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Annual Report 2003 Exclusive licences, 1 January 2004

Ilulissat

Sisimiut

Tasiilaq

0 2040608100km0

Petroleum EnCana Corporation/ A/S Minerals Angus & Ross PLC Brereton Engineering & Dev. Ltd. Bureau of Minerals and Petroleum Crew Development Corporation Falconbrigde Limited Gem Fields International Hudson Resources Inc. Nalunaq Gold Mine A/S Navigator Exploration Corp. New Millennium Resources N.L. NunaMinerals A/S Rimbal Pty Ltd Skaergaard Minerals Corp. Vismand Exploration Inc. Application for new licence

0 20406080100km Application for renewal

Narsaq

Qaqortoq

Nanortalik

Topographic base: G/2.5M Vector © National Survey and Cadastre, / Geological Survey of Denmark and , 1997. UTM Zone 24, WGS84. 0 10 20 30 40 50 km

Map of licences 1 January 2004 Example of map of licences in Greenland.The map is updated every 14 days on the first and sixteenth of the month on the Bureau of Minerals and Petroleum website www.bmp.gl and it can be printed from here. Preface

Greenland is the world's largest island and has great potential been pivotal for the industry's interest in the licensing round. for becoming a significant supplier of mineral resources to the In addition, the Greenland government and the Danish govern- world market. However, making Greenland's potential for mi- ment have, in anticipation of the licensing round, adopted in- neral resources and water resources attractive for exploration ternationally competitive exploitation conditions which, apart is an important task, as is true for other poorly accessible land from corporation tax, include royalties on profits and partici- and marine areas where large areas are still almost unexplo- pation by NUNAOIL A/S in all exploration and exploitation li- red. Doing this will enable Greenland to compete with other cences. and often more easily accessible sites. In November 2003, the Bureau of Minerals and Petroleum 2003 was a year when expectations for the future became (BMP) hosted a successful strategy conference focusing on the much more specific than they had been before.At the end of problems related to the export of ice and water from Green- the year, Nalunaq Gold Mine A/S in commen- land.A number of experts helped clarify the complex of markets, ced loading ore from the gold mine.The opening of this mine industries, technologies and resources.The main conclusions in Greenland sends a particularly positive signal to internatio- of the conference formed the basis for the preparation of a nal industry that mining in Greenland is a viable option. new strategy for the area in 2004.The objective is for Green- land to become a significant exporter of ice and water for the Therefore, the Greenland government has great expectations global market. that the gold mine in Nalunaq will be encouraging evidence for other mineral exploration companies. Furthermore, promising The Greenland government places great emphasis on develo- exploration results from other locations in the country reflect ping a strong industry for the exploitation of Greenland's na- international companies' investments in the exploration in tural resources which will benefit economic growth as well as Greenland during recent years. employment in Greenland.

Oil and gas activities have been increasing steadily in the last few Since the Greenland Home Rule took over the management years. In 2003, activities reached a new peak with the collection of mineral resource activities in Greenland in 1998, all signifi- of 9,000 km of seismic data in the sea area off the coast of West cant decisions with regard to mineral resources have been Greenland.Also the implementation of a comprehensive and made in common understanding between the Greenland go- successful seabed sampling programme which, for the first time, vernment and the Danish government. BMP is responsible for showed the existence of an oil-prone source rock offshore the secretariat services for the Joint Committee on Mineral West Greenland. Resources in Greenland. In close co-operation with particu- larly the Geological Survey of Denmark and Greenland This high level of activity is due partly to the upcoming licens- (GEUS), the National Environmental Research Institute (NERI), ing round in 2004 and partly to the oil company EnCana Cor- the Danish Energy Authority and NUNAOIL A/S, BMP has tar- poration having carried out a comprehensive exploration pro- geted its efforts to fulfil the goal of developing the mining in- gramme in 2003.This was carried out within the framework of dustry into one of the most important industries in Green- the corporation's licence for exploration and exploitation of land. oil and gas in an area offshore West Greenland. The Greenland government is looking forward to continued With a view to further strengthening oil and gas exploration, co-operation in the coming years.There is no doubt that Gre- the Greenland government and the Danish government adop- enland is facing a very exciting future. ted a new strategy in June 2003. In accordance with this oil strategy, oil licensing round for areas offshore West Greenland will be carried out in 2004.These areas will be selected and promoted to the oil industry on the basis of geological surveys of the subsurface.The results of the projects and the chosen promotion strategy toward the international oil industry have

Minister for Self Governance, Justice and Petroleum

1 Mr Jørgen Wæver Johansen The Joint Committee on Mineral Resources in Greenland

The Mineral Resources System for Greenland establishes a The Joint Committee joint Danish-Greenlandic political responsibility for mineral resource activities in Greenland.This means that At the end of 2003, the Joint Committee consisted of Greenland and Denmark have joint authority to make de- the following members:: cisions regarding principal investments in mineral resource activities. Furthermore, the Danish government and the Chair: Kim Andersen, MP (Venstre) Greenland government have agreed on the distribution of possible profits from extraction of mineral resources. Greenlandic members: The Joint Committee on Mineral Resources in Greenland Kuupik Kleist, vice chair has been set up as a political forum in which politicians Per Rosing-Petersen from Greenland and Denmark can bring central issues Per Berthelsen regarding mineral resource activities up for debate. BMP Ruth Heilmann under the Greenland Home Rule administrates the Mineral Jakob Sivertsen Resources System for Greenland and is the responsible authority for case processing in connection with mineral Danish members: resource activities.

