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The developer of a rare earth minerals project in Greenland is
continuing to hold out faint hopes for what would be one of the
three largest mines of its kind after a general election last week
in which the most successful party vowed to block the mine.
Greenfield Minerals said 9 April it looks forward to working
with the government, once the new coalition is formed, on moving
forward with the Kvanefjeld project, which includes reserves of
rare earth minerals neodymium and praseodymium. The rare earth
minerals are essential for the permanent magnets used by electric
vehicles as well as rechargeable batteries.
But those hopes are decreasing with each passing day after the
leader of Inuit Ataqatigiit (IA) Party, which took 12 of the 31
mandates in the national parliament, the Inatsisartut, said the
project was canceled. "The people have spoken," IA's Mute Egede
also told Danish broadcaster DK when asked about Kvanefjeld.
Kvanefjeld's reserves of rare earth minerals are accompanied in
the deposit by uranium. Now in talks with other parties to form a
coalition government, IA's opposition to any radioactive waste the
mine might produce was central to the party's election campaign. IA
says it is not against mining, just radioactive mine tailings,
especially in a region of Greenland where agriculture plays a
prominent role.
Part of the attraction of Kvanefjeld was Greenland Minerals'
promise of $235 million for the country's budget.
Approval of rare earth or other mining projects would enable a
diversification away from fishing and decrease reliance on an
annual Danish subsidy of around €526 million ($626.5 million),
representing a third of Greenland's national budget. Greenland is a
semi-autonomous region of Denmark.
Kringlerne
But Kvanefjeld is not the only rare earth minerals option for
Greenland. In February, Tanbreez Greenland won an exploitation
license for its Kringlerne project some 8 km south of the
Kvanefjeld site.
Tanbreez Founder and Chief Geologist Greg Barnes used to hold
the rights to develop Kvanefjeld before selling them and putting
his energies into Kringlerne.
The problems Greenland Minerals ran into won't be a problem for
Tanbreez because the Kringlerne deposit does not include uranium,
Barnes told IHS Markit 9 April.
Tanbreez has good relationships with both sides of the political
divide, he said, adding that he doesn't believe the change in
government or the makeup of the coalition will affect Kringlerne
going forward. "I can see absolutely no difference in the way the
government is going to see us," he said.
Tanbreez has an exploitation license granted, but Greenland
Minerals won't get one, said Barnes.
The Kringlerne deposit is heavily weighted toward cerium,
lanthanum, yttrium, and neodymium, according to Tanbreez. Cerium is
used in catalysts, lanthanum can be used in EV batteries and
hydrogen storage fuel cell materials, while yttrium is often used
for tablets and computer monitors.
The Kvanefjeld deposit has light rare earth minerals such as
neodymium and praseodymium and heavy rare earths such as terbium
and dysprosium as well as uranium and zinc, according to a December
presentation by the company. On its website, the company also says
the site includes access to the lithium used for batteries.
Permanent magnets are used by electric and hybrid automobiles as
well as wind turbines and involve the use of neodymium,
praseodymium, terbium and dysprosium. Rechargeable batteries used
by hybrid vehicles, electronic devices and tools use neodymium and
praseodymium.
World leaders and industry have worries about their supply
chains of key minerals as the electrification boom gathers pace,
particularly in power generation and transportation.
President Joe Biden's administration on 24 February said it will
review key US supplies, including rare earths, to ensure other
countries cannot weaponize them against the US. "This is about
making sure the United States can meet every challenge we face in
this new era — pandemics, but also in defense, cybersecurity,
climate change, and so much more," Biden said when announcing the
executive order.
The Greenland projects are part of an EU initiative, the
European Raw Materials Alliance, to boost Europe's output of
critical minerals and cut dependence on China for rare earth
metals.
The alliance is coordinating investment and providing seed money
for European mines, processing plants, and industries such as
magnets. The raw materials alliance declined to comment 12 April on
the Greenland election.
Alternatives
Very few mines have been set up over the past decade, however,
both because of the cost and dependence for processing on
China.
One exception is Lynas Rare Earths' Mt Weld mine in western
Australia, which has 5% to 10% of rare earth minerals globally,
according to IHS Markit Director Minerals Research and Analysis
Samantha Wietlisbach. Lynas has a deal in place with the US
government to build a separation facility too. It previously set up
a separation plant in Kuantan,
Malaysia. The plant can produce as much as 22,000 mt/year.
Tanbreez is hoping to join Lynas as a producer. But what
Tanbreez needs now is an end to the COVID-19 pandemic and money,
Barnes told IHS Markit.
The company has spent A$50 million ($38.12 million) so far on
Kringlerne, it says, and the mine would cost about $500 million to
develop.
Barnes said he is fielding multiple offers each day from
potential financial partners, with the results of the election
bringing all sorts of interested parties out into the open. It
hasn't just been funding offers though, the company has had offers
from China, the US, India, and the UK for its projected output from
Greenland, he said.
The next steps for Tanbreez also depend on the COVID-19
pandemic's impact decreasing, said Barnes, noting that the
company's employees were currently spread out across the globe.
"It's harder to get out of Australia than North Korea at the
moment," he said, speaking to IHS Markit from his home in
Australia.
The coming year will involve getting all the company's plans
lined up, preliminary work carried out, and then Tanbreez will
"hopefully" get up and running in 2022, said Barnes.
The company has also a decision to make on where to locate its
processing operations, with a US site most likely, he said, while
declining to go into further detail.
Chinese dominance
In contrast, Greenland Minerals' largest shareholder at roughly
10% is Shenghe Resources, a Chinese rare earths giant
that owns a similar stake in what was the dominant global rare
earth minerals source for many a decade -- MP Materials' Mountain
Pass operation in California.
The output of Mountain Pass, in which Shenghe bought a stake in
2017, is sent to China. A similar route for the output of
Kvanefjeld was expected because most rare earth processing --
separation and smelting -- takes place in China.
China has a stranglehold on smelting and separation, controlling
88% of the market, Wietlisbach said. China's other monopoly is in
knowledge and the ability to convert the minerals to usable
product, she added.
Some 34% of the demand for rare earth minerals goes toward
permanent magnets, while 17% is used for emissions control
catalysts and fluid cracking catalysts at refineries for making
gasoline and diesel. Over 90% of the rare earth minerals used for
permanent magnets are neodymium and praseodymium, according to
Wietlisbach.
China's share of global rare earth mineral reserves stood at 37%
at the end of 2018, according to IHS Markit data.
The annual demand for rare earth elements is currently about
200,000 mt/year and can be supplied by a handful of large mines,
according to Per Kalvig, chief
adviser, Geological Survey of Denmark and Greenland.
That said, the supply of minerals used for permanent magnets
could be tight in two to three years' time as demand increases, but
that might also not be the case as China may just increase
production, according to Wietlisbach. However, the question then is
whether China will sell its magnet rare earth minerals to other
countries and magnets to other companies and countries, she
added.