The US, Denmark, and Greenland have reached a security agreement that could increase scrutiny of foreign investment in Greenland’s critical minerals sector.
The agreement is expected to be formally signed during the UN General Assembly and remains subject to parliamentary procedures in Denmark and Greenland. Its full terms have not been released.
Benzinga reports, citing Politico and the US Department of State, that the provisions could allow the US to oppose strategic investments involving countries considered security threats.
Greenland and Denmark say the arrangement does not change Greenland’s sovereignty or its status as a self-governing territory within the Kingdom of Denmark.
The pact follows Greenland Mines’ (NASDAQ:GRML) completion of its acquisition of the Sarfartoq Neodymium-Praseodymium Rare Earths Project from Neo Performance Materials (TSX:NEO) on 1 September.
The New York Post highlights the timing of the two developments, although neither company nor the governments involved have indicated that the acquisition and security agreement are connected.
A recent initial assessment gives Sarfartoq a high-case pre-tax net present value of US$2.05 billion ($2.87 billion). Greenland Mines estimates its proposed output could equal about 34% of neodymium-praseodymium oxide currently refined outside China.
The project does not have a mineral reserve, and development remains subject to further studies, permitting, financing, and construction.
Greenland’s mining sector also faces limited infrastructure, high development costs, and Arctic operating conditions. About 80% of the territory is covered by ice, while many prospective areas require new roads, ports, and power infrastructure.
Greenland Mines is a US-listed company focused on critical minerals and precious metals projects in Greenland.
Write to France Pinzon at Mining.com.au
Images: Greenland Mines
