28 June 2024

Greenland Is Under Attack

After the last general election in Greenland in 2021, which was dubbed “the uranium election”, because it was perceived as a referendum on uranium mining and the controversial Kvanefjeld mining project, Greenland’s uranium ban was reinstated. Since then, there have been several attempts to undermine the ban and uranium mining will once again be on the political agenda during the next parliamentary election, which will be held within a year.

The struggle to keep uranium mining out of Greenland does not only take place at the ballot box: both an arbitration court in Copenhagen and a court of justice in Greenland are currently considering whether to accept a complaint by the Australian mining company Energy Transition Minerals, ETM (formerly known as Greenland Minerals Ltd., GML). ETM, the owner of the huge Kvanefjeld project in Southern Greenland, is demanding approximately 10 billion EUR in compensation from the Greenlandic government – equivalent to almost four times Greenland’s GDP – and is at the same time trying to involve the Danish government in the proceedings.

ETM, which has a permit to explore for minerals in Kvanefjeld, has applied to the Greenlandic Department of Mineral Resources to extract uranium and rare earth elements in its license area, but has been refused, partly because uranium mining in Greenland has been prohibited again.

The case has generated interest far beyond Greenland and the Danish Kingdom: in addition to the fact that it is the largest court case in the history of the Kingdom, it is related to its largest industrial project ever. Kvanefjeld contains the second largest deposit of uranium, possibly the largest deposit of thorium, as well as the third largest deposit of rare earths in the world.

Considering that there are now more than 100 active large-scale mining licenses in Greenland covering thousands of km2 and almost all owned by international mining companies, the problems caused by ETM could be a taste of what might happen in the future.

 

A convincing legal defence

Under Greenland’s and Denmark’s Public Access to Information Acts, green NGOs have gained access to the authorities’ legal defence in the arbitration court case, which they did not make public themselves. The Danish government’s legal adviser, who conducts the case on behalf of both the Greenlandic and Dansh authorities, rejects the lawsuit as without merit and states that the initiation of the arbitration case has “no other purpose than to try to put undue pressure on the Greenlandic government in order to grant ETM an exploitation permit for the Kvanefjeld project, which the company has no legal claim to under Greenlandic law”.

The adviser expects the case to be rejected by the arbitration court, and his biggest concern is that ETM will not be able to pay for the authorities’ large costs because the company is constructed in a way that makes it possible to predict that there will not be full coverage.

In his defence, the legal adviser reiterates what green NGOs have said for a long time: for more than a decade, actors in the mining industry have tried to undermine Greenlandic society and unduly influence elections and government decisions. Some of them might even have been successful in delaying Greenland accession to the Paris Agreement. In all this, ETM has played a crucial role, as the mining company was responsible for the abolishment of Greenland’s uranium ban ten years ago, which until then had been effect for a quarter of a century.

 

Mainly a political issue

The main reason that ETM has a bad case is because Greenland has not ratified the Energy Charter Treaty and other international and bilateral investor protection treaties. This means that the dispute will be settled according to Greenlandic and Danish law and not within the framework of a privatised international arbitration system. Thus, one could argue, that the case is first and foremost political.

No to uranium demonstration, Urani? Naamik, Narsasuaq

Here too, it is uphill for the mining company: people, politicians and media in Greenland have lived with ETM’s scare campaigns for more than a decade and learned to take announcements from the company with a grain of salt. Unfortunately not so in Denmark, where publication of the company’s compensation claim has triggered a panic mood in parts of the political community. The mining company’s success in presenting its case to the Danish public is not least due to Danish mainstream media’s consistent use of expert commentators whom one would normally not expect to give an informed opinion on the validity of ETM’s claim.

The fact that the claim was submitted to the arbitration court shortly before the chairmanship election in Greenland’s co-government party Siumut – a party that strongly supports uranium mining, but has agreed to put this on hold while in government – looks like more than a coincidence. The two competitors to the incumbent chairman both wanted a renegotiation of the government coalition agreement, where the uranium issue would again be central. In this regard, they were willing to call an early general election.

Although the ETM complaint gave the opposing candidates the necessary impetus to bring the uranium issue back onto the political agenda, the election ended with a convincing victory for the incumbent chairman.

Greenland’s shifting political situation is probably also the reason that ETM has brought its case before a Greenlandic court of law, before the tribunal has made its final decision. The next general election must be held before April 2025 and could even take place in the fall, and a lawsuit in Greenland of this size would make it certain that abolishment of the uranium ban again will be on the political agenda.

