A terse news item on the website of South Korea’s ministry of foreign affairs states that the Qeqertaasaq rare earth, niobium and tantalum project near Maniitsoq in western Greenland is “expected to be delayed” now that Greenlandic state-owned firm NunaMinerals has filed for bankruptcy. NunaMinerals and Korean state-owned miner KORES (한국광물자원공사) agreed to jointly explore the site and started drilling last year.
South Korean SOEs invested heavily in natural resource projects abroad, sometimes as part of a ‘resource diplomacy’ policy during president Lee Myung-bak’s administration. These investments have become a source of controversy after a government audit that became public not a month ago questioned their profitability and suggested already scheduled investments could put these companies, that include KORES, in financial trouble. The agreement between Nuna and KORES was signed during Lee Myung-bak’s visit to Greenland in September 2012.