Helge Mortensen, vice chair The more detailed provisions pertaining to the Mineral Kaj Ikast Resources System for Greenland have been laid down Aase D Madsen in the Greenland Home Rule Act and in the Mineral Kristen Touborg Resources Act. Erik Larsen The Joint Committee on Mineral Resources in Greenland - also called the Joint Committee - consists of five politi- The following officials from Greenland and Denmark cally appointed members from the Greenland Parliament took part in committee work as delegates: and the Danish Parliament. In addition, a Chair is appoin- Kaj Kleist, Greenland Home Rule ted by the Queen of Denmark following joint nomination Hans J. Høyer, Department of Environment and Nature by the Danish government and the Greenland govern- Kirsten Trolle, the Danish Prime Minister's Office ment.The tasks of the Joint Committee are to monitor Michael Dithmer, the Danish Ministry of Economic and developments in mineral resource activities and to su- Business Affairs bmit its recommendations to the Danish and Greenland governments on, for example, issues about the granting During 2003, five Joint Committee meetings were held. of licenses for preliminary surveys, exploration and ex- ploitation. Less complex cases, such as applications for new li- censes and area expansions and transfers, are processed in between meetings by the Joint Committee's Chair and Vice Chairs. The Bureau of Minerals and Petroleum

Objectives and tasks of the Mineral resources as a primary industry Bureau of Minerals and Petroleum Greenland aims at making mineral resources one of its The Bureau of Minerals and Petroleum (BMP) under the primary industries. Developments within mineral re- Greenland Home Rule is responsible for the management source activities must therefore be in dialogue with the of mineral resource activities in Greenland and for the people of Greenland.As a consequence, BMP is striving export of ice and water from Greenland. BMP aims at to establish a clear and comprehensible framework for ensuring professional promotion of the mineral potential mineral resource activities via a number of information in Greenland to the international mining industry. activities, in order to encourage a successful working relationship between the mining industry and the public. One of the main tasks of BMP is the day-to-day admini- stration of licences within the area of mineral resources. External partners BMP is responsible for all case processing and is the only authority the industry needs to contact in order to receive BMP co-operates on the administration of mineral necessary licenses.This ensures efficient case processing resource activities with e.g. the Geological Survey of for mineral resource activities. Denmark and Greenland (GEUS), the National Environ- mental Research Institute (NERI) and the Danish Energy Start-up and promotion Authority.Also the state-owned oil company NUNAOIL A/S is an important partner. BMP contributes to the financing and implementation of a number of projects which can provide new knowledge Ice and water about Greenland's mineral potential. In this way, the autho- rities are attempting to sharpen private-enterprise interest Greenland wishes to exploit the country's significant ice in exploration activities in Greenland. BMP engages in con- and water resources for export purposes. Case processing. certed efforts to promote Greenland's mineral potential through participation in international trade shows and exhibitions and through direct promotion initiatives aimed at selected oil and mining companies. Moreover,the English website of BMP is an important means of communicating full and relevant information to the mining industry.

3 Hydrocarbons... New hydrocarbon strategy adopted There is broad political agreement in Greenland and Den- mark to work towards developing the mining sector into one of the country's most important industries. In June 2003, the Greenland government and the Danish government adopted a new hydrocarbon strategy for Greenland, which includes a new licensing round offshore West Greenland in 2004.The strategy was prepared by BMP and submitted through the Joint Committee.The background for the preparation of the new hydrocarbon strategy was primarily that a significant part of the objectives of the previous strategy from 1999 60˚W 50˚W 70˚N 55˚ 70˚N have now been realised, including not least the production of significantly improved seismic and geophysical data.

The new strategy carries on one of the primary objectives Illulisat 69˚ of the 1999 strategy to work toward licensing rounds off- 69˚ shore West Greenland, since that region has the best data coverage and operational conditions compare to other Greenlandic areas. Comprehensive collection of seismic data has been carried out since 1999, and not least in 2003. 68˚ 68˚ In addition, the strategy states and it is a clear political pre- HelleH ef requisite for all mineral resource activities that they are 3 carried out in a responsible manner with regard to safety and the environment. Kangerlussuaq 67˚ 67˚ -1 Licensing round in 2004 The new hydrocarbon strategy for Greenland includes a Kangâmiut-1 new licensing round offshore West Greenland in 2004 in 66˚ 66˚ four areas between 63°N and 69°N.The licensing round 2 Nukik-2 will be formally open when the licensing documents and the licensing terms are published, and opening meetings will Nukik-1 Maniitsoq be held on 1 April in and on 6 April in Houston, 65˚ 65˚ Texas.The round will be closed for further applications on 1 October and new licenses are expected to be granted

da EnCana

a n licence around the turn of the New Year.

with Ca

r Four license areas have been selected that each have 2-3 64˚ 64˚ de 4 or 1 Nuuk large structures with hydrocarbon potential.This has been

B Qulleq-q- done on the basis of a mapping carried out by GEUS.A number of geological structures of more than 100 km2 in the region were mapped, and of these, the most promising 63˚ 63˚ ones were selected. Consideration has also been taken as regards the industry's views on delimitation and timeframes. These views were divulged during several meetings, includ- ing visits to large oil companies and a seminar at GEUS for 62˚N 62˚N invited oil companies in the spring of 2003. 60˚W 51˚ 50˚W 59˚ 58˚ 57˚ 56˚ 55˚ 54˚ 53˚ 52˚ NUNAOIL A/S, equally owned by the Greenland Home Rule and Danish state-owned oil company DONG A/S, takes part in active licenses as a carried partner in the ex- ploration phase.This means that NUNAOIL A/S does not share the costs of exploration.

As opposed to licensing-round areas, in areas with the so- called open-door procedure (from July 2003 offshore South- west Greenland and Jameson Land), companies may apply for licenses on a continuous basis.The former open-door area (incl. Disko and ) north of the future license areas will be closed down from July 2003 (and all of 2004) until further notice due to the authorities' ongoing assess- ment of promising new data.

4 Oil exploration offshore West Greenland south-west of Kap Farvel.These new data are also of great rele- vance for the mapping of the southern stretch of Greenland's In 2002, the West Greenland licensing round resulted in a continental shelf. new license for exploration and exploitation of hydrocar- bons to EnCana Corporation and NUNAOIL A/S. GEUS 2003: With TGS-NOPEC as the contractor, GEUS has collected about 1,500 km of seismic data in the area immediately The area of their licence is 3,985 km2 in a sea area about south-west of Kap Farvel for the UNCLOS 76 project. 200 km north-west of Nuuk in West Greenland. Geologically, the area covers part of the Nuuk Basin. In the western part 65¡W 40¡W of the area, the ocean depth typically lies between 500 and 70¡N 60¡W 45¡W 70¡N 55¡W 50¡W 1,000 m, while in the eastern part it generally lies between 200 and 500 m. No wells have previously been drilled in this area.

