important factors when it comes to considerations of both safety and protection of the environment.

The guide training that is organised by Svalbard Reiseliv AS on behalf of the Tourist Board is a good example of efforts to professionalise and improve the quality of tourism in Svalbard. Through practical courses and certification as so-called Svalbard guides, the training of guides should ensure the quality and improve the safety of the tour products that are offered in the archipelago.

On 1 April 2007, an environmental charge of NOK 150 was introduced for all visitors to Svalbard. The revenue from this charge goes to the Svalbard Environmental Protection Fund. The fund should be used to launch projects that contribute to the preservation of Svalbard’s natural environment as a basis for experience, knowledge and economic growth. For more details about the Svalbard Environmental Protection Fund, cf. Box 7.1. With funding from the Svalbard Environmental Protection Fund, the Svalbard Tourist Board in collaboration with UNIS and Finnmark University College has drawn up a plan for a one-year university college programme of study in Arctic nature guiding.

In 2009, a total of NOK 1.25 million was allocated from the Ministry of Trade and Industry and the Ministry of Justice and the Police to launch this programme of study in the autumn of 2009. The students in the programme will gain competence in tour planning, tour management and acting as host. The programme of study shall lay the basis for development of sustainable tourism and ensure quality experiences that are adapted to the natural environment, culture and geopolitical conditions in polar regions. This kind of programme of education in Arctic nature guiding may help improve the quality of the tourist product of Svalbard in its entirety, both by helping promote a safer and more justifiable traffic in the vulnerable Svalbard natural environment and by quality assuring the informative aspects of the role as guide.

As a follow-up of Report No. 9 (1999 – 2000) to the Storting, Svalbard, provisions were introduced during the revision of the tourist regulations in 2002 that give the Governor an opportunity to specify requirements concerning the documentation of sufficient and relevant knowledge of local conditions. However, it was also signalled in the Report that the possibility of introducing the right to require that tour operators use approved guides would be considered, e.g. by requiring that they had completed the guide and tour training that is now being provided by Svalbard Reiseliv AS on behalf of the Svalbard Tourist Board. However, these provisions have not been introduced. In view of the development of the tourist industry and the educational opportunities that are now offered, the Government thinks that there is reason to conduct a renewed evaluation of this matter.

9.2.3 Legal constraints

The Regulations of 18 October 1991 relating to tourism and other travel in Svalbard are one of the most important constraints with regard to developing tourist products in Svalbard. They were last amended by the Regulations of 18 June 2002. These regulations have provisions concerning guarantees, insurance and liability with regard to tour programmes and other tourism activities, and they apply to both tourist enterprises and individual travellers. They are intended to help protect the natural and cultural environment and to ensure that safety precautions are observed and that other rules are complied with. The regulations impose an obligation on travel agents, tourist carriers and individual travellers to notify the authorities and take out insurance prior to travel in certain areas in the archipelago. In addition, the regulations give the Governor authority to alter or prohibit tour programmes if that is deemed necessary. Other important regulations are the Regulations concerning harbours and fairways, the Camping Regulations and the Regulations about motorised traffic. The latter lay down guidelines for snowmobile traffic and prohibit tourist sightseeing by aircraft, while the Camping Regulations regulate tent camping in the archipelago.

The Svalbard Environmental Protection Act has the objective of maintaining a virtually untouched environment in Svalbard with regard to both the natural environment and cultural monuments. Within this framework, the Act allows room for environmentally justifiable settlement, research and economic development. If there is insufficient knowledge about the environmental impacts of new measures, authority shall be exercised with the aim of avoiding possible damaging effects on the environment – the so-called precautionary principle. It is also pointed out, however, that the legislation should not prevent settlement, research and economic development that are deemed to be environmentally justifiable. For a more detailed discussion of the Svalbard Environmental Protection Act, cf. Chap. 7 Environmental protection.

