Funding to Build First Ship Tunnel Withdrawn by Norwegian Government

 

Norway has decided that the construction of the world’s first ship tunnel would be too expensive to be practical. After receiving construction bids, the government will tell its parliament (Storting) that it has decided to shelve the project due to cost, leaving its future uncertain.

Prime Minister Jonas Gahr Støre told Norwegian broadcaster NRK, “It will be so expensive that we consider it irresponsible to continue the project.” Detailing the plans for the next budget, he said they would not be committing any further funding to the tunnel, as there are higher priorities with defense, health, and municipal finances. 

It represents a change in position by the government from statements highlighted during Norway’s recent elections. The ruling party had stressed the safety concerns, calling the tunnel a critical project. The new budget is likely to prompt a heated debate in the Storting. Norwegian media reports that last month, 450 companies sent a letter to parliament demanding that the project proceed. However, Hurtigruten has said it did not intend to use the tunnel, highlighting that weather conditions in the area rarely delayed its trips.

The Norwegian Coastal Authority, which was overseeing the project, received bids from three construction partnerships in June for the project and had said it expected to complete a construction contract this year. Work was expected to start in 2026 and take approximately five years to complete.

The project was to be located near Stad and a challenging shipping zone prone to bad weather. Stadhavet is said to be one of the most weather-exposed and dangerous sea stretches along the Norwegian coast. The tunnel was promoted both for its safety aspects and the ability to shorten sea travel times.

 

 The tunnel would accommodate ships up to the size of the coastal passenger vessels (Kystverket)

 

The project, which was started in 2010, planned to excavate through a mountain to create a 2,200-meter (1.4-mile) tunnel able to handle ships up to the size of Hurtigruten and Havlia’s coastal passenger ships. The estimates said three million square meters of rock would have to be blasted and removed to create the tunnel.

It is not the first time the government has stalled the project. The project was approved in 2021, only to have it be put on hold when cost estimates rose. The first projection was set at approximately $325 million, although estimates jumped by 2023 to over $690 million. The Norwegian Coastal Authority worked on the proposal and won government support for construction costing up to $490 million. Media reports are saying the costs have now reached an estimated $930 million, and it seems unlikely they could negotiate a lower cost.

Feasibility studies have already been completed for the project, and land purchases have begun. Media reports said approximately $38.5 million has already been spent.

Prime Minister Støre is scheduled to officially present the new budget on Wednesday, October 8. It is unclear if opposition parties or members of the coalition government might fight to retain the funding for the project.