Draft Social Impact Assessment for The Aappaluttoq Ruby Project, True North Gems Inc. (In accordance with the BMP Guidelines for Social Impact Assessment of November 2009)
v. 5.2
January 2014
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TABLE OF CONTENTS PAGE
1 INTRODUCTION 3
1.1 Background 3
1.2 Objectives and Scope 3
1.3 Acknowledgements 5
2 POLICY, LEGAL AND ADMINISTRATIVE FRAMEWORK 6
2.1 The political situation in Greenland 6
2.2 Legal Framework 6 2.2.1 National legislation 6 2.2.2 National guidelines 7 2.2.3 International Unions and Conventions 8
2.3 International Labour Organization Conventions 8
2.4 Taxes and revenues 8 2.4.1 Concession fees 8 2.4.2 Tax regulation 9
3 SIA METHODOLOGY 12
3.1 Baseline study 12
3.2 Data collection and research from primary sources 12 3.2.1 Strategic Impact Analysis 13
3.3 Impact Analysis Methodologies 13
4 PROJECT DESCRIPTION 15
4.1 Ruby and pink sapphires in Aappaluttoq 15
4.2 Study area 16
4.3 The Aappaluttoq Project 19 4.3.1 Infrastructure 19 4.3.2 Processing plant 20 4.3.3 Workshop 21 4.3.4 Roads 21 4.3.5 Environmental impacts 21
4.4 Project activities in Nuuk 22 4.4.1 Hydrofluoric Acid Cleaning 22 4.4.2 Sorting 23
4.5 Expected work force and working conditions 24
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4.5.1 Construction phase 24 4.5.2 Operation Phase 24 4.5.3 Camp facilities 26 4.5.4 Closure 28
4.6 Security 30 4.6.1 Sorthouse security 31 4.6.2 Security at Processing Plant 32 4.6.3 Security at the Cleaning Laboratory 32 4.6.4 Ruby Track™ System 33
4.7 TNG Gemstone Marketing 33
4.8 Certification and Branding 38 4.8.1 Certification of Greenlandic Origin 38
5 SOCIAL AND ECONOMIC BASELINE CONDITIONS 39
5.1 Overview 39
5.2 Demographic profile 39 5.2.1 Country profile 39 5.2.2 Languages spoken 40 5.2.3 Number of inhabitants 41 5.2.4 Migration 43
5.3 Social and political organisations 44 5.3.1 Political organization 44 5.3.2 Municipal administration 47 5.3.3 Civil society organisations 49 5.3.4 Labour Unions and NGO´s 50 5.3.5 Small scale mining and recreational stone collection 51 5.3.6 Employers’ organisations 51 5.3.7 Inuit Circumpolar Council 52
5.4 Values and traditions of importance in the Greenlandic society 53
5.5 Local use of natural resources 54 5.5.1 Hunting and fishing in Greenland 54 5.5.2 Hunting and fishing in the project area 55 5.5.3 Oil and mineral resources 56
5.6 Economic indicators 57 5.6.1 National economy 57 5.6.2 Cost of living 60 5.6.3 Income 61 5.6.4 Businesses 63 5.6.5 Employment 65 5.6.6 Unemployment 67 5.6.7 Income and corporate tax 69 5.6.8 Greenlandic businesses 69 5.6.9 Business development strategy 70
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5.6.10 Tourism and free time activities 71 5.6.11 Challenges for the Greenland society 71
5.7 Public Infrastructure and Services 71 5.7.1 Dwelling and accommodation 71 5.7.2 Communication 72 5.7.3 Transporting facilities and infrastructure 72 5.7.4 Energy production 73 5.7.5 Health services 74 5.7.6 Health services for expatriates 74 5.7.7 Infrastructure and services in Qeqertarsuatsiaat 75
5.8 Education and training 78 5.8.1 Educational levels 78 5.8.2 Education strategy (2005-2020) 79 5.8.3 Primary and secondary Schools 79 5.8.4 Vocational Training 80 5.8.5 Higher Education 82 5.8.6 Courses for unskilled and skilled labour 83 5.8.7 Selected Education Statistics 83
5.9 Public Health 85 5.9.1 Health status 85 5.9.2 Social health and vulnerable groups 87
6 PROJECT INTERACTIONS WITH THE COMMUNITY DURING EXPLORATION PHASE 92
6.1 Exploration activities 92
6.2 Community relations between 2005-2011 94
6.3 Conflicts identified 96
7 IMPACT ASSESSMENT 98
7.1 Methodology 98
7.2 Economic environment 99 7.2.1 Employment 99 7.2.2 Taxes and Revenues 102 7.2.3 Various Taxation Scenario’s dependent upon marketing success 106 7.2.4 Business life 112 7.2.5 Closure of mine 115 7.2.6 Conflict and synergies with other economic sectors 115 7.2.7 Changes in traditional production systems 119 7.2.8 Salary boost 120
7.3 Education and training 120
7.4 Public service and development plans 122 7.4.1 Existing infrastructure and services 122
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7.4.2 Pressure on development plans 125 7.4.3 Social and health services 125
7.5 Social aspects 126 7.5.1 Demography and population 126 7.5.2 Social conflicts 127 7.5.3 Vulnerable groups 129
7.6 Health 130 7.6.1 Occupational health and risk of accidents 130 7.6.2 Public health and quality of life 133 7.6.3 Environmental impact 134
7.7 Cultural and natural values 135 7.7.1 Sites of monumental or cultural importance 135 7.7.2 Access to natural areas 136
7.8 Summary impact matrix 138
8 DRAFT IMPACT AND BENEFIT PLAN 140
9 DRAFT MONITORING PLAN AND DRAFT EVALUATION PLAN 144
9.1 Draft monitoring plan 145
10 ANALYSIS OF ALTERNATIVES 150
10.1 Mine camp on site vs. housing of workers in Qeqertarsuatsiaat 150
10.2 Sorting house in Nuuk vs. sorting house in Qeqertarsuatsiaat 151
10.3 Polishing of rubies in Greenland vs. polishing in Asia 151
10.4 Project Vs No project 152
11 ACTIVITIES INVOLVING STAKEHOLDERS 154
11.1 Activities involving stakeholders 154
12 REFERENCES 157
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DEFINITIONS AND ABBREVIATIONS
Wording or abbreviation Explanation
ANFO AN/FO – Ammonium Nitrate / Fuel Oil
APP Local fishermen and hunters’ association
BMP Bureau of Minerals and Petroleum in Greenland Concentrate Is the result of processing to separate rough ruby and pink sapphire from the matrix. Concentrate may be “dirty” (including approximately 35% matrix still firmly attached to the crystals) or “clean”, having very little matrix attached DKK Danish Crowns
DCP Decommissioning and Closure Plan
EBA EBA Engineering Consultants
EIA Environmental Impact Assessment
FIFO Fly-In-Fly-Out basis
FSA The Primary Schools Final Examination
FSUA The Primary Schools Extended Final Examination
GA Employer’s Association of Greenland
GM Grontmij A/S
GMS Greenland Mining Services A/S HIV/AIDS Human Immunodeficiency Virus/ Acquired Immune Deficiency Syndrome HS Health and Safety
HR Human Resources
ICC Inuit Circumpolar Council
ICMM International Council on Mining & Metals
ILO International Labour Organization
Inuit Aboriginal/Local people of Greenland
IUCN International Union for Convention of Nature Matrix Refers to the rock in which the rough ruby and pink sapphire crystals are found MoB Man over Board
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MSDS Material Safety Data Sheet
OHS Occupational Health and Safety
PPE Personnel Protective Equipment
PWC PriceWaterhouse Coopers
QAPP Quality Assurance Project Plan Rough ruby and pink Are crystals in their natural state that look like red sapphire pebbles RAL Royal Arctic Line A/S
SIA Social Impact Assessment SIK Sulinermik Inuussutissarsiutteqartut Kattuffiat – Employee’s Union of Greenland SLiCA Survey of Living Conditions in the Arctic International Convention for the Safety of Life at SOLAS Sea STD Sexual Transmitted Disease
TB Tuberculosis
TNG True North Gems Inc.
TNGG True North Gems Greenland S/A
Ton Metric tonnes
ToR Terms of Reference UNESCO United Nations Educational, Scientific and Cultural Organization WPA Work Place Assessment
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1 INTRODUCTION
1.1 Background
This report is the Draft Social Impact Assessment (SIA) for the Aappaluttoq ruby mining project in Qeqertarsuatsiaat in Kommuneqarfik Sermersooq, West Greenland.
This Draft SIA has been produced by Grontmij A/S on behalf of True North Gems (TNG), according to the Guidelines for Social Impact Assessment for mining projects in Greenland, Bureau of Minerals and Petroleum, November 2009 (the Guidelines).
Figure 1-1 shows the SIA Process as required according to the Guidelines, indicating where in the overall process this report is located.
Figure 1-1 Location of the Draft SIA in the overall SIA Process
Scoping & ToR
BMP review and comments
Relevant material for submission, e.g.: Stakeholder Participation Strategy It is strongly recommended to Scoping report keep BMP updated and Background material consulted throughout the Minimum 1-2 hearing year(s) process DRAFT SIA submitted Formal BMP review and hearing
IBA negotiations Revised FINAL SIA submitted This report between BMP,
participation municipality and licensee BMP review and approval
Impact Benefit Agreement (IBA) signed
Implementation, monitoring and evaluation of Impact Benefit Agreement through: Stakeholder Benefit and Impact Plan Monitoring Plan Evaluation Plan
* Background material includes relevant studies, reports, memos etc.
Source: Guidelines for Social Impact Assessments for mining projects in Greenland, Bureau of Minerals and Petroleum, November 2009
The SIA process started in July 2009 with the elaboration of a Scoping document. Scoping consultations with stakeholders and field work in Nuuk and Qeqertarsuatsiaat were performed in February 2011, followed by additional consultations by phone and mail during March 2011. The feedback received during the public hearing, expected to take place in the spring of 2013, will be incorporated into the final version of this document.
1.2 Objectives and Scope
According to the Guidelines, the objectives of the SIA process are:
To engage all relevant stakeholders in consultations and public hearings To provide a detailed description and analysis of the social pre-project baseline situation as a basis for development planning, mitigation and future monitoring
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To provide an assessment based on collected baseline data to identify both positive and negative social impacts at both the local and national level To optimize positive impacts and mitigate negative impacts from the activities throughout the project lifetime To develop a Benefit and Impact Plan for implementation of the Impact Benefit agreement.
The study covers the area directly impacted by the mining operations and ancillary facilities. Towns and settlements with expected impacts and benefits of employment, business opportunities and developments directly and indirectly created by the project are also included in the study area.
The primary area of influence will be Nuuk, Qeqertarsuatsiaat and the surrounding areas.
The secondary area of influence will be Kommuneqarfik Sermersooq in general, including Paamiut and other towns where workers may come from and where there are small scale mining, jewellery production or tourism activities that can potentially benefit or be affected by the project. Furthermore, areas from which local entrepreneurs are expected to come including Nuuk and Qaqortoq.
The SIA covers the following stages in the project:
The construction stage The operational stage Closure.
This draft SIA document is organised in the following sections:
1. Introduction
2. Policy, legal and administrative framework
3. Project description
4. Methodologies
5. Description of the social baseline conditions
6. Project interactions with the community during exploration phase
7. Potential impacts
8. Analysis of alternatives
9. Benefit and Impact Plan
10. Monitoring and Evaluation Plan
11. Public participation activities.
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1.3 Acknowledgements
The authors would like to thank all the people who have collaborated in the SIA process by responding to the questions and providing information and their views.
We are particularly thankful to the community of Qeqertarsuatsiaat, the members and board of the Mineralogical Society of Greenland and the August 16th Union, who openly responded to all our questions and requests.
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2 POLICY, LEGAL AND ADMINISTRATIVE FRAMEWORK
2.1 The political situation in Greenland
Greenland is part of The Kingdom of Denmark, and has had status of home-rule since 1979. On June 21, 2009, the new Act on Greenland Self-Government was introduced following a referendum in November 2008.The country’s status changed to “self government”, although it still remains part of the Kingdom of Denmark. Greenlandic is now the only official language in Greenland. Under the Government of Greenland, Greenland will eventually become a subject under international law in matters that are within its jurisdiction. Greenland can then enter into agreements and establish bilateral and multilateral relationships with other states.
Greenland is a member of the Nordic Council and Nordic Council of Ministers. This membership with other Nordic countries and autonomous regions facilitates parliamentary cooperation among the members, particularly in relation to nature and environmental issues. The current Environmental Action Plan, 2009-2012 focuses on climate change, the use and discharge of hazardous chemicals, protection of marine ecosystems and protection and utilization of biological diversity.
In addition to the Nordic Council, Greenland also participates actively with status as an observer in the Arctic Council where the respective ministries meet on a regular basis in order to promote and strengthen cooperation, coordination and interaction within the Arctic community.
2.2 Legal Framework
This section lists and describes the regulations and guidelines relevant for the project, particularly for the issues and areas of interest for the Social Impact Assessment.
