Greenland gives green light for uranium and rare earths mining

Greenland’s parliament has voted to end a decades-long prohibition on mining for radioactive materials such as uranium, further opening up the country to investors from Australia to China eager to tap its vast mineral resources.

Thursday’s vote, by 15-14 after a heated debate, also allows the mining of rare earths – minerals used in products from wind turbines to hybrid cars and smart phones, and which are currently mostly extracted by China.

“We cannot live with unemployment and cost-of-living increases while our economy is at a standstill. It is therefore necessary that we eliminate zero tolerance towards uranium now,” Greenland’s prime minister, Aleqa Hammond, was quoted as saying by local newspaper Sermitsiaq during the debate.

With sea ice thawing and new Arctic shipping routes opening, Greenland has emerged from isolation and gained wider geopolitical attention thanks to its untapped mineral wealth.

Environmental groups have warned that uranium mining in Greenland could threaten the Arctic region’s pristine ecological system.

While Greenland is self-governing, its former colonial ruler Denmark still has a say in security and defence policy, and the uranium decision may need to be approved by the Danish parliament – possibly putting the two nations on a diplomatic collision course.

Greenland’s “zero tolerance” policy on mining radioactive materials is inherited from Denmark, but the island is keen to develop mining to help pay for welfare and jobs in a country with a population of about 57,000, mostly Inuits.

Since Greenland won self-government in 2009, most politicians have aimed for growing autonomy and eventual independence. Revenue from mining or oil can help Greenland wean itself off Denmark’s annual grant that accounts for more than half the island’s budget.

One rare earth deposit being explored by Australian-owned Greenland Minerals and Energy could be one of the largest outside China, which accounts for more than 90% of global production.

It is likely to take some time for mining operations to get under way.

“I think the Danish government is prepared for the no-tolerance to be lifted” said Cindy Vestergaard, senior researcher at the Danish Institute for International Studies.

“After that the Greenlanders and the Danes are going to start hammering all the legal aspects. We will not be mining on Friday, nor next year, or 2015.”

Separately, the iron ore producer London Mining said on Thursday it had received the go-ahead from the Greenland government for a mine that could produce 15m tonnes a year, paving the way to attract partners for the project.

The Isua project, which will cost an estimated $2.3bn (£1.4bn), has been controversial in Greenland, with fears its construction would attract a flood of Chinese workers into the country.

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