Kainuu – Battery production and raw materials – all in one place

The mining industry has been a growth sector in Kainuu. Finland has a long history of mining activity, and Finnish metallurgical technology. Manufacturers of mining equipment are well known throughout the international mining community.

Kainuu therefore benefits from its long mining tradition, a highly developed infrastructure, an efficient operating environment, security of tenure and political stability, and strong technological expertise in machines and automation used in mining industry – all of these and more make Kainuu a favorable investment and operating environment for the exploration industry. Additionally, the Finnish government offers a complete package to support mining investments. Side flows surrounding the mines of Terrafame and Sotkamo Silver represent emerging opportunities.

Map of Kainuu with project pinpointed in it

Continuous development of mining industry

Raw materials form approximately 50% of the battery cell costs. The annual demand of nickel, lithium and cobalt – the most critical raw materials – is estimated to multiply within the next six years. Raw material production has an important role in building the competitiveness of electric vehicle battery production. 

Finland is the biggest nickel producer in the EU. It is the only EU country with its own cobalt production and known resources exceeding 445,000 tonnes. Both lithium and graphite production is planned to start in the 2020s. 

Terrafame Oy, a Kainuu based mining company specialised in the bioleaching process, is leading the way in the local mining industry. The company utilises microbes to extract metals from ore and its bioleaching method is proven to be an energy-efficient way of producing nickel, for example. On the whole, the greenhouse gas emissions of the nickel production process are around 40%, sulphur dioxide emissions 2% and energy consumption 20% lower than average.

Terrafame uses oxygen at its new production plant to manufacture battery chemicals for electric vehicle batteries. The sharp increase in the demand for electric vehicles has also led to an increasing demand for battery chemicals worldwide. The annual production capacity of the battery chemicals plant is approximately 170,000 tonnes of nickel sulphate and 7,400 tonnes of cobalt sulphate. Terrafame’s total investment in the battery chemicals plant is approximately EUR 240 million.

Sotkamo Silver AB´s business concept is to exploit mineral deposits in the Nordic countries with positive social and environmental benefits. Sotkamo Silver owns mineral deposits, which contain silver, gold and tungsten in Finland and Sweden as well as zinc and gold in Norway. The Company’s main project is the Silver Mine project in the municipality of Sotkamo, Kainuu. Sotkamo Silver production in Sotkamo started in 2019.

The mining and mineral field is undergoing a strong expansion in Northern Finland and growing strongly in Kainuu region. Kainuu, is part of the Fennoscandian Shield, a physiographic region of extremely high ore potential; The potential can be roughly divided into three categories: the exploitation of industrial minerals, rock, and metallic minerals. The region is also rich in other soil materials needed in industry and construction, such as sand, gravel, rock suitable for crushing, and peat.

In addition to the impact on employment, business and marketing expertise and international contacts in the region’s stone and minerals sector have increased dramatically and will continue to develop in the coming years. The Finnish Government has also promoted mining industry with a variety of measures, including training of skilled personnel, construction of roads and railways, and providing funding for research.