2.2.1 National legislation
Title Summary & Relevance Year The Mineral Resources Law, act This Greenland Parliament Act aims to ensure 2010 no. 7 appropriate exploitation of mineral resources, use of the subsoil, regulation of matters of importance to mineral resource activities and subsoil activities. Furthermore it aims to ensure that activities under the Act are performed in a sound manner as regards safety, health, the environment, resource exploitation and social sustainability, and appropriately and according to acknowledged best international practices under similar conditions. Act no. 7 was created on December 7, 2009 and came into force on January 1, 2010. The Greenland Working The Greenland Working Environment Act aims to 2005 Environment Act no. 1048 of ensure a safe and healthy working environment which October 26, 2005 shall at any time be in accordance with the technical and social development of the Greenland society, and the basis on which the enterprises themselves will be able to solve questions relating to safety and health under the guidance of the employers' and workers' organisations, and under the guidance and supervision of the Working Environment Authority.
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Danish regulation no. 150 Immigration 2001 Safety on Sea, Act no. 882 The International Convention on Safety at Sea 2008 (SOLAS, 1974), the international convention for the prevention of pollution from ships, 1973 and the modified protocol (MARPOL), 1978 are implemented in the Greenland legislation. Article 24 of the Mineral The article gives rules and guidelines regarding 1999 Resources Act: Rules for field activities with mineral resources in Greenland and work and reporting regarding reporting of the activities and results to the BMP. mineral resources Greenland Conservation Act The Greenland Conservation Act serves to protect the 2007 nature of Greenland and the ancient relics, finds, monuments and buildings.
Orders on Health and Safety relevant to the project
Title Year
Order no. 32 of 23 January 2006, Rest periods and off-time in Greenland 2006 Order no. 395 of 24 June 1986, Order on the Performance of work 1986 Order no. 398 of 24 June 1986, Technical equipment 1986 Order no. 399 of 24 June 1986, Arrangement of workplaces 1986 Order no. 1168 of October 2007, Work Place Assessment in Greenland 2007 Order no. 1346 of 15 December 2005, Order on the Occupational Health and Safety 2005 Work in Greenland Order no. 396 of 24 June 1986, Work with substances and materials (chemicals) 1986 Order no. 1348 of 15 December 2005, Order on the Arrangement of Construction Sites 2005 and similar Work Places in Greenland Order no. 1344 of 15 December 2005, Order on the Construction Owner’s obligations 2005 and responsibility
2.2.2 National guidelines
Title Summary & Relevance Year Guidelines for Social Impact Guidelines prepared to assist mining companies and Nov Assessments for mining projects their consultants in preparing Social Impact 2009 in Greenland Assessments (SIA), describe the role of the BMP, the SIA process and content of the SIA document. BMP Guidelines for preparing Guidelines for EIA that apply to mining companies. Jan and Environmental Impact The report must cover the entire exploitation period 2011 Assessment (EIA) Report for from mine development prior to mine start until Mineral Exploitation in closure and subsequent monitoring period. The Greenland guidelines include requirements on baseline and project specific environmental studies 2-3 years in advance of EIA report preparation. Standard Terms for prospecting Serves under the Mineral Resources Law. Guidelines 2010 Licences for Minerals (excluding from BMP describing application for prospecting hydrocarbons) in Greenland licences, rights and rules for prospecting of minerals in Greenland. Standard Terms for Exploration Serves under the Mineral Resources Law. Guidelines 2010 Licences for Minerals (excluding from BMP describing application for exploration hydrocarbons) in Greenland licences, rights and rules for exploration of minerals in Greenland.
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Standard Terms for Small Scale Guidelines for the application of a licence to perform 2009 Exploration, BMP small scale exploration and rules regarding this licence
2.2.3 International Unions and Conventions
Title Summary & Relevance Year United Nations Framework The convention aims at protecting, preventing and 1997 Convention on Climate Change reducing global warming by reducing the emissions of greenhouse gases. The convention enforces the Kyoto protocol, which came into force in 2005. The Kyoto protocol is a legally binding agreement to reduce greenhouse gas emissions.
2.3 International Labour Organization Conventions
The relevant conventions are implemented in the Greenlandic laws and orders.
2.4 Taxes and revenues
This section describes the legal framework and regulations on taxes and revenues applicable to the project. The impact analysis regarding taxes and revenues to be generated by the project is based on the legal framework described in this section. The information is based on the Act on Minerals and Resources (Inatsisartut law no. 7, dated December 7, 2009), which came into force on January 1, 2010, and the Tax Law, including available information regarding the latest amendments to income tax from November 9, 2010. The section is divided into concession fees and tax regulations.
2.4.1 Concession fees
According to articles 16 and 17 in the Act on Minerals and Resources, the license holder has to pay a concession fee, which can be an area fee, a production fee or a yield fee, or a combination of the fees. Amounts to be paid are regulated in the Standard Terms.
In the preparatory work with the Act in the Self Government Parliament, the Government informed that the Government Take-model will be used in the bidding rounds in 2010, 2012, 2013.
Referring to § 4 in the Act on Minerals and Resources, the BMP has to submit an annual report to the Government of Greenland. The report from February 2011 states that the Government of Greenland will regulate the processing and sale of rubies and sapphires, in order to ensure a correct market price as the basis for taxes and fees. The same report cites a benchmark analysis carried out by PricewaterhouseCoopers (PWC) in late 2008 of the economic conditions for mining activities. The survey included Greenland, Argentina, Sweden, Norway, Australia, South Africa, Chile, Canada (Ontario), Canada (Newfoundland), Russia, Ghana and Japan. (Source: BMP Annual Report, February 2011, page 46)
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According to the above-mentioned analysis, Greenland collects royalties of 37%, even though mining activities in Greenland are significantly smaller than in a number of countries that Greenland is supposed to compete with. Sweden and South Africa, which are well developed mining countries, charge 28% and 33% respectively. Chile, as one of the largest South American mining countries, charges 37%.
Japan, Canada, Argentina and Russia all charge approximately 50%, which is judged as being the highest possible level of charges for minerals. Above this level a country loses its competitiveness.
The report from PWC (2008) concludes that as the aim for the Self Government is to develop the mineral sector as a key growth sector, it is too early to introduce a general turnover based royalty on top of the existing dividend and corporate taxes, as this may have a negative influence on investment and hence on job creation and future tax income.
2.4.2 Tax regulation
This section contains an account of mining related corporate tax regulations in Greenland, as well as an income tax estimate related to employees. The different types of taxes that will be relevant to a limited company domiciled in Greenland are listed below and are supplied by Deloitte and Naalakkersuisut.
Corporate Taxation
Capital contribution There is no capital contribution tax.
Dividend tax Greenlandic companies are to withhold a dividend tax corresponding to the personal tax in the municipality of registration. For companies with permits under the Mineral Resources Act, the present dividend tax rate is 37%.
Tax losses Companies with exploration or utilization permits under the Mineral Resources Act are entitled to carry forward tax losses without timing limitations.
Corporate tax In general the corporate tax is levied at a flat rate of 31.8% and the rate applies to a resident company as well as a registered branch office of a foreign company. The taxable income is determined on the basis of the profit shown in the statutory annual report, adjusted to comply with the prevailing tax provisions. Corporate tax for companies with a license under the Mineral Act is 30%.
Tax depreciation and amortization can be allocated as follows: Buildings and related installations are depreciable in a straight line by a maximum 5% per year. Aircrafts and vessels by maximum 10% per year. All other items like machinery, equipment etc. by max 30% All assets costing less than DKK 100,000 are depreciable / amortizable in the year of acquisition.
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Profit amortization If the taxpayer has calculated a tax profit, it is possible to make further tax amortization of 50% of the profit. The amortization may freely be deducted from the balance in one of the said three amortization/depreciations groups, however, provided that the remaining balance of the group remains positive or DKK zero.
Companies with utilization under the Mineral Resources Act may, when computing their taxable income, deduct any change in the provisions made to ensure that a closing-down plan can be carried out in a financially viable way.
Licence amortization An amendment to the income tax law passed by the Parliament of Greenland in November 2010, and effective from January 1, 2011 changed the amortization of licenses.
For mineral licenses the amortization is now “pegged” and fixed at the same amount over a period of 4 years.
Transfer prices The tax law now includes specific provisions on documentation of trade between related companies. Agreements between related companies/parties must be documented, including written documentation as to how prices and term are determined for the intercompany transactions.
Thin capitalization rules The tax rules include specific rules on thin capitalization. Basically it is important to note that lending between related companies/parties is to observe the arm’s length principle.1
Personnel taxation
The Greenland income tax system is composed of three tax percentages:
A state tax of 11%, which has to be paid by all taxpayers. A common municipal tax of 6%, which has to be paid by all citizens in municipal areas, and which is redistributed between the rich and poor municipalities. A municipal tax between 25 and 28% (2011) decided by the municipality council
An amendment to income tax laws in November 2010 introduced a 35% flat rate tax for foreigners working in the mineral resource industry outside towns and settlements on salary originating from their income in Greenland. Only individuals who have not been liable to pay tax in a Greenland municipality during the past six months will be covered by the flat tax scheme.
1 The arm's length principle (ALP) is the condition or the fact that the parties to a transaction are independent and on an equal footing. Such a transaction is known as an "arm's-length transaction". It is used specifically in contract law to arrange an equitable agreement that will stand up to legal scrutiny, even though the parties may have shared interests or are too closely related to be seen as completely independent.
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There are double tax agreements between Greenland, Denmark, Iceland, Norway and the Faroe Islands. Otherwise the income tax system is structured according to the Danish model with taxation at the source (Flat rate tax for Researchers and Key Employees recruited abroad).
The income tax rate for 2013 is 41 % for Kommuneqarfik Sermersooq, and 37% for areas outside municipal classification. Personal allowance for 2013 is DKK 58.000.
Offered Advance Tax Royalty
TNG has offered to pay an advance tax royalty to Greenland in an amount equal to 5% of the sales of ruby and pink sapphire. This tax is not required by the taxation rules of Greenland, but has been offered by TNG to demonstrate TNG’s commitment to sustainable mining in Greenland, with the understanding that the money paid by TNG will be used by Greenland in part to train and educate Greenlanders so they may participate in the mining industry.
The advance tax will be paid quarterly based on sales during the three month period. If ruby or pink sapphire is polished before sale, the cost of polishing will be deducted before the tax is calculated.
The advance tax will be credited against corporate income tax payable in the future so that the total tax paid by TNG remains the same, as required by Greenland tax law.
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3 SIA METHODOLOGY
3.1 Baseline study
The baseline study provides information on demographic and economic conditions and trends, political structures, local organisations, cultural traits, and other factors that can influence the way in which affected communities will respond to anticipated changes brought about by the project. The baseline also helps to predict in which way the project will be affected by these factors. The development of the baseline and the identification of the impacts are an interrelated and parallel process.
For the Aappaluttoq project, the baseline encompasses information at National level, at Municipal level for Kommuneqarfik Sermersooq and local level for Qeqertarsuatsiaat. When relevant and possible, baseline information from Paamiut was included as some of the workers are expected to be recruited there.
The baseline study is based on review of secondary resources and information obtained through interviews with key informants and stakeholders, qualitative participatory methods and quantitative methods.
After having identified potentially critical social issues, detailed interviews and/or short studies involving specific project affected groups (focus groups) were carried out.
3.2 Data collection and research from primary sources
The data collection and research from primary sources has included qualitative and quantitative methods with the purpose to collect information for the baseline as well as inputs for impact analysis. Key stakeholders in Nuuk and Qeqertarsuatsiaat were also interviewed in relation to mitigation measures.
Qualitative methods have to do with peoples’ perceptions, how they view themselves and the world around them.
For large groups, group meetings and group interviews were used. Focus group meetings and group interviews have been carried out for smaller groups, which represent a large group. Focus group discussions were used to provide information on key issues from stakeholder representatives. For these focus group discussions, interview guides and participatory techniques were used for the collection of information, opinions and perceptions.
Individual interviews with knowledgeable key informants were applied to collect information and get a better understanding of complex issues and past events.
The study “SLiCA2-Qeqertarsuatsiaat for Grontmij Carl Bro A/S, 2011”, was performed specially for the SIA of the Aappaluttoq project in February-March 2011. The study is based on the interviews conducted during the SLiCA study between November 2004 and April 2005, which involved 53 inhabitants of Qeqertarsuatsiaat older than 15 years. The study is very relevant, as it took place before the interactions between TNG and the community.
2 SLiCA is an acronym for Survey of Living Conditions in the Arctic
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The sample is significant as the population older than 15 years in Qeqertarsuatsiaat at that time was 195 inhabitants. The study “SLiCA-Qeqertarsuatsiaat for Grontmij Carl Bro A/S, 2011” provides descriptive information for the baseline and forms a base for the interpretation of impacts related to the following aspects or living conditions areas:
Social network Use and significance of the Greenlandic language Use of traditional food Health Housing and living standards Commitment with the community Social problems Security, safety and environment in the local community.
3.2.1 Strategic Impact Analysis
The following potential synergies and conflicts with other projects in the area have been examined: competition for human resources, competition for use of existing services, access to natural resources and business opportunities.