The consortium's operator, EnCana Corporation, carried out a comprehensive exploration programme in 2003, in- Greenland cluding collection of seismic data and seabed samples, etc. 65¡N 65¡N New seismic surveys offshore West Greenland

Almost 9,000 km of seismic data were collected in six sur- veys (see below) between August and December from off- 60¡N 60¡N shore areas west and south-west of Greenland.Thus, over 50,000 km of seismic data have been collected offshore

West Greenland since 1990. 2003 became one of the most ODP SITE 646 active years offshore West Greenland so far.This high level of activity is primarily due to the upcoming licensing round in 2004, but also to the honouring of the exploration com- Canada mitments in the EnCana/NUNAOIL licence and the Danish 55¡N 55¡N 65¡W 40¡W and Greenland governments' surveys of the continental 60¡W 45¡W 55¡W 50¡W shelf in connection with the UNCLOS 76 project.The EnCana/NUNAOIL Licence Seismic surveys 1977-2002 seismic data collection was co-ordinated by TGS-NOPEC Licence areas 2004 Not confirmed borderline with the two Russian vessels: M/V Professor Polshkov, and TGS-Nopec (2003) Official borderline M/V Geolog Dmitry Nalivkin. RD/TGS Nopec (2003) §76 (2003) Basin of Lady Franklin 2003: In a joint venture with NUNAOIL, TGS-NOPEC collected about 2,000 km of seis- mic data in and around area 1 of the upcoming licensing round with a view to achieving better coverage of the area for oil companies that might be interested during the licen- Seabed sampling offshore sing round. West Greenland in 2003

Kangamiut West 2003: In a joint venture with In 2003, seabed samples were collected offshore southern NUNAOIL, TGS-NOPEC collected about 400 km of West Greenland in two stages (nos. 3 and 4) in connection seismic data in area 2 of the upcoming licensing round with with a UNESCO cruise (TTR-13) with the Russian research a view to make the data available to oil companies assess- vessel R/V Professor Logachev.The sampling was primarily ing the area during the licensing round. aimed at collecting seabed samples selected on the basis of geophysical and geological interpretations in order to sur- Fylla South East 2003: In a joint venture with vey old subsurface strata close to the seabed.The samples NUNAOIL, TGS-NOPEC collected about 600 km of seismic were analysed and reported on in 2003.The results of geo- data in and around area 4 of the upcoming licensing round chemical and biostratigraphic analyses have identified old with a view to selling them to the oil industry during the strata containing oil.The project was planned and imple- licensing round. mented by GEUS and BMP and co-funded by NUNAOIL A/S.

Green 2003: On behalf of EnCana and NUNAOIL, TGS- Mapping and assessment of the licence areas NOPEC collected a total of about 3,000 km of seismic data, mainly within the area of these companies' licence, In preparation for the 2004 licensing round and the con- with a view to honouring some the commitments attached tinued work with the areas north of the licence areas, to the licence. GEUS and BMP initiated a mapping and assessment project in late 2003 which will continue in 2004 and which entails a Kap Farvel 2003: Funded by BMP,TGS-NOPEC has collec- detailed interpretation of all seismic data in the four licence ted about 1,100 km of seismic data in the area immediately areas. Hydrocarbon activities and The physical conditions of West Greenland

the environment The Danish Meteorological Institute and BMP have initiated preparing a new report on climate, sea and ice conditions With funding from BMP,NERI carried out two mapping in the licence areas and the surrounding sea area.The pur- projects in 2003 along the West Coast.The entire coast be- pose is to update industry as to the operational conditions tween Kap Farvel and the southern part of the municipality in connection with hydrocarbon exploration. of (72ºN) has thus been mapped on an atlas.The coast's vulnerability to oil spills has been assessed on the The Greenland and Canada continental division basis of this mapping.The mapping can both be used in the general coastal and environmental contingency services, In recent years, seismic data acquisition has shown that even and also in connection with exploration and exploitation the newer models of the subsurface and the development activities with regard to hydrocarbons. of basins need to be revised. Our understanding of the basin development and structure formation is of great im- There is great public attention about the problems that portance for the assessment of prospects for the area, as may result from hydrocarbon research and production, and sedimentation of potential hydrocarbon and reservoir- thorough environmental studies help ensure appropriate forming rocks are dependent upon regional basin develop- contingency plans.The projects are funded by BMP and the ments.The project is carried out by GEUS and co-funded Danish Environmental Protection Agency. by BMP.

BMP takes part in the so-called PAME working group (Pro- Preparation of onshore surveys in West Greenland tection of the Arctic Marine Environment) under the Arctic Council. PAME works to protect the marine environment In preparation of possible new exploration in onshore in connection with land and sea based activities. In addition, areas of West Greenland - particularly on Disko Island and PAME assesses international agreements on the protection Nuussuaq - a study has been commenced in order to plan of the Arctic marine environment and regulations for safe the collection of seismic data and possible subsequent well navigation in Arctic areas. BMP participated in the co-ope- drillings.A new digital terrain model has been developed ration on the revision of ‘Arctic oil and gas guidelines’ and for parts of Disko and Nuussuaq, and previous information is currently participating in the work on a new Arctic Marine has been collated in a new exploration model. Strategic Plan for the protection of Arctic marine areas. NERI carried out environmental background studies of geese/eider ducks and vegetation in the same area. In addi- tion, the studies of reindeer carried out by the Greenland Institute of Natural Resources in April 2002 were included. ...Hydrocarbons Continental shelf project UNCLOS 76 BMP co-operates with other Danish and Greenlandic aut- horities and institutions on determination of Greenland's continental shelf with a view to possibly presenting claims for extending the continental shelf around Greenland. Project ‘Mammoth 2003’ Article 76 in the UN Convention on the Law of the Sea, also called UNCLOS 76, provides coastal states with the The project is being carried out by BMP and GEUS and in- opportunity of stating claims beyond 200 nautical miles. cludes a seismic interpretation and mapping of large geo- With Greenland's accession, the Kingdom of Denmark can logical structures (minimum 100 km2) offshore West Green- ratify UNCLOS in 2004. Surveys have been initiated by land.The project focuses on the largest structures - or means of seismic data, gravimetry and echo soundings of "mammoths" - of more than 400 km2, which may have hy- sea depths and the subsurface geology in three areas; south, drocarbon potential.The main purpose of this mapping sur- north-east and north of Greenland. vey of all existing data from the region is to finalise a new assessment of potential hydrocarbon traps in connection with the 2004 licensing round.Together with other infor- mation, the results of this mapping were presented at GEUS in April at a seminar for invited oil companies and subse- quently at the AAPG exhibition for the oil industry in the USA.The mapping and the reports from industry have for- med a background for the selection of the four new licence areas. Minerals...

