References/27 Oct 2023

Borenius successfully represented Agnico Eagle in two precedent-setting environmental permit cases before the Supreme Administrative Court

For the past 15 years, Agnico Eagle has been operating and continuously expanding Europe’s largest gold mine in Kittilä, Finland.

In May 2020, Agnico Eagle was granted environmental permits that allowed the company to expand the operations of its Kittilä mine by 25% and the mine’s tailings storage capacity. Based on these operating permits, Agnico Eagle launched extensive investments in Kittilä totalling over EUR 300 million. These investments included the construction of a kilometre-deep shaft with an upgraded hoisting capacity and a new discharge waterline in addition to the commissioning of a new nitrogen removal plant, which further improved the mine’s environmental performance.

In July 2022, the Administrative Court overturned the permits, which resulted in the risk that the mine’s production levels and the CIL tailings storage capacity would be severely limited. In its decision, the Administrative Court also cancelled the enforcement of the permits to the extent that Agnico had already been allowed to operate with an expanded capacity in 2020–2022.

In August 2022, Agnico Eagle filed an appeal regarding the Administrative Court’s decisions with the Supreme Administrative Court and requested that the permits be restored.

On 27 October 2023, the Supreme Administrative Court rendered its final decisions by which it overturned the Administrative Court’s decisions, upheld Agnico Eagle’s permits, and subsequently reinstated Agnico Eagle’s right to continue production at 2.0 Mtpa.

During the appeal proceedings before the Supreme Administrative Court, the Court carried out an on-site visit in Kittilä. We advised Agnico Eagle in connection with the visit, which allowed it to successfully demonstrate the high level of environmental responsibility embedded in its operations to the Supreme Administrative Court.

Both decisions have been published as precedent-setting yearbook decisions. The Supreme Administrative Court ruled that an industrial operation that has been operating for 15 years should not be assessed similarly to how a greenfield operation would with respect to the uncertainties involved in its future long-term impacts in light of the precautionary principle.

As such, by virtue of these decisions, the Supreme Administrative Court has imposed limitations on the doctrine that has been evolving since the Supreme Administrative Court’s decision in the Finnpulp case and a few other cases thereafter. These are important decisions that will have an impact especially on the permit thresholds of all expansion projects of existing industrial operations in Finland. The rulings therefore will also have a positive impact on the predictability of environmental permit decisions and, in this respect, will improve the investment environment in Finland.

Agnico Eagle is a senior Canadian gold mining company that has been producing precious metals since 1957. Its operating mines are located in Canada, Finland, Australia and Mexico with exploration and development activities in each of these countries as well as in the United States and Sweden. Agnico Eagle is listed on both the Toronto Stock Exchange and the New York Stock Exchange.

Read more in Agnico Eagle’s news release here.

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