Synergies and conflicts with other mining projects in Greenland, particularly in terms of education and development of human resources have also been included in the analysis.
3.3 Impact Analysis Methodologies
The positive and negative impacts of the project activities on valued socio-economic components, both during the construction and operation phases, have been predicted and their magnitude quantified as far as possible by use of an Impact Matrix. The significance of the impacts identified has been evaluated according to the following significance factors:
Certainty of impacts: level of certainty & likelihood of occurrence, Extent of the impacts: geographical range of the impacts, regional “winners” and “losers”. Duration and frequency of impacts: temporary occurrence of the impacts (short lasting or permanent), wide fluctuations that could disrupt the community over time (boom-and bust periods) Period of Manifestation: the impacts could be noticed immediately or over time by the community
The public concern will also be considered when assessing the significance of the impacts.
For the Aappaluttoq project, the impacts have been assessed at two different levels: potential local impacts in Qeqertarsuatsiaat and impacts at regional and national level (Nuuk, Kommuneqarfik Sermersooq and at national level).
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The SIA has also identified mitigation measures for all impacts likely to occur, adverse in nature and significant enough to require mitigation (medium and high-level (negative) impacts) in order to mitigate or eliminate such impacts.
Impacts are summarised in a table with colours indicating their magnitude and significance before and after applying mitigation measures.
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4 PROJECT DESCRIPTION
This chapter is based on the information available about the Aappaluttoq Ruby Project, sourced from a project brief, which was produced in February 2011 as well as the Feasibility Study on the Aappaluttoq Ruby Project published in June 2011. The brief was distributed among the stakeholders in both Danish and Greenlandic and made publicly available during the scoping workshops and to the general public in three languages through the True North Gems home page (www.truenorthgems.com) in February 2011. The Feasibility Study was made publicly available (in English only) on the True North Gems home page (http://truenorthgems.com/upload/pdfs/True_North_Gems_2011_PFS_Report_2.pdf).
4.1 Ruby and pink sapphires in Aappaluttoq
The Aappaluttoq ruby and pink sapphires are embedded in metamorphic rock that was formed during the geologic processes that created Greenland millions of years ago. Ruby and pink sapphires are family members of the mineral corundum. A very small amount of chromium in the mineral corundum produces a pink colour: pink sapphire. A slight increase in chromium creates the red corundum known as ruby. The pink colour graduates to red, but there is no standard division between pink sapphire and ruby. The other family members of the corundum family are known as sapphires, which occur in every other colour of the rainbow. Rubies and pink sapphires were first identified in Greenland in 1966.
Individually, ruby-bearing zones can measure up to 20 metres in thickness and up to 200 metres in length. They may occur as single showings, but are usually found in alignments of multiple showings, with some of the occurrences forming a trend referred to as “The Ruby Island Line” which is several kilometres in strike length, and as much as 100 metres in width. The project area, the Aappaluttoq Ruby Project, represents one occurrence along the Ruby Island Line. Ruby Island, located at sea level, was the first confirmed ruby occurrence in the Fiskenæsset district and was discovered in 1966 by GEUS, the Danish Geological Survey.
The Aappaluttoq Ruby and Pink Sapphire project proposed by True North Gems Inc. (TNG) is located in the area 30 km southeast of Qeqertarsuatsiaat in West Greenland.
TNG is proposing to build a small open pit mine with a minimum of infrastructure starting in 2013 and to expand the infrastructure and production as the market for Greenland ruby and pink sapphire is developed. The project is expected to cost approximately DKK 215 million ($38 million) to construct, and approximately DKK 62 million ($11 million) per year to operate.
At peak production, which should be achieved by the third year of operation, 20,000 tonnes of corundum-bearing ore will be processed annually. According to the mine plan in the Feasibility Study, 20,000 tonnes of ore will result in approximately 7 tonnes of raw corundum annually. Of this 7 tonnes of corundum, approximately 35% will be either gem or near-gem, with the balance being non-gem material for which no market has yet been located.
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Even considering only the gem and near-gem material, the vast majority of the corundum will not result in polished gemstones. Studies that have done bulk samples estimate that the retention (the amount left after polishing) will be approximately 9% with the balance (over 90%) being waste material that is either clipped or ground off, is the result of breakage, or is unpolishable for various other reasons. As a result, 7 tonnes of raw corundum is therefore expected to result in approximately 220 kg of polished gemstones annually, with only a small fraction of this 220 kg expected to be top-grade gemstone. Independent valuations place an average of $115/g ($23/ct) on the ruby and pink sapphire polished from bulk samples.
The cost of polishing ranges from $0.20 to several dollars per piece polished. Rather than polish all pieces before sale, TNG’s marketing strategy is to polish some ruby and pink sapphire before sale to strategic customers to create demand and awareness, and sell the majority of production as rough ruby and pink sapphire once rough prices have increased sufficiently to be equivalent, on a net, risk-adjusted basis, to polished prices. In this way, TNG can take advantage of substantial existing marketing chains and reduce polishing, marketing and overhead costs, and manage risk more effectively. This strategy will be adapted as market conditions change so that profitability (and tax payable to Greenland) will be maximized. Refer to section 4.7 Marketing for more information.
At the present time there isn’t any commercially viable market for the non-gem. The sorting between gem, near-gem and non-gem will take place in Nuuk. The non-gem identified will be stored in secured containers in Nuuk until a market is identified.
The project in Aappaluttoq will contribute to the Greenlandic economy through employment and through the payment of corporate tax by TNG’s Greenlandic Company, TNGG. A central computerized tracking system will contain all relevant information about the rubies mined and sold. All information will be accessible for audits by the Greenlandic authorities.
4.2 Study area
The primary areas that will be affected by the Aappaluttoq project are Nuuk, Qeqertarsuatsiaat and surrounding areas.
The Aappaluttoq project area is located within Kommuneqarfik Sermersooq, one of the four municipalities shown in the map below. The towns of Nuuk and Paamiut, from where some of the workforce is expected to come from can also be seen on the map.
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Figure 4-1 Map showing Greenland with an overview of municipalities and main towns. Note the national park in North east Greenland (NunaGIS, Oqaasileriffik ©, KMS ©).
Figure 4-2 Map showing Nuuk, Qeqertarsuatsiaat and Paamiut (NunaGIS, Oqaasileriffik ©, KMS ©).
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The closest community to the project area is Qeqertarsuatsiaat, which is located 30 km from the mining site. Qeqertarsuatsiaat is located south of Nuuk and is only reachable by boat or helicopter. Depending on the boat, the average sailing time is 4- 5 hours from Nuuk or Paamiut in good weather conditions. Below is a map showing the project area in relation to Qeqertarsuatsiaat.
Project area
Figure 4-3 Map over Qeqertarsuatsiaat and the project area
The Aappaluttoq project is located within the Tasiusarsuaq fjord close to the Tasiusaa bay area as shown in the map below.
Project area
Figure 4-4 Map over Tasiusarsuaq and Tasiusaa, the red dot is the mine pit area
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4.3 The Aappaluttoq Project
The Aappaluttoq Project will consist of mining operations and processing of ruby ore to ruby concentrate at the site in Aappaluttoq. The project will also include processing, sorting and cleaning of ruby concentrate to rough classified ruby and pink sapphire in Nuuk. The process of extracting the ruby concentrate from the rock to shipping it to Nuuk is shown in Figure 4-5.
Figure 4-5. Mining and processing of ruby and pink sapphires in Aappaluttoq.
4.3.1 Infrastructure
The mine will consist of: An open pit from which the ruby bearing rock will be extracted A processing plant at which the ruby and pink sapphire will be separated from the matrix Infrastructure, such as a camp, maintenance shop, explosive storage, roads, barge landings, and power plants.
Two barge landings will be built: An outer landing that will accommodate large ships An inner landing close to the camp that will only be accessible by small crafts.
Supplies and equipment will be delivered from Nuuk either to Qeqertarsuatsiaat or to the outer landing before being transferred to a small boat for delivery to the inner landing. Road construction will be kept to a minimum. Roads will initially only run from the inner landing to the camp, connecting the camp, the processing plant and the mine pit. At a later stage of development, a road may be built to connect the inner and outer landings.
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Figure 4-6 Map showing the mining site (camp area) and the infrastructure related to the project
Personnel will generally travel from Nuuk and Qeqertarsuatsiaat by boat. Some personnel and supplies will be transported to and from Nuuk by helicopter.
The initial mine pit will grow to be approximately 200 meters long by 150 meters wide and 70 meters deep. Mining will be done mostly with low-intensity blasting techniques that are common in the diamond mining industry. Most of this rock will not contain ruby or pink sapphire but will be waste rock that has to be moved to access the rock containing the ruby and pink sapphire. The level of the lake adjacent to the mine will be lowered at least 10 meters to allow access to the ore body.
4.3.2 Processing plant
The processing plant will consist of a steel hall with the approximate dimensions: width: 33 m, length: 78 m, height: 14 m. The final dimension of the hall has not been established, as the design of the processing plant is ongoing. The building will likely be built of steel truss construction with pre-insulated mineral wool sandwich panels and an insulated reinforced concrete floor painted to facilitate cleaning. An office for the production manager will be installed as well as changing rooms, toilets, lunchroom, and security area for controlling access.
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4.3.3 Workshop
The workshop will be a steel hall with the approximate dimensions: width: 18 m, length: 25 m, height: 7 m. The building will likely be built of steel truss construction with pre-insulated mineral wool sandwich panels and an insulated reinforced concrete floor painted to facilitate cleaning. The workshop area is 12x25 meters, the last 6x25 meter will be arranged in 2 levels, with toilet, foreman's office, lunch room, warehouse, depot for storage of lubricating oils, etc.
4.3.4 Roads
From the camp there will be an access road to the inner port of approximately 450 m. From the camp there will be an access road to the mine pit of approximately 3,150 m. From the mine pit to the process plant there will be an access road of approximately 450 m. From the explosive storage to the access road between camp and mine pit, there will be an access road on 500 m. If built at a later date, from the inner port there will be an access road to the outer port of approximately 4,100 m.
The access roads will be made by a roadbed of 6 meters in width and laid out roadway of 4.5 meters in width. The coating will consist of gravel 0-32 mm. There will be excavated a drainage ditch on the side facing the mountains and on both sides of the road which cut through a ridge. There will be placed underflow pipes as appropriate. All underflow will be marked with iron pipes on both sides of the road. The max speed is 40 km/h for cars and 30 km/h for vehicles over 3500 kg gross weight. In places where there is risk of driving off the road there will be made a pile at ¾ in height of the biggest tires. There will be lay-bys as needed with a maximum distance of 500 meters.
4.3.5 Environmental impacts
To minimize the environmental impact, waste rock will be placed in a lake adjacent to the mine. The lake does not have a local name but was dubbed Lake Katrina during field exploration. The local community in Qeqertarsuatsiaat later proposed the name Ukkaata Qaava (the lake behind the crest). TNG’s environmental consultants, Rambøll, have investigated Ukkaata Qaava and the lake has neither fish nor other larger aquatic life (Rambøll, 2007, 2008 and 2009). When mining is finished the lake will be allowed to re-fill to its natural level and the pit will be allowed to fill with water as an extension of the lake. Buildings and process facilities will be removed and little evidence of mining will remain.
A processing plant will be set up near the mine site to crush, wash, screen and concentrate the ruby and pink sapphire material. The processing plant will likely utilize a process called dense media separation (DMS) to separate the corundum (which has a relatively high density) from the other material (which has lower density). The DMS process is able to separate materials by density using ferrosilicon mixed with water to produce a liquid with the desired properties. DMS plants using ferrosilicon are very common in diamond and coal processing and have been used in Greenland in diamond exploration.
Water flowing from the mining and processing area will be monitored closely and treated if necessary. Priority will be given to environmental protection in the design of facilities such as containment systems around fuel storage areas.
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The concentrate produced by the processing plant at Aappaluttoq will consist of corundum with approximately 35% matrix (valueless material attached to the ruby and pink sapphire). The concentrate will be transported to TNG’s secure facility in Nuuk in locked containers.
4.4 Project activities in Nuuk
4.4.1 Hydrofluoric Acid Cleaning
The dirty rough concentrate will be shipped from Aappaluttoq to the sorting facility in Nuuk. After preliminary sorting, the concentrate will be sent to a facility in Nuuk for cleaning with hydrofluoric acid whereby the remaining matrix will be removed. TNG has not yet determined whether it will build a new cleaning facility or utilize existing companies and facilities that provide services for the mining industry. Initially TNG is planning to use the laboratory at NunaMinerals, operated by Actlab.
Regardless of whether the cleaning is done by TNG or by an independent company, the process is the same:
1. The corundum to be cleaned is divided into appropriate sized batches and placed in acid-proof containers. 2. HF acid is introduced to the containers, the containers are closed (not sealed), and the containers are agitated for a period of time. 3. The HF acid, after having dissolved the silicate, is drained. The cleaned corundum concentrate is rinsed thoroughly with water, and is then safe to handle. 4. Both the rinse water and the products of the dissolution (remaining HF liquid and dissolved solids) are neutralized with an inexpensive and benign alkaline material such as hydrated lime (Ca(OH)2).
