Greenland Minerals and Energy, an Australian mining company, is seeking to develop Greenland’s Kvanefjeld uranium and rare earth’s deposit. Meanwhile, a majority in the Danish parliament signaled their readiness to allow extraction and exports of uranium from Greenland, marking a historical shift in Danish foreign policy after 30 years of opposition to nuclear power.
Greenland, a former Danish colony, was granted home rule in 1979. Thirty years later, Greenland assumed self-determination with responsibility for judicial affairs, police, and natural resources, but the Danish government is still in charge of foreign affairs, financial policy and security.
In December, Greenland passed a bill setting the framework for foreign mining and exploration companies to start exploiting Greenland’s natural resources. It included plans to open up the country to foreign labour, including workers from China. The legislation defines the size of large-scale projects and regulates the minimum salary of foreign workers. It has been criticised for allowing companies to employ cheap foreign workers, at the expense of local employment.
A new report commissioned by the Greenland government has concluded that the country has full sovereignty over commodities trading, including for uranium, which is regulated by international treaties on non-nuclear proliferation. The report was kept confidential for more than six months but recently published as Greenland’s parliament prepares to vote on 24 October on whether to allow the extraction of radioactive substances in Greenland.
Kvanefjeld is the first of several large-scale deposits to be delineated, and is widely recognized as one of the world’s largest resources of rare earth elements, as well as containing substantial resources of uranium (5th largest deposit in the world) and zinc. Project overall resource inventory: 956 Mt containing 575 Mlbs U3O8, 10.33 Mt TREO, 2.25 Mt zinc TREO includes 0.37 Mt heavy REO, 0.84 Mt yttrium oxide.
Greenland Minerals and Energy Limited (ticker on ASX: GGG) continues its ongoing feasibility studies for the Kvanefjeld Project (GGG 100%), has decided to focus on a staged development strategy with an estimated start-up cost of $810 million for an initial mine throughput of 3Mtpa. The company is pursuing its regulatory approvals with the Greenland government as well as completing a feasibility study. It hopes to commence construction in 2015.
Greenland Minerals and Energy Limited trades at $0.185 per share and has a market cap if ~$165M.
The new Greenland government favors development of uranium resources and has pushed the Danish government not to block its development. The referendum in October looks like it will pass.