Will 2017 be the year of the miner in Greenland? The early outlook is yes.
After being without an active mine since 2013, when tumbling prices forced the closure of the Nalunaq gold mine, two mines appear to be solid bets to be up and running by the end of next year. The owners of a third project are also bullish on their chances.
The favourite to begin drilling first is LNS, the Norway-based owner of the Aappaluttoq ruby project. LNS overtook full control of Aappaluttoq after its former majority owner ran out of operating capital, and it is now in the process of taking over the exploitation licence, which is expected to take about eight months.
That, however, has not stopped LNS from pushing ahead. It is currently putting the finishing touches on the mine’s construction, and expects the first gems to be out of the ground and on the market before the end of this year according to Gunnar Moe, an executive with LNS.
Also expected to be operating in 2017 is the White Mountain Anorthosite Project, near the town of Maniitsoq, on the western coast. Formally, Hudson Resources, a Canada-based outfit, has been cleared to begin operation since the beginning of this year, but local officials and the company both reckon it will not be until late 2017 that the first anorthosite, a mineral primarily used in fiberglass, will make it to market.
Hudson has wrapped up activity at the site for the year and expects to complete construction upon its return in 2017. Financing still needs to be finalized, according to the latest progress report, and purchase agreements are also still in the works. But, earlier in the year Hudson announced that it had landed a 10-year deal with one of the world’s leading fiberglass producers.
Four other firms hold 30-year exploration licences for their respective sites. Which of them will be next? None, quite possibly.
Arctic Minerals, the firm holding the Nalunaq licence, for example, has handed it back to mining authorities. The same slump in commodity prices that undermined its profitability has also idled another two other projects that have been approved to begin operation: Isua, reputed to be the largest deposit of iron ore anywhere, and the Malmbjerg molybdenum project, in eastern Greenland.
The fourth, the Black Angel mine at Maarmorilik, in the far northeast, is known to contain zinc, iron, lead, and silver. However, it had already been active for two periods during the 20th century, and, despite ongoing exploration, its current owner, Angel Mining, a UK-based operation, has been unable to find commercially viable drill sites.
A fifth firm, Greenland Minerals and Energy, an Australia-based outfit seeking to open a combined rare-earths and uranium mine, is likely the next company that will join the exploiters’ club after submitting its application for a license last year, though its chances of opening a mine have clouded somewhat in recent weeks.
License applications take about a year to review, making a 2017 start feasible. Before then the management will need to sweat out a review the recent deal GME signed with Shenghe, a Chinese firm. Mining officials so far have been unimpressed with the company’s willingness to co-operate on the latter, and suggest it will affect their decision about the former.
In addition to having the bureaucracy on its back, GME’s progress may be slowed by a change in the political winds. The government in Nuuk, once friendly to uranium mining, last month welcomed opponents into the ranks of the governing coalition. Now, the official position is to remain undecided until GME or another of the firms seeking to mine uranium submits an application.
Greenland has all the minerals it needs to base an economy on. Unfortunately, it also has the low prices and political uncertainty that miners would rather do without.