Greenland’s Parliament has rescinded a decades long ban on uranium mining. Greenland’s “zero tolerance” policy on mining radioactive materials was inherited from Denmark, but the island is keen to develop mining to help pay for welfare and jobs.
Greenland Minerals & Energy Ltd. said it’s in early talks with the Danish government and institutional investors to sell debt to fund an $800 million investment in uranium mining in Greenland. Greenland Minerals expects to receive a full license in 2014 from the government in Nuuk. That would allow the company to start construction of the mine in 2015 and begin production by 2017.
Greenland Mineral’s Kvanefjeld project (rare earth elements, uranium, zinc), is located in south Greenland. The global resource base established for Kvanefjeld contains 575Mlb’s U3O8, and 10.3Mt of rare earth oxide (REO); a resource of genuine global significance, particularly in consideration that less than 20% of the project area has been subjected to drilling and resource definition.
Greenland Minerals and Energy Ltd (ASX – GGG) is an Australian exploration and development company focused on developing high-quality mineral projects in Greenland. The shares trade at $0.23 AUS. Market cap ~$150M AUS.
Interestingly, a delegation of politicians and government officials then made study tour of Canada to learn more about the Canadian uranium mining industry and its governance.
Given the quasi-monopolistic hold on rare earths production, China is keen on investing in Kvanefjeld project. Obviously Greenland Minerals will require investment capital to fund the project. The company’s estimated capital cost of $810M seems low given the lack of infrastructure.