Arctic ocean Railway Arctic Business Forum 11.4.2018 THINK BIG THAT IS WHAT WE HAVE DONE WHEN MAKING THIS STUDY

Sito and Wise Group – Now Sitowise Comprehensive solution for customers’ major and minor challenges within building and infrastructure construction The largest Finnish-owned company in building and infrastructure construction design and consultancy Over 40 years of accumulated experience, more than 90,000 successfully completed projects Employs more that 1,200 experts in Finland, Norway, Latvia, Estonia and Poland Aims at customer-focused growth both in Finland and abroad Actively investing in developing the entire business sector SOME WORDS OF ME AND COMPANY I REPRESENT AREA MANAGER IN SITOWISE COMPANY DREAM PROJECT TO INGENEER FROM LAPLAND SITO JA WISE HAVE JOINED 1.1.2018 FIRST THERE WAS SITO AND WISE GROUP AND NOW WE ARE SITOWISE WE HAVE OVER 1200 EXPERTS AT YOUR SERVIVE

History of Arctic railway designing Railway plan from year 1923, made by Government of Finland Plan to built a new railway from Rovaniemi – Petshenga (Petsamo) Picture from book Erkki Lilja Jäämerenkäytävä (Arctic corridor) OVER 100 YEARS PLANNED Professor Jalmari Castren 1912 RAILWAY TO ROVANIEMELLE -> NEXT PLANS TO FURTHER DURING THE WORLD WAR 2, THERE WERE ALSO ACTIVE PLANNING OF THE RAILWAY UP NORTH SO ARCTIC RAILWAY IS NOT A NEW IDEA DURING THE LAST FEW YEARS LOGAL REGIONS OAND MINIPALICITIES HAVE MEDE THEIR OWN STUDIES THIS IS THE FIRST STUDY. WHERE ALLA HTE OPTIONS ARE IN TABLE

Background of the study In June 2017 Finnish Ministry of Transport and Communications together with Norwegian Ministry of Transport decided to make a study of Arctic Ocean Railway Finnish Transport Agency (Liikennevirasto) together with Norwegian Railway Directorate (Jaernbanedirektoratet) were resbonsible of the study Three tasks -> Three studies Tecnical Study -> Sitowise Oy Feasibility Study -> Ramboll Finland Oy Study Norwegian side -> Norconsult As Studies were finished February 2018 and delivered to Minister of Transport and Communications Anne Berner The studies were published in March 2018 by Minister Berner KAIKKI OVAT VARMAAN KUULLEET LOPPUTULOKSEN MINISTERI BERNER KERTOI SEN 9.3.2018 KERRON KUITENKIN CONTENT OF THSI STUDE JA VAIKUTUSARVIOINNEN YHTEENVEDON

ARCTIC OCEAN RAILWAY IS PART OF GLOBAL TRAFFIC NETWORK In a logistical perspective Finland is an island ja and fully depended on transport via the Baltic sea Finland wants to improve logistical position and accessibility Globalisation continues and is becoming stonger. Global trade and manufacturing is increasing in Asia. We in Finland wish to improve all connections between Europe and Asia Arctic Railway is a Finnish connection to Atlantic and Arctic Ocean and to Northeast Passage Arctic connection is also related to Helsinki – Tallinn tunnel and Rail Baltica PÄÄSY TALLINAN TUNNELIN JA RB KAUTTA EUROOPPAAN

Finland´s logistical position Ministeriön esitys Picture: LVM Anne Berner presentation 9.3.2018

Five options for ROUTING Rovaniemi/Kemijärvi–Kirkenes (465km/445km) Kemi–Kolari–Skibotn/Tromssa (519km/610km) Kemi–Tornio–Narvik (633 km) Kemi–Kolari–Narvik (543 km) Kemijärvi–Alakurtti–Murmansk (564 km) All the routes were tecnically feasible.

Investment cost (includes risk 10%) Investment costs, M€ Option Investment cost (includes risk 10%) Total Finland Sweden Norway Russia Rovaniemi–Sodankylä–Kirkenes Kemijärvi-Sodankylä- Kirkenes 2 063 1 913   856 2 919 2 769 Kemi–Kolari–Kilpisjärvi–Tromssa 2 271 5 178 7 449 Kemi–Kolari–Kiiruna–Narvik 86 1 397 1 483 Kemi–Haaparanta–Kiiruna–Narvik 22 631 652 Kemijärvi–Kantalahti–Murmansk 101 649 750 24.11.2018

