Greenland ditches 25-year ban on uranium mining paving the way for Chinese investors to dive in for resources

  • Greenland lifts cap on mining radioactive and 'rare earth' materials
  • Move to help Greenland win economic independence from Denmark
  • Island national relies on former colonial power for subsidies
  • Selling uranium could put two nations on diplomatic collision course

By Chris Pleasance

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Greenland has voted to allow the mining of uranium, other radioactive materials, and rare earth metals. The decision is sure to attract interest from China which currently exports 90 per cent of the world's 'rare earths' (file picture)

Greenland has voted to allow the mining of uranium, other radioactive materials, and rare earth metals. The decision is sure to attract interest from China which currently exports 90 per cent of the world's 'rare earths' (file picture)

Greenland's parliament has lifted a ban on mining radioactive materials including uranium in the hope that it will raise funds for the nation's stagnant economy.

The new law will also allow the mining of 'rare earths', uncommon materials used in many modern technologies such as smartphones and hybrid cars.

The move is sure to attract the attention of China which currently produces around 90 per cent of the world's rare earth metals.

Investors from Australian-owned Greenland Minerals and Energy think they may have found one rare earth deposit which could be the largest outside of China, and has estimated it could extract up to 40,000 tons of metals per year.

Quoted by local newspaper Sermitsiaq, Greenland Prime Minister Aleqa Hammond said: 'We cannot live with unemployment and cost of living increases while our economy is at a standstill.

'It is therefore necessary that we eliminate zero tolerance towards uranium now.'

Hammond's government won the vote by 15-14 votes and now hope that mining income can be used to win financial independence.

While Greenland is self-governing the island is still officially part of the Kingdom on Denmark, and rely on their old colonial masters for a cash subsidy which makes up two-thirds of the island's economy.

One Australian-owned firm says it is exploring a rare earth deposit which could be the largest ever found outside of China (file picture)

One Australian-owned firm says it is exploring a rare earth deposit which could be the largest ever found outside of China (file picture)

The former colonial ruler also has a say in security and defence issues and any decision to sell uranium may need to be approved by the Danish parliament - possibly putting the two nations on a diplomatic collision course.

 

Denmark's Minister for Trade and European affairs, Nick Haekkerup, said: 'Concrete actions on the mining and export of uranium will potentially have far-reaching implications for foreign, defence and security policies and are as such a matter for the Kingdom.'

Greenland's 'zero tolerance' policy on mining radioactive materials is inherited from Denmark, but the island is keen to develop mining to help pay for welfare and jobs in this country with a population of around 57,000 people, mostly Inuits.

Since Greenland won self-government in 2009, most politicians have aimed for growing autonomy and eventual independence.

Environmental campaigners have warned that mining in Greenland could upset the pristine Arctic ecosystem

Environmental campaigners have warned that mining in Greenland could upset the pristine Arctic ecosystem

'I think the Danish government is prepared for the no-tolerance to be lifted' said Cindy Vestergaard, senior researcher at Danish Institute for International Studies.

'After that the Greenlanders and the Danes are going to start hammering all the legal aspects. We will not be mining on Friday, nor next year, or 2015.'

However, the possibility of uranium mining has been criticised by environmental groups which warn that uranium mining in Greenland could threaten the Arctic region's pristine ecological system.

Separately, iron ore producer London Mining said on Thursday it had received the go-ahead from the Greenland government for a 15 million tonne a year mine in the country, paving the way to attract partners for the project.

The Isua project which will cost an estimated £1.4billion ($2.3 billion) has been controversial in Greenland over fears that it will attract a flood of Chinese workers into the country.