Greenland Minerals (ASX:GGG)is an exploration and development company focused on the development of the world‐class Kvanefjeld Rare Earth Project. The Kvanefjeld Project is very unique with favourable metallurgy and production forecast profile across all the important Rare Earth Metals. It is located near existing infrastructure in southern Greenland that has access to direct shipping all year round.
Unexpected Election Results Led Greenland Minerals Shares Price Crash
The country’s Inuit Ataqatigiit, a party that opposes mining projects in southern Greenland won the election. Their leader went on to say that the rare earth projects would not go ahead given their focus on environmental protection. This resulted in the share price of Greenland Minerals crashing 45%.
Greenland Mineral has invested close to $100 million on the project. However, given that it will approximately increase the country’s carbon dioxide emissions by 45%.
The election results are a blow to China as well – a country that currently mines close to 70% of the rare earth metals in the world. Greenland Minerals said that Kvanefjeld has the “potential to become the most significant western world producer of rare earths” and could be “a globally significant supplier of rare earths for many decades.” However, with recent developments, it is extremely unclear how things may pan out in Greenland. The use case for Rare Earths are very large and the demand is heating up. Western countries including USA are looking for sources to get thier hands on rare earths without having to go through China.
After the shares collapsed, Greenland Minerals entered a trading halt pending a market update regarding the election and its effects. The shares ended at 8.9 cents.
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