Rare earths from Kvanefjeld for the world’s greener technology – but also hundreds of jobs and billions in revenue for

GREENLAND MINERALS A/S Rare earths from Kvanefjeld for the world’s greener technology – but also many hundreds of jobs and billions in revenue for Greenland is published by Greenland Minerals A/S Issortarfimmut 7, 201 PO Box 1350 DK-3900 Phone +299 482 699 E-mail: [email protected] www.ggg.gl

Journalistic adaptation: FreelanceFyn

Graphic production: ProGrafisk ApS

Published January 2021

Data, calculations and assessments and the assumptions behind conclusions, results etc. are contained in the Environmental Impact Assessment Report and the Social Impact Assessment Report which will be available on the Naalakkersuisut web site. Contents

Preface ...... 4

No green and clean world without rare earth metals...... 7 Permanent magnets play a key role in the development of green technologies ...... 7

Many more electric cars and much more wind power...... 7

The Kvanefjeld can secure the future supply...... 8

The Kvanefjeld project is moving closer to the start date...... 8

The Ilimaussaq complex...... 9

3 million tonnes of ore needed to produce 30,000 tonnes of rare earths...... 9

Greenland has come this far in the green transition...... 10

Hundreds of new jobs and billions in tax revenue ...... 13 More than 900 new permanent jobs in Greenland ...... 13

New business opportunities for Greenlandic companies and tradesmen...... 13

Accommodation of employees ...... 14

Education and training of the Greenlandic workforce ...... 15

Revenue from taxes make Greenland far more economically self-sustaining...... 16

Many families will experience a financial boost ...... 16

High standards ensure the employees, the population and the environment...... 18 The environment and the health and safety of employees and the population are given very high priority. . . 19

Dust and noise...... 20

Radioactive material ...... 20

Mining waste (tailings) will be deposited in a storage facility ...... 23

The embankments built to withstand earthquakes and extreme weather ...... 23

Two ways to cover tailings in the storage facility ...... 23 Preface

International Days are held for many He continued: electric cars worldwide may increase different purposes. On 7 September to almost 140 million in 2030 - an 2020, another was added to the list ”We must also urgently address the increase of approx. 1,900 %. - perhaps the most important one deeper threat of climate change. Lim- • Wind turbines use significant and in- - when the UN held the first annual iting global warming to 1.5 degrees creasing quantities of rare earths in International Day of Clean Air. will help reduce air pollution, death their power generation systems. The UN Secretary-General António and disease … Reinforced environ- amount of electricity generated by Guterres said, among other things, on mental standards, policies and laws wind turbines is expected to increase the day: that prevent emissions of air pollu­ from 565 GW in 2018 to 2,000 GW in tants are needed more than ever”. 2030 - an increase of approx. 250 %. ”Around the world, nine out of every In comparison, Greenland’s largest ten people breathe unclean air. Air hydropower plant, Buksefjordsvær- pollution contributes to heart dis- Greenland has the opportunity to ket, has a capacity of 0.045 GW. ease, strokes, lung cancer and other become a key player in the global • Electric bicycles, mopeds and respiratory diseases. It causes an fight for a better climate. scooters use motors with permanent estimated 7 million premature deaths In this publication you can read magnets. By 2030, sales are expect- every year, predominantly in low- and about how metals produced from ed to double to almost 60 million middle-income countries. Air pollu- Kvanefjeld can help make the world a devices. tion also threatens the economy, food greener place. • Permanent magnets are also used security and the environment”. We are talking in particular about extensively and increasingly in in- 4 rare earth elements with the exotic dustrial pumps, computers, smart- names neodymium, dysprosium, phones and in a wide range of other praseodymium, terbium. electronic appliances. These four elements are used in the manufacture of some of the On the following pages you can read world’s strongest magnets - the so- how Kvanefjeld could supply 15-20 % called permanent magnets, that are of the world’s demand for rare earth needed to ensure the green transi- for permanent magnets thereby tion: making a decisive contribution to the • Almost all electric cars use motors global fight against greenhouse gas powered by permanent magnets. emissions. • According to the International Energy Another significant contribution Agency the current just over 7 million that the Kvanefjeld project will make

