Compensation of ecosystem services as part of the ecological compensation of the Sakatti Project
30 April, 2025
The basis of our planning for the Sakatti Project is to avoid negative impacts on nature and the local community. However, it is not possible to avoid all harm in large projects. Developing the Sakatti mine requires the construction of infrastructure, which inevitably takes away space from nature and affects the surrounding environment as well as the ability to practice local livelihoods and culture. When impacts cannot be avoided, efforts are made to minimize them. To mitigate remaining impacts, restoration measures are implemented, and as a last resort negative environmental impacts are compensated.
The Sakatti Project is planned and implemented in compliance with the company's Sustainable Mining Plan (SMP) commitments. According to the SMP, after mining operations cease, biodiversity in the area must be better than the baseline, meaning we leave a net positive impact (NPI). Net positive impact is the goal for all Anglo American’s new mining projects.
The first voluntary ecological compensation for the Sakatti Project was carried out in 2022 by acquiring and protecting nearly 3,000 hectares of forest in Inari. This compensation offsets the impacts on forests within the mine’s area of impacts. It is the largest ecological compensation implemented in Finland to date. The company is also committed to offsetting its impacts on wetlands in the Sodankylä area during the next phase of the project. Read more about our ecological compensation in Inari here.
In accordance with our sustainability principles, we also compensate for weakened ecosystem services in the Sakatti Project area and its surroundings. Since mining operations inevitably impact the surrounding area's nature and the ecosystem services it provides, our goal is to enable the utilization of these services elsewhere.
The voluntary ecological compensation forest of Sakatti in Inari, about 125 km north of Sodankylä.
What are ecosystem services?
Ecosystem services refer to all the benefits that humans obtain from nature. Businesses also benefit from ecosystem services. These free services require ecosystems to remain vital and functional. Ecosystem services are classified into provisioning services, regulating and supporting services, and cultural services.
The most tangible ecosystem services are provisioning services. These services consist of material goods obtained from nature, such as berries, mushrooms, fish, and game animals. The production of crops and livestock, reindeer husbandry, and timber also fall under provisioning services.
Regulatory services, on the other hand, mitigate changes occurring in nature and regulate natural phenomena. These include, for example, the regulation of water flows and floods, the provision of shade, and noise reduction. The existence of regulating services is not always noticeable, but their disappearance can have a significant impact.
Maintenance services are intangible and difficult to observe with the naked eye. However, they form the foundation for other ecosystem services and nature. Maintenance services include processes such as photosynthesis and production of oxygen, air purification, binding of carbon, nutrient cycling, soil formation, and the decomposition of dead matter. Maintenance services are natural processes essential for life.
Cultural services are intangible benefits obtained from nature, which improve people's mental well-being and health and also support the tourism industry. These include various recreational opportunities such as hiking and skiing, as well as important sites for cultural practices. A pleasant living environment, nature as a source of experiences and inspiration, and scientific knowledge obtained from nature are also part of cultural services.
Ecosystem services depend on the biodiversity and well-being of the ecosystem. They ensure the well-being of people and the environment and improve quality of life. Nature provides ecosystem services for free, but the loss of these services can result in costs and harm to people.
Mapping ecosystem services together with local stakeholders
Ecosystem services in the Sakatti Project's area of impacts and its surroundings were already mapped during the EIA phase. The mapping continued in 2024 at the Sakatti Open House event, where the public had the opportunity to place locations of ecosystem services of importance to them on a map within the project's area of impacts.
"So far, the project has mostly mapped tangible ecosystem services. Locals have identified berry picking, hunting, snowmobiling, and other outdoor activities as ecosystem services that are important to them", says Ulla Syrjälä, Principal Safety & Sustainable Development of the Sakatti Project.
Reindeer herding routes and pastures required for reindeer husbandry are locally important ecosystem services necessary for livelihood practices. Other livelihoods relying on ecosystem services in the region are agriculture and forestry. Cottages, huts, and campfire sites also appear in the mapped data.
"Some ecosystem services will inevitably disappear from the mining area and its proximity. As part of our sustainability work, we map these areas and strive to find compensation methods to enable the utilization of these ecosystem services elsewhere in the locality or nearby area. The project's starting point has been that when discussing compensation, we do not offer ready-made solutions but rather try to identify ecosystem services of importance as well as compensation measures together with the local residents”, notes Syrjälä.
Compensating for ecosystem services does not mean financial compensation, but rather replacing the benefits provided by nature – for example, maintaining a new snowmobile trail or establishing a campfire site, to preserve recreational opportunities. Building a new jogging path, creating a swimming area, or planting a forest could also be possible compensation methods.
The mapping of ecosystem services will continue during the spring of 2025, when we will organize open workshops to find compensation and restoration methods. We especially hope that local people participate in these workshops, as they have the best knowledge of nature and its current use in the mining project's area of impacts. The information collected in the workshops will be supplemented with a survey, where respondents can mark important places on the map and suggest which ecosystem service could be compensated and how.
Compensation for ecosystem services is relatively new in Finland
Compensation and restoration of ecosystem services does not have a long tradition in Finland, even though ecosystems have been weakened by, among other things, the utilization of forest resources and land use changes, such as the drainage of wetlands. Some compensation activities have been undertaken, but the concept of compensating for ecosystem services has not yet been widely used.
“The Sakatti Project operates in environmentally sensitive areas. The aim is to create services equivalent to the current ecosystem services provided by the area under the planned future mining area of impacts, such that the myriad of services that nature provides in the region remains unchanged. It is of utmost importance to us that compensation for ecosystem services is implemented in a stakeholder-driven manner”, summarizes Titi Ollila, Stakeholder Coordinator of the Sakatti Project
For additional information, please contact:
Ulla Syrjälä, Principal Safety & Sustainable Development, Anglo American's Finnish subsidiary
Phone: +358 40 480 1820, Email: [email protected]
Background information
Mitigation hierarchy
The mitigation hierarchy framework sets out an approach to how biodiversity impacts should be addressed in any development project. The hierarchy starts with avoiding impacts in the first place. If avoidance is not possible, efforts are made to minimize the harm locally. Remaining impacts should be restored or rehabilitated after the exposure to the impacts.
It is often impossible to restore ecosystems to a similar ecosystem that was in place before the disturbance. In addition, the rehabilitation of areas can only be concluded after operations are concluded, leading to a length of time that ecosystems are lost. Offsetting is the measure of last resort. Biodiversity offsetting can be used to compensate for any residual negative impacts after the previous three steps of the mitigation hierarchy have been completed, and to compensate for ecosystems that are lost for a period of time.
There are generally two types of offsets: restoration offsets which regenerate or rehabilitate degraded habitats outside of the area impacted by the development project, and averted loss offsets which aim to prevent or reduce the loss of biodiversity in areas under external threat/pressure.
Finland is committed to protecting biodiversity in accordance with the UN's sustainable development goals. Ecological compensation is considered as one way to achieve the goal. In many European countries, compensation is already an important part of environmental legislation and the EIA process of planning and assessment of environmental impacts.
Read more on the Ministry of the Environment and Finland’s environmental administration websites:
Ecosystem services secure human life in Finland
Ecological compensation