Exploration for minerals in Greenland in the period 2000-2003 2000 2001 2002 2003

No. of prospecting licences 15 6 6 11

No. of exploration licences 24 19 17 19

No. of km2 covered by exploration licences 11.289 10.264 5.956 5.714

Exploration commitments (DKK mill.) 27,6 40,5 25,8 31,8

Exploration expenses incurred (DKK mill.) 103,2 111,8 20,8 #

#The deadline for submission of accounts for 2003 is 1 April 2004.Total data were not available at the time of closing of the editing.

Mineral Exploration Gold exploration

A stable level of activity in Greenland has replaced the de- Gold exploration is carried out in several places, and new cline in exploration internationally and in Greenland at the activities are planned for 2004. In the area surrounding end of the 1990s. Nalunaq, Crew carried out comprehensive programmes near Lake 410 and in 2003.At Lake 410, the At the end of 2003, a total of 19 exploration licences had deposit is of the same types as at Nalunaq and a promising been granted, covering an area of 5,714 km2. Seven new ore structure of about 500,000 m2 has been identified so far. licences were granted in 2003. Interest is primarily focussed At Niaqornaarsuk, there are several clear mineralisations, on exploration for gold, diamonds and nickel. which have shown a content of gold of up to 56 g per tonne. Work is planned to continue at both sites in 2004. The fall in exploration expenses incurred from 2001-2002 is primarily due to the fact that Nalunaq Gold Mine at that Near Nuuk, the gold deposit at Storø has again become time had prepared the gold project in South Greenland the object of intense studies by NunaMinerals A/S. Recent with a view to applying for an exploration licence which studies indicate that the deposit is a part of a gold province was granted in 2003. stretching as a belt from Nuuk to Isukasia. In 2003, Nuna- Minerals signed a declaration of intent with Greenland Gold mining Resources A/S to spend up to DKK 12 million on the Storø project in the years to come. At Nalunaq, mineral explorations were discontinued in 2003, and Nalunaq Gold Mine A/S commenced preparations Publicly funded gold project for mining and shipment of already mined ore for which the company received a licence at the end of the year. On BMP and GEUS carried out field work in the Nuuk Fjord 28 December 2003, the bulk carrier M/V Lake Erie arrived and completed a preliminary study report on the total at Nalunaq to pick up the first load of gold ore of about potential for gold and mineral resources in the greenstone 31,000 tonnes for delivery in Rio Narcea in Spain for pro- belts of the area (GEUS report no. 2003/94). During the cessing. Mining proper is expected to be commenced field season, digital aerial photography was carried out for during the spring of 2004. In addition, a comprehensive key areas.Accordingly, new background material has been exploration campaign for the entire mining area is planned collected for a significant joint programme between GEUS for 2004. and BMP in 2004 where the mineral potential in the area will be evaluated. 7 ...Minerals

DIAMOND INDICATOR MINERALS

Diamond indicator minerals are a handful of different minerals that are only formed under the same high pressures and temperatures as diamond, but which normally occur in much larger volumes than diamond.The occurrence of diamond indicator minerals does not guarantee the occur- rence of diamond, but they constitute an important positive sign.

Diamond indicator minerals are searched for in stream sediments or in till when tracing diamondiferous kimberlite. One of the indicator minerals, regarded as particularly useful, is pyrope garnet. Other indicator minerals that have been explored and analysed in connection with the Greenland exploration are chrome diopside, chromite, (picro-) ilmenite, eclogitic garnet, clinopyroxene and olivine.

Diamond exploration 0,5 mm Diamond exploration in Greenland is on the rise again, and in 2003 two Canadian companies carried out renewed ex- ploration. Navigator Exploration Corp., which has an explo- ration licence 130 km north of Nuuk, not far from Maniitsoq, carried out follow-up work on an already known deposit of ultramafic breccia in 2003. Samples of this breccia are awaiting the result of an analytical programme. Earlier drill- ings at the site carried out in connection with nickel explora- tion confirmed that the breccia is also found at deeper levels. Laboratory studies and new drillings may elucidate 0,5 mm whether this is Greenland's first diatreme (pipe) of kimber- lite.

Analyses of indicator minerals from the area around Maniit- soq show that they originate from a kimberlitic source that had the right conditions for being diamondiferous.

Hudson Resources Inc. concentrated its field work around the search for sites in the Sarfartoq area south of Kanger- lussuaq where known kimberlitic deposits coincided with interesting geological structures and positive indicator mi- nerals. Results form the study showed that three of the samples contained a total of 20 microdiamonds.The com- pany also funded a study of the geothermal gradient of the subsurface.This showed that the conditions that existed at the formation of the diamonds were just as favourable as in Canada where there are two active diamond mines today.