4 will be to public tax revenues, a con- tribution which can be measured in billions. Income that can make a significant contribution to maintain welfare in Greenland and be a huge step on the road to a more economically self-sustaining Green- land. But - and this is both crucial and essential - all mining projects must be carried out sustainably. Greenland Minerals has therefore for many years, in collaboration with the authorities, carried out extensive studies to ensure that the project is sustainable in terms of health, safety and environment. The environmental and social reports are now ready for public consultation. This publication looks into the future and summarizes the main conclusions of the envi- ronmental and social assessment reports. We wish you a good read. Greenland Minerals

5 6 No green and clean world without rare earth metals

What do wind turbines and electric Permanent magnets play a electric vehicles and wind power in cars / hybrid cars have in common? key role in the development the coming decades. You are right. They all help reduce of green technologies In just ten years, it is expected the world’s dependence and con- The countries of the world have that almost 140 million electric cars sumption of coal, oil and gas. committed themselves to the climate will be in use around the world. By And that will have an effect on the goals of the Paris Agreement. If they 2030 it is expected that wind power CO2 balance. are to meet the goals, clean, green capacity globally will have increased But the green technologies have and renewable energy is the only by approx. 250 % to 2,000 GW. The another common feature. They are all way forward. This is where rare earth increased production of electric cars significant consumers of rare earths metals, especially the four magnet and wind turbines in the years to elements. Each of which has its own metals, will play a key role. Demand come naturally leads to an increased special characteristics. for rare earths will grow as coun- demand for raw materials in the two 4 out of a total of 17 rare earths tries of the world work towards their industries, including an increased are called magnet metals because climate targets. need for rare earth elements. Or more they possess properties which en- specifically, the four magnet metals hance the performance and efficiency Many more electric cars with strange names like dysprosi- of permanent magnets. and much more wind power um, neodymium, praseodymium and The engine in an electric car is Governments around the world are terbium. driven by permanent magnets, the currently preparing and adopting In contrast to for example steel generator in a modern wind turbine climate policies with clearly defined plate supplies, which are easy to uses permanent magnets and the goals for, for example how many obtain, the situation is complete- engine in many industrial pumps is electric cars should be on the roads ly different with the supply of rare driven by permanent magnets. Just in 2030 and beyond and how many earths. Rare earths are only mined in as they are part of electric bicycles, onshore and offshore wind turbines a few countries around the world – computers, smartphones and pretty should be put into operation within primarily in China, the United States, much all the electronics we are sur- the same time horizon. Australia and Burma – they are also rounded by in our everyday life. Both the car industry and wind costly to extract and technically turbine manufacturers are putting complicated to process into end-use extra efforts into development and applications. The vast majority of production, in order to meet the the world’s production of rare earths rapidly growing global demand for occurs in China. It is probable that,

7 the rare earth products will continue to grow. With an expected annual pro- duction of approx. 30,000 tonnes of rare earths, Kvanefjeld could meet 15-20 % of the current annual global demand.

The Kvanefjeld project is moving closer to the start date Since 2007, Greenland Minerals has carried out extensive exploration of the Kvanefjeld deposit. The explora- tion programme has demonstrated that the Kvanefjeld deposit contains one of the world’s largest inventories of rare earths. Since 2011, the exploration activ- ities have been supplemented with a large number of studies, which have examined the economic, social and environmental impacts of the pro- posed mining project. Here in the beginning of 2021, Greenland Minerals now awaits the Greenland Government’s approval of the mining project’s Environmental Impact Assessment (EIA) report and over time, China’s share of global rare The Kvanefjeld can secure the Social Impact Assessment (SIA). earth production will decline. future supply According to Greenlandic law, both Currently, Greenland has the Products containing rare earths met- reports must be subjected to public opportunity to secure a place on the als are in high demand on the world consultation before the necessary stage of global supply of rare earths. market. With the global transition to licenses can be issued. The key is Kvanefjeld in South Green- a greener future underway demand The environmental and social im- land. from the world’s automotive, wind pacts of the project are described in turbine and electronics industries for more detail in the following sections.