The neutralizing of the HF acid cleaning liquids in step 4 creates a slurry consisting of two parts: (1) a solid precipitate (sludge) which is inert and can be filtered out, dried and disposed of in an ordinary municipal landfill; and (2) a liquid solution consisting of varying concentrations of benign salts. This solution can be diluted and generally disposed of in the municipal sewage treatment system.
Until the environmental safety of disposing of the solids and the solution is demonstrated, it is intended that the resulting products of HF cleaning will be shipped out of Greenland for disposal. Contacts to Kommunekemi A/S in Denmark have been established in order to have this procedure formalized.
A more detailed description of the HF-cleaning process can be found in the document Appendix 3 – HF Cleaning of Corundum Concentrate, which is an appendix to the EIA.
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4.4.2 Sorting
After HF cleaning the clean rough concentrate will then be delivered back to TNG’s sorting facility in Nuuk. The location of the sorting facility has not yet been finally determined, but will likely initially be a rented space at NunaMinerals. The NunaMinerals building has a basement on 162 m2, where the sorting facility can be located and a safety box can be installed. On the ground floor there are also 162 m2 that can be setup for office facilities. To enter both floors, security measures will be required, depending on the area entered. TNG currently has rented office space in the same building. An assay laboratory is located on the ground floor in the same building; this laboratory could be easily converted for use for HF-cleaning process. This arrangement would have practical benefits such as ease of transport and security.
At a later stage of development of the project, in an area approved by the environmental and infrastructure authority of Kommuneqarfik Sermersooq, and approved by the BMP after proper application, TNG may have a purpose-built sorting house built. The analysis of alternative locations is described in chapter 10.
The clean rough concentrate will be sorted at the sorting facility into categories by size, colour (pink to red) and by clarity (gem to non-gem) according to standard criteria using reference sets so that the sorting can be done consistently over time. The sorting will be done by TNG personnel both by hand and using automated equipment and subject to verification by a representative from the Greenlandic authorities.
TNG has developed a sorting system based on two colour divisions (red and pink), four size categories (1.7-3.3mm, 3.4-6.3mm, 6.4-9.5mm and 9.6+mm sieve sizes) and four transparency categories, plus a “specials” category in both red and pink, yielding 34 categories. Over time, this sorting system (referred to as a sorting “matrix”) will be re-evaluated and sorting into additional categories is likely.
Initially only two colour categories will be used, but even this relatively simple system is somewhat complicated. There are extreme ranges of hue, tone and saturation in rubies and pink sapphires. Judging the colour in a ruby will take some experience and careful adherence to the reference sets. It is even possible that some colours (combinations of hue, tone and saturation) that are initially sorted as pink will ultimately prove to be considered red by purchasers, and sorting adjusted to maximize value.
The sorted and categorized rough concentrate will then be divided into appropriately sized parcels, given an identification number and entered into a computer tracking system. TNG will provide access to the tracking system for audit purposes to representatives from the Greenlandic authorities.
As later explained in the marketing section, a significant amount of the rubies and sapphires will be polished to be sold in the market, particularly during the early years of the mine life. The polishing will take place in a well-known factory in Asia, where the biggest source of expertise on ruby polishing can be found. Measures will be taken to ensure physical traceability of the stones and records of fractions polished and sold.
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The proposed polishing factory is already providing services to international brands known for their quality and ethical standards, and it is in compliance with all legal requirements regarding environmental and working conditions. At this point, TNG does not intend to perform any polishing in Greenland, as the ruby polishing and faceting expertise does not exist in Greenland and will demand many years to build at a level that is commercially viable. Analyses of the alternative considered for polishing are explained on section 10.
TNG will sell both rough and polished ruby and pink sapphire. Sales information will be entered into a tracking system. TNG will sell rough rubies to companies with existing polishing facilities and sales networks. TNG will also sell polished rubies to specific customers and the information on the polishing process (retention) and sales will be entered into the tracking system.
The sales information will be open to audits by the Greenlandic authorities to ensure that the prices are reasonable. The tracking system will also form the basis for the issuing of export licenses for Greenlandic rubies.
4.5 Expected work force and working conditions
4.5.1 Construction phase
During the construction phase, TNG expects to utilize a Greenlandic based leading contractor to manage Greenlandic subcontractors. The construction period is expected to last approximately 6 months, starting in early 2014 depending on permitting.
Approximately 40-50 people are expected to be involved in the construction phase, where approximately 75% of the workforce is expected to be Greenlandic (resident and tax payers in Greenland). Workers from Qeqertarsuatsiaat will have first priority for employment as long as qualifications are met. 25% of the workforce is expected to be foreign nationals. The construction crew will live in the existing, refurbished tent camp at Aappaluttoq. The permanent container mine camp will be established during the construction period and run from 2014. Workdays will amount to 12 hours per day, 7 days a week.
Personnel will work on site for two weeks and have one week off site. Some personnel might work on site for four weeks and then have two weeks off site, depending on whether their hometown is in Greenland or another country, e.g. Denmark.
A passenger boat will be chartered on a regular basis, probably twice a week, in order to transport personnel back and forth to Nuuk or Qeqertarsuatsiaat.
4.5.2 Operation Phase
Table 4.1 describes the job positions expected to be necessary to run the mine, camp, processing plant and the Nuuk sorting house and office once it reaches full capacity in three years (2015-16). After a period of training, TNG expects that Greenlanders can occupy all positions with few exceptions.
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The work season for mining operations was originally planned for 3-4 months. Input received during the consultations and preliminary impact analysis motivated a new mine plan with a working season of 8 months. It is expected that this will make Aappaluttoq a more attractive workplace for Greenlanders.
Area Position Working season Number Mine Operations Supervisor 1 Excavator operator 1 Truck operator 4 Dozer operator 1 Driller 1 Misc operator 1 8 months/year Maintenance Maintenance Leading hand 0,5 2:1 weeks Heavy diesel fitter 1 Apprentice 1 Service operator 1 Technical Mine Engineer* 1 Mine Geologist* 1 Sampler 1 Sub-total Mining 15,5 Processing Plant Supervisor 1 Loader operator 1 Crushing/Grinding Operator 1 Jigs 2 8 months year Sorter/Labourer 4 Maintenance Maintenance leader 1:1 weeks 0,5 Fixed plant mechanical 1 Electrician 1 Apprentice 1 Technical Process Engineer 1 Sub-total Processing 13,5 G&A Administration Mine Manager 1 OHS & Env. Supervisor 0,5 Assistant 8 months/year 1 Paramedic/security 1:1 weeks 1 Security 12 months/year 3 Warehouse Logistics Superintendent 0,5 Clerk 1 Camp Manager/Handyman 8 months/year 1 Chef 1:1 weeks 1 Apprentice 1 Cleaner 2 Sub-total General & Administration 13 Nuuk Office Administration Site Manager 1 OHS & Env. Supervisor 0,5 HR & Training 1 Accountant 1 Logistics Superintendent 12 month/ year 0.5 Reception 40 hours/ week 1 Operations Sort house manager 1 Sorters 3 Rough Concentrate handler. 1 Security Security superintendent 1 Security officer 3-9 Sub-total Nuuk 14-20 Total on site at the mine and in Nuuk at any time 56-62 Table 4.1 Job positions expected for the Aappaluttoq Project
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The total number of staff at the mine and in Nuuk during the production phase is approximately 80 (56-62 on site at the time while the rest off site due to rotation), of which 15 staff are professionals. Of these, there will at all times be 42 staff at the mine. As TNG will have a very small operation, personnel will work on various aspects so that, for example, road maintenance can be undertaken during periods when personnel and equipment are not being used in process or mining operations. The jobs generated by the project will be seasonal (8 months a year) for the workforce in Aappaluttoq (except security staff who will be on site 12 months/year) and all year round for the workforce in Nuuk.
During periods when the mine will be closed, the number of personnel on site will decrease. Security personnel will still be on site, but also in a decreased number. Designated security personnel will do security related jobs. The personnel used for various maintenance tasks will be from the mine staff and mine-camp staff.
During operations, TNG estimates that there will be a seasonal workforce of two shifts, amounting to approximately 25 people in Aappaluttoq and 14 – 20 in Nuuk, respectively. After a period of training, TNG expects that Greenlanders can occupy all positions with few exceptions.
For Aappaluttoq mining operations, a rotation of two weeks at the site and one week off (7 shifts of 12 hours each) has been proposed, with no mining being undertaken for the week off shift, as the mining capacity will exceed the processing capacity. The processing plant will run full-time, and so for the processing plant and other activities conducted on-site, the shifts will most likely be structured as one week on-site and one week off with most positions having a cross-shift. The optimal rotation scheme(s) will be discussed and agreed during the SIA process and further if needed in order to maximise the amount of Greenlandic workforce.
4.5.3 Camp facilities
As shown in Table 4.1 there will at any time be a minimum of 42 employees at the mine site. The camp will be designed to approximately 50 people, in case additional people have to be accommodated.
Rooms 50 single-person rooms. The rooms are approx. 8.5 m2 each. Bathrooms and toilets are shared. Rooms will be equipped with a bed 80x200 cm, writing desk, chair, 2 closets, heat and window.
Toilet and bath In the corridors there are toilets and bathrooms. There will be installed household washing machines and dryers for washing of civilian clothes.
Recreational area A room of 152 m2 is designed for recreational activities. At present time it is not yet decided which activities the room will be used for. The room can be used for activities like table tennis, pool, videogames, etc. or it can be divided as needed.
Offices 6 offices of 8.5 m2. The offices are equipped with desk, chair, network, server printer and plotter. Furthermore, there is a conference room at 25.5 m2.
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Gym Exercise room at 17 m2 with various equipment.
TV Room TV room at 25.5 m2 with sofas and tables, TV, video and DVD-player.
Living room Lounge at 25.5 m2 with sofas, tables.
Canteen Canteen on 86 m2 with seats for 50 persons.
Kitchen / dishwasher Kitchen with cold kitchen, hot kitchen, bakery, dishwashers, scullery. Total of 64 m2.
Warehouse / refrigerator / freezer As an extension of the kitchen there is a cold storage at 8.5 m2, freezing room of 8.5m2 and a dry storage of 8.5 m2. Furthermore there is a room for staff of 8.5 m2. Additionally 1 pc. 20' freezer container, 1 pc. 20' refrigerated container and 2 - 20' containers for dry stores will be posted.
Men's locker Dressing rooms, wash basins, shower and toilet for a total of 61 m2.
Women’s locker Dressing rooms, wash basins, shower and toilet, to a total of 61 m2.
Laundry Laundry at 24 m2 with washing machines, dryer and storage for clean and dirty clothes.
First aid station "hospital" Designed with couch, doorway of 2 meters as stretcher patients can be easily transported in and out. There will be a ramp and no stairs to the entrance. There will also be a desk, medicine cabinets, emergency showers and other customary equipment.
Fire Station A 20' container will be installed to house fire fighting equipment such as clothing, helmets with visor, fire fighting gloves, breathing apparatus, ladders, diesel pumps, hoses, nozzles, axes, foam mixing plant, foam, etc. The fire station is to be located in proximity to waterworks for quick connection of water
Wastewater treatment plant A sewage treatment plant will be installed. The plant is built in a metal container. In order to gain access to all components all sides of the container can be easily removed. The plant will be designed for the size of the camp. A pump will transport the sewage in to a buffer tank. From there, it will pass through a pump that can cut up material in the sewage. This pump will lead the sewage in to a slurry tank where the sludge will remain and the wastewater will be led in to a biological process tank.
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All other waste products and the sludge will be transported in to Nuuk to be disposed of accordingly. In the biological process tank, biological filters will clean the water and disinfection equipment will be used before discharge into the environment.
Drinking Water Treatment Fresh water will be taken from a nearby river. This water will then be processed in a water treatment facility built in a 20' insulated container. The plant will contain a 10-12 m3 buffer tank, a filter treatment stage for particles, UV light water treatment and dosing plant for chlorine if necessary. A booster system with dual pumps will be mounted. Connection for fire-water will be mounted.
Energy Supply There will be installed 2 generator plants of approx. 450 KVA with associated tank placed in the PE liner. Generator plants are placed in the noise reduction cabinet, but a noise-reduction wall around the plant will also be build. The plant is equipped with an alarm to a mechanic on duty in case of generator failure. The generator plants are designed so that one plant is running while the other is on standby. Residual heat from the generators will be used to heat other facilities.
General The entire camp will be covered by wireless networks, mobile telephony, fax, telephony, GPRS coverage, TV signal which include KNR, FM radio. VHF radio will be installed in the hospital and on site-managers office for use in an emergency. Furthermore a satellite dish to take down the Canal Digital signal will be installed. Sirens in case of fire, activated by pressure will be placed in corridors and around central located sites. All rooms are equipped with smoke alarms. The camp is equipped with 1 x 230 and 3 x 400 V, 50Hz. The total camp area is 1,577 m2. Heating of the camp is with electric radiators.
Security For security purposes, there will be restrictions on personnel leaving the camp area.
