When one thinks of Greenland, what comes to mind? Incredible glaciers, large expanses of wooded forest, and perhaps confusion with Iceland.
However, mining is now on the news. CNN published a provocative article “Billionaires are funding a massive treasure hunt in Greenland as ice vanishes.” In the story, the reporter explains that investors including Bill Gates have helped fund an expedition to explore the mineral wealth of Greenland.
Yes, the recent melting of polar ice caps has opened the market and prospectors are leering towards Greenland as a kind of new frontier for gold. What does this mean for energy markets? What are the implications for the future? Let’s find the answers.
Mining in Greenland: Why now?
In the past, the Arctic was largely considered off-limits for mining work because the land was buried under hundreds of feet of snow and ice, and there was a complete lack of traditional infrastructure. Global warming, however, has changed the situation.
While the traditional ways of hunting and normal life in Greenland are on the verge of being completely removed due to the melting polar ice caps, mineral mining may be a new source of income for the country.
Foreign countries like China and Russia are interested in exploiting the materials available there, including uranium used for nuclear enrichment. Other political blocs though, such as the EU, have encouraged the international community to take a more pragmatic approach.
In 2011 the Greenland government in Nuuk committed to the encouragement of new ventures when it repealed a law that prevented uranium mining. Now, laws have been amended to allow for exploration licenses for radioactive elements like uranium and thorium.
The land that has become exposed is rich with lead, iron ore, zinc, diamonds, gold, uranium and even oil, so executives and politicians alike are looking at Greenland like prospectors once looked to California as the new frontier for wealth.
Of course, there is some irony in the fact that Greenland is seeking to become a major producer of hydrocarbons, while simultaneously suffering from the very climate change that is causing its own glaciers to melt. The greedy appetite in the rest of the world for energy is forcing the country’s leadership to face extremely difficult decisions – save the wildlife and glaciers, or survive today?
The public in Greenland is divided. While many fear what opening the markets will do to their traditional life, the native Inuit people who reside in Greenland are also curious about what increased wealth could do for their immediate comfort and well-being.
There has, of course, been a backlash addressing the possibility of mining in Greenland. Groups like Greenpeace and other environmental NGOs are fighting back and putting safeguards in place to avoid natural disasters.