Søre Fagerfjord Estate: a unique piece of Arctic land is for sale

Søre Fagerfjord Estate: a unique piece of Arctic land is for sale
Søre Fagerfjord Estate: a unique piece of Arctic land is for sale

A unique opportunity: the last piece of land still in private hands on the strategic Svalbard archipelago in the Arctic is up for sale, an operation likely to attract China and which the Norwegian authorities are opposed to.

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Halfway between mainland Norway and the North Pole, Svalbard lies in a region whose geopolitical and economic value is growing as tensions between Russia and the West escalate and the sea ice recedes.

For 300 million euros (nearly CA$444 million), one can today acquire the Søre Fagerfjord area in the southwest of the archipelago: 60 km2 of plains and mountains, far from everything, stripped of infrastructure, but enhanced by a glacier and 5 km of shoreline.

“This is the last private land in Svalbard and, to our knowledge, the last private land in the world in the Far North,” boasts lawyer Per Kyllingstad, responsible for representing the sellers.

“The Chinese are naturally potential buyers, because they have shown a real interest in the Arctic and Svalbard for a long time,” he says, ensuring that he has received “concrete expressions of interest” from this country.

Legal UFO

Since the White Paper it devoted to the region in 2018, a sign of the importance it attaches to it, China has defined itself as a state “near the Arctic” and intends to play an increasing role there.

However, Svalbard is governed by a legal UFO which opens the door to foreign desires.

A 1920 treaty recognizes Norwegian sovereignty over this territory, but it also grants nationals of the contracting parties – including China – the right to exploit natural resources there “on a footing of perfect equality”.

It is for example for this reason that Russia has several rights of way there, where its state company Trust Arktikugol has exploited and still exploits coal seams.

But times have changed.

Jealous of its sovereignty, Norway would be unfavorable to see the Søre Fagerfjord domain falling into the hands of a foreign country.

A fortiori China, considered by Norwegian intelligence services as the main foreign threat against the kingdom after Russia.

The state prosecutor therefore issued notice to the owners – a company controlled, according to local media, by a naturalized Norwegian Russian – to cancel the transfer process.

“The land cannot be sold without the agreement of the Norwegian authorities,” says the Minister of Trade and Industry, Cecilie Myrseth.

“It is also not possible to start negotiations on the property,” she adds.

An argument which is based on the clauses of an old loan granted by the State in 1919. Mr. Kyllingstad assures that there is limitation.

“Red cloth”

The Norwegian state owns 99.5% of Svalbard and has classified most of the territory, including the Søre Fagerfjord area, as protected areas where construction and motorized travel are prohibited.

But the sellers do not see this the same way and invoke the 1920 treaty.

“All parties must have the same rights,” underlines Mr. Kyllingstad, arguing that Norway had built housing, an airport and port facilities in Longyearbyen, the capital of the archipelago.

“Imagine if Norway now adopted regulations limiting activities on Russian lands,” he said, “it would be World War III.”

For Andreas Østhagen of the Fridtjof Nansen Research Institute, the Søre Fagerfjord land has “minimal” economic value and its possible transfer does not represent “a huge threat” to Norway.

But, he says, “owning land in Svalbard could have strategic value in 50 or 100 years.”

In the meantime, the mention of Chinese interests is, according to him, above all “a red rag to force the Norwegian authorities to do something”.

In 2016, the government paid 33.5 million euros to buy, near Longyearbyen, the penultimate piece of land still private in Svalbard which, it was already said, was attracting the interest of Chinese investors.

This had earned him criticism from those who judged that he had allowed himself to be fooled by arguments that nothing was ever able to support.

In 2018-2019, the state also already negotiated the purchase of Søre Fagerfjord, but the negotiations failed over the price. According to Minister Cecilie Myrseth, her door remains open as long as the conditions are “realistic”.

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