Greenland miner could offer solution to the precious metals crisis

ven if you don’t invest in precious metals your life wouldn’t be the same without them.

Your alarm clock, mobile phone, watch, laptop, iPad, washing machine, dishwasher or car simply would not work.

The problem is that the metals are scarce and demand is rapidly increasing with global demand for electronic consumables booming.

Worryingly, China was early to spot this and has spent the last 15 years buying up nearly all the supply of these metals across Asia, Africa and South America.

Not for the first time, they have completely outflanked the West and a supply crunch is heading our way.

I spoke with Eldur Olafsson the CEO of AEX Gold, which holds the largest rights to mining across Greenland, a country which is a territory of Denmark with a land mass half the size of the continent of Australia. Eldur may have the answer to the impending supply shortages of rare earths and help get the West out of a hole.

What minerals are important in consumer electronics and the energy transition?

There are a number of minerals that are now vital due to our addiction to technology and which will become increasingly important as the world embraces technology to reach its net-zero goals. As ever, China has stolen a strategic march on the West.  It currently provides more than 85 per cent of the world’s rare earths and controls about two-thirds of the global supply of scarce metals and minerals according to the Centre for Strategic and International Studies (CSIS). Lithium, nickel, cobalt, magnesium and graphite are all crucial to battery operation, performance and longevity, and copper and aluminium are required for any electric network to function, meaning the price and availability of these elements has a direct effect on the electric vehicle supply chain.

What minerals are in Greenland?

With very little exploration so far, Greenland currently already holds 1.5% of global rare earth reserves, which includes an abundance of different metals and minerals and substantially more to find. There have been recent discoveries of rare earth deposits hosting copper, nickel, zinc and graphite. There are currently 12 active explorers across eight commodities.

How easy is it for the UK, US and Europe to access minerals in Greenland?

There is no need for Western countries such as the UK, US and Europe to be solely looking to China for the supply of rare earth materials. Greenland was an EU member until 1982, remains close from a trading perspective and has since been forming its own trade deals with a number of Western countries. In June 2021, talks were held between the Greenland and UK governments, following the UK’s decision to leave the EU, in a bid to forge closer trading ties.

Is mining easy and environmentally friendly in Greenland?

The Greenland government is particularly supportive of the mining industry in order to diversify its economy, so much so that it doubled its spending on exploration in its last Budget announcement. Although many view the island as permanently covered in snow and ice, this is far from the case. Where AEX Gold operates, in Southern Greenland, conditions are warmer than the north of the island, with the tip actually being on the same latitude as the most northern part of Britain.  With a population of only 50,000, aggregated in fishing communities near the coast, the majority of the island is population free. The Government has also introduced a responsible mining code ensure the operators mitigate emissions, using alternative fuel substitutes such as wind and hydro.

Greenland has great potential to become a strategic mining hub to supply strategic metals to go in the technologies used in everyday life in both Europe and the US.