8 Publicly funded diamond project Other mineral resources

In order to stimulate diamond exploration, BMP decided to Nickel exploration in Greenland has been commenced "close" selected key areas with a view to collecting specific numerous times since the Second World War.After a couple geological knowledge to include in the promotion aimed at of years' standstill, it now appears as though nickel - and the international mining industry. some of its characteristic related metals from the Platinum Group (PGM) as well as copper, cobalt, gold, etc. - are back During the summer of 2003, BMP and GEUS carried out a in the spotlight. field programme in West Greenland.The fieldwork consis- ted of collecting of 'bulk' samples and geophysical and geo- On Disko Island,Vismand Exploration Inc. is searching for a logical mapping of several diamondiferous kimberlitic rocks. so-called Norilsk type of nickel deposit. In 2003, the com- The 'bulk' sample is much larger than the samples normally pany carried out three geophysical "Titan 24" cross-sectional collected.Three large samples of a total weight of about 3 measurements in the licence area in the northern part of tonnes were removed. Disko Island.The object was to locate special nickel-en- riched deeper-lying lava channels that are connected to the After the fieldwork, several laboratory tests were made on basalt layers in the surface as previously described by GEUS. the collected 'bulk' samples, and the test for diamonds was For the first time, the application of the "Titan 24" system the most important.A total of 128 diamonds were found in offers an opportunity to assess the conditions down to just the three samples.All the diamonds were less than 1 mm, over 1 km below ground level. but they were of good quality and state of preservation. It should be pointed out that diamond finds, irrespective of Gem Fields International has an exploration licence in the their size, indicate that West Greenland's approx. 3.8 billion area that covers a so far unknown mineralisation in year-old subsurface once harboured conditions under which serpentinised magnesium-bearing ultramafic rocks with up it was possible for diamonds to form.Apart from the to 1 per cent nickel. Diamond Fields International has an diamond test, analyses were also made of the content of agreement for a possible 80 per cent participation in the indicator minerals and dating processes were commenced. project.The company has said that exploration in the area will continue in 2004. The results of the diamond test and the preliminary results of the field study were published in GEUS report no. The Skaergaard intrusion in East Greenland is still in focus 2004/19. with regard to palladium and other platinum metals (PGM). Skaergaard Minerals Corp. carried out field studies in 2003 As a part of the collection of kimberlite data from West and gathered previous information which, according to the Greenland, hyperspectral measurements were carried out company, point to resources of up to 1.8 billion tonnes of in an area south of Kangerlussuaq. In hyperspectral measu- exploitable PGM, gold, titanium and vanadium.The company rements, the spectral nature of certain minerals is used to is planning to carry out 6,000 m of new drillings in 2004 in map rocks.This is useful in kimberlite exploration where order to verify the amount of mineral resources. the method is used specifically to locate the minerals that form part of the groundmass of kimberlitic rocks.These The Seqi olivine project near is being investigated minerals are phlogopite, calcite, serpentine and talc. By using by Crew Development Corp. with a view to initiation of this technique with a digital terrain model, it is possible to exploitation in the near future. In 2003, the company made get a picture of where there is a possibility of finding a 22 drill holes which show that the volume and quality of kimberlitic rock in an area. the olivine deposit are better than previously assumed. With Swedish co-operation partner Minelco, a detailed test of the material's characteristics is being carried out on the basis of a 50-tonne bulk sample.The discovery of this de- posit may lead to a number of years of open-pit mining in the range of 1 million tonnes of olivine per year. Skærgaard Seqi Ice and water

BMP is the co-ordinating Conference on "Ice and Water" in Nuuk administrative authority The target group for the conference was central political decision makers, interest organisations, public authorities as On 1 July 2001, the Greenland Parliament Act on explo- well as Greenlandic and international industry. It turned iting ice and water for export entered into force.This out that there was great interest in the conference among Act targets all kinds of export of ice and water. public authorities as well as private enterprises.The main purpose of the conference was to support Greenland's 2003 was primarily concentrated on development tasks long-term goal of becoming the leading exporter of ice and such as the preparation of a coherent and flexible regu- water to the global market. latory structure and the procurement of a knowledge base for the preparation of a new strategy for the export The conference dealt with the following topics: of ice and water from Greenland.

1. Global water supply BMP is the co-ordinating authority in respect of the Exports of Ice and Water Act.The administration of this 2. Water resources, water quality and water treatment Act is carried out according to a one-door principle, technologies which is also seen in the Mineral Resources Act.The one-door principle entails that the applicant only has to 3. Current and future regulations and legislation regar- go to one authority. BMP will file for the required licen- ding exploitation of ice and water, including Green- ces and approvals from other authorities.The exploita- land's opportunities for earning an income and conditi- tion licence is a model licence, which is adapted to the ons for promotion specific project of the applicant.The licence includes all terms of relevant issues including provisions regarding 4. Readiness in Greenland, including conditions like infra- royalties - a production tax payable to the Greenland structure and access to resources; technical risks of exploitation; Greenland quality standards in relation to the export of ice and water

5. Market conditions for ice and water, including exam- ples for a promotion strategy for commercial exploita- tion and promotion of packaged drinking water

In 2004, BMP will prepare a white paper and a strategy re- garding the export of ice and water from Greenland on the basis of experience from the conference.The strategy will be presented by the Greenland government at the Parlia- ment's 2004 spring session. Material from the conference is available in Danish and Greenlandic on the website of the Greenland Home Rule: www.nanoq.gl/vand, where the white paper and the Green- land government's strategy will also be made available in 2004 in Danish and Greenlandic.

10 Home Rule.The licence is granted by the Greenland government for a maximum period of twenty years.The Act provides for a possible extension on terms speci- fied in individual negotiation.

The licence system corresponds to the one applicable for the mineral resources area.This is because there are similarities between exploitation of ice and water for exports and other activities exploiting non-living re- sources. Both require considerable venture capital and a high degree of professionalism in all aspects of the activities.As is true for mineral resources, it is necessary to attract investors that can contribute with capital, expertise and international distribution channels if ice and water is to be developed into a significant industry in the long term.

So far, the attraction of venture capital and expertise has not been sufficient for the development of the area into an independent industry in Greenlandic society. Such factors contributed to BMP hosting a conference in November 2003 in Nuuk on exports of Greenlandic ice and water.

