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Northland Resources co finances rail line in Pajala
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Tuesday, 02 Feb 2010

Northland Resources SA and the Swedish Rail Administration announced that an additional step has been taken to realize an entirely new railroad to new mines in Pajala.

The goal is that the mining company and the Swedish Rail Administration jointly finance the railroad. The mining company Northland Resources SA and the Swedish Rail Administration have now signed a Memorandum of Understanding regarding the co financing of the rail line.

Mr Minoo Akhtarzand director general of Swedish Rail Administration said that "This is an important project which contributes to increased growth and new job opportunities in Sweden and Finland and therefore has great significance for the development of Sweden in general and for northern Sweden, in particular."

Mr Karl Axel Waplan president & CEO of Northland Resources SA said that "We are pleased and proud of the results that we have seen from earlier joint efforts with the Swedish Rail Administration. Now we are formalizing our long standing cooperation with a Memorandum of Understanding."

The mining company will be responsible for an amount corresponding to the cost of alternative transport solutions. The commitments will be defined later in an implementation agreement. A condition precedent is that the project is part of the national plan for the transport system 2010-21, which the Swedish Government will finalize this spring.

It is thought that the rail line would extend from the planned new iron ore mines at Kaunisvaara in the municipality of Pajala, to the Finnish rail line east of the Muonio River. Construction is estimated to cost between SEK 750 million and 1,250 million. In addition, there is a need for an upgrade of the connecting railroad on the east side of the Mournio River, this is being planned by the Finnish Transport Agency.

The goal is to have the new railroad ready by 2013. This will be unique for Sweden as the railroad will be built with Finnish gauge track, which is wider than Swedish track.

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