There aren’t many vast untapped resource areas left in the world. There’s Mongolia, where major iron ore, copper, and coking coal investments are yielding major changes in the local economy. Another such opportunity is Greenland, part of the Kingdom of Denmark but self-governing since 2009. With a population of only 56,400 people, Greenland covers 836,100 square miles, three quarters of which is blanketed by the largest ice sheet outside of Antarctica.
One inheritance of Greenland’s close association with Denmark has been its zero tolerance to uranium mining and reluctance to consider any mining that might conceivably harm its pristine environment. But times are changing, and a growing sense of independence has been matched by the realization that in order to pay welfare and social costs, the country has to earn a living. Note: half of Greenland’s revenue comes from an annual grant paid by Denmark.
In a close run vote, the parliament voted to allow uranium mining and by extension mining that involves the production of radioactive waste, such as rare earths. Experts estimate that a mine in southern Greenland could contain the largest rare earth metals deposit outside China, which currently accounts for some 90% of global production, according to the Washington Post.
An Australian company has estimated Greenland could extract up to 40,000 tons of rare earth metals per year. The government also gave a British company a license to extract iron. The company, London Mining, is now seeking investments to develop a mine northeast of capital city Nuuk, amid debate about whether foreign workers should be allowed to be brought in.
Needless to say, this hasn’t happened overnight. One firm, Greenland Minerals and Energy, has had feasibility studies underway since 2007. Their Kvanefjeld resource is said to contain 956 Mt. The breakdown is 575 Mlbs U3O8, 10.33 Mt Total Rare Earth Oxide (TREO), 2.25 Mt Zinc, TREO includes 0.37 Mt heavy REO, and 0.84 Mt yttrium oxide.
But don’t expect metals or oxides to be coming out of Greenland anytime soon. The political, economic, and social stability of Greenland makes it an interesting resource. Its position midway between North America and Europe makes it convenient and attractive to investors, but as we saw with Mountain Pass, a huge amount of permitting work is required before a shovel hits dirt.
Optimistically it could be the back end of the decade before mining starts in Greenland. Nevertheless the decisions taken this month to permit extraction in principle is a major step forward and ends a 25-year moratorium on what will undoubtedly prove to be a very valuable resource area in the years to come.