8 The Ilimaussaq complex plex forms a unique geological rock 3 million tonnes of ore The Kvanefjeld project is locat- deposit enriched with rare earths, needed to produce 30,000 ed within an 80 square kilometre zinc and uranium. In addition to the tonnes of rare earths area behind the town of Narsaq in Kvanefjeld, the area comprises two The mine has been designed as South Greenland, which is part of other potential mineral resources; an open pit, from which approx. 3 the Ilimaussaq complex. The com- Zone 3 and Sørensen. million. tonnes of ore will be extract-

Figure 1: Project Area.

9 ed annually. After extraction, the ore of the energy that Greenland’s public will be processed in two process- energy utility company Nukissiorfiit ing plants; a concentrator where a dispatched to consumers. mechanical process (crushing) takes With the prospect of building ad- place and a refinery where a series of ditional hydropower plants, up to 90 chemical separation processes takes percent of Greenland’s energy supply place. will be supplied by hydropower. The project will produce approxi- Greenland also uses, albeit on a mately: smaller scale, both wind and solar • 30,000 tonnes of rare earths energy in the energy supply. • 15,000 tonnes of zinc concentrate On the electric car front, Greenland • 8,700 tonnes fluorspar is also moving ahead. In 2015, 83 • 500 tonnes of uranium oxide electric cars were registered, while the number in 2019 had grown to Rare earths are the primary products 643. An increase of almost 700 per- of the mine, and are expected to gen- cent - in just five years. erate more than 90 % of the revenue. Globally, nature, humans and The remaining revenue will be gener- animals are suffering from climate ated by zinc, uranium and fluorspar. change. Greenland is no exception being a passive recipient of pollu- Greenland has come this far tion from industries and greenhouse in the green transition gases for decades. The ice sheet is Clear political goals - green energy melting at breakneck speed, and with wherever possible - mean that Green- political will and courage, Green- land has come a long way in the use land can become one of the leading of renewable and green energy. suppliers of metals that the green Green energy is supplied by the transition so desperately needs, thus country’s many hydropower plants. In contributing to the technology that 2018 alone, they delivered 67 percent must combat climate change.

10 11 12 Hundreds of new jobs and billions in tax revenue

The mine project that comprises Or maybe more, as the Kvanefjeld jobs at various suppliers, stores and amongst other an open pit, process- deposit, Zone 3 and Sørensen contain other companies. 328 of the work- ing plant and tailings facilities is a total resource of 1 billion tonnes of places in the mining project itself are located about 7.5 km from the town ore. Calculations show that this could expected to be occupied by Green- of Narsaq, which has approx. 1,350 be sufficient to support a project with landic labour. inhabitants. Narsaq is located in the a life of several hundred years. In the active closure phase, which Municipality of , Greenland’s is set to be six years, there will only southernmost and smallest munici- More than 900 new be a need for 48 employees, of which pality with a total of just above 6,400 permanent jobs in Greenland 41 will be residents of Greenland. inhabitants. The need for labour, local and foreign, In filling positions, Greenland Min- The main occupations in the varies in the three phases of the pro- erals has committed to giving qual- municipality as well as in the town of ject. During the construction phase, ified Greenlandic applicants priority Narsaq are fishing, agriculture and the employment of 200 employees over foreign applicants. public administration. from Greenland and 971 foreigners Greenland Minerals will also, in However, the upcoming mining is expected. The construction will collaboration with Greenlandic edu- project will generate completely new extend over three years during which cational institutions, carry out train- types of employment, both locally the mine and all of the associated ing courses – to ensure that as many in Narsaq, in the municipality and production facilities and infrastruc- positions as possible are occupied by throughout Greenland. Just as the ture including tailings storage, port, Greenlandic labour. Greenland Government and the Mu- accommodation, roads etc. will be nicipality of Kujalleq will be able to established. New business opportunities look forward to considerable income Where the Greenlandic workforce for Greenlandic companies in the form of taxes and royalties. makes up 17 % of the total workforce and tradesmen Phase 1 of the mining project during the construction phase, the The project will be a very large includes the mining of 108 million number of Greenlandic employees workplace in Narsaq with a little tonnes of ore, and consists of a will increase considerably when min- more than 700 employees. Like construction phase of three years, ing begins. everyone else, these employees will an operational phase of 37 years The total workforce in the opera- need a place to live, something to and a closure phase of six years. 46 tional phase is expected to be around eat, transport, they will have hobbies, years of increased employment and 715 employees in the mine project they might get sick, they might need increased tax revenues for Greenland. itself and 215 employees in derivative childcare and much more. All of these

