A Rostec subsidiary is in talks with Chinese partners to extract rare earth elements in Russia with Chinese technology. Rostec, together with Aleksandr Nesis’ ICT and other investors, own TriArk Mining, with rights over two major sources of rare earth elements: Th+REE monazite concentrate stocked in Krasnoufimsk near Yekaterinburg since the ’40s, and large REE deposits in Tomtor, in the Far Eastern region of Yakutia.
South Korea’s Electronic Times (전자신문) carried a piece by geologist Sung-Won Park (박성원) two weeks ago where he highlights the need for the country to get involved in untapping Greenland’s mineral resources, specifically due to the island’s “abundant rare-earth deposits”. Hi-tech industries in Korea depend on imports for important REE-based components, says Park, making actively exploring for the elements a necessity for the country. “Among Arctic regions, REE-rich Greenland is where we should be focusing most of our attention.”
Mr Park, a researcher at South Korea’s Institute of Geoscience and Mineral Resources (KIGAM, 한국지질자원연구원) Mineral Resources Research Division, has been involved in geological research in Greenland for several years. KIGAM and its local counterpart, the Geological Survey of Denmark and Greenland (GEUS) signed an agreement to start joint research in 2012, during then-president Lee Myung-bak’s visit to the island. Talking to Greenland’s state-owned broadcaster KNR in 2013, Park was particularly enthusiastic about the REE potential in Kvanefjeld, one of the areas where the Korean team had been working.
Korea’s national miner KORES has been conducting joint exploration at the Qeqertaasaq REE+Nb project with NunaMinerals, whose prospects are now uncertain with the Greenlandic company still on the verge of bankruptcy.
South Korea’s ambassador to Denmark Ma Young-sam 마영삼 was in Greenland last week in an official visit, during which he met with government ministers charged with foreign affairs, industry and natural resources, as well as with representatives from seafood producer Royal Greenland. There was talk of increasing cooperation in mining and fisheries (Sermitsiaq).
A more urgent concern than such future prospects is surely Korean state-owned miner KORES’ investment in the Qeqertaasaq REE+Nb project. KORES has been exploring at the site in partnership with Greenland’s state-owned NunaMinerals, a company in rather serious financial trouble that filed for bankruptcy. Talking to Greenlandic public broadcaster KNR, Ma said the Koreans are keeping a “close eye” on their country’s first investment in Greenland, since “many other Korean companies want to invest big in Greenland”.
Soon after Ma’s visit, news emerged that NunaMinerals are withdrawing their bankruptcy petition based on optimism about ongoing restructuring talks with Greenland Mining Management (GMM), a new-ish UK company seemingly wholly owned by Patrick Newman, a businessman who has been involved in a number of mining companies with interests in Greenland and elsewhere. GMM are proposing to invest in Nuna with an eye to the latter then making an offer for investment group Worthington, suspended from trading in London in Oct ’14 after an ambitious investment plan attracted regulatory attention as amounting to a reverse takeover. Worthington’s shopping spree included a stake in Greenland Rare Earth Projects (GREP), also led by Mr Newman, who hold an exploration license for the REE+Nb+Ta+U Paatusoq project in southeast Greenland.
South Korean interest in Greenland was displayed rather spectacularly in 2012, when then-president Lee Myung-Bak visited the island. The KORES-Nuna Qeqertaasaq exploration agreement goes back to Lee’s visit.
Ambassador Ma’s visit to Greenland appears to have gone unnoticed by the South Korean press, but Korean attention on the fate of KORES Greenlandic investment has been evidenced by news items on the website of the ministry of foreign affairs and other sources, as I reported a couple of weeks ago.
More attention has been dispensed to Mr Ma’s parallel career as an international ping-pong referee, in which capacity he took part in the ping pong championship in Suzhou, China, some ten days before heading to Greenland. An Chosun article compares him to Bao Zheng 包拯, a Song dynasty judge with a semi-legendary reputation for impartiality and the subject of a number of Chinese TV series that have enjoyed some popularity in South Korea. Ma Young-sam’s diplomatic career began in the Middle East.
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.
If you’re looking for an overview of Chinese mining activities in Greenland thorough enough to talk your fellow dinner-party guests into submission, then I know where you can procure one. The University of Nottingham’s China Policy Institute Blog has just posted such an overview, titled “Shock and ore“, in which I go over the mining ventures with some degree of Chinese participation, with an emphasis on General Nice, the new owner of the Isua mine.
John Mair from Greenland Minerals and Energy has told Chinese news site DZH News (大智慧) that a feasibility study for the Kvanefjeld rare earth project is almost done, and that trial production might start once an environmental study is ready later this year.
China Nonferrous (CNMC, 中色), a national state-owned integrated miner, is involved in GMEL’s Kvanefjeld project through its largest listed subsidiary, Shenzhen-listed NFC (中色股份). This involvement officially began with a non-binding MoU between NFC and GMEL signed one year ago (‘China Nonferrous enters Greenland rare-earth game‘). That cooperation seems to be progressing towards more concrete form as, according to a recent GMEL announcement, multiple meetings between the two companies have been taking place during the past year, both at management and technical levels.
However ‘non-binding’ it might be at the moment, cooperation between China Nonferrous and the Kvanefjeld operator is an MoU made in Heaven. The Kvanefjeld mine is expected to produce output fitting the needs of China Nonferrous’ colossal REE separation plant under construction in Xinfeng 新丰 county in Guangdong, and rather cheaply at that.
GMEL has also announced they’ve secured up to $20m from Long State (远邦投资), a HK-based resource investment company with Mainland connections I might (or might not) have occasion to talk about in some future post. They also say they’re looking forward to getting more financing during this year.
Other than in Kvanefjeld, Nonfezza are also involved in Ironbark’s zinc project in Citronenfjord at the other end of Greenland.
Yesterday’s Chinese edition the Global Times (环球时报) carried an article signed by their special envoy to Greenland Liu Zhonghua 刘仲华 that included interviews with Aleqa Hammond and Sara Olsvig.
The piece, entitled “No market for ‘China threat theories’ in Greenland”, goes to considerable lengths to emphasise the island welcomes investment from everywhere, in particular from China, and that fears of China’s intentions come from outside, specifically from English-language media. Liu refers to exaggerated reports about possible future Chinese involvement in the Isua iron project, and quotes Ms Hammond’s description of the situation.
Remarkably enough, the article calls Ms Hammond Greenland’s ‘Prime Minister’ and totally ignores what’s been going on in Greenlandic politics in the last few weeks. There’s also nothing about the fact that London Mining’s Isua project faces a rather uncertain future after the company went into administration.
The Global Times‘ envoy dates his insights about Greenland to a “recent” visit to that island. He interviewed Aleqa as recently as June 20. Unless he’s been to Nuuk again since then, that means material from that interview has taken four months to surface (to be fair, some already appeared on the People’s Daily on October 10).
There’s also no mention of Chinese interest in Greenland mining, which includes Jiangxi Copper’s exploration activities and China Nonferrous’ interest in rare earth projects.
Opposition leader Sara Olsvig is quoted about the deep impression a 2012 trip to China, that included visits to Tibetan areas in Qinghai, left her. She also “learned a lot from China’s political development”. A more global assessment of Ms Olvig’s interest in Chinese issues might have benefited from a word or two about her 2011 meeting with the prime minister of Tibet‘s government in exile.
More on the Global Times‘ style, with links to discussion elsewhere, in my previous post on one of their articles.