June 28, 2012
EU, Greenland signs letter of intent on Greenland's mineral development
A letter of intent that could boost the role of EU metal and mining companies in Greenland's development of metal and other mineral resources have been signed between the European Commission and Greenland.
The autonomous north Atlantic territory has gold and silver mine in Nalunaq, southern Greenland, operated by Britain's Angel Mining.
There are plans to start production at a lead/zinc mine in Maarmorilik, northwest Greenland in 2012, and to open a molybdenum mine in Malmbjerg, in the east.
Meanwhile, metal mine projects are being developed at Isukasia, north of the capital Nuuk, for iron; there is a gold and platinum group deposit being explored at Skærgården, east Greenland; and zinc reserves at Citronen Fjord, north Greenland.
With the Greenland government pushing hard for mine development, the EC is concerned that non-EU companies stand to benefit the most: 58% of exploration companies operating in Greenland are Canadian or Australian, with just 15% from the EU – from Denmark, Germany, the Czech Republic and Britain.
"The European companies have a low involvement in on-going exploration activities and own only a few exploration licences, with most licences owned by UK, Germany and Denmark," the EC said in a note.
As a result, EU industry commissioner Antonio Tajani and development commissioner Andris Piebalgs have struck a deal with Greenland's Prime Minister Kuupik Kleis over future EU involvement in mineral exploitation.
The resulting letter of intent exploits Greenland's constitutional links to the EU through the official EU-Greenland partnership, negotiated after Greenland left the EU in 1985.
The new deal says the EU and Greenland will co-operate in looking for more geological reserves; analysing the infrastructure and investment needed; building competence within Greenland to enable mine exploitation and regulation; and assessing potential environmental and social problems.
With this much work likely to be shouldered by the EU, Greenland has agreed to "fair competition conditions and market access" regarding access of EU companies to these projects and the minerals that are produced.
"We now should be able to move quickly ahead to ensure better access to minerals for EU industry with the signing of further agreements on concrete projects," Tajani said. "This co-operation offers a win-win solution for both parties."
