Canada backs Greenland molybdenum mine in $3.6 billion critical minerals strategy

The Canadian government will invest up to $7 million in Greenland Resources Inc.’s Malmbjerg molybdenum project, part of a $3.6 billion push to develop domestic and allied supply chains for critical minerals currently dominated by China.

The funding, announced at the PDAC conference, supports a feasibility study to extract molybdenum, magnesium and rare earth elements from the east Greenland site. China controls 89% of global magnesium production and 69% of rare earth elements, both vital for defense, electric vehicles and renewable energy technologies.

“Canada has the minerals the world wants, and we are acting with speed, scale and purpose to get them from deposit to market,” said Energy and Natural Resources Minister Tim Hodgson. “We are not just extracting rocks—we are purposefully building and onshoring full, domestic value chains that create good jobs, strengthen our economic and national security, and support rural, remote and northern communities.”

The Malmbjerg project, which includes innovative methods to recover magnesium from seawater, could supply all of the EU’s defense molybdenum requirements and boost Greenland’s GDP by more than 25%. Construction will be led by Nuna Group, Canada’s largest Inuit-owned heavy civil company, with an emphasis on local hiring and skills development.

The project is one of 22 initiatives receiving a total of $165.2 million in federal support, leveraging over $434 million in private capital. Ottawa is also launching a $1.5 billion First and Last Mile Fund for mine infrastructure and a $2 billion Critical Minerals Sovereign Fund to accelerate project development. A new Mine Permit Navigator tool aims to streamline federal approvals within two years.

The EU has designated Malmbjerg as a priority project under its RESourceEU program, seeking to reduce dependence on Chinese mineral imports. Greenland Resources chairman Dr. Ruben Shiffman said the project will prioritize sustainability and Indigenous partnership, with potential to reshape Arctic resource development.

The government reports that domestic production of nine critical minerals has already increased by over 10% since 2022.