I believe the Mine Will be approved!

Withoutnew private business activity, the outlook is bleak. Moreover, there is a greatneed to diversify the economy, which is too dependent on the fishing industry,which accounts for some 90% of Greenland’s total exports. Diversification isalso needed in terms of trade patterns, as Denmark and other EU-countriesaccount for some 90% of total exports and total imports.

Theemployment situation constitutes a major economic policy challenge. Thechallenge is not only due to the modest growth potential in the economy butalso structural challenges. A share of the highly educated and specialized laborforce comes from overseas, and many are unskilled. In recent years, progresshas been made in the educational sector, where more young people are nowcompleting their education. However, there are still great challenges in thisarea, and consequently continuous efforts are required.

Self-sustainable economy
The government’s long-termtarget is to make the economy self-sustainable. Today, Greenland receives anannual grant from Denmark of around DKK 3.7 billion, or USD 10,000 perinhabitant. Thus, the road toself-sustainability will be long. Mineral resource projects are necessary forprogressing towards a self-sustainable economy. These projects will onlytrigger large socio-economic gains if translated into business development andemployment without import labor on a large scale. Businesses that increaseproduction and employment presuppose an increased level of qualifications amongthe labor force, mobility and incentives to remain employed. If this processsucceeds, it will also strengthen public finances via increased tax paymentsand less expense for social benefits.

2. What role does the mineral sector play in this environment?
The Government ofGreenland aims to promote the prosperity and welfare of Greenland. One way ofdoing this is to create new income and employment opportunities in the area ofmineral resources activities. The government’s goal is to have five to 10long-term active mines, and it has published a new five-year strategy for theperiod 2014-18, which represents a major step in the right direction. The newstrategy focuses on royalty models and establishing a more profound geologicalknowledge and control over all geo-data concerning Greenland. More broadly, itcovers sustainable development in terms of the environment, training andemployment. Infrastructure challenges are also addressed, and active citizenand stakeholder involvement are central new objectives.

3. How does the government intend to develop the mineral sectorover the next decade?
Strategy andsociety Society must benefit from a fair proportion of the value gainedfrom extracting minerals. Local insight and knowledge of the activities must beacquired to ensure that local labor and local enterprises are used to thegreatest possible extent. All mineral resource activities are subject to thespecific political condition that they be carried out properly in terms ofhealth, safety and the environment.

TheMinistry of Mineral Resources (MMR) is responsible for strategy-making,policy-making, legal issues, licensing and marketing of mineral resources inGreenland. MMR deals with licensing and inspection issues via the MLSA andgeological issues through the Department of Geology. The Mineral License andSafety Authority (MLSA) is the one-door authority. Licensees and other partiescovered by the Mineral Resources Act communicate with the MLSA and receive allnotifications, documents and decisions from the MLSA. It is the overalladministrative authority for licenses and mineral resources activities, and isthe authority for safety matters including supervision and inspections.

MLSApublishes information on the case processing status of applications for mineralexploration and small-scale licenses in Greenland every two weeks on the 1stand the 16th of every month. The applications status document is a dynamic toolintended to improve the level of transparency into the processing ofapplications for new licenses, transfers, reductions, renewals andrelinquishments. The application terms for the included license types are setout with reference to the Mineral Resources Act in the applicable standardterms for each license type.

Geology and minerals
Greenland has a favorablegeology, and nearly the whole history of the Earth’s evolution is represented,which yields a lot of opportunities for a variety of mineral prospects.Greenlandhas the same geological framework that characterizes major mining nations suchas South Africa, Australia and Canada. Greenland even has a large ice cap, andthere is still more than 400,000 km2 to explore. It has a pro-mining governmentand population. It has no private land and therefore no first nations landrights issues. It has an ocean-moderated arctic climate with deep-water fjordaccess to most of the ice-free land areas.

Greenlandmay become a player particularly for iron alloys (iron, nickel, molybdenum,titanium, vanadium) and base metals (copper, zinc). The overall viability iscontrolled by demand, and production concentration and subsequent globalvulnerability to political and socio-economic changes and conflicts. In themeantime, Greenland already has the ability to enter – and potentially change –the market for critical minerals.

Marketing
In its campaign topromote business, the Government of Greenland has a particular focus onmarketing Greenland’s mineral resource potentials. For a number of years,Greenland has attended the world’s largest industry trade shows, and itsparticipation is evaluated on a regular basis so as to ensure that Greenlandcontinues to be represented at the most important industry events.

Apartfrom participating in industry trade shows, marketing efforts includeactivities aimed directly at carefully selected countries, explorationcompanies and investors. This ensures flexibility and a clear target for theactivities to ensure that the resources allocated are utilized to their fullpotential. Official visits together with the Ministry of Mineral Resources arealso used strategically to open the doors to potential partners in explorationas well as exploitation projects. In the years to come, Greenland’s marketingefforts will reflect the fact that not only exploration companies but alsoinvestors and purchasers are a central part of the marketing strategy.

4. Does Greenland intend to become independent from Denmark ifit can generate more wealth from the mineral industry? If so, what are theadvantages of independence?
This is a politicalissue and cannot be answered directly, and the approach to it can changedepending who is in government. Independence is always a much-discussed issue,but no decision has been made and no time-frame has been established however, the voices of independence are gettinglouder.

5. What benefits does Greenland offer the internationalinvestment community?
Overall, Greenland issupportive of developing mining and lifting the zero-tolerance ban on miningore containing uranium or thorium, which in turn has expanded the possibilitiesto exploit deposits containing critical minerals. The REEs, niobium andtantalum almost exclusively occur in connection with uranium or thorium, whichmeans that Greenland now has the potential to become a major producer not onlyof REEs, but also other critical metals.

TheGovernment of Greenland has also focused on how to develop large-scaleprojects, including the unique issues and challenges raised by suchdevelopments. The main issue has been whether there is a need to assess socialsustainability separately in the construction phase. This has turned out to benecessary because the construction phase can be large enough and intensiveenough to have a significant influence on launching the mining industry inGreenland.

The Government of Greenland’s objective is to license the three tofive new mines on an environmentally and socially sustainable basis over thenext five years. This is a realistic goal. The next mining project is theruby-sapphire mine (Qeqertarsuatsiaat/Fiskenæsset), probably followed by theanorthosite project (White Mountain at Kangerlussuaq). Large projects such asthe Isukasia iron ore, the Kringlerne and Kvanefjeld multielement deposits ofREE and associated elements, and the Citronen Fjord base metal project lookpromising for Greenland’s future as a mining country. Within the strategy period,both nickel (Maniitsoq project, West Greenland) and gold mining projects (SouthGreenland) can be brought to maturation.

Thestrategy of Greenland’s government over the next decade is to maintain a highlevel of mineral exploration activity to further incentivize the mineralresources industry to obtain exploration and exploitation licenses. Greenland recognizes the importance of mineralresources as indispensable inputs to industrial production, and it aims tobecome an important source of a variety of minerals. The strategy also focuseson ensuring that the opening of new mines benefits local society the most inthe form of new jobs and increased income.