The Australian mining company GME, in charge of preparatory work, is enthusiastic about the prospects:
The mining project at Kuannersuit is a unique project in southern Greenland. The mining preparatory work that has been in operation since 2007, has unveiled the world's largest deposits of rare earth metals including uranium and zinc. --
Kvanefjeld has the potential to meet the world's rapidly growing demand for rare earth metals, and thus can contribute strongly to the Greenlandic economy for many decades to come.
Greenland Minerals and Energy believes that Kvanefjeld can be the starting point for a mining area in the world that can be developed in a responsible and environmentally friendly way and become one of the world's leading sources of rare earth metals.
The ore in Kvanefjeld contains a number of elements with a very high commercial value. The rare earth metals are the primary product and the uranium is extracted as a byproduct. The potential annual production of rare earth metals are more than 40,000 tonnes, which is ten times more than the production of the byproduct uranium oxide.
Greenland decided more than 30 years ago that there should not be exploration or mined uranium and other radioactive elements. This political decision remains valid - the so-called zero tolerance.
But the Greenlandic authorities have eased zero-tolerance a little bit and changed the standard conditions for mineral exploration, so Greenland Minerals and Energy has been allowed to continue test drilling and complete exploration work on Kvanefjeld, although there is uranium in the ore. --
The US and the EU - as well as China - are closely watching the development of the Kvanefjeld project:
China accounts for nearly 95 percent of world production of rare earth metals. The national demand is so high that the majority is consumed in China, and only a relatively small proportion is available for export. China has slowly but surely reduced its export quotas and increased their export tax knowing that the rare earth metals in the degree is a strategic commodity.
Unless large and stable detection of rare earth metals outside of China happen, foreign companies may be forced to relocate their production to China to get access to the rare earth metals. In the light of that the deposit on Kvanefjeld plays a significant strategic role, and the mining project will be followed with great attention in the EU and the U.S. and multinational industrial groups.
Greenland was in 1979 granted self-government by the Danish parliament. In 2009 Greenland acquired greater responsibility for internal affairs, including the right to decide about use of raw materials.