4.5.4 Closure
The mine plan developed using information about the project to date provides for a mine life extending for 10 years starting in 2014 and ending in 2023. If ruby and pink sapphire sales are positive, it is expected that the mine life will be prolonged by the addition of further minable material that will extend the pit to the east as currently projected.
Closure of the operation will consist of 4 principal tasks: Removing all buildings, equipment and infrastructure; Reclaiming roads, ports, camp area, processing plant pad, and any other ground disturbance; Closing in the lake channel with rock and concrete to allow the lake to refill to its natural level; and Implementation of an environmental monitoring program.
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Project Conceptual DCP measures Re-vegetation plan infrastructure
Surface facilities and Salvage buildings and remove these by Self-sustaining plant infrastructure ship/barge growth Demolish remaining buildings with demolition equipment and remove these by ship/barge Salvage equipment and remove this by ship/barge Remove culverts and formal drainage systems Remove foundation beams concrete/wood Rip gravel pads, staging areas and access roads at port and plant site to encourage re- vegetation
Port facilities Remove sheet pile walls and doze gravel fill None planned (inner port) to level 2 m below LAT
Port facilities (outer Remove barge and landing ramp Self-sustaining plant port) Excavate and remove prefabricate bollards growth
Access roads Remove culverts Self-sustaining plant Re-establish the normal drainage system in growth a natural way by precipitation
Pipelines Decommission pipelines, all pipes and Self-sustaining plant equipment growth Remove supporting structures for pipes
Tailings Remove constructed facilities next to the None planned lake and ship these out Remove pipes in the lake
Open pits Remove equipment and ship it out None planned Allow the pit to be naturally filled with water Safety bund walls and signage will be placed around open excavations (if any)
Dikes Remove dikes by dozing materials into The None planned Lake to level -2 m under natural water level in all 9 m of the dike height
Drainage channel at Plugged with a 2 m wide concrete wall; the The Lake rest will be filled with natural rocks
Table 4.2 Detailed plan for closure for the Aappaluttoq Project.
At the currently planned level of development, it is anticipated that the above- mentioned tasks will take approximately 3 months to complete with a workforce of approximately 20 people.
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In Nuuk the facility will most likely be in the NunaMinerals building on rental basis. The facilities will consist of administration, cleaning and sorting facilities and a safety vault. Conditions related to a closure will be part of the rental contract. Any additional costs related to closure of Nuuk facilities will be part of the DCP budget as soon as they are known.
At present the mine plan is at a preliminary stage. The closure plan will be adjusted and elaborated along with the developments of the project, thus will the total costs. All direct and indirect closure costs are calculated by an independent contractor, CMP Nedrivning A/S. The total costs calculated by CMP Nedrivning A/S amounts to DKK 15,030,000.
As construction commences, reclamation and closure costs will be calculated and set aside in accordance with Greenland law.
4.6 Security
All the security measures, procedures and technologies to be implemented in the Aappaluttoq project and described in this section are common in the gemstone industry and are based in the experience of the diamond mine Diavik, in Canada. The general strategy is based on a system of reducing opportunity, minimizing the amount (value) of material in any place, and ensuring that, if a theft does occur, it is quickly identified. The emphasis in the security system is in control, tracking and remote monitoring, rather than through large numbers of security personnel.
It is given in the nature of this issue that this description cannot go into all details as this document is unclassified. However, all necessary measures will be taken to prevent any attempt to steal corundum of any kind.
TNG has been in contact with the Operational Section under the Chief of Police in Greenland. According to this officer the police have no indications of threats against any gemstone activity in Greenland. It is not expected that any professional criminal person or organization is plotting anything at this moment. Should such activity occur later, it is expected to be planned and initiated from outside Greenland.
It is not expected that a plot organized by professionals would involve an intrusion into buildings used by TNG. The reason is that professional criminals will know that an intrusion is too difficult, too dangerous, too time consuming and the outcome will be uncertain. Instead of an armed intrusion a plot to steal would most likely focus on the employees working for TNG and the cleaning laboratory contractor.
Initiatives in order to prevent and ensure that the employees working for TNG or the cleaning laboratory contractor are not stealing or are persuaded (or forced) to help a third party in getting access to the corundum will be coordinated between TNG and The Section for Crime Prevention at the Police.
According to the interviewed police officer, but also estimated by TNG, attempts to break into TNG's facilities and laboratory cannot be ruled out. However, these break- ins will be performed by locals with no knowledge of the security measures taken.
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Should an attempt take place, alarms will start. Security patrols will arrive to the facility. Should a burglar get access to a building, any corundum present would either be in a safety box or going through cleaning or sorting process in which case personnel will be present and the corundum, thus the break-in will be immediately known.
Should a burglar succeed in getting access to the corundum, he would have to get the corundum out of the country in order to sell it. At this point, the police will be investigating, and in order to get the corundum out of the country, it would have to pass both police and the Greenlandic Customs.
4.6.1 Sorthouse security
The security system philosophy for the sorthouse has been developed based on the security requirements for the handling and monitoring of the valuable product as it moves through the sorthouse. The philosophy is based on the following:
1. Surveillance of office, personnel and equipment. 2. Access control. 3. Monitoring and searching of persons entering and exiting the office.
Personnel entering the sorthouse will be required to undergo a random search of their belongings especially if they are carrying bags to ensure that they don't bring in any firearms or contraband. This will be done at the entrance to the sorthouse at the security office located at the entrance.
All personnel exiting the plant will go through the following search control procedure. Personnel will line up to enter the pulse monitor room. On entry each person will place his or her palms on top of two metal plates to monitor the pulse. A door will open to allow the person to exit the pulse monitor room. A second door will open based on two criteria:
1. A person's heartbeat rate is measured; if the pulse monitor indicates a very rapid rhythm the search door will open. 2. Random; there will be a random override where the personnel will be checked on a random basis.
If neither of the above two criterion are fulfilled an exit door will open and the person is free to exit the sorthouse. When the search door opens, the person will be required to wait in a holding room. Detailed protocol and procedure for the searching of personnel will have to be developed, as this is obviously a very sensitive issue.
Cameras will be placed in all the rooms and search areas as well as pulse monitors and holding room (MT Højgaard, Processing Plan, 2011).
Security procedures will change as final designs are completed and as technology improves.
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4.6.2 Security at Processing Plant
A security fence will surround the processing plant building, at the site with a space between the fence and building. A single access point with pedestrian and vehicle gates will be monitored.
Normal access into and out of the building will be through security rooms that will be controlled by a security officer and swipe card or biometric access.
Just as in the sorting house in Nuuk, the philosophy is based on the following:
Surveillance of plant and personal equipment. Access control. Monitoring and searching of persons entering and exiting the plant.
Personnel entering the plant will be required to undergo a random search of their belongings especially if they are carrying bags to ensure that they do not bring in any firearms or contraband. This will be done at the security office located at the entrance of the processing plant (MT Højgaard, Nuuk Operations Control Systems, 2011).
Security procedures will change as final designs are completed and as technology improves.
4.6.3 Security at the Cleaning Laboratory
The security system philosophy for the laboratory has been developed based on the security requirements for the handling and monitoring of the product as it moves through the laboratory. The philosophy is based on the following:
1. Surveillance of laboratory, personnel and equipment. 2. Access control. 3. Monitoring and searching of persons entering and exiting the laboratory.
At the laboratory, several passive initiatives will be implemented. Access through doors and windows will be made difficult by bars in front of windows. It will not be possible to look through the glass. The door into the laboratory will be made of other material than wood and will have multiple locks. Access can only be granted when using personal issued ID-access "key". Security alarms and video cameras will be placed several places in the building and laboratory.
To minimize the risk of having corundum stolen while being kept at the laboratory, the corundum will, at all times, be in tamper-proof sealed containers. These will only contain small amounts in order to limit the total amount of corundum accessible at the laboratory. While HF-cleaning in progress, there will be working staff present. Corundum that are not yet - or has finished - HF cleaning will be stored in a safety box, until moved back to the safety box at TNG's facility. At no time, will clean rough corundum be stored unattended and overnight.
As set out in "Appendix 3 - HF-Cleaning of Corundum Concentrate" in the EIA the corundum will be contained in a tamper-proof container throughout the cleaning process.
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The employees working with the corundum at the laboratory will be security cleared by TNG. The security procedures when hiring workers for TNG will also apply for the employees at the cleaning laboratory contractor, working with the corundum.
The cleaning laboratory contractor may have other jobs, involving other personnel, but at no time will these procedures be in conflict with the HF-cleaning procedure, thus these personnel will not have access to any corundum.
4.6.4 Ruby Track™ System
Ruby Track™ is proprietary software that has been developed by TNG. It is designed to track rough ruby from the mine site through to the sorting phase of the operation. It will be used to track the rough as it is crushed, sorted and resorted and made into rough parcels for sale to the trade cutting houses.
Material that is cut and polished by TNG will then be placed into DiamondTrack software. This is software designed specifically for the cut stone industry. The rough parcel number will be noted in DiamondTrack as a transition from rough to polished as a mean for tracking that material back to the mine site if necessary. The number of stones, color, clarity and size are recorded in individual files (by size or carat weight). The sofware allows for invoices to be generated for sales, as well as allowing inventory to be moved in and out of cut parcel lots easily. It also allows for individual customer accounts to be set up where tracking of their specific cut requests can be kept and monitored.
The tracking system as suggested by TNG will have to be approved by Naalakersuisut.
4.7 TNG Gemstone Marketing
For this project, TNG has developed a Marketing Plan and it is up to the Naalakersuisut to approve this plan and to set the conditions for this, which may include sales methods, polishing strategies and classification.
This section describes the marketing plan for the rubies and pink sapphire from Aappaluttoq. The TNG marketing team has over 220 years of gemstone experience, representing a broad range of buyers, producers, polishers, manufacturers and educators.
Colored gemstone market Virtually all gemstone mining companies in the world, whether in diamonds or coloured gemstones, sell the vast majority of their production as rough gemstones. The reasons are easy to understand. First, mining takes different skills than marketing and it is difficult for any organization to excel at two tasks that are so dissimilar. Second, over many years, particularly in the coloured gemstone industry, a fragmented and decentralized polishing-marketing system of buying and selling rough and polished coloured gemstones has evolved.
No centralized purchasing system or market exists for coloured gemstones. Instead, the market is fragmented with suppliers of gemstones selling to multiple distribution networks.
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This is likely because of the nature of coloured gemstone deposits: the deposits themselves tend to be small and of variable quality. Unlike diamonds, no concerted effort has ever been made in the coloured gemstone industry to create a central transparent market for either rough or polished coloured gemstones.
Because of the decentralization, the majority of polished coloured gemstone sales are made through long-standing relationships between rough buyers/polishers and jewellery manufacturers, often through intermediate brokers. The relationships between these parties are closely guarded secrets. Very little reliable data of the amount of coloured gemstone trade exists, and no new producer of polished coloured gemstones can expect to break into the market easily. To protect their market share, both polishers and brokers can reasonably be expected to engage in anti-competitive behaviour to prevent the entry of new market participants.
The extent to which informal barriers exist for entry into the polished coloured gemstone market varies greatly. Geographically, the barriers will be greatest in the relatively closed economies of emerging nations such as India, Russia and China. China and India are traditionally substantial consumers of coloured gemstones. With respect to China particularly, demand for luxury goods such as gemstones is increasing so quickly that the traditional industry cannot keep up, and accordingly barriers to entry are expected to be lower and direct access to large jewellery manufacturers is anticipated to be easier than other emerging nations.
In the United States and Europe the coloured gemstone industry operates in a more transparent manner. Jewellery sales are undertaken by (or through) a number of large chain stores, including high-end chains such as Harry Winston, Tiffany & Co., Cartier, Pandora and others, and more consumer oriented companies such as Walmart (the biggest seller of gold in the United States) and Jewelry Television. In most cases, the buyers for these organizations are open to discussions utilizing new products and may purchase polished coloured gemstones directly either for their own design and manufacturing operations, or as pieces of jewellery created in conjunction with them and manufactured under contract.
As a consequence TNG have made a strategy that in the beginning will focus on the sale of polished gemstones, and at the same time nurture the interest for the rough gemstones in order to increase knowledge, interest, demand and sales price.
As the demand and price for the rough stones increase focus will shift from the polished stones to the rough stones.
This strategy has been proven in the diamond industry and by Gemfields within the coloured gemstone industry and has proven to increase the price of rough gemstones dramatically over a short period. The consequence being that the sale has shifted focus from the polished to the rough stones with an increase of turnover and profitability.
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The reason for this is that polishing and marketing entails risks and high costs, without necessarily resulting in increased prices for polished gemstones that overcomes these risks and costs. In the diamond industry, rough diamond prices are very close to polished diamond prices. Similarly, TNG believes that once the price of rough gemstones is high enough, selling the majority of the production as rough will result in greater profitability (and subsequently result in the payment of more taxes in Greenland) than if TNG attempts to undertake polishing and marketing. Nevertheless, for a number of reasons, it is anticipated that the Company will maintain a portion of its polished sales throughout the mine life.