In recent years, a number of amendments to the regulations concerning protection and traffic have been passed, which apply to large parts of the archipelago. This trend will affect the cruise industry in the archipelago, among others, and makes requirements for continuous restructuring of the industry. The tourist industry has expressed a desire for more predictability with regard to new restrictions and rules, so as to thereby have a better basis for long-term planning – at the same time as increasing traffic and new traffic patterns create a need for regulation out of consideration for the environment and safety. When amendments are made in existing regulations, it is important that consideration be given to what the consequences of the amendments will be for business and industry, including tourism.

The development of tourist products has mostly occurred through a cooperation between the agents in the tourism industry and the authorities that administer key laws and regulations. It is important to the Government that this cooperation continue and be further developed. It can provide a basis for predictable operating constraints on tourism and the development of tourist products in an environmentally justifiable framework. At the request of the Ministry of Justice and the Police, the Governor has recently undertaken an evaluation of the Tourist Regulations, and some amendments to these regulations have been proposed. The Ministry of Justice and the Police will evaluate the proposals, and in light of this possibly recommend necessary amendments to the regulations.

9.2.4 Challenges and objectives

There is a potential for further growth in tourism in Svalbard, but seasonal fluctuations and the relatively low occupancy rate are important challenges in that respect. The occupancy of lodging facilities is high in the high season, but in the low and shoulder seasons there is a great unutilised potential. The efforts to develop the course and conference market have helped improve the occupancy for the lodging facilities early and late in the seasons. These seasonal fluctuations are a challenge with regard to maintaining year-round jobs in Longyearbyen. Thus, it is important to make a purposeful effort to develop a tourist product that provides a basis for year-round employment in Longyearbyen.

As can be seen in figure 9.3, tourism in Longyearbyen is concentrated in two peaks: one in the period around the Easter vacation after the sun has returned and the other in the summer months. In the period of polar night from October to February, when the sun never rises above the horizon, there are relatively few visitors.

Source Svalbard Reiseliv AS – Annual Report 2007

It is holiday and leisure travellers who spend the most money on tourism in Svalbard by paying for a number of activities and experiences in addition to buying food and beverages. Business travellers have a lower consumption. Therefore, it is important that the market for business travellers be better exploited. Holiday and leisure travellers are regarded as the market where the potential for growth is greatest, especially if more foreign tourists visit Svalbard. Sixty-five per cent of the current tourists to the archipelago are Norwegian.

The tourist industry in Svalbard notes that changes in flight routes and restrictions on the number of flights outside the high seasons make it difficult to do anything about the seasonal challenges. SAS’s schedule of flights is seasonally adjusted, and SAS is currently the only airline that flies to Svalbard after Norwegian discontinued its route in 2008 after two seasons of operation.

It is not desirable that tourist products be developed that may result in environmental or safety risks. Strict rules for traffic, combined with the obligation to notify the authorities and take out insurance should reduce this risk. In the event of increased traffic, there may be a greater impact on natural areas and cultural monuments that are vulnerable, and that may lead to land-use conflicts both with research and with various types of tourist products. The need for regulation of various types of traffic may also become greater. Maintaining the balance between development of tourism and the ambitious environmental objectives for Svalbard is challenging. This issue is especially relevant with regard to traffic related to expedition cruises in the big nature reserves in East Svalbard, where various measures to regulate the traffic will be assessed. This matter and other challenges and measures related to traffic in Svalbard are further discussed in section 7.4.2.

Ecotourism is a tourism niche that is well suited to the constraints that are specified in the Svalbard Environmental Protection Act and a natural target area for the tourist industry in Svalbard. The adventure and dog-sledding company, Svalbard Villmarkssenter AS, is one of the companies that is concentrating on this niche, and they have recently become a “Certified Norwegian Ecotourism Business”. The symbol certification scheme “Norwegian Ecotourism” sets strict requirements for environmental and sustainable measures, good hosting and a locally based involvement in the community. The typical ecotourist is distinguished by being older, well-educated, affluent and interested in wilderness and outdoor activities. Thus, the profile of a typical ecotourist coincides with the typical Svalbard tourist. It is important to the Government that the tourist industry develop the tourist product in such a way that it does not damage the archipelago’s foremost attraction, which is the undisturbed natural environment and the authentic wilderness experience. Most of the tourists visiting Svalbard have Longyearbyen as the point of departure for their visit, and it is desirable that the traffic be concentrated in the Longyearbyen area. It makes sense to facilitate a concentration of traffic in this area, while protecting other areas fully or partly from traffic. The further development of ecotourism and non-motorised tourism largely depends on how arrangements are made for this tourism and how land-use conflicts with regard to motorised traffic are handled. This is especially true in the areas around Longyearbyen, where a protection of areas that are attractive and provide sufficient space for development of non-motorised tourism is an important factor. The need to make better arrangements for the non-motorised tourism is further described in section 7.4.2.