 

Already warning signs a decade ago

The problems caused by ETM could have been predicted many years ago, when the uranium ban was lifted. Since uranium has ”dual use”, i.e., serves both civilian and military purposes, security issues are supposed to be handled by the Greenlandic and Danish authorities jointly, but in practice mostly by the Danish authorities, since the Greenlandic government has not taken control of defence, law enforcement and the judiciary. Here, the Danish authorities have failed on virtually all points.

Even before the uranium ban was abolished, ETM’s supposed owner had been a topic for Australia’s largest and most recognized newspapers, where the mining company was mentioned in numerous articles. ETM’s alleged founder and possibly biggest shareholder was described as a person with links to the organized criminal underworld, who owned shares and companies worldwide under at least nine different names, with no fixed contact or business address. On several occasions he was said to have used a key figure in the Italian-Australian mafia as a mediator in civil disputes, and in the 1990s his name was linked to drug trafficking and money laundering.

Even worse was the reporting by the Australian media of alleged financing of terrorist activity, which is punishable under Danish, Greenlandic, and international law. The alleged owner of ETM was believed to control a company that owns or has owned oil rights in Somalia’s Puntland province, whose dominant clans were suspected of piracy off the coast of Somalia. The extraction agreement was concluded with Puntland’s Ministry of Finance and the money from the oil company was, among other things, used for arms procurement for ”pacification of adjacent non-Puntland territories”. However, attempts to explore the disputed area for oil failed due to resistance from the local population, who reacted to the violations of its territory by the Puntland militias and the oil company. Ten locals were killed during clashes with Puntland militias funded by the company, and with local tribesmen.

In 2013, the current government party Inuit Ataqatigiit’s (IA) Member of the Danish Parliament, Johan Lund Olsen, raised the above questions at a closed session in the Parliament’s foreign policy committee. Here he was told that the Danish government had no intention of investigating ETM. Shortly afterwards, the then Chairwoman of IA, Sara Olsvig, asked similar questions in the Greenlandic Parliament, Inatsisartut, where she was told that the Greenlandic government would not do it either.

 

Undermining the rule of law

Since then, ETM has developed so much of a negative record that there is only room for the most negative highlights below.

First of all, it is striking to what extent ETM has received favourable treatment from parts of Greenland’s political community, and how close ETM’s ties to this community are. An example of this is that before the abolishing of the uranium ban, which specifically aimed at legalizing the Kvanefjeld project, the then newly elected Prime Minister announced that a referendum would be held in South Greenland on the mining project. After the lifting of the ban, the promise was taken off the table.

In addition, Greenland’s former head of government during 2009-2011, later became chairman of ETM’s board while at the same time a Danish MP representing Siumut. Afterwards, he continued as an ETM management consultant and when the uranium ban was lifted in 2013, he was the Chairman of Inatsisartut.

In 2019, ETM’s CEO was formally reprimanded by Greenland’s then Prime Minister and the head of Greenland’s Department of Nature and Environment for attempts to influence ministers and high-ranking officials who had nothing to do with the environmental assessment of the Kvanefjeld project, in order to undermine the Greenlandic Environmental Protection Agency. Additionally, ETM was criticized for having provided false information and not complying with orders to correct deficiencies in draft environmental reports.

Even closer than ETM’s connections to the political community are its relations with influential civil servants: in 2020, the former head of the Department for Business and Labor Market that controls Greenland Mineral Resources Authority, and is considered one of the main initiators of Greenland’s bet on mineral extraction, was employed as director in ETM. Only a month before, he had resigned as head of department after ten years of employment. From ETM’s annual report it appears that, in addition to an annual salary of 170,000 EUR, he was given two options of two million shares. If ETM had obtained an extraction permit for the Kvanefjeld project and had started to operate in the way the company describes it in its information material, he would have earned 410 million EUR, corresponding to 3 per cent of ETM’s share value.

Furthermore, his predecessor as head of the Greenland’s Mineral Resources Authority became chairman of the board of ETM, after retiring from his directorship. The person in question, who is a former state geologist, head of the ore geology department of the Geological Survey of Denmark and Greenland, and co-author of the Greenland Minerals Act, was, according to an ETM’s annual report, remunerated with almost 140,000 EUR as well as shares in the company at a nominal value of almost 880,000 EUR.

 

Threats against the state

ETM’s and the mining industry’s negative record does not stop here: in 2019, Forbes wrote that ETM has been involved in the process that led to the Trump administration’s offer to buy Greenland. Already, another former co-owner of ETM and present owner of the large rare earth mining project at Kringlerne, located not far from Kvanefjeld, claimed to have triggered the same offer.