The danger of a polished sales strategy that dominates sale It may be possible, over time, to develop relationships whereby the Company sells polished rubies directly to buyers who initially buy rough ruby. However, it is a better long-term goal of the Company to force the price of rough upward, as has been done in the diamond industry and is being done by Gemfields. This will allow the Company to avoid the expense and risk of polishing and marketing. There are no successful rough gem mining companies that fully integrated into the polished manufacturing sector.
If a company attempts to become a producer that polishes a large majority of their own rough then ruby rough buyers cease to be motivated purchasers because they reasonably assume that the company is retaining the best product and only selling them the rejects from the company's manufacturing arm.
TNG believes that, at full production, the most profitable model for the business is to supply existing polishing and distribution networks rather than undergo the expense of building infrastructure to compete with them, with the ultimate objective of selling the bulk of production as rough rubies and pink sapphires.
The balance between rough and polished sales which obtains the best value for Greenland corundum cannot be predicted in advance, as it depends in part upon the extent to which partnerships can be made with jewellery retailers who wish to purchase polished gemstones directly from TNG. Obviously the profitability of the sales are also depending on how the sales prices develop for both rough and polished stones.
Greenlandic rubies and pink sapphires are virtually unknown in the gemstone market. Rough gemstones that are unknown in the marketplace, unlike diamonds, have little value because, until they have worked with Greenlandic ruby and pink sapphire rough, polishers do not know; (a) the retention (how much of the stone is left after polishing). Retention for coloured gemstones is highly variable and much lower than diamonds, or (b) the colour and quality, and therefore the value, of the polished gemstones. It is considerably more difficult to assess the potential of rough coloured gemstones than diamonds.
In addition, the optimum sales strategy will change over time.
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Stages The mine plan has been designed to increase production of ruby and pink sapphire from a modest amount of material in the first year (which is mainly construction and plant commissioning), to full production by year 3. This increase will allow TNG to assess the market for the rubies and pink sapphires produced and to adjust its marketing plan accordingly.
The general marketing strategy proposed is to introduce the rubies and sapphires from Aappaluttoq to the market as follows:
Introduction to the market: sale of polished rubies and pink sapphires, starting 2014. The purpose of these polished sales as a form of advertising is to show the gemstone market that Greenlandic rough rubies and pink sapphires can be polished and transformed into a high quality product. In order to monitor the relationship between rough and polished prices, a suggested minimum of 25% of corundum in each gem and near-gem sorting matrix category will be polished during the first three years of production.
Gradual increase of sales of rough rubies and pink sapphires during the 2016 – 2019 time period, following the increasing demand and price of rough gemstones once the market becomes acquainted with the Greenlandic gemstones.
Majority of sales as rough rubies and pink sapphires once the price is high enough. It is intended that a percentage of sales will be from polished gemstones, depending partly upon the extent to which jewellery wholesalers and retailers will wish to purchase polished gemstones directly from TNG to be absolutely certain of the origin of the gemstones and certain that the gemstones have not undergone any undisclosed treatments.
It is the opinion of the BMP that a stepwise approach of consecutive sales phases is the best way to build up knowledge about the value of cut and polished corundum within the different sorting matrix categories. After each phase the requirements regarding the sale of cut and polished corundum respectively will be revaluated.
The sales phases will be regulated through consecutive mining approvals in accordance with section 19 and 86. The mining approvals will define the time frame and the quantity of tonnes that are allowed to be mined in the subsequent phase.
Polished sales Polished sales will probably be made on a polished-to-order system using negotiated prices.
Polish-to-order is e.g. a jewellery manufacturer that comes to TNG requesting a certain number of stones in a certain color range with certain dimensions to complete a jewellery collection they have designed and wish to set it with ruby.
Often these manufacturers are looking for consistancy so as to make the jewellery collection all look the same. Consistant stones also ease in the setting of stones. The following must be determined before cutting begins:
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Colour is determined with an acceptable tolerance range of colour. Clarity is determined with an acceptable tolerance range of clarity. Diameter and depth dimensions are given for a shape they are requesting with an acceptable tolerance range. The number of stones required, in individual shapes and sizes, along with an acceptable overage to allow for breakage that may happen in the setting process. A time frame is determined pertaining to the completion of the job.
From here the required rough is sorted out and sent to the cutting facility, along with the specifications above, and an acceptable overage of rough to allow for any breakage that may happen in the cutting process so there are sufficient cut stones at the end to complete the polish-to-order order.
In managing these allocations, attention must also always be given to the effect they will have on the value and liquidity of the remaining rough production.
Rough sales Rough sales are expected to be conducted via some form of auction or tender. This is common practice for coloured gemstone producers (such as Gemfields for emeralds, http://www.gemfields.co.uk/images/stories/reports/99.pdf) and is also requested by the BMP. If properly planned and carefully conducted, an auction or tender system should maximize value and transparency on rough sales.
When selling bulks of rough gemstones of a specific category, the bulk will mainly consist of the category requested by the buyer, but it will also consist of a small part with lower quality and an even smaller part with higher quality, all for the price of the requested category. This is an accepted method within the gemstone market. The purpose of doing this is that it allows the selling company to sell all inventory no matter quality. If the selling company did not do this, the company would end up with all low quality (lower value) gemstones and would not be able to sell this material in a profitable way. Any resorting will be undertaken at a TNG secure facility and any updated inventory will be traced through Ruby Track™.
It is the opinion of the BMP that auction sale is the best way to define real market prices for the different sorting matrix categories of both rough and cut corundum. However, for a certain percentage of corundum the BMP is willing to consider a non- auction sale or term auction which allows customers to lock in a long-term supply commitment.
Branding Finally, as described later, in order to brand the Greenlandic Ruby and Pink Sapphire targeted on the markets in Asia, Europe and America, TNG will sell ethical and pure gemstones. Therefore TNG will avoid treatments that are unacceptable to the coloured gemstone industry.
A certification will be developed that will follow the stones proving that they originate from Greenland and that they are produced under strict ethical conditions.
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4.8 Certification and Branding
4.8.1 Certification of Greenlandic Origin
In some geographic regions and client segments it is expected that there will be a marketing advantage in certifying the origin of the Greenland ruby and pink sapphires. Parcels of rough gemstones sent for auction will be tracked from Greenland and can therefore be certified as Greenlandic in origin. Similarly, any gemstones that are polished by TNG in its dedicated polishing factory can be certified by TNG as Greenlandic when sold. Certification will be made for parcels of rough or polished gemstones as providing certificates for each individual stone is neither practical nor cost effective, with the possible exception of any unique high-value material.
TNG will introduce a plan for implementing a Certification of Greenlandic Origin if/when this is commercially appropriate. TNG has been advised that if this implicates the Government of Greenland, Naalakkersuisut has to approve this.
The Ruby Track™ system as described in section 4.6.4 will also be used as a security and chain of custody system in order to guarantee the registration and track of its production and sales, information that is fully available to Greenland Government audit. This will enable TNG to confirm the Greenland origin of parcels of rough gemstones that are sold.
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5 SOCIAL AND ECONOMIC BASELINE CONDITIONS
5.1 Overview
The baseline study provides information on demographic and economic conditions and trends, political structures, Greenlandic organisations, cultural traits, and other factors that can influence the way in which affected communities will respond to anticipated changes brought about by the Project. The baseline study also helps to predict in which way the Project will be affected by these factors. The development of the baseline study and the identification of the impacts are an interrelated and parallel process.
The scope and content of the baseline for the Aappaluttoq Project is based on the requirements of the SIA Guidelines for Mining projects in Greenland (BMP, 2009) and includes the critical aspects identified during the scoping phase.
The findings of the socio-economic baseline study of the Aappaluttoq Project, as presented here, have been organised in the following sections:
Demographic profile Social and political organizations Social and cultural well-being Economic indicators Public infrastructure and services Education and Training Public Health.
Where available, qualitative information and quantitative information are described for Greenland, Kommuneqarfik Sermersooq Municipality and specifically for Nuuk and Qeqertarsuatsiaat.
The baseline study has been based upon a thorough review of secondary sources and information obtained through qualitative, quantitative, and participatory methods. Specific baseline studies of social aspects within the area includes “SLiCA – Qeqertarsuatsiaat for Grontmij Carl Bro A/S, 2011”.
The list of persons, focus groups and organizations consulted when collecting information for the baseline study can be found in Chapter 11. Furthermore, research reports and other relevant reports and studies, which are listed in chapter 14, have been used.
5.2 Demographic profile
5.2.1 Country profile
88% of Greenland’s population is Kalaallit (Inuit) and 12% is either Danish or other nationalities (Greenland in figures, 2010). It is important to emphasize that this SIA study does not distinguish between ethnicity, rather whether people are born in or outside of Greenland.
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Since 2009, the country has been divided into four municipalities:
Qaasuitsup Kommunia Qeqqata Kommunia Kommuneqarfik Sermersooq Kommune Kujalleq.
Greenlanders have settled into 17 towns and approximately 56 settlements stretched over 2000 km, which are primarily located along the western coastal areas. The population size of the towns range from between 21 (Qassimiut) and 16,583 (the capital and main town, Nuuk in Kommuneqarfik Sermersooq). Figure 4.1 shows the four municipalities and main towns in Greenland. Each settlement, sometimes characterized as a village, consists of a population between one to over 300 (Kangaamiut), the majority having around 60 inhabitants. The smallest settlements are mostly sheep farmers in southern Greenland (Greenland Statistics, 2013).
The means of transportation in Greenland is by boat, helicopter and/or airplane. There are no roads or railways connecting towns and settlements (there are very few exceptions).
Greenland’s climate is very rough and quick to change, which Greenlanders have learned to live with and endure.
5.2.2 Languages spoken
The two major languages spoken in Greenland are Kalaallisut (Greenlandic) and Danish.
The majority of people in Greenland speak Kalaallisut, which is a West-Greenlandic dialect of the Inuit-language. Within Kalaallisut, there are dialectal differences, even from settlement to settlement and town to town (Rischel, 2007).
Spoken language Group Kalaallisut only 75 % in settlements. 60 % in towns. Greenlandic descent. Mixture of Danish and Greenlandic descent. Danish only Danish descent. Mixture of Danish and Greenlandic descent. Kalaallisut and Danish 2-12% of Danish descent. Majority of Greenlandic descent. Mixture of Danish and Greenlandic descent. Table 5.1 Groups speaking Danish and Kalaallisut (Poppel et al, 2007)
In Qeqertarsuatsiaat 70% consider themselves to speak Kalaallisut very well with the remaining 30% speaking it well. The majority of the population in Qeqertarsuatsiaat can understand and speak Danish quite well, with only 10% declaring not to understand Danish at all (Poppel, 2011).
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Danish is also well known and used in Greenland as a second language. It is common to be bilingual in Kalaallisut and Danish, although more common in towns. Schools and most education centers in Greenland also teach in Danish. English is the second foreign language taught and scarcely spoken.
Since 2009, when Greenland was granted self-government, Kalaallisut stands as the official language of Greenland. However, both the Danish and Greenlandic languages are spoken and used in the administration and Parliament.
5.2.3 Number of inhabitants
The total population of Greenland by January 1, 2011 is 56,615, with 47,857 living in cities and 8,239 in villages. There are 21,559 inhabitants in the Sermersooq Municipality, among which 15,862 live in the capital, Nuuk, 3,145 in Paamiut and 218 in Qeqertarsuatsiaat. The Greenlandic population density is 0.14 per km2 on ice-free areas (Greenland Statistics, 2011).
Sermersooq is the most populated municipality in Greenland with 38% of the total Greenlandic population. The municipality covers a large part of Southwestern Greenland and the main portion of the Eastern coast, not including the National Park in the NE, which is not included in the municipal division.
The figure below illustrates the evolution of the total population in Greenland over the last ten years (Greenland Statistics, 2010).
57.000
56.800
56.600
56.400
56.200
56.000
55.800
55.600 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Figure 5-1 The Greenland population from 2000-2011 (Greenland Statistics, 2011)
The graph shows that there was a steady increase in the total population from 2000 to 2005 and that the total population then experienced a few years of steady decline between 2006 and 2009. Over the last two years the population has once again increased.
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Qeqertarsuatsiaat Qeqertarsuatsiaat has 218 inhabitants, as of January 1, 2011, comprising 123 men and 95 women. Of these 3 men and 1 woman were born outside of Greenland, while the rest are born in Greenland. Figure 5-2 below shows the development in the population of Qeqertarsuatsiaat from 1990 until 2011.
350
300
250
200
150
100
50
0 1990 2000 2007 2008 2009 2010 2011
Figure 5-2 The Qeqertarsuatsiaat population from 1990 to 2011 (Greenland Statistics, 2011)
A correlation can be drawn between the decline in the population of Qeqertarsuatsiaat and the decline in Arctic cod fishing over the past two decades. Especially, young women in the working age tend to move away for educational or job opportunities (Mobilitetsstyregruppen, 2010).
The largest age bracket is the 10-19 year-olds, with a total of 45 people, 19 men and 26 women. The division between gender and age groups is not like the demographic profile of Greenland, Kommuneqarfik Sermersooq or Nuuk, with more variation between both gender and age.
