Critical minerals are a big part of Donald Trump’s obsession

14
Jan 25
By | Other

A plane believed to be carrying US businessman Donald Trump Jr. arrives in Nuuk, Greenland on January 7, 2025.

Emil Stach | Afp | Getty Images

US President-elect Donald Trump’s bid to buy Greenland may well be motivated by critical minerals, with mining executives and researchers describing the island’s massive resource potential as a “huge opportunity”.

Trump’s years-long bid to take control of the world’s largest island has begun in recent weeks.

Before his inauguration on January 20, Trump said that US ownership of the autonomous Danish territory is an “absolute necessity” for purposes related to “national security and freedom around the world”.

Trump has doubled down on those comments, refusing to rule out using military or economic force to make Greenland part of the US.

Greenland Prime Minister Mute Egede has told Trump the Arctic island is “not for sale” and urged the international community to respect the territory’s aspirations for independence. Alongside Danish Prime Minister Mette Frederiksen, Egede has also recently called for talks with Trump to resolve the situation.

Asked about Trump’s obsession with making Greenland part of the US, the president-elect’s incoming national security adviser, Rep. Michael Waltz, R-Fla., was unclear.

“This is about critical minerals. It’s about natural resources,” Waltz told Fox News in a Jan. 9 interview.

“This is about bringing America back to the Western Hemisphere,” Waltz said. “You can call it the Monroe Doctrine 2.0, but all this is part of the “America First” agenda.

Greenland will become more and more relevant; it will become more and more front and center because of the climate change discussion, the critical metals discussion and the geopolitical discussion.

Roderick McIllree

CEO of 80 Mile

Critical minerals refer to a subset of materials considered essential to the energy transition. These minerals, which tend to have a high risk of supply chain disruption, include metals such as copper, lithium, nickel, cobalt and rare earth elements.

Critical minerals and rare earth elements are vital components in emerging green technologies, such as wind turbines and electric vehicles, energy storage technologies, and national security applications.

China is the undisputed leader of the critical minerals supply chain, accounting for approximately 60% of the world’s production of rare earth minerals and materials. US officials have previously warned that this poses a strategic challenge amid the shift towards low-carbon energy sources.

In this aerial view, melting icebergs pile up in the Ilulissat Icefjord on July 16, 2024 near Ilulissat, Greenland.

Sean Gallup | Getty Images News | Getty Images

Jakob Kløve Keiding, senior consultant at the Geological Survey of Denmark and Greenland (GEUS), said a 2023 study of Greenland’s resource potential assessed a total of 38 raw materials on the island, the vast majority of which have a level relatively high or moderate. potential.

These materials include rare earth metals, graphite, niobium, platinum group metals, molybdenum, tantalum and titanium.

“In general, we can say that there is a great potential for critical raw materials [in Greenland],” Keiding told CNBC by phone.

“Many of them are of great importance to the EU economy and, of course, it is not limited to Europe. Many of them are also on the American list. [critical raw materials]”, he added.

Greenland is not for sale

Aaja Chemnitz, a member of Greenland’s Danish parliament from the Inuit Ataqatigiit party, described Trump’s comments on Greenland as “disrespectful” and reiterated the prime minister’s message that the territory is not for sale.

“I’m not worried. I think some people in Greenland are quite worried, but I think it’s important for us to say that Greenland is not for sale, never has been for sale. [and] it will never be for sale,” Chemnitz told CNBC’s Silvia Amaro on Monday.

Chemnitz said Greenlandic lawmakers would have to have “clear and very specific goals on how to cooperate with the US.”

Closer ties between Greenland and the US moving forward, for example, could help facilitate investment in the island’s mining industry, she added.

“If we look at mining, for example, rare earths. That’s something we’ve been willing to do for a very long time. We’ve been looking for American investors, [but] we haven’t found them, so they are quite welcome,” said Chemnitz.

The US military maintains a permanent presence in northwest Greenland at Pituffik Space Base, formerly known as Thule Air Base.

‘A race for what’s left’

Roderick McIllree, chief executive of UK-based mining company 80 Mile, said he has worked in Greenland for just over 20 years on projects ranging from resource discovery to feasibility.

“I think what we’re seeing in Greenland is really a race for what’s left,” McIllree told CNBC via video call.

“Many independent country surveys point to Greenland and its natural shelf boundaries as potentially 20% to 25% of the last remaining mined resources on the planet. Now, if correct, this is a huge opportunity for Greenland.”

The Old Colonial Port of Nuuk, Greenland is pictured on August 30, 2024. Greenland, an icy land whose rugged landscapes are fascinating, wants to attract more tourists, a paradox for a territory that is particularly vulnerable to warming global and whose geographic isolation means that many people have to take planes to get there.

James Brooks | Afp | Getty Images

80 Mile currently has three projects it is actively developing in Greenland, including a major oil concession on the island’s east coast, a titanium project near Pituffik in the northwest and its Disko-Nuussuaq project in the southwest.

Highlighting the resource potential in the territory, McIllree said the firm’s Disko project could be one of the largest nickel and copper occurrences on the planet.

“Greenland will become more and more relevant; it will become more and more front and center because of the climate change discussion, the critical metals discussion and the geopolitical discussion. And its proximity to the U.S. makes it kind of a natural jurisdiction for significant American investment,” McIllree said.

“If Greenland plays their cards right, it will lead to their independence,” he added.

“Important strategic interest”

In March last year, European Commission President Ursula von der Leyen traveled to Nuuk, Greenland to inaugurate an EU office in the island’s capital.

The move, which came months before Donald Trump Jnr’s recent trip to the same city, was designed to strengthen Europe’s presence in the territory, as well as in the wider Arctic region.

Von der Leyen announced two cooperation agreements totaling almost 94 million euros ($95.9 million) at the time, which she said would be used to invest in clean energy, critical raw materials and skills in Greenland.

(L-R) European Commission President Ursula von der Leyen, Greenland Prime Minister Mute B Egede and Danish Prime Minister Mette Frederiksen sign an agreement to open the European Commission’s new office in Nuuk, Greenland, March 15, 2024.

Leiff Josefsen | Afp | Getty Images

“I’m a geologist by background and I know that Greenland is very well endowed with natural resources,” Paul Lusty, head of battery raw materials research at Fastmarkets, told CNBC via video call.

“There has been a lot of interest in the rare earths in Greenland, for example, and clearly, they could be of significant strategic interest to the US,” Lusty said.

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