In order to extend the season, innovative ideas and product development will be needed in the industry. One example of these innovative ideas is the polar nights initiative, which attempts to increase the tourist traffic during the polar night, which has traditionally been the low season. They are attempting to do this by establishing a comprehensive marketing concept with the emphasis on the aurora borealis and outdoor activities during the polar night. This collaborative project has broad support in the business community and trade union movement in Longyearbyen, and the cooperative aspect of the project in particular is important in order to create good, comprehensive tourist products.

Longyearbyen also has a potential for much better utilisation of the local cultural and natural environments. In this way, another dimension will be added to the local community, both environmentally and as an experience, and Longyearbyen will be developed as an attractive tourist destination. In this context, the Environmental Protection Fund has already funded many good local development projects. One good measure that is under development is a nature and culture path. This is supposed to consist of information points around Longyearbyen that provide information about the location’s natural environment, culture and history to visitors and residents alike who get around on foot or on a bicycle. Other local measures are observation points for bird watching and arrangements to promote colonies of eider ducks and other species. A collaboration between Longyearbyen Community Council and Svalbard Reiseliv has also resulted in a resolution that Svalbard shall become a so-called plastic-bag-free zone by year-end 2009. It ought to be possible to realise other measures.

In the previous Report to the Storting on Svalbard, it was emphasised that the efforts to arrange matters to facilitate tourism in Svalbard that is justifiable from both an environmental and a safety perspective would be continued. Since then, the Governor has developed a separate strategic plan for tourism and outdoor recreation in Svalbard. This plan was completed in 2005 and gives a description of the development, the status and body of legislation, and other tools in this area. In addition, it provides a summary of political goals and guidelines, and the most important challenges for the management of tourism and outdoor recreation are assessed. Strategies are then devised in the individual fields. The strategic plan is an important tool for the Governor in the administrative processing of matters pertaining to tourism and outdoor recreation in Svalbard.

In the former Report to the Storting, Svalbard, attention was called to various policy instruments so as to be able to influence the development of tourism in a direction that is justifiable with regard to the environment and safety. One measure that was emphasised was the possibility of introducing requirements that tours be part of organised programmes, e.g. snowmobile trips to the east coast or other remote locations on Spitsbergen. In connection with this, the Standing Committee on Foreign Affairs in the Norwegian Storting argued that it would generally be “useful if as much tourism as possible takes place in organised forms”, cf. Recommendation No. 196 (1999 – 2000) to the Storting.

Among other things, this was followed up in the Regulations about motorised traffic from 2002, which specify strict constraints on traffic with snowmobiles for visitors. This kind of traffic outside of the central areas in Nordenskiöld Land is only permitted in a small area on the east coast and then only when accompanied by residents or as part of an organised tour programme.

Although some visitors to Svalbard travel on their own initiative, especially in the summer as hikers in the vicinity of Longyearbyen, most of the tourism takes place now as part of organised activities. The administrative practices, information measures and facilitation of organised programmes are factors conducive to this development. This applies in particular to snowmobile activities, where private rental of snowmobiles to visitors has flattened out during the past decade, while the number of participants in organised tour programmes has doubled during the same period.

Although it can be argued that the objective has more or less been achieved, the Government will also attach great importance in the coming years to keeping as much tourism as possible as part of an organised programme.

