Greenland Readies For Chinese Miners.
On Friday, the Greenland Parliament, parliament of a semi-autonomous, self ruling part of Denmark, half the size of western Europe, passed a natural resource bill setting out the rules for foreign mining and exploration and development companies to come in to exploit the natural resources of Greenland. The new legislation allows for, and governs how the foreign miners are to bring in cheaper foreign labour necessary to develop the resources of the island of Greenland. Greenland’s native population of 57,000, being too small and too expensive to provide the needed workforce. While it is in theory possible that the foreign work force could come from any part of the planet, the likelihood is the new miners will be coming from China.
The first project under the new legislation, is expected to be London Mining’s $2.3 billion planned large scale iron ore project near the capital of Nuuk, intended to supply China. Unsurprisingly, London Mining intends to recruit workers in China, boosting Greenland’s population by about 4%. Kaj Kleist, spokesman for London Mining commented:
“Several issues around the big scale projects, such as salaries, are quite heavy politically. With the legislation in place that we can follow, we will be able to have less debate.”
Recently, Greenland has awarded about 150 licences for mineral exploration compared with only a handful in previous decades. Reuters has reported around $100-million spent by companies last year alone, while oil companies have spent more than $1-billion in exploring offshore. To say the least, all this accelerated resource exploration activity is controversial with much concern about destroying Greenland’s unique environment.
While iron ore is likely to be the first mine to benefit from Greenland’s newly relaxed attitude to resource exploitation, via enhanced immigration, with zinc probably second in line, right behind them comes rare earth elements. Two REE companies stand out as being among those early adopters of Greenland’s new policy. ASX listed Greenland Minerals & Energy Ltd., is looking to develop its Kvanefield uranium and zinc project, which is also rich in REEs, more importantly Heavy Rare Earth Elements. Helpfully for this project, last month Greenland altered its policy to allow uranium mining. Uranium and the zinc would probably go to China, with Denmark enforcing the non-proliferation nuclear policy.
Toronto listed Hudson Resources Inc., is another early contender. To quote Hudson:
Get our daily investorintel update
“The area in which Hudson operates has excellent logistical and infrastructure support with an international airport 60km from the project and year round ice-free tidewater within 20km of the Sarfartoq Project and 4km of the Najaat Project. The opportunity for hydroelectric power near the project site is excellent.”
I suspect that we will be hearing a whole lot more about Greenland in 2013 and beyond.
Greenland Minerals & Energy Ltd.
Hudson Resources Inc.
InvestorIntel is a trusted source of reliable information at the forefront of emerging markets that brings investment opportunities to discerning investors.