13 Table 1. Greenlandic Business Opportunities by Project Phase. needs will have to be met and this will create new business opportuni- Support Local Business Opportunities Construction Operations Closure Area ties for Greenlandic companies and

Camp Accommodation n n n tradesmen. Services Village management n n It is estimated that indirect em-

Catering services n n n ployment will amount to 215 jobs per

Cleaning services n n n year during the 37 years of operation.

Gardening and maintenance n n Table 1 shows the business

Plumbing and construction n n n opportunities that will be created for Greenlandic companies and trades- Utility services n n n men by the mining project. Mining and Minor civil earthworks n n Processing Equipment hire n n Plant Accommodation of employees Work training n n During the early stages of the project Sampling services and testing facilities n n n employees will be accommodated in Environmental monitoring services n n n existing homes in Narsaq and Narsar- Staff and Boat operators (incl. skippers) n n n goods suaq until a temporary construction Helicopter services n n n transportation accommodation camp has been built Aviation and airport services n n n ( or ) in the vicinity of the mining area.

Sea cargo transportation n n n This temporary accommodation

Bus, taxi and car rental services n n camp with 500 beds, will house the

Fuel supplies and repair services n n n majority of the foreign construction

Waste management and waste transport n n workers while the Greenlandic em- ployees will continue to be accom- General Labour recruitment services n n support n n modated in Narsaq and Narsarsuaq. services Greenlandic and English language courses When the three-year construction Mine area tours n n phase is over and the project moves Legal services n n n into its operation phase, the employ- Health and safety services n n n ees will move once again. This time IT and communications n n to a permanent village built on the Public relations n n n outskirts of Narsaq. The village can Media n n n accommodate around 450 employees Recreation facility services n n and is intended for accommodation Hospitality services n n of both Greenlandic and foreign Childcare services n n workers during their rostered work n n n Tourism periods.

14 Education and training of the • Greenland Minerals will, in collabo- that participate in training courses Greenlandic workforce ration with the Greenland School of (so-called PKU-courses). In the construction phase, a rela- Minerals & Petroleum and the Food • Greenland Minerals will establish tively small proportion of the jobs, College of Greenland, develop train- a mentoring program for the staff around 17 %, is expected to be filled ing plans to help students achieve to ensure the development of the by Greenlandic labour. The explana- either direct or indirect employment workforce over time thereby in- tion is quite simply that at present in the mining project. The goal is to creasing the proportion of Greenlan- the Greenlandic skilled workforce is employ at least 40 graduate stu- dic labour in senior positions. not large enough to meet the require- dents from the Greenland School of ments of the project. Minerals & Petroleum. Various initiatives have been taken In the longer term, and as a • Greenland Minerals will aim to hire on the Greenlandic side to prepare number of educational initiatives are 15 apprentices annually. the country’s workforce for jobs in launched, that situation will change. • Greenland Minerals will, in coordi- the mining sector, including: Amongst others the following initi- nation with the Greenland Govern- • The Greenland School of Minerals atives are planned: ment, sponsor unskilled workers & Petroleum has completed youth

15 educations specifically aimed at the the Greenland Government and the Many families will experience mining sector. Municipality of Kujalleq will be a huge a financial boost • The Municipality of Kujalleq has step on the way to a more economi- As mentioned, a good part of the fu- admitted 300 students to cours- cally self-sustaining Greenland. ture jobs will be filled by local labour. es targeted at the mining sector, It is estimated that the annual tax- For many families, a steady and well- likewise a number of students have es and royalties will average DKK 1.5 paid job will mean a financial boost. been admitted to English courses. billion per annum in current prices. A boost that can help ensure families, Over the life of the project, the total not least families with children, better Revenue from taxes taxes and royalties will amount to ap- living conditions thus better well- make Greenland far more prox. DKK 56 billion in current prices. being. In other words, a sustainable economically self-sustaining The individual taxes and royalties life and well-being for several gener- The income from taxes and fees to are specified in table 2. ations.

