‘Red-carded’ Australian miner signals intention to play on in Greenland – Mongabay.com

  • The advancement of a huge rare earths and uranium mining project in Greenland sparked a snap election in April that saw a green party elected and a new government formed that is opposed to the mine.
  • The Kvanefjeld project, developed by small Australian mining company Greenland Minerals Limited, with Chinese partner Shenghe Resources, would exploit one of the world’s largest deposits of rare earth metals and uranium near the small township of Narsaq and increase Greenland’s greenhouse gas emissions by 45%.
  • While new coalition partners Inuit Ataqatigiit (Party for the People) and Naleraq campaigned against the mine and have a written agreement opposing any uranium mining in Greenland, the consultation process for Kvanefjeld is continuing, and NGOs are concerned that Greenland Minerals will try to pressure the new government to agree to the project in some form.
  • In early July, Greenland’s Ministry of Mineral Resources released a draft bill banning uranium mining and exploration and limiting the amount of uranium present as a by-product in any mining operations to 100 parts per million — which would prevent the Kvanefjeld operation going ahead.

An Australian mining company hoping to build a vast open-cut rare earths and uranium mine on a mountain in southern Greenland has told shareholders it will persist with the project despite the mine having been rejected by the people of the Arctic nation.

Publicly listed Greenland Minerals Limited has been working to develop the Kvanefjeld mine since it acquired an exploration license for the area in 2007, and it achieved a significant milestone in December last year when its environmental impact assessment for the project was finally accepted for public consultation.

However, the advancement of the controversial mine triggered a breakdown of Greenland’s governing coalition and a snap election that served as a referendum on the issue.

In a result the Danish-language newspaper Sermitsiaq referred to as a “decision to give Greenland Minerals the red card,” 37% of voters backed the pro-independence, green-leaning Inuit Ataqatigiit (Community for the People) party, which had adopted an explicit policy to stop the mine and reinstate a uranium mining ban in Greenland.

“It is written in black and white in the coalition agreement between Inuit Ataqatigiit and [its partner] Naleraq that ‘the coalition is in agreement that uranium should not be mined in Greenland. The mineral project at Kuannersuit must be stopped,” Sermitsiaq wrote.

Narsaq, a major settlement in Kujalleq, southern Greenland, lies in the vicinity of Kvanefjeld. Image by Algkalv via Wikimedia Commons (CC BY-SA 3.0).

The Kvanefjeld/Kuannersuit project

The $1.24 billion Kvanefjeld project (Kuannersuit in Greenlandic) is named for the mountain in Greenland’s southernmost municipality, Kommune Kujalleq, where the Australian company and its Chinese partner, Shenghe Resources, aim to exploit one of the world’s largest deposits of rare earth metals and uranium, 600 meters (2,000 feet) above sea level and less than 8 kilometers (5 miles) from the township of Narsaq (population 1,500).

Kvanefjeld is part of the Ilimaussaq geological complex, which has been estimated to contain the second-biggest uranium, largest thorium and second-largest rare earth deposits in the world.

In 2007, the company saw Kvanefjeld’s uranium, which it valued at $11 billion, as the project’s primary focus. But with uranium prices stagnant following the Fukushima disaster in 2011, and uranium mining a hotly contested issue in Greenland, the emphasis switched to rare earths. Uranium is now described as a “small but commercially valuable” by-product of the operation, which would also extract zinc concentrates and fluorspar, along with rare earth elements neodymium, praseodymium, dysprosium and terbium. Also excavated but discarded and stored as tailings would be large quantities of highly radioactive thorium, which has no commercial value.

Kvanefjeld is part of the Ilimaussaq geological complex in southern Greenland. Image by Greenland Minerals Ltd.
Kvanefjeld orebody as shown in an early Greenland Minerals Ltd. presentation to shareholders on their project. Image by Greenland Minerals Ltd.

GML’s plan to process 111 million metric tons of ore from the mountain over 37 years involves building processing and chemical refinery plants near the elevated mine site, and storage dams in nearby Lake Taseq, where the radioactive waste would be dumped. The project would use an estimated 155,200 liters (41,000 gallons) of fresh water per hour from the Narsaq River and discharge treated water into one of the fjords surrounding the town.

It would also see the construction of a power station, workers’ village, road and new port, from where the rare earth products would be shipped for further processing by Shenghe, one of the world’s biggest producers of rare earth metals.

Social and political background

Greenland has had autonomy within the Kingdom of Denmark since 1979, but only gained more significant political control, including over its rich mineral resources, in 2009 following a referendum on self-rule. With limited economic opportunities on the largely ice-covered island and a declining population, Greenland’s leadership has in recent years been keen to explore the country’s mining potential.

The idea of achieving economic independence from the colonial power, whose annual “block grant” still makes up more than half of Greenland’s budget, is also a strong motivation (although one university study showed that an impossible number of projects would be required to replace the Danish funding).