Greenland Ice Cap Productions ApS

At the moment, one exploitation licence is active - granted in 2001 to the Greenland-owned company, Greenland Ice Cap Production ApS, which is recovering raw ice in South Greenland. Greenland Ice Cap Productions ApS is co-opera- ting with the Canadian distribution company, Premium Glacier Inc., which intends to distribute a vodka product based on Greenlandic ice on the international market. In 2003, Premium Glacier Inc. was granted a product approval by the American federal authorities for this product. Information -domestic and in

Local activities Ujarassiorit - the hunt for minerals

Throughout 2003, there was a general increase in the The annual national mineral hunt programme for public interest in finding rocks and having them identi- amateur geologists showed yet again that, despite geo- fied.This was reflected in the number of rock samples logists' intense exploration for minerals, it is still possi- submitted to the national programme for mineral hunt, ble to find new mineral locations in Greenland that may Ujarassiorit.At the same time, the Greenland Minerals lead to commercial exploitation. Club, Ujaqqeritooqatigiit, in Sisimiut is reporting an in- crease in membership. Of the total of 1,279 rock samples submitted to Ujaras- siorit - the highest number of samples submitted since In order to disseminate knowledge about rocks and dif- 1991 - two very interesting samples were found.These ferent types of mineralisation, the minerals club hosts two samples were awarded the 1st and 2nd prize by an annual prospector course where participants learn the Judging Committee, which comprised geologists about prospecting methods and rocks.The club also from BMP,GEUS and Greenland Resources A/S. hosts an annual rock trade show. In 2003, the seventh rock trade show was held in Sisimiut on 8-9 November. The 1st prize of DKK 55,000 went to Najannguaq Sara Both lapidists and soapstone carvers participated, and Adolfsen from for a rock sample with a BMP was present with an exhibit of rocks and minerals very high gold content of 109 g per tonne from Illorsu- from well-known deposits in Greenland as well as with atsiaat near Uunartoq. In comparison, the ore in the various geological publications. Nalunaq gold mine in South Greenland has an average content of approx. 20 g gold per tonne. In addition, the Mapping of soapstone deposits sample contains increased values of silver, bismuth, cop- per and tungsten. in Greenland The 2nd prize of DKK 35,000 went to Thor Eugenius In 2003, BMP carried out mapping of Greenland's soap- from for a rock sample with a very high silver stone deposits concurrently with the traditional mineral content of 227 g per tonne from Kangikitsoq. In addition hunt.About 50 soapstone samples were submitted from to the high silver content, the rock sample also had in- throughout Greenland, and the purpose of the mapping creased values of gold, bismuth, copper, tungsten as well was to obtain an overview of the quality of Greenland's as metals of rare earth types and radioactive elements. soapstone deposits.This was done on the basis of col- our, hardness, fractures and homogeneity in order to be Ujarassiorit is funded by BMP,and in 2003 the pro- able to give better advice as to appropriate exploitation gramme was co-ordinated by Greenland Resources A/S. of the soapstone. In addition to the total amount of tax-exempt prizes of DKK 75,000 from BMP,the BANK of Greenland's The winners of the soapstone competition were selected business fund doubled the 1st and 2nd prizes with a in co-operation with project manager Thue Christiansen total of DKK 55,000 for the third consecutive year. from the Department of Industry and the soapstone In addition, Greenland Resources A/S added a carver Karl Kristoffersen.The winner of the 1st prize further DKK 20,000 free of tax to the prize was Tom Sukuara from Nuuk who received a prize of amount. DKK 19,000.Two 2nd prizes of DKK 10,000 each were awarded to Jokum Jessen from and Søren Fre- deriksen from Nuuk, and three 3rd prizes of DKK 5,000 each were awarded to Jakob Skade from , Jokum Jessen from Napasoq and Per N. Hansen from . 12 ternational

International promotion Participation in trade shows and conferences

of mineral resources In 2003, BMP took part in the following promotion events and conferences: The overall objective of the promotion of the mineral potential in Greenland is to attract capital and tech- • Direct Marketing visit at oil companies in Europe nology, in both the short and long term, for a wide and North America on exploration opportunities spectrum of investments in mineral resource operations and licensing policy for hydrocarbons, 9-13 Decem- to promote and increase mineral resource activities in ber 2002 and 10-20 January 2003 Greenland. • British Columbia and Yukon Chamber of Mines: Attracting international venture capital for exploration Cordilleran Roundup,Vancouver, Canada, 27-30 and exploitation requires that the terms and geological January 2003 data offered are competitive in relation to the outside world. Information for the mineral resource industry is • Prospectors and Developers Association of Canada therefore a key concept. Promoting Greenland's mineral (PDAC): International Convention and Trade Show, potential to the industry is partly done through direct Toronto, Canada, 9-12 March 2003 visits to companies, partly through attending internatio- nal trade shows and conferences, and partly through • West Greenland exploration possibilities - a meet- printed and electronic media. ing for invited oil companies, BMP and GEUS, Copenhagen, 10 April 2003 In co-operation with GEUS, BMP publishes the MINEX and GHEXIS newsletters, aimed at the mineral and oil • American Association of Petroleum Geologists industries respectively.These are published two to (AAPG),Annual Meeting and Exhibition, three times each year.Two news platforms have also Salt Lake City, USA, 11-14 May 2003 been set up on the Internet at www.geus.dk/minex and www.geus.dk/ghexis. • 8th International Kimberlite Conference, Victoria, British Columbia, Canada, 22-27 June 2003 As part of the international promotion of Greenland's mineral potential, two new publications were launched • International Geochemical Exploration Symposium in 2002 - a magazine entitled "Geology & Ore" and the (IGES), North Atlantic Minerals Symposium data sheets "Fact Sheets". In 2003, a further two issues (NAMS) of "Geology & Ore" about the mining operations at the Dublin, Ireland, 29 August - 3 September 2003 Black Angel Mine and about the geophysical surveying of Greenland.Two new Fact Sheets were issued • American Association of Petroleum Geologists on topics like geochemical mineral exploration (AAPG), International Conference and Exhibition, and presentation of the mineral occurrences Barcelona, Spain, 21-24 September 2003 map of Greenland. As in previous years, Greenland participated in the trade shows together with GEUS and NUNAOIL A/S with a common exhibit booth. Selected publications

During 2002-2003, BMP published a number of publications with P.Kalvig, C. Knudsen & T.V.Rasmussen 2002: Potentialer for fa- its co-operation partners. Other publications of relevance for the cadesten og skærver i Grønland.Afrapportering af felt- og la- raw materials area in Greenland are available via the relevant web- boratorieundersøgelser 2001. 2002/11, 101 pages. sites for BMP and GEUS. J.D. Krebs, B.Thomassen & P.R.Dawes 2003: A Landsat study of Annual repoprts the region, North- West Greenland.With a sum- Bureau of Minerals and Petroleum, 2003: Annual Report 2002. mary of mineral occurrences and potential. 2003/92, 37 pa- Bureau of Minerals and Petroleum and the Joint Committee on ges. Mineral Resources in Greenland, Nuuk, 16 pages. L.M. Larsen,T.Dahl-Jensen & S.A.S. Pedersen 2002: Geologiske GEUS 2003: Annual Report 2002, GEUS - the Geological Sur- naturkatastrofer _ Fjeldskred i Grønland. Nyt fra GEUS vey of Denmark and Greenland, Copenhagen, 16 pages. 2002/3, 16 pages.