9.2.5 Assessments

The Government thinks that it is important to have a further development of the tourist industry as a basis for as much economic growth in Svalbard as possible – e.g. as a basis for settlement in Longyearbyen. This must occur in keeping with the Government’s and the tourist industry’s overriding objective of a sustainable ecotourism in Svalbard. This kind of further development will contribute to a more diverse economic structure in Longyearbyen. An extensive effort to extend the high seasons and create more year-round jobs will result in a more stable local community at the same time as it will help increase the economic growth in the tourist industry.

9.3 Fisheries

Commercial fishing takes place in the territorial waters around Svalbard and in the Fisheries Protection Zone beyond those waters. Fishing in the territorial waters is far less extensive than fishing in the Fisheries Protection Zone.

Many of the stocks around Svalbard migrate between Norwegian, foreign and international marine areas. For migrating stocks, it is important to provide protection and management throughout their entire area of distribution. Pursuant to Act No. 91 of 17 December 1976 relating to the Economic Zone of Norway, a fisheries protection zone of 200 nautical miles was established around Svalbard by the Royal Decree of 3 June 1977. Thus, the reason for establishing a non-discriminatory fisheries protection zone was primarily to gain control of the fishing in the area in order to protect the resources and prevent unregulated fishing.

At present the fishing in this area is mainly for cod, shrimp and Norwegian spring-spawning herring. Various forms of regulation have been established for the different fisheries, including quota regulation of the cod and herring fisheries and effort regulation of the shrimp fishery. Regulations concerning fishing in territorial waters around Svalbard are laid down pursuant to the Svalbard Act, whereas regulations concerning fishing in the Protection Zone are laid down pursuant to the Act relating to the Economic Zone of Norway. Quotas were first established in 1986 when Norway established Regulations concerning the regulation of cod fishing in the Fisheries Protection Zone around Svalbard. The fishing effort permitted for each country was established on the basis of their earlier fishing activities in the area. As a result, Norway, Russia, the EC and the Faroe Islands are permitted to fish for cod in the Fisheries Protection Zone.

In July 1996, regulations of the shrimp fishery in the territorial waters around Svalbard and in the Fisheries Protection Zone were laid down. The regulation of the shrimp fishery entails that vessels from Norway, Russia, Canada, the EC, Greenland, the Faroe Islands and Iceland can take part in this fishery. The fishing is effort-regulated, which entails that the fishing effort permitted for each country has been established on the basis of their earlier fishing operations around Svalbard. Restrictions have been introduced with respect to the number of vessels that may be used for shrimp trawling and the number of fishing days allowed in the territorial waters around Svalbard and in the Fisheries Protection Zone.

The provisions governing fishing are the same for the territorial waters around Svalbard and in the Fisheries Protection Zone. They include provisions on logbook recording, mesh size in fishing gear, the use of sorting grids, minimum sizes and so on.

The Norwegian Coast Guard and the Directorate of Fisheries share the responsibility for the executive part of the control of resources in the areas under Norwegian fisheries jurisdiction. A significant share of the Coast Guard’s resources are used in the Northern marine areas. The Coast Guard is part of the Norwegian Armed Forces, and provisions concerning the Coast Guard’s mission and exercising of authority are specified in the Act relating to the Coast Guard and the instructions to the Coast Guard. The Coast Guard’s exercising of control and enforcement measures in the territorial waters around Svalbard shall be in accordance with directives specified by the Governor of Svalbard.

It is essential that the living marine resources are managed in such a way that it will be possible to continue harvesting them in the future in our marine areas, also including Svalbard, and that biological diversity is maintained in the short and long term. In this context, it is important to concentrate the fishing on mature fish and to restrict the catches of small fish or bycatch of species subject to strict bycatch provisions due to the stock situation. If the intermixture of fish under the minimum size or of other species is too high in the catch, the Director General of Fisheries will close the relevant area. Many of the stocks around Svalbard are migrating stocks. Thus it is important that the management, control and enforcement regulations protect the stocks equally well throughout their entire area of distribution, including around Svalbard. The control of fishing in the territorial waters and the Fisheries Protection Zone around Svalbard should be as good as in other areas under Norwegian fisheries jurisdiction. International obligations concerning resource management and control must also be implemented in the marine areas around Svalbard. It is in the interest of all fisheries nations that there be a genuine control of the outtake of fish in these areas and that illegal fishing be halted.