90-99
70-79 MALE FEMALE
50-59
30-39
10-19
0-1
30 20 10 0 10 20 30
Figure 5-3 The Qeqertarsuatsiaat population by gender and age group in 2010 (Greenland Statistics, 2010)
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Between 2005 and 2009, Greenland experienced higher emigration rates in comparison to immigration and birthrates, partly explaining the decline seen during that period. However, the reversing of that trend in 2009 can be partly explained by a reduction in the emigration rates while immigration rates have stayed somewhat constant (Nordisk Statistik Årbog, 2010).
5.2.4 Migration
In general, Greenlanders are very mobile. For young Greenlanders, the primary reasons for moving permanently are to take advantage of education and skilled job opportunities as well as the resulting higher wages. Especially young women move permanently, either for education purposes or to seek other new challenges. For the older segments, job safety and higher wages are the main reasons for moving. For people with higher education, particularly career and further education opportunities as well as their children’s access to schools are decisive factors for moving (Mobilitetsstyregruppen, 2010). According to SLiCA, (Poppel et al, 2007), especially people in Nuuk and Central Greenland are willing to move away from their town or settlement.
In 2008 a total of 20,639 persons moved within Greenland. Two thirds of these moved within the same locality. 1,282 people moved from a settlement to a town and 1,028 from a town to a settlement. Nine out of ten persons who moved outside Greenland moved either to or from Denmark (Statistics Greenland, 2009).
3500
3000
2500
2000
1500
1000
500
0 2005 2006 2007 2008 2009 -500
-1000
Immigrations Emigrations Net migration
Figure 5-4 Migration in Greenland from 2004-2009 (Greenland Statistics, 2009)
Migration trends by gender indicate that immigration of women has increased between 2008 and 2009, while that of men has fallen during the same period. Emigration rates for both sexes have decreased between 2008 and 2009.
According to Greenland Statistics, the most popular municipality is Kommuneqarfik Sermersooq in terms of people moving to the municipality, with Qaasuitsup Kommunia a distant second. Kommune Kujalleq had the highest net emigration rate whereas Kommuneqarfik Sermersooq had the highest net immigration rate.
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5.3 Social and political organisations
5.3.1 Political organization
Greenland is under the Danish Crown. Its status of Home Rule was granted in 1979, and in 2009 Greenland gained status as self-government. Two Greenlandic-elected nationals are members in the Danish Parliament.
The Greenlandic Parliament, Inatsisartut (legislative power and assembly), is comprised of 31 members elected by Greenlandic citizens for a four-year term. The Inatsisartut meets in organised sessions on a biannual basis. A Premier is elected by Inatsisartut. The elected Premier puts the Greenlandic Cabinet together to form nine ministries. The ministries, Naalakkersuisut, form departments, which are run all year round. Inatsisartut proposes laws and appropriations that Naalakkersuisut must conform to and supervises Naalakkersuisut’s activities.
The following six parties exist and are active in the Greenlandic society: (Greenland in figures, 2010).
Two of these parties currently form the Cabinet (highlighted in bold):
. Parti Inuit (Humans): Greenland’s youngest party, formed in 2013. Are in Parliament. The party stands for socialism and wants to work for the protection of Inuit and their values. The party is still in the process of defining their political program . Siumut (Forward): The largest party in Greenlandic politics, founded in 1977. This party stands for social democratic affairs and equality amongst the people. Loyal to the Danish Crown and Government, this party still stands for independence and self-government in Greenland. . Inuit Ataqatigiit (Unified Inuit): Left-wing oriented party founded in 1976 with demands of independence and recognition as one people. Loyal to the Danish Crown and Government, the party is somewhat of a socialistic party. . Kattusseqatigiit Partiiat (Alliance of Candidates): Formerly represented by individual candidates. A formal party was founded in 2005. This party is mostly represented in the northern part of Greenland. The party was not elected for the parliament at the election in 2013. . Demokraatit (Democrats): A social liberal party founded in 2002 in the middle of the two political wings in Greenland. . Atassut (Unity): This party was founded in the late 1970s. Loyal to the Danish Crown and Government this party of green liberal mentality stands for unity within the Royal Danish Realm.
The actual Cabinet (From April 2013) is a political cooperation between Siumut and Atassut (www.nanoq.gl).
Figure 5-5 shows the organisation of the Greenland Government, and Table 5-2 provides an overview of the ministries and their accompanying responsibilities.
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Parliament of Greenland
Government of Greenland
Minister for Minister for Premier and Minister for Minister for Education, Housing, Nature and Minister for Minister for Minerals and Minister for Fisheries, Hunting Minister for Family, and Legal and Justice Environment and Nordic Finance and Domestic Affairs Industry Church, Culture and Gender Department Foreign Affairs Coorperation and Agriculture Health and Infrastructure Equality
The Dept. of Finance and Dept. of Fisheries, Hunting and Dept. of Health and Dept. of Family and Legal and Dept. of Education, Church, Dept. of Housing, Nature and Dept. of Minerals and Industry Premier’s Environment Domestic Affairs Agriculture Infrastructure Justice Culture and Gender Equality Office
Greenland Bureau of Mineral and Agency for Health and Finance and Administration Housing and Propperty Agency Tax Agency Veterinary and Food authority Family Representation, Petrolium Prevention Agency Copenhagen
Department of Agency for Councils and Tecnic and Regionalplanniing Economy and Personnel Agency Infrastructure Agency Justice Administration Development and Strategy Foreign Affairs Boards
Greenland Representation, Environment Agency Agency for economic planning National Board of Health Children and Welfare Agency Brussels
Nature Agency Culture and Church Agency
Agency for climate and energy
Figure 5-5 Greenland Government organisational chart (www.nanoq.gl, April 2013)
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Table 5.2 Overview of the ministries and their responsibilities (www.nanoq.gl, April 2013) Ministry Responsibilities The Premier’s Office Secretariat Greenland representation in Copenhagen Information activities Bureau of Corporate Governance Shareholder role regarding the Self-Governance companies Departments: Department of Foreign Affairs Legal and Justice Department Department of Housing, Nature Authority for buildings, explosives and fire and Environment Land planning and emergency response plans Environment- and Nature department Nature Protection Management Plan for the World Heritage site of Ilulissat Icefjord Environment and nature protection (administration of international agreements) Utilities Housing Agencies: Property and Emergency Management Agency Department of Finance and Budget Domestic Affairs Municipalities Agencies in settlements Citizens’ council in Pituffik Burden and task allocation Structure policy Tax policy Block subsidy Statistics Greenland Nordic cooperation Taxes, charges and Recovery of claims Accounting HR- development Bargaining Internal Audit IT management Common services Agencies: Tax Agency Economy and Personnel Agency Agency for Domestic Affairs Department of Fisheries, Living resources Hunting and Agriculture Fisheries Hunting Control and sanctions Agriculture Fisheries Unit Division of Wildlife Management Department of Minerals and Authority for business and nutritional matters Industry Labour market policies Occupational safety and health legislation Veterinary matters Agencies: Bureau of Minerals and Petroleum Authority for regulations and tasks regarding the oil- and minerals area Agency for Councils and Boards Department of Family and Social care and security benefits Legal and Justice Social development plans Institutions
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Care of the elderly MIPI – Documentation Centre on Children and Youth Council for the Greenlandic Justice Courts Police Prisons Department of Health and Health Services Infrastructure Hospitals Settlement consultations Dental care Health research Alcohol treatment centre Health education Analysis-, development- and administration of Infrastructure Agencies: Health and Prevention Agency Department of Education, Public schools Church, Culture and Gender Educational institutions Equality Cultural matters Sport Language policy Media Museums and archives The Church National Advocacy of Children’s Right Equality Council in Greenland Agencies: Finance and Administration Agency Agency for Development and Strategy Children and Welfare Agency Culture and Church Agency Residential Institutions IPIS – Knowledge and Counselling Center for Disabled
5.3.2 Municipal administration
The 4 municipalities in Greenland have responsibilities within the following areas:
Culture and education, Social, welfare, and health issues, Economy and taxes, Planning, housing and environment.
The political work in Kommuneqarfik Sermersooq is distributed between six standing committees (www.sermersooq.gl):
Economy & Business committee Welfare committee Development committee Infrastructure & Environment committee Business Development committee Labour Market committee.
The organisational chart for Kommuneqarfik Sermersooq is presented in figure 5-6.
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Figure 5-6 Kommuneqarfik Sermersooq organisational chart (www.sermersooq.gl, April 2011)
Mayor
Managing Director
Staff
City Hall Citizen adm. Strategic Secretariat Interpreters’ Office Officres TAS & PAA Development
Construction and Welfare Communications Development Finance and Business Environmental Administration Administration Administration Administration Administration
Communications Staff Staff Department Staff Staff
Business Health and Prevention Citizen School Technology and Development Department Service Center Department Operations
Child Daycare Urban and Adult Care Centre Housing Accounting Department Department Development
Land and Children and Family Piareersarfik Building Payroll Department Authorities
Labour Market Culture and Nature and Department Leisure Sustainability
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The national organization of municipalities, KANUKOUKA (www.kanukoka.gl) attends to the issues concerning the common interest of the municipalities, providing coordination, strategic planning, capacity building, political lobbying, etc. KANUKOKA has the following working areas:
Education and culture Social issues and health Economy and taxes Engineering and environment Staff and salaries Legislation, administration and IT Settlements Hearings Structure reform Regional development strategy.
In addition to the Nordic Council, Greenland also participates actively with status as an observer in the Arctic Council where the respective ministries meet on a regular basis in order to promote and strengthen cooperation, coordination and interaction within the Arctic community.
5.3.3 Civil society organisations
Greenland has a long tradition of labour organizations and has a variety of civil society organizations with different purposes.
The list bellow summarises the main labour unions and civil society organizations. The organizations of most relevance for the project are further described in the following sections.
Table 5.3 Selected society organisations. Name in English Name in Greenlandic Trade unions Sulinermik Inuussutissarsiuteqartut Kattuffiat SIK
Greenland employers' GA association Employers' Association. Nunaqavisissut Suliffiutillit Kattuffiat (NUSUKA) Graduate association. in Kalaallit Nunaanni Greenland Ilinniagaqartuut Kattuffiat Nurse union . Peqqissaasut Kattuffiat (PK) (Association of. ) ex-workers SIK from Maarmorilik and Olivine mine Arctic business network Nature association AVATAQ – Pinngortitaq avangisillu peqatigiiffik Association of Ornithologists TIMMIAQ ICC Inuit Circumpolar Council ICC Organisation of professional Kalaallit Nunaanni Aalisartut fishermen and hunters, national Piniartullu Kattuffiat KNAPK, and regional Aalisartut Piniartullu Peqatigiiffiat (APP)
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Women’s association Arnat Peqatigiiffiat Kvindeforening Association for the elderly Utoqqaat Peqatigiiffiat Rotary Club Lions Club August 16 Union Foreningen af 16. August The Mineralogical Society of Grønlands Stenklubben Greenland * Sport associations Association of Greenland Children Nanu children Nanu børn Save the children Red Barnet * The Mineralogical Society of Greenland ceased operations in 2011.
5.3.4 Labour Unions and NGO´s
There are a number of Greenlandic labour unions active in the country. The largest, and the most powerful one is Sulinermik Inuussutissarsiuteqartut Kattuffiat (SIK). This organisation, now with over 9,000 members, was founded in 1956 with support from the Ministry of Greenland and the Danish Labour Organisation (LO). Mining workers are often associated with and represented by SIK.
Professional fishermen and hunters at the national level are organised into KNAPK (The Greenlandic Association of Fishermen and Hunters) and at the local level as APP (Fishing and Hunting Associations) (see Table 5-3). These organisations are active within the interests of the fishermen and hunters, and participate in hearings when quotas for fishing or hunting are determined. There are approximately 98 full- time fisherman and hunters in Nuuk, 53 of them affiliated to KNAPK. The Qeqertarsuatsiaat association, QAPP, (The Qaqortoq Fishing and Hunting Association), have about 25-30 full-time hunters and fishermen as members.
There are a number of other unions such as the academic and graduate union and the health care workers union. These are all centered in Nuuk.
Women are organised in every town and most large settlements in women’s associations. The organisations focus both on preservation of the traditional female handicraft and gender equality.
Elderly people are organised through organisations in the towns that work for the interests of the matters of the elderly people, such as care conditions in the nursing homes or activities for the elderly.
Greenland has a strong tradition of civil society organisations; although only in recent years have environmental organisations appeared. Especially, relief organisations, such as the Cancer Society and Nanu Børn, have been established with great success.
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5.3.5 Small scale mining and recreational stone collection
Small scale mining has recently been regulated as a commercial activity and the few small scale licence holders are not yet organised. Nevertheless, collection of stones by hand or with mechanized equipment is a popular activity. Today there is only one formal organization related to the collection that has been identified:
August 16th Union August 16th Union is the union of Greenlandic ruby collectors and has approximately 40 members. None of the members currently have licences for small-scale mining.