It is also a fact that ETM is under Chinese influence, although it is unclear to what extent. In 2016, Shenghe Resources, which is partly owned by the Chinese state, acquired 12.5 per cent of ETM and later the company signed a letter of intent to take over all rare earths production from the Kvanefjeld project. It is still unknown whether the company has the right to buy up to 60 per cent of ETM, if the mining project is realised. In 2019, Shenghe Resources entered into a partnership with the China National Nuclear Corporation (CNNC) – the former Ministry of Nuclear Industry which was responsible for the creation of the first Chinese hydrogen bomb. CNNC’s leadership is appointed by the Chinese Prime Minister, which means that the Kvanefjeld project could have been on its way to becoming a Chinese government project.

The attempts to undermine the Greenlandic state culminated just before the general elections in 2021, when Denmark’s largest television station measured by viewership, TV 2, smeared the later Greenlandic Prime Minister, Muté B. Egede, who campaigned on reinstating the uranium ban and halting the Kvanefjeld project. TV 2 accused Egede of incompetence and corruption and the article that formed the basis of the campaign was widely quoted in other media both in Greenland and Denmark. Although it turned out to be false, it was only retracted after the election had taken place.

TV 2’s smear campaign was based on an 11-page anonymous memo sent to a news editor at the television station, who has staked her position on bringing the fake news, pressured her employees against their will and deviated from the television station’s internal procedures for news dissemination. Independent experts and Greenlandic politicians have later estimated that TV 2’s campaign in all probability had an impact on the election result.

When asked directly, ETM replied that it had nothing to do with the anonymous document.

Nonetheless, the mining company was involved in the election campaign and launched what is said to be the largest and most expensive advertising campaign in Greenland’s history with daily ads in the state TV and radio station Kalaallit Nunaata Radioa and the private media group Sermitsiaq/AG.

Despite the likelihood that TV 2 seriously damaged Greenland’s green transition, the case was never investigated judicially, and the TV station was allowed to exonerate itself through an internal investigation. This despite the fact that demands for such an investigation were raised by leading Greenlandic politicians who realised that Greenland’s security is at stake when the integrity parliamentary elections is undermined.

Even if the TV 2 news director was fired from her job at the TV station, it did not hamper her carrier: subsequently, she was hired as director of communication for the Danish government party, The Moderates, whose leader is the current Minister of Foreign Affairs and former Prime Minister, Lars Løkke Rasmussen.

 

Delayed adoption of the Paris Agreement

The later government party, IA, was four seats from obtaining absolute majority at the Parliament election and therefore had to participate in changing government coalitions. IA succeeded in reinstating the uranium ban, stopping the Kvanefjeld project, making mining legislation more restrictive, including making protection of areas of special geological interest possible, prohibiting convicted criminals from owning or controlling mining companies, banning oil and gas exploration, and introducing a national biodiversity strategy, but not – because IA did not get an absolute majority – ratification of the Paris Agreement. It took two years before this was made possible and it just happened recently.

Hopefully, ETM’s frivolous lawsuits can give rise to the mining company becoming the target of the critical investigation that every democratic country and above all the Greenlandic public deserve. The fact that a general election is underway, which again could be undermined, makes the need even more urgent.

There is yet another reason why the mining company should be put under scrutiny: ETM is currently expanding its activities and could be on the way to become the owner of some of the largest lithium license areas in Europe. Potentially, both its mining projects in Greenland (depending on the outcome of the upcoming general election) and in Spain could be designated as strategic projects under Europe’s Critical Raw Materials Act and benefit from favourable treatment by the European Union.

 

 

Authors of this article:

Mariane Paviasen, Member of Parliament for Inuit Ataqatigiit, who is also former Minister for Housing and Infrastructure.

Erik Jensen, Chairman of URANI? NAAMIK / The No To Uranium Society in Nuuk.

Jan Rehtmar-Petersen, Chairman of URANI? NAAMIK / The No To Uranium Society in Narsaq.

Piitannguaq Tittussen, Founder and Chairman of Nuup Kangerluata Ikinngutai / Friends of Nuuk Fiord. Hans Pedersen, former Editor-in-chief, SustainableEnergy.

Henning Bo Madsen, Chairman of INFORSE-Europe.

Niels Henrik Hooge, Campaigner in NOAH Friends of the Earth Denmark.