9.4 Space-related activities

Svalbard’s geographic location is ideal for space-related activities, both for studying the atmosphere and downloading satellite data. Svalbard plays a key role in Norwegian space-related activities. One of the Government’s objectives is to target space-related activities as part of Svalbard’s future economic base.

9.4.1 General background

The space-related activities in Svalbard are undergoing rapid development. Its northern location gives Svalbard a competitive advantage when it comes to the downloading of information from satellites in polar orbits. Svalbard is the only easily accessible place for communication with satellites in all kinds of polar orbits. Thus, downloading of satellite data from Svalbard helps make the operation of satellites in polar orbit more efficient. There has therefore been a big demand for the services provided by the station in Longyearbyen.

Svalbard’s location is ideal for studying the atmosphere and phenomena associated with the aurora borealis. Svalbard’s accessibility and northern location, together with educational and research teams etc. associated with the University Centre in Svalbard (UNIS), result in an active research community. Among other things, UNIS is involved in research in Arctic geophysics and studies of the aurora borealis.

9.4.2 Current activities

The mainstays of the space-related activities in Svalbard are the downloading station, Svalbard Satellite Station (SvalSat) and the Svalbard Sounding Rocket Launch Facility (SvalRak). SvalSat downloads information from satellites in polar orbits, and SvalRak provides launch services for scientific balloons and rockets.

SvalSat is owned by Kongsberg Satellite Services (KSAT). SvalRak is owned by Andøya Rakettskytefelt (ARS). The Ministry of Trade and Industry, acting on behalf of the Norwegian State, owns 50 per cent of KSAT and 90 per cent of ARS. Through its subsidiary Norsk Romsenter Eiendom AS, the Norwegian Space Centre has delegated the authority to manage the state’s ownership interests in the companies and is represented on the boards of directors of these companies.

The Svalbard Satellite Station, which is located at Platåberget near Longyearbyen, is the northernmost station in the world for downloading satellite data and currently has 16 employees and an annual turnover exceeding NOK 100 million. Through efficient utilisation of SvalSat, Norway avails itself of its geographic advantage. This has made Norway a significant international player in the downloading of satellite data, and SvalSat is a global leader in the downloading of polar meteorological satellites. Through the downloading in Svalbard and at the Troll base in Antarctica, KSAT is the only company in the world that can offer downloading of information at both the North and South Poles.

SvalRak is a launching facility for research rockets in the vicinity of Ny-Ålesund. Since Svalbard lies very close to the Magnetic North Pole, the rocket launching range is especially well-suited to studies of the aurora borealis and other special phenomena in the Arctic. In 2008, a new campaign was initiated with the launching of scientific rockets at SvalRak. In addition to Norwegian researchers, the main users of the facility are Japanese and American. There is also increased interest in the release of large stratospheric research balloons from Svalbard.

Major international players, such as the American, European and Japanese aerospace organisations, in addition to many other major players in space-related activities, make use of services and infrastructure at SvalSat. The European Space Agency (ESA) makes use of the installations at Platåberget near Longyearbyen in both commercial and research-related activities. ESA is a major customer for downloading information from Platåberget. Svalbard is also utilised as a test area for monitoring sea-ice and glaciers by satellite. There is also a possibility of a separate field centre located at Longyearbyen in connection with space weather monitoring under the direction of ESA. Pursuant to the regulations on electronic communication, special permits are required for the establishment and operation of earth stations for the downloading of satellites in Svalbard.

As part of the development and test phase, ground-based infrastructure has been placed in Svalbard and at the Troll base in Antarctica among other places. According to plan, the stations shall be included in the permanent infrastructure for Galileo. Permanent ground-based stations will have value for Norway both as a part of the global infrastructure and because their operation will allow access to important processes in the EU and in EU member states, both in normal operation and in crisis situations. The station in Svalbard is of particular interest with a view to ensuring adequate performance from Galileo in the High North as well.