Geology and exploration C. Marcussen, N. Skaarup & J.A. Chalmers 2002: EFP Project P.Appel 2002: De ældste sten - det ældste liv.Temanummer af NuussuaqSeis 2000 – Final report: Structure and hydro- Geologi - Nyt fra GEUS 1/2002, 12 pages. carbon potential of the Nuussuaq Basin: acquisition and interpretation of high-resolution multichannel seismic P.W.U.Appel,A.A. Garde, M.S. Jørgensen, E. Moberg,T.M.Rasmus- data. 2002/33.63 pages. sen, F.Schjøth & A. Steenfelt 2003: Preliminary evaluation of the economic potential of the greenstone belts in the T.F.D. Nielsen 2002: Palaeogene intrusions and magmatic Nuuk region. General geologyand evaluation of compiled complexes in East Greenland, 66 to 75º N, GEUS Rapport geophysical, geochemical andore geological data. 2002/113, 249 pages. 2003/94, 147 pages. + DVD. H. Nøhr-Hansen 2003: Dinoflagellate cyst stratigraphy of the J.Audun Rasmussen, H. Nøhr-Hansen & E. Sheldon 2003: Palaeoe- Palaeogene strata from the Hellefisk-1, Ikermiut-1, Kan- cology and palaeoenvironments of the lower palaeogene gâmiut-1, Nukik-1, Nukik-2 and Qulleq-1 wells, offshore succession, offshore West Greenland, Marine and Petroleum West Greenland, Marine and Petroleum Geology 20 (9), page Geology 20 (9), page 1043–1073. 987–1016.

J.Audun Rasmussen and E. Sheldon 2003: Microfossil biostrati- Stefan Piasecki 2003: Neogene dinoflagellate cysts from Davis graphy of the Palaeogene succession in the Davis Strait, Strait, offshore West Greenland, Marine and Petroleum Geo- offshore West Greenland, Marine and Petroleum Geology 20 logy 20 (9), page 1075–1088. (9), page 1017–1030. T.C.R. Pulvertaft & J.G. Larsen 2002: Note on the sub-basalt F.Dalhoff, J.A. Chalmers, U. Gregersen, H. Nøhr-Hansen, J.Audun surface in the hinterland of the Nuussuaq Basin, central Rasmussen & E. Sheldon 2003: Mapping and facies analysis of West Greenland. Contribution to the SNF 2002 project Paleocene–Mid-Eocene seismic sequences, offshore sou- "Neogene uplift, erosion and redeposition in West Green- thern West Greenland, Marine and Petroleum Geology 20 (9), land". 2002/39, 15 pages. page 935–986. T.M.Rasmussen, L.Thorning & K. Secher 2003: Airborne geo- GEUS 2003: Well data summary sheets.Volume 35. Relea- physical data from Greenland, Geology and Ore No 3, 12 pages. sed wells West Greenland. 2nd revised edition [Rt2000/13]. 2003/65, 71 pages. T.V.Rasmussen 2003: Dimension stone prospecting in West, South and East Greenland 2002. 2003/8, 60 pages. J. Rose-Hansen & H. Sørensen 2002: Geology of the lujavrites from the Ilímaussaq alkaline complex, South Greenland, K. Secher, H. Stendal & L.Thorning. 2002: Grønlands mineralske with information from seven bore holes. MoG 40, 58 pages. råstoffer _ Nyt materiale til markedsføring; 2002/45, 63 pa- ges. A. K. Higgins, K. Secher & M. Sønderholm (red.) 2002: Review of Greenland activities 2001. GEUS Bulletin 191, 2002, 161 pages. E. Sheldon 2003: Palaeogene nannofossil biostratigraphy of the Kangâmiut-1 and Nukik-2 wells, offshore West Green- J.R. Ineson & F.Surlyk (red.) 2003: The Jurassic of Denmark land, Marine and Petroleum Geology 20 (9), page 1031–1041. and Greenland. New GEUS Bulletin 1, 948 pages. (28 articles). A. Steenfelt 2002: Exploration targets outlined by the geo- P.Japsen, J. Bonow, K.E. Klint & F.K.Jensen 2002: Neogene uplift, chemical Atlas of West and South Greenland, Explore New- erosion and resedimentation in West Greenland. Field re- sletter 116, page 1-3 & 17-19. port summer 2002. 2002/71, 58 pages. A. Steenfelt, P.R.Dawes, J.D. Krebs, E. Moberg & B.Tho- S.M. Jensen, M. Lind,T.M.Rasmussen, F.Schjøth & K. Secher 2003: massen 2002: Geochemical mapping of the re- Diamond exploration data from West Greenland. 2003/21, gion, 77°10´ to 78°10´ N, North-West Greenland. 2002/65, 50 pages + DVD. 29 pages. 14 H. Stendal & H.K. Schønwandt 2003: Precambrian supracrustal M. Bender, G. Felding & C.S. Jacobsen 2003: Water quality of the rocks and mineral occurrences, Northeast Disko Bugt.A Greenland icecap. 2003/22, 38 pages. review and new data. 2003/24, 57 pages. M. Bender, G. Felding & C.S. Jacobsen 2003: Drikkevands-kvali- H. Stendal & K. Secher 2002: Gold mineralisation and gold po- tet af grønlandsk indlandsis. 2003/26, 34 pages. tential in South Greenland, Geology and Ore No 1, 12 pages. K.G. Jensen 2003: Holocene hydrographic changes in Green- M. Sønderholm, H. Nøhr-Hansen, J.A. Bojesen-Koefoed, F.Dalhoff & land coastal waters. Reconstructing environmental change J.A. Rasmussen 2003: Regional correlation of Mesozoic– from sub-fossil and contemporary diatoms. (Thesis for Palaeogene sequences across the Greenland–Canada Ph.D.degree from the University of Copenhagen.) boundary. Final report EFP-2001 Project. ENS J.nr. 1313/01-0022. 2003/58, 160 pp. 2003/25, 184 pages +CD-ROM. C.[J.] Mayer 2003: Glaciological observations at the Qorlort- H. Sørensen (red.) 2003: Geologi i det sydlige Vestgrønland. orsuaq glacial lake, S-Greenland. Potential hazard and wa- Tunulliarfik området og Gardar-provinsen. Nyt fra GEUS ter ressource assessment. 2003/62, 12 pages. 2/2003, 24 pages. C.J. Mayer, C.E. Bøggild, O.B. Olesen & S. Podlech 2003: Ice stu- B.Thomassen 2003: The Black Angel lead-zinc mine at dies in relation to ice/water export, a data collection, mo- Maarmorilik in West Greenland, Geology and Ore No 2, 12 delling and evaluation approach. 2003/6, 33 pages. pages. Leaflets and data sheets B.Thomassen, J.D. Krebs & P.R.Dawes 2002: Qaanaaq 2001: Råstofdirektoratet og Grønlands Stenklub 2002: Gemstones from Mineral exploration in the Olrik Fjord _ Kap Alexander Greenland. Chalcedony. region, North-West Greenland. 2002/86, 72 pages. Råstofdirektoratet og Grønlands Stenklub 2002: Gemstones from B.Thomassen, L.Thorning, L.Aa. Christensen, M. Lind & T.Tukiainen Greenland. Ruby. 2002: GREENCORE: the database for the Bureau of Mine- rals and Petroleum’s Drill Core Library in Greenland –A Råstofdirektoratet og Grønlands Stenklub 2003: user manual. 2002/82, 37 pages. Gemstones from Greenland. Metallic iron.