16 Table 2. Government take from the Kvanefjeld project.

Government take instrument Currency No. of years Yearly average For the project period

Corporate and withholding tax DKK 37 1,350,000,000 49,950,000,000

Royalty on uranium DKK 37 30,064,000 1,112,368,000

Income tax on labour employed in the project DKK 37 136,000,000 5,032,000,000

Total 1,516,064,000 56,094,368,000

17 High standards ensure the employees, the population and the environment

18 In addition to rare earths, the 3 is reflected both in the plans made million tonnes of ore mined annually for the management of employees’ in the Kvanefjeld also contains zinc exposure to dust and radiation and and uranium. Both products have the procedures that are put in place commercial value and will to a lesser to minimize exposure. extent contribute to earnings. By far All employees will be trained in the largest income - about 90 % - will safety and radiation protection, partly come from the production of rare to increase their knowledge of risks earth metals - and especially the four and partly to qualify them for their magnetic metals. working roles. Zinc is primarily used for galvaniz- In addition, all employees are ing steel to prevent rust, while urani- equipped with a dosimeter, which um is known to be the fuel that drives must always be worn during work. electricity production in the world’s The dosimeter constantly measures nuclear power plants. However, the the individual employee’s exposure to Kvanefjeld project’s production of radiation and continuously forwards uranium will account for less than 1 the information to a central monitor- % of the total global uranium produc- ing system. tion. In addition, a washing plant will Although the uranium content in be established, which all vehicles the Kvanefjeld is very low - approx. leaving the mining area must drive 0.03 % - uranium is a radioactive ma- through. The system is automatic terial whose handling requires special and the drivers therefore do not have safety measures and procedures to to leave the cab during the car wash. minimize the risk of radiation. Washing should ensure that the vehi- cle is free of dust, but to be absolute- The environment and ly sure that no contaminated vehicles the health and safety of employees leave the mining area, a check for and the population radiation will be performed. are given very high priority Greenland Minerals’ management That all employees go home from and procedures for radiation protec- work in the same condition as when tion are consistent with the principles they arrived at work is a completely and practices used in similar mines mandatory goal for Greenland Miner- in Australia and Canada. als. The health and safety of employ- ees has the highest priority, and this

19 Dust and noise minimize the impact, water, salt etc. Dust and noise will to a certain extent will be used to keep the dust on the be unavoidable from an open mine, ground. where ore is drilled, blasted and Noise is another impact of the transported on trucks around the mining activities. However, a number clock 365 days a year. of noise estimates have been made After the ore is mined, it is initially showing that the noise level in the transported to a storage site, where residential areas of Narsaq and at the it is placed in various depots. Ore constructed village will meet guide- from selected depots is mixed and lines for noise in mixed residential transported again with trucks, (a total and commercial areas. of 3 at project start and later max. 6) to the first processing plant, the Radioactive material concentrator. Here the mechanical Radioactive elements are found in processing takes place, where the ore nature in all soil and rocks, albeit in is crushed and ground to the same varying concentrations. Kvanefjeld consistency as fine sand. is no exception. The natural concen- The concentrator produces two tration of radioactive substances saleable products, zinc concentrate at Kvanefjeld, in the Narsaq Valley and fluorspar as well as a mineral and in Narsaq city is higher than the concentrate with the rare earths. The global average. latter is transported via a pipeline To ensure that future mining to the project’s second processing activities do not involve any harmful plant, the refinery. And it is here, using release of radioactive material into chemical processes, that the produc- soil, water, plants and animals and tion of a concentrate of rare earth ox- thus the entire food chain, Greenland ides and uranium oxide takes place. Minerals is required by law to imple- Volatile dust will be generated as ment a number of measures. a result of blasting and excavation Here it can, amongst other, be in the mine, handling of material and mentioned that all mining waste transport on gravel roads. Exten- (tailings) will be stored in Lake Taseq, sive studies show, however, that the either under water or under a dry cov- expected dust concentrations will er consisting of clay, sand, stone and not exceed permissible limit values. gravel to minimize radiation. At no Although the dust impact is thus time will mining waste be discharged assessed as low, in order to further into the Taseq River.