Major investments have been made in order to strengthen SvalSat’s position as a leading provider of space-based services. In 2004, fibre optic cables were introduced for the transmission of data from Svalbard to the mainland. This gives the mainland real time access to data from the satellites as well. The development was financed through an agreement with the National Aeronautics and Space Administration (NASA) and the National Oceanic and Atmospheric Administration (NOAA) in the USA and is owned by Norsk Romsenter Eiendom AS.

9.4.3 Further developments

There is reason to believe that the international interest in the use of the space-related infrastructure in Svalbard will increase. Satellite data downloaded in Svalbard is increasingly used for monitoring sea-ice conditions, oil pollution and ship traffic. This is critical information in order to avoid collisions and environmental crime at sea.

Efforts are being made to integrate the space-related activities with other observation platforms. SIOS (Svalbard Integrated Arctic Earth Observing System) has the objective of utilising Svalbard’s unique conditions in order to establish an Arctic earth observing system in and around Svalbard. This entails integration of studies of geophysical, chemical and biological processes from research and monitoring platforms, including satellites.

With this system, Norway will also be able to help study the solar system. NASA has recently discovered large glaciers beneath the surface of Mars. Norwegian researcher’s interpretation of satellite data and field measurements from glaciers in Svalbard may become important in the future for the understanding of glaciers and possible biological life on Mars and other planets. NASA and ESA regularly use Svalbard for testing equipment that is used in space journeys for the purpose of studying the solar system.

Space-related activities give rise to high tech jobs in the northernmost counties of Norway and in Svalbard. The increase in such activities in Svalbard will result in increased interest from both national and international scientific communities. This will have effects on other activities in Svalbard, including local economic activity.

Space-based infrastructure makes useful, cost-effective contributions to the population and the economic activity in Svalbard. Good examples of this are environmental monitoring and maritime emergency response, which are especially important for the High North, including Svalbard. The need for space-based services will continue to increase in areas such as civil protection, the environment and climate. The fibre optic cables to Svalbard are an example of how the space-related infrastructure benefits residents and researchers in Svalbard through rapid, secure Internet access.

9.5 Petroleum operations

The marine areas that surround Svalbard are not open for exploration for petroleum. Drilling for petroleum has previously been conducted onshore, most recently in 1990 within what is now Nordenskiöld Land National Park without any commercially viable discoveries being made. Permits for exploratory drilling in the territorial waters of Svalbard have not previously been granted. Both in the vicinity of the island of Hopen and along the west coast of Spitsbergen, claims have been granted on the basis of indications of petroleum deposits. A claim is a preferential right to exploitation of the resources within a specifically defined area, but it entails no automatic right to commence operations unless the claimholder is granted a permit pursuant to the Svalbard Environmental Protection Act and other regulations that are in force in Svalbard. As with former governments, this Government does not consider issuing permits for petroleum operations in the territorial waters around Svalbard to be in accordance with the Svalbard Environmental Protection Act, cf. section 7.4.3.

The marine areas that surround Svalbard are not open for exploration for petroleum. In the comprehensive management plan for the Barents Sea (Report No. 8 (2005 – 2006) to the Storting), the polar front, the sea-ice edge and the marine areas around Svalbard (the territorial waters) are defined as especially valuable and vulnerable areas.

In the areas around Svalbard, there is Norwegian and international research activity. Parties playing a significant role in these activities include Russia, Germany, the USA and Sweden. These countries perform scientific studies where they must apply for a permit in each case in order to conduct the studies. The nature of these studies is essentially not petroleum-related, but more inclined toward a general study of the earth’s crust and in particular the deeper parts of it. In these studies, geophysical methods are employed that are different from the gathering of conventional seismic data. One of the objectives is to understand the mechanism of tectonic lift for the whole Barents Sea, and this has general relevance for the storage of petroleum in the Svalbard area.