Meanwhile, the country’s 56,000 residents, around 90% of whom are Inuit, enjoy a largely pristine natural environment, where hunting and fishing are key forms of traditional culture, and increasing Western influence is seen as a cause of social problems, including a very high suicide rate.

Greenland’s residents, around 90% of whom are Inuit, enjoy a largely pristine natural environment, where hunting and fishing are key forms of traditional culture. Image by jtstewart via Flickr (CC BY-SA 2.0).

Greenlanders reject the mine

Opponents of the Kvanefjeld mine dispute its promised benefits and point to the potential for contamination of the local environment through dust, leaks and spills. They also note the possibility of catastrophic failure of its waste storage systems poses an unacceptable risk.

They also predict impacts on grazing and agriculture in the Narsaq Valley, which is among the less than 1% of landmass available for year-round farming in Greenland, as well as to fishing, hunting, tourism and the nearby Kujataa UNESCO World Heritage Site.

“We are against the project due to thorium pollution, fluorine pollution and dust pollution,” Jan Rehtmar-Peterson, the chairman of Narsaq anti-uranium organization Urani Naamik, told Mongabay by email. “And there are about 15 different radioactive elements that will also contaminate. There are also over 200 different other elements in between lead and mercury [present at the site].”

While reactions to the project were reportedly initially mixed, the results of one study suggest that dissatisfaction with Greenland Minerals’ consultation process and lack of transparency may have played a significant role in the increase in opposition to it.

Also apparently influential was an expert report published by Greenlandic and Danish NGOs in 2017, which concluded that Kvanefjeld, the first open-pit uranium mine to be located on an Arctic mountain top, was not environmentally sustainable and threatened the health of the local population.

Uranium ore from Narsaq. This installation was part of the screening of the 2017 documentary film Kuannersuit / Kvanefield which portrays the conflicts facing the small community of Narsaq. Image by Kristof Vrancken/Z33 House via Flickr (CC BY-NC-ND 2.0).
Map of the Kvanefjeld Project location. Image by Kvanefjeld Project EIA.

Rehtmar-Peterson says resistance increased significantly when the scale of the proposed mine was revealed in social and environmental impact studies.

“People found out that the project was huge, with 6 million tons of rock having to be blasted a year,” he said.

“We are not happy about [earning] money at the expense of our nature, which we use for food and housing. The mine will pollute our nature for a minimum of 37 years. And Greenland Minerals has plans [for continued mining at the site] that are five times larger than the current project.”

In the weeks leading up to the election, GML ran one of Greenland’s largest-ever publicity campaigns, with daily advertisements across media outlets touting an estimated annual contribution by the mine of $245 million in taxes and royalties to the country’s economy and the creation of 330 local jobs, while environment groups campaigned against the mine.

In March 2021, an opinion poll commissioned by government agency Innovation South Greenland found that while 52% of people surveyed across Greenland were in favor of mining in general, 71% opposed the Kvanefjeld mine. Opposition in southern Greenland, where the project is located, stood at 86%.

The mine was a defining issue in the April 6 election and the victory of Inuit Ataqatigiit (IA), whose 37% of the vote came as no surprise in Greenland. The long-time ruling party, Siumut, under which GML had obtained preliminary approval for Kvanefjeld, received 29% and lost government.

Houses in Narsaq. Resistance by the population increased significantly when the scale of the proposed mine was revealed in social and environmental impact studies. Image by Adrian Boliston via Wikimedia Commons (CC BY 2.0).

While French uranium giant Orano, which was recently granted exploration licenses in Greenland, announced it would “respect the chosen direction” of the new coalition and suspend operations, Greenland Minerals has hinted at legal action against the new government if its project is stopped.

In a company newsletter, managing director John Mair said GML had spent “14 years and several hundred million Danish krone developing a world-class mining project” that had been assessed as “within the framework of Greenland’s extremely restrictive Minerals Act,” and expected the sequence of mining approval processes laid down in the legislation to be followed.

At the company’s annual general meeting (AGM) in Perth, Australia, on May 26, Mair suggested that international NGOs and local media were responsible for politicizing uranium and turning public opinion against the mine in Greenland. He told shareholders the company would “engage” the new government “to understand what the specific issue points are, from their perspective.”

Criticism close to home

But at the AGM, dissident shareholder Greg Barnes, an Australian geologist who originally sold the Kvanefjeld exploration license to the company, accused Greenland Minerals of a “dreadful” standard of work and of “ruining” the project by “pushing things through the politics.”

Barnes, who owns Tanbreez Mining Greenland A/S, a company that has already been granted an exploitation license for another huge rare earths mine near Kvanefjeld, can be heard in a recording of the meeting expressing “disbelief” at the “poor standard” of GML’s environmental impact assessment and telling directors the company was deeply unpopular in its host country.

“Mate, you stink in Greenland,” he said to Mair. “Your advertising campaign in the election probably did more to get IA elected than anybody else.”

