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Greenland’s mineral wealth caught up in a geopolitical snowstorm

• Greenland’s strategic location and mineral endowment have come into focus in recent months, attracting interest from the US government
• Its untapped rare earths deposits, vital for defence and clean-energy technologies, could position Greenland as a linchpin in Western supply chains
• In particular, the Tanbreez deposit in southern Greenland could potentially supply up to 50% of the world’s heavy rare earths – a market currently dominated by China

Greenland rarely features in global headlines, but renewed US interest in the Arctic island has pushed it into the geopolitical spotlight, highlighting the nation’s strategic location, military importance, and untapped mineral wealth.

Positioned along the shortest route between the US and both Europe and Russia, it occupies a pivotal place in US defence planning.

America already operates the Pituffik space base in northwest Greenland, a key installation supporting ballistic missile warning, missile defence, and space surveillance missions.

However, the US government appears determined to expand its presence in the territory.

In essence, missiles or aircraft travelling between Russia and North America would likely pass over or near Greenland, giving it strategic importance for early-warning and surveillance systems.

Accordingly, President Trump has cited Greenland’s significance as central to his proposed US$175 billion ‘Golden Dome’ missile defence initiative, which aims to intercept hypersonic, ballistic, and advanced cruise missiles – as well as drones – launched from anywhere in the world, including from space.

However, his recent insistence that the US is prepared to “go as far as we have to” to acquire Greenland from Denmark – an ally and fellow NATO member – sent shockwaves through diplomatic circles.

Shifting geopolitical landscape

Under President Trump, the US appears increasingly wary of China’s interest in Greenlandic infrastructure and Russia’s expanding military footprint across the Arctic.

He has previously described Greenland as “critical” to US national interests, warning that “if we don’t go in, Russia’s going to go in, and China’s going to go in.”

However, the scope of America’s future involvement has recently become less clear, following reports that the US and NATO have agreed to a “framework for a future deal” with respect to Greenland.

Nevertheless, US diplomacy is seemingly geared towards keeping Greenland aligned with Western interests.

This concern is not new.

The US explored acquiring Greenland in 1867, again in 1946, and most recently in public discussions in 2019, each time underscoring the island’s strategic value.

Fast forward to today and climate change could be adding fresh urgency.

Melting ice is opening Arctic shipping routes, easing military movement, and unlocking access to some of Greenland’s globally significant mineral resources.

Modern-day minerals

Greenland hosts a wide array of commodities, including iron ore, graphite, tungsten, molybdenum, palladium, vanadium, zinc, gold, uranium, and copper.

However, it is rare earths that are now attracting global interest.

This group of 17 elements underpins a wide array of modern-day industries, such as clean energy, electric vehicles, consumer electronics, and defence.

And China dominates the world’s supply chain.

In a nutshell, Beijing controls about 70% of global rare earths production and an even larger share of processing capacity.

This concentration came into focus last October when China expanded its rare earths export controls. It added five more elements to its restricted list and lifted the total to 12.

According to the US Geological Survey, the US relies on China for about 70% of its rare earths imports.

President Trump has moved to address these vulnerabilities through public-private partnerships and international cooperation.

These included an equity investment in New York-listed MP Materials, owner of the only rare earths mine in the US known as Mountain Pass.

The US has also entered bilateral agreements with allies such as Japan and Australia to build rare earths capacity outside China.

However, reshaping the global supply chain will not happen overnight, cautioned European Lithium (ASX:EUR)  executive chair Tony Sage, whose company is advancing the Tanbreez rare earths project in Greenland.

“Geopolitically, it’s complex,” noted Sage in a recent interview with CNBC.

“The US aims to reduce reliance on China, but that will take years. During this time, the US will remain reliant on Chinese supply,” he said.

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Source: Stockhead