Gold miner ‘encouraged’ after 2019 Greenland exploration season

AEX is working toward a 2021 restart of southern Greenland's Nalunaq gold mine.

Ore from the Nalunaq mine would be shipped from a nearby fjord. (AEX)

Dormant since 2013, Greenland’s Nalunaq gold mine remains on track to become the country’s third operational mine next year after a better-than-expected 2019 exploration season that showed evidence of more gold than previously thought, Toronto-based owner AEX reports.

“The drilling results have outperformed our expectations … These results are very encouraging for the future growth of the Nalunaq mine and represent further validation of the wider AEX Gold strategy in Greenland,” CEO Elder Olafsson said in a comment to the results.

Nalunaq, located in the southern Greenland, originally began operation in 2004 and had hoped to earn a reputation as an ethical, environmentally friendly producer. A downturn in prices resulted in it being closed and the elimination of the 60 jobs it had created.

Today, most of the mining infrastructure from remains intact for AEX, which took over the rights to Nalunaq in 2017. Although AEX underscored that market conditions would be the determining factor, the company believes it can pick up where the previous owner left off to begin production starting next year.

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“We are focused on effectively working to fast-track the resumption of operations at Nalunaq and are targeting first production in 2021,” Olafsson said.

That opinion is shared by public officials in Denmark and Greenland, who chose last year to invest 15 million kroner in AEX in order to speed along the restart of operations at Nalunaq, which is seen as a keystone activity that could spur other economic activity in southern Greenland.

In addition to the Nalunaq license, AEX also holds the rights to a second potential gold mine. But the firm’s prospecting lead it to believe to that the region could sustain as many as 20 gold mines.