Questions of governance

Danish Friends of the Earth (NOAH) campaigner Niels Henrik Hooge, who has been following Kvanefjeld developments for more than a decade, told Mongabay that while Greenland Minerals was only a “junior mining company,” it had had a very big impact on the political landscape in Greenland.

“They have been a very divisive factor, for sure,” he said in a recent interview, describing the company as “instrumental” in the 2013 overturn of a decades-long ban on uranium extraction, and pointing to “illegal” attempts to influence the project’s licensing process, which were documented in a 2019 reprimand from former prime minister Kim Kielsen.

NOAH, along with Inuit Ataqatigiit politicians, have called for an investigation into the company, on the grounds that questions about the integrity of its ownership and connections have been raised many times in the Australian media.

Greenland Minerals Ltd. workers at the Kvanefjeld project site. Image courtesy of Proactive Investors.

According to Hooge, Greenland’s failure to sign up to international transparency and anti-corruption agreements enabled the “problematic” GML board appointments of former Greenland prime minister Lars-Emil Johansen and former Mineral Resources Authority heads Hans Kristian Schønwandt and Jørn Skov Nielsen. Nielsen, who was considered to be Greenland’s most senior civil servant, took up the role of general manager of GML’s Greenland subsidiary in July 2020 just a month after leaving his decade-long role with the government and was rewarded with a large share package.

Hooge says benchmark standards of integrity, transparency and public participation are badly lacking across the whole mining sector in Greenland, where the country’s Mineral Resources Authority to date has been over-eager to establish Greenland’s mining-friendly credentials.

Not so green

GML pitches Kvanefjeld as a green project but estimates its operation there would create 0.24 million metric tons of greenhouse gases a year, increasing Greenland’s CO2 emissions by 45%.

While media coverage of rare earth mining often focuses on the role of the metals in a global transition to green energy, the many mining exploration companies lining up to drill Greenland’s accessible resources show no great commitment to a more sustainable world.

GML itself, through investment and personnel, is linked to a web of current and former companies pursuing oil, gas and mineral interests around Greenland and beyond. These include Arctic Energy Pty Ltd, Greenland Gas & Oil Ltd, East Greenland Oil A/S, and Bluejay Mining PLC.

Around the country, 90 large-scale mining projects covering thousands of square miles, including in the country’s only national park, are now active in Greenland, according to Hooge, in addition to around 50 small-scale ones.

GML pitches Kvanefjeld as a green project but estimates its operation there would increase Greenland’s CO2 emissions by 45%. Image by Maggie & David via Flickr (CC BY-NC-SA 2.0).

What happens next?

Greenland’s new mining minister, Naaja Nathanielsen told parliament in May, following the election, that it was not possible under the country’s current legislation to stop the public consultation process on the Kvanefjeld mine that is underway, and the government has since announced the extension of the process until Sept. 13.

On July 5, the country’s Ministry of Mineral Resources published a bill that would reinstate a uranium ban in the country. The bill, which has gone out to public consultation until Aug. 2, sets an upper limit of 100 ppm uranium, or 100 grams (3.5 ounces) of uranium per metric ton of ore extracted in mining operations. If passed into law, this would stop the Kvanefjeld mine from going ahead. The project has an average ore grade of nearly 300 ppm uranium and approximately 800 ppm thorium.

Among the observers following the situation closely is Australian-based mining watchdog the Mineral Policy Institute (MPI), which has links with environmentalists and NGOs in Denmark and Greenland.

MPI board member Lian Sinclair, who attended the Greenland Minerals AGM and questioned its directors about their plans, said she was worried the company would try to “undermine the democratic mandate.”

“As an Australian NGO that’s concerned with the politics and social implications of resource extraction, we’re interested in how Australian companies are operating when they operate overseas,” she told Mongabay.

“I’m worried about this talk of ‘quiet diplomacy’ — the idea that the company wants to do things behind closed doors — combined with their refusal to rule out suing the government.”

According to the project’s opponents, while GML may be looking to recast its operation as uranium-free or negotiate a lower level of extraction of the controversial metal, the nature of the ore body at Kvanefjeld and the radioactive dust and waste that would be produced mean the mine would still pose an unacceptable risk.

GML project’s opponents argue that the project has been rejected by the voters of Greenland due to the risk the mine would pose. Image by jtstewart via Flickr (CC BY-SA 2.0).

More importantly, they argue, GML’s project has been rejected by the voters of Greenland.

“MPI will always support our partner organizations that work on the ground, so if something happens and they genuinely change their minds based on a process of free, prior and informed consent, we will follow the will of the local people,” Sinclair said.

“But if that consent is being given with the threat of a lawsuit, that’s not free consent. That’s coercion.”

Banner image: Houses in Narsaq with the Qaaqarsuaq mountain in the background. Image by claire rowland via Flickr (CC BY 2.0). 

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