20 21 Figure 2. Tailings Facility.

Figure 3. Cross-section of the dam at the facility for depositing tailings with chemical residues (CRSF) (top) and the facility for depositing tailings (FTSF) (bottom) in year 37.

22 Transport and packaging of urani- of life and not drinkable and partly corresponds to approx. 2.5 times the um oxide will be in accordance with because the bottom consists of im- length of a football pitch. the safety standards of the Interna- penetrable crystalline rock. To prevent any leakage of waste tional Atomic Energy Agency. Both waste (tailings) streams, from the storage facilities, the em- Furthermore, several calculations which are slurries, will be discharged bankments will be lined with special show that the increase in the dose of through separate pipelines from the double membranes. This type of stor- radioactivity due to the mining activi- processing plants to separate sec- age facilities is known from mines ties will be extremely low and will not tions of the tailings storage facility. elsewhere in the world. cause harmful effects on animals or The two sections will be separated by plants. an embankment just as an embank- Two ways to cover tailings For the residents of Narsaq, the ment will be built at the end of the in the storage facility mining activities will mean that the lake. Although the closure of the level of the background radiation Kvanefjeld project is several decades they are exposed to today will be The embankments built to into the future, closure plans have increased by approx. 1 %. withstand earthquakes already been made in accordance and extreme weather with best international practice. The Mining waste (tailings) will be Both embankments, built of stone decommissioning will take place in deposited in a storage facility and anchored in solid resistant rock, a sound and sustainable way, which As mentioned, the production of rare will be designed to withstand a max- will ensure a clean and sustainable earths, uranium, zinc and fluorspar imum expected earthquake. The tail- environment for future generations. requires the processing of both ings storage facility will be designed The tailings in the storage facilities ore and its concentrates. With the with the capacity to withstand rain in can be covered in two different ways, processing also comes waste, in fact quantities that only occur once every both of which are environmentally two waste streams, respectively from 10,000 years, or even less frequently. sound. One is a wet cover, where the the concentrator and refinery. They The two embankments will appear in mining waste is covered with water are handled and disposed of sepa- the landscape as large rock eleva- and the other, a dry cover, which con- rately. tions reaching maximum heights sists of clay, sand, stone and gravel. The storage facility is located in of 45 and 46 meters, respectively, Whether tailings in the Taseq the Taseq Lake, which is close to above the original ground level in the basin should be covered with water Kvanefjeld. The lake is suitable for two tailings storage facilities. The or dry material will be decided by the storing waste, partly because the width of the embankment at the end authorities. water in the lake is naturally devoid of the lake will be 247 meters which

23 24 25 Table 3. Project summary.

Project Element Description Details

Tenement EL 2010/02 80 km2

Mine reserve 108 Mt

Mining rate 3.0 Mtpa

Extraction of ore and waste rock using drilling, Mining method Open pit blasting and power shovels

Processing method Mechanical (Concentrator) and chemical processing (Refinery)

Life of Project 46 years

Construction phase 3 years

Operating phase 37 years

Decommissioning 6 years and closure phase

Rare earth elements ~30,000 tpa

Zinc concentrate ~15,000 tpa Products Fluorspar ~8,700 tpa

Uranium oxide ~500 tpa

Power station 59 Megawatts (MW) Supporting Power lines 2 x 11 km, 11 KV transmission lines infrastructure Roads 10 km dual lane (8 m wide) unsealed road from port to mine

Total footprint (after 37 years) 5.9 km2

Mine pits 1.14 km2 Size of Project elements Port 0.1 km2

Village 0.04 km2

Water use Supplementary fresh water 191 m3/h from Narsaq river

Excess water Discharge of treated excess water to Nordre Sermilik 816 m3/h

Product transport 22 vessels per year Handy-Max, 40,000 DWT

Employee transport Airport Narsarsuaq

Construction phase (peak) 200 Greenlandic, 971 foreign

Employees Operation phase (average) 328 Greenlandic, 387 foreign

Closure phase (average) 41 Greenlandic, 7 foreign

26 27 GREENLAND MINERALS A/S

Materials for an energy efficient future