Potential transport flow OF ARCTIC RAILWAY Identifying potential transport flows was based on transport cost case studies. Estimated opening year of the railway is 2030. The time span of the feasibility study is 30 years. Time span of identifying transport flows and preparing prognosis extends to year 2060. Cargo could be minerals and ore, fish products, raw wood and wood industry products. In the future there can be transported natural resources from Barents region and cargo from Northeast Passage Prognosis of future transport flow was and is very challenging. 24.11.2018

Potential transport flow of each option 2 Raw wood Phosfat from possible Sokli mine, iron ore from Sokli, raw wood, Copper ja Nickel ore from Kevitsa ja some Norwegian transport Iron ore from Pajala SAKATTI MINE IS NOT ESTIMATED, AFTER YEAR 2030 24.11.2018

Economic profitability To estimated economic profitability is challencing. Potential transport flow can vary a lot during next decades. One big mine or chances to mode of transport can improve a lot profitability. Climate change can cause changes towards more environmentally friendly modes of transport. For now we know, all the railway options are non profitable at the moment. 24.11.2018

PassEnger transport The biggest potential to passenger transport: Options Finland - Tromso and Finland - Kirkenes. Passenger transport would mainly consist of tourist transport. In the long term tourism is expected to increase and continue troughout the year. PASSANGER TRANSPORT WILL ALWAYS PROBABLY BE QUITE MODERATE AND IT WILL NOT MAKE RALIWAY PROFITABLE 24.11.2018

Local impacts Impacts to reindeer husbandry Plenty of reindeer herders Impacts to reindeer pastures and reindeer herding Volume of these effect has not been estimated at this stage Impacts to Sami Heritage area Northern Lappland is Sami Heritage area Railway has effects to Sami people and Sami culture Impacts to nature There are plenty of nature reserve areas in Lappland 24.11.2018

Example of valuable enviromental areas between designed Sodankylä – Kirkenes railway line 24.11.2018

Summary of impacts Tornio-Narvik Kolari-Narvik Kolari-Tromssa   Tornio-Narvik Kolari-Narvik Kolari-Tromssa Rovaniemi-Kirkkoniemi Kemijärvi-Murmansk Investment costs Low in Finland In Sweden 0,6 B€ Low in Finland, In Sweden 1,4 B€ In Finland over 2 B€, in Norway high, over 5 B€ In Finland about 2 B€, In Norway 0,85 B€ Low in Finland, In Russia 0,65 B€ Logistical position of Finland Small impacts Improves clearly Accessibility of Finland Small impact. Does not improve accessibility of Lapland Improves Finlans´s ja Lappaland´s accessibility Small impact, Improves a little Lappaland´s accessibility Security of supply Small impact No impacts Enviromental impacts Small impacts on Finnish side Challencing impacts on Finnish side Large impacts Reindeer husbandry No impacts on Finnish side In Sweden impacts Large impacts on Finnish and Norwegian side Sami heritage area TELL JUST BIG PARTS 24.11.2018

The result of the studies The Ministry of Transport and Communications has decided that a railway routing to the Arctic Ocean via Oulu, Rovaniemi and Kirkenes is the one that will be examined further. It would improve logistical position, accessibility and security of supply in Finland. Of the two leading alternatives, it was also less expensive. 24.11.2018

ARCTIC RAILWAY, Connection to europe CONNENCTS LOGISTICAL FLOW FROM ARCTIC OCEAN TO EUROPE TROUGH HELSINKI – TALLINN TUNNEL AND RAIL BALTICA Picture: LVM Anne Berner presentation 9.3.2018

Next steps OF ARCTIC OCEAN RAILWAY Finland is making a joint working group with Norway Group will be appointed to determine the further stages and schedule of the work. The group is to examine the key questions relating to the chosen routing, such as environmental issues, permit procedures, costs, and finance structure and model. Deadline of the work is 31.12.2018. Large hearing during the process Further studies on the routing will also be included in the work on regional land use plan for Northern Lapland. THINK BIG IT IS ALWAYS HARD TO ESTIMATE FUTURE I BELIVE THAT ARCTIC OCEAN RAILWAY WILL BE BUILT SOME DAY DIFFICULT TO SAY WHEN, BUT IT WILL BE IT BENEFITS FINLAND AND IT BENEFITS LAPPLAND I PROBABLY WONT TRAVEL IN IT, BUT HOPEFULLY MY CHILDREN AND GRAND CHILDREN WILL 24.11.2018

KIITOS, THANK YOU. THINK BIG https://www. lvm KIITOS, THANK YOU! THINK BIG https://www.lvm.fi/uusimmat-julkaisut https://www.liikennevirasto.fi/julkaisut www.sitowise.com