T.Tukiainen,J.D. Krebs,V.Kuosmanen, J. Laitinen & U. Schäffer 2003: Ujarak 2003: Medlemsblad for Grønlands Stenklub, Nr. 1–2. Field and laboratory reflectance spectra of kimberlitic (in Danish). rocks, 0.35–2.5 µm,West Greenland. 2003/43, 25 pages. K. Secher 2002: Early mining in South Greenland, Fact Sheet T.Tukiainen,T.M.Rasmussen, K. Secher & A. Steenfelt 2003: No 2, 2 pages. Restored digital airborne radiometric data from surveys flown in 1975 and 1976 by GGU between 63° and 69°N, K. Secher 2002: Deposits of speciality metals in South West Greenland. 2003/37, 9 pages. Greenland, Fact Sheet No 3, 2 pages.

J.A.M. van Gool et al 2002: The Nagssugtoqidian Orogen of K. Secher 2003: Map of known mineral occurrences in West Greenland: tectonic evolution and regional correla- Greenland, Fact Sheet No 5, 2 pages. tions from a West Greenland perspective. Canadian Jour. Earth Sciences 39, page 665-686. A. Steenfelt 2003: Geochemical data as exploration tools in West and South Greenland, Fact Sheet No 4, 2 pages. Minex News 2002-2003: Newsletter to the Mining industry. Geological Survey of Denmark and Greenland / Bureau of Mine- H. Stendal & K. Secher 2002: Gold mineralisation and gold po- rals and Petroleum, Nr. 22–25. tential in South Greenland, Fact Sheet No 1, 2 pages.

Ghexis Newsletter 2002-2003: Newsletter to the Oil indu- GEUS 2003: Catalogue of Greenland publications and data. stry.. Geological Survey of Denmark and Greenland / Bureau of Update December 2003, 71 pages. Minerals and Petroleum, Nr. 20–23.

Ice and water A.P.Ahlstrøm 2003: Ice sheet ablation assessed by observa- tion, remote sensing and modelling. (Thesis for Ph.D. degree from the University of Copenhagen.) 2003/49.

M. Bender, G. Felding & C.S. Jacobsen 2003: Global forurening af den grønlandske indlandsis med miljøfremmede stoffer og tilstedeværelsen af levedygtige mikrobielle kim. 2003/64, 35 pages. Annual Report for Mineral Resources Activities in Greenland 2003 © Bureau of Minerals and Petroleum, June 2004.

Published by the Bureau of Minerals and Petroleum and the Joint Committee on Mineral Resources in Greenland

P.O.Box 930, DK-3900 Nuuk, Greenland Tel:+299 346800. Fax: +299 324302 www.bmp.gl; [email protected]

Published and edited by the Bureau of Minerals and Petroleum in co-operation with the Geological Survey of Denmark and Greenland Text and edition:K. Secher, GEUS Graphics: P.Warna-Moors, GEUS Printers: Schultz

This publication is published in Greenlandic, Danish and English ISSN 1399-2058

16 80° 70° 60° 50° 40° 30° 20° 10° 0°

Station Nord

Qaanaaq

Thule Air Base (Pituffik)

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Zackenberg Daneborg

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Upernavik Mestersvig

Nerlerit Inaat 70° Illoqqortoormiut Uummannaq Illoqqortoormiut Qeqertarsuaq

Aasiaat Ilulissat Aasiaat Qasigiannguit Ammassalik

Kangaatsiaq

Sisimiut Sisimiut Kangerlussuaq

65° Maniitsoq Maniitsoq Nuuk Tasiilaq

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Paamiut

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Ivittuut Town Narsaq 60° Qaqortoq Airstrip Municipal boundary Nanortalik Prins Christiansund Nanortalik 0 100 200 300 400 500 km

Topographic base: G/2.5M Vector © National Survey and Cadastre, Denmark / Geological Survey of Denmark and Greenland, 1997. UTM Zone 24, WGS84. ISSN: 1399-2058