The Mineralogical Society of Greenland The Mineralogical Society of Greenland was founded in 2000 and had about 400 members. The club arranged yearly rock trade shows (14 have been held). The objectives of the club were to create a forum where one was able to teach and inspire others within the many areas of interest within stone and minerals, support each other in developing business opportunities, as well as extend the interest in Greenlandic stones and minerals among a wider sector of the population.
In order to achieve these objectives, the publication UJARAK was started, prospector courses organised and a framework for the annual fair was established. A board of five members coordinated the Mineralogical Society. (Ujarak, 2010)
Together with the Bureau of Minerals and Petroleum the Society arranged 27 prospector courses up to 2008 when the funding was stopped. Members of the Society include, among others, jewellers, stone carvers and polishers, geologists, owners of shops promoting Greenlandic crafts in stone, and in general people from all over Greenland interested in Greenlandic stones as a hobby. Members of the Mineralogical Society met normally the first week in November for some days in the annual fair where exhibitions, courses and conferences related to Greenlandic stones took place.
Six different mineral guides for amateur geologists and rock collectors and a poster with about 80 different pieces of minerals from Greenland have been printed. The publication UJARAK and all the books with minerals and rocks from Greenland have been produced by Bjarne Ljungdahl, chairman of the board.
The Society built a collection of over 4000 minerals and rocks at the School of Minerals and Petroleum in Sisimiut. Furthermore, in cooperation with former Ivittuut Komune and two geologists from GEUS, the Society established a mineral museum in Ivittuut, Southern Greenland (Ljungdahl, 2011).
The Board of The Mineralogical Society of Greenland decided in 2011 to close down, so today only one formal organization excists.
5.3.6 Employers’ organisations
There are two employers’ organisations in Greenland.
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Greenland’s employers’ organisation (GA), was established in 1966 and has about 500 company members with about 7000 workspaces within all land-based industry. The organisation works to promote the interest and development potential of companies in Greenland as well as offering legal, economic and organisational advice. GA offers commercial developmental and skill enhancement courses and conferences for their members. GA has compiled a business catalogue in which member businesses promote their specialities and skills offered to the minerals and hydrocarbon industry.
NUSUKA is another employers’ organisation consisting mostly of Greenlandic speaking employers and business owners that was established in 2004. NUSUKA works to shape polices and influence decision making in a way that develops and protects member’s interest. Recently, NUSUKA and the Icelandic employers’ organization, SA, have signed a cooperation agreement to promote closer working relationship between the two countries (www.nusuka.com visited April 2011).
5.3.7 Inuit Circumpolar Council
Inuit Circumpolar Council, ICC, is an international non-governmental Indigenous Peoples’ Organisation representing approximately 160.000 Inuit living in the Arctic regions of Alaska, Canada, Chutkotka (Russia) and also Greenland.
The principal goals of ІСС are:
To strengthen unity among Inuit of the Circumpolar region To promote Inuit rights and interests on the international level To ensure and further develop Inuit culture and society for both the present and future generations To seek full and active participation in the political, economic, and social development in our homelands To develop and encourage long-term policies which safeguard the Arctic environment To work for international recognition of the human rights of all Indigenous Peoples.
Inuit Circumpolar Council is also involved in different international forums. Read more about ICC's work and involvements on theire web site.
The Inuit Circumpolar Council has played a role in asserting the interests of both the Inuit people, as well as the interests of other indigenous peoples worldwide. The ICC holds consultative status to the United Nations Economic and Social Council, (ECOSOC), besides being involved in many areas in the various international forums.
The Inuit delegates at the General Assembly who meets from the four different Arctic nations every 4 years give the guidance and mandates to the Inuit Circumpolar Council President and Executive Council.
At present the president of ICC-Greenland is Aqqaluk Lynge.
(Source: www.icc.gl visited May 2012)
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5.4 Values and traditions of importance in the Greenlandic society
Traditionally, Greenlanders are a hunting people and dependent on natural resources. According to tradition, the male hunts while the women gather berries, sew clothes, clean and butcher the prey. To this day, these gendered roles still exist, although not as strongly. Even though the number of subsistence hunters is decreasing, the majority of men carry a recreational hunting license, and hunt and fish on a regular basis for their own consumption.
According to the Survey of Living Conditions in the Arctic (Poppel et al, 2007), the preferred lifestyle among people in the Arctic in general, including Greenland, is a combination of traditional activities such as hunting and fishing, and a wage job. Nine out of 10 Inuit consider traditional activities as important for their identity and wellbeing.
Greenlanders possess close-knit ties with their immediate and extended family. These relationships have arisen out of a necessity to uphold a small community living off the seas in a frequently hostile climate. It is natural to come to each other’s assistance in times of difficulty and to share, to a certain extent, surplus food, money or favours. It is common to gather people, acquaintances, friends and family for dinner, indoor or out, eating traditional Greenlandic food, such as seal, whale, fish, birds etc. Thus, traditional dishes play an important role in the Greenlandic diet, although the overall diet mainly consists of Western foods.
In Qeqertarsuatsiaat, outdoor activities such as fishing, hunting as well preparation of traditional foods form an important part of upbringing and the social and communal framework (Poppel, 2011). A large proportion of the community derive their daily sustenance from traditional Greenlandic food that is caught locally, with 69% of the households in Qeqertarsuatsiaat reporting that over half their diet consists of local fish and game. Moreover, 94 % of respondents in Qeqertarsuatsiaat declare hunting and fishing to be either important or very important (Poppel, 2011).
Most Greenlandic families spend their summers travelling by boat, sleeping in their boats or in tents, living off the natural resources, sometimes in groups of families or as individual families. Furthermore, it is common to stop by friends or family unannounced, and guests are always offered a bite to eat, coffee, drink, or cake.
Greenlandic women have adapted to the Western European way of living much more easily than Greenlandic men. This is thought to be due to the fact that men have traditionally hunted and had a close relationship to nature and outdoor life, whereas women have been used to housework. The better adaptation to the modern lifestyle of women compared to men is shown in the higher number of women starting an education, lower rate of unemployment and lower suicide rate among women etc. This is also supported by the preferred lifestyle in Greenland where the rate of women working on a wage job is 66% (compared to male of 49%) as opposed to harvesting, herding or processing own food (Poppel et al, 2007).
In Qeqertarsuatsiaat, 50% of those interviewed prefer working for wages, 25% preferred fishing and hunting and a similar number or persons interviewed preferred a combination of wage and fishing and hunting (Poppel, 2011). These results are similar to the preferences at national level.
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5.5 Local use of natural resources
The term “local use“ covers a broad range of human activities related to fisheries, hunting, tourism, and recreational use. The main usages of natural resources in Kommuneqarfik Sermersooq are hunting and fishing.
5.5.1 Hunting and fishing in Greenland
A hunting license must be obtained at the Ministry for Fishing, Hunting and Agriculture, more precisely, at the Department of Fishing and Hunting. There are two types of hunting licenses, a professional and a recreational license. The license application is submitted to the respective municipality office. To obtain a professional hunting license it must be demonstrated that at least 50% of income is derived from selling game species compared to wage related sources and be accepted by the local hunting and fishing association. Mammals such as belugas and polar bears have quotas and are subject to other strict conditions that the hunter has to meet before a license can be issued (www.nanoq.gl). There are 21 professional hunting licenses issued in Qeqertarsuatsiaat.
Greenland is partly economically dependent on its fishing resources. There are rules and regulations for fishing in sheltered waters and for the open seas. A license is required for fishing some of the species, such as shrimp and salmon, in the different sea areas. The licenses are issued at the Department of Fishing under the Ministry of Fishing and Hunting. Most fishing in the open waters is by larger and industrial-sized fishing vessels (about 50 boats in Greenland – 1 in Qeqertarsuatsiaat, typically over 80 gross tonnage), and the fishing in sheltered waters is by smaller vessels (about 5 boats in Qeqertarsuatsiaat under 20 gross tonnage). Other vessels used for fishing and hunting are the smaller boats (in Greenland there is a total of about 2,000 dinghies and boats under 5 gross tonnage, in Qeqertarsuatsiaat there about 15-20 dinghies and boats of the before mentioned sizes). Fishing from the small vessels is mostly by a few full-time combined hunters and fishermen and a large group of part- time hunters that supply the household economy by the catch. Only about 15 % of the total catch in Greenland is by the small vessels (www.nanoq.gl).
Smaller dinghies and fishing boats have to have a logbook that should be filled out with the area of fishing and activities and the amount of caught fish and mammals. The logbook is required as it is used for keeping track of the biological resources so that the exploitation of the resources is suitable for the biological population. The logbooks are kept confidentially at the Greenland Resource Institute and Greenland Statistics (www.nanoq.gl).
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5.5.2 Hunting and fishing in the project area
A description of the project area and baseline study on natural resources was performed by Rambøll in 2007 and 20083 and is further described in the Environmental Impact Study. Greenlanders use the biological resources in Greenland traditionally and it is not any different in the Tasiusarsuaq and Tasiusaa area. Locals in Qeqertarsuatsiaat, especially by both spare-time and professional hunters and fishermen, mostly use the area. The hunters and fishermen in Qeqertarsuatsiaat hunt using their dinghies and smaller boats. The game consists mostly of fish, mammals and birds.
The following information is gathered from the focus group of fishermen and hunters in Qeqertarsuatsiaat.
Caught fish (Arctic cod and Lumpfish roes) is sold to the fish factory in Qeqertarsuatsiaat. Mammals and birds are sold at “brættet” that is a common market for catch of the day for the local combined full-time fishermen and hunters.
On land, reindeer is the species most often hunted in the project area by locals, both by fulltime and part-time hunters. Reindeer inhabits the project area and locals hunt by boat and on foot (as using motor driven onland transport is illegal in connection with hunting). The hunting season lasts from August through September. The area is popular as the reindeer is told to be particularly tasty due to their high fat content. The meat is sold at “brættet” (stalls) in Qeqertarsuatsiaat and to a smaller degree to Nuuk.
The fishing plant in Qeqertarsuatsiaat, owned by Royal Greenland A/S, purchases Atlantic cod all year round, some fished in Tasiusarsuaq and Tasiusaa, and Lumpfish in the spring. These species are the most important income source for the fishermen in Qeqertarsuatsiaat.
To a smaller extent, Atlantic salmon (August through October), Spotted wolfish and Arctic char (June through August) are caught in Tasiusarsuaq and Tasiusaa.
Blue mussels are gathered in the fjords and sold at “brættet” (stalls) or used for own consumption. Scallops are fished less frequently in the fjords. This catch is also sold at “brættet”.
Important hunted bird species in Tasiusarsuaq and Tasiusaa are the Common eider (October-February) and Ptarmigans (September-April).
The most important hunted seal species are Harp seal and Ringed seal found in the area all year round. Full-time and part-time hunters hunt seals and the catch is mostly sold at “brættet” or used for own consumption. The sealskins are sold to Great Greenland’s skin center in Nuuk.
The locals use the areas indicated in Figure 5-7 for camping for recreational purposes and for hunting reindeer. Camping is particularly popular around the streams containing Arctic char as well as an entrance area for hunting reindeer. All land is highly suitable for berry picking.
3 Rambøll, Aappaluttoq environmental study – Baseline 2007, April 2008 and Baseline 2008, April 2009
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Project area
Figure 5-7 Map over project area showing the good reindeer hunting areas and char fishing areas according to local fishermen and hunters (base map NunaGIS ©, April 2011).
There is a hunting cabin, used frequently by the locals, on an island near the gate to Tasiusarsuaq.
People from Nuuk rarely use the area, although they are seen in the area during the summer in fast boats.
5.5.3 Oil and mineral resources
Some of the largest investments that are currently implemented in Greenland are within the oil, mining or mineral processing sector. The investments include hundreds of millions of dollars on exploration and developments of new oil licence areas on the west coast such as the offshore areas held by Cairn and mineral deposits such as the Malmbjerg Molybdonite Mine, the ISUA Iron Project, the Kvanefjeld Multi-Element Project, the Citronen Fjord Zink Project and on new investments related to the re- opening of the Nalunaq Gold Mine and the Black Angel Mine and on projects related to the Alcoa Aluminium Smelter Project.
These enormous investments in a country with a population of less than 56,000 will of course have an impact on the macroeconomic situation in the country.
As the combined manpower requirements for all of these projects will be much larger than the size of the national population, there has been a great deal of focus on involving the population in the discussions concerning the different projects. Public meetings have been used as a way of reaching out to the population.
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The mining legislation already provides for a preference to Greenlandic companies and manpower, but it must be expected that this will be difficult to implement without exceptions in the various projects that are getting closer to actual exploitation and if several or all of these start construction simultaneously.
The figure below shows a map over the Qeqertarsuatsiaat and project area. The blue areas show mineral exploration areas. All are held by True North Gems Ltd, with the exception of the area north of Qeqertarsuatsiaat that is held by 21st North. The latter area is still in the exploration phase.
Figure 5-8 Map over Qeqertarsuatsiaat (in green) and project area (in red) showing the licence areas (NunaGIS ©, April 2011).
5.6 Economic indicators
5.6.1 National economy
Several of the largest Greenlandic enterprises are government owned such as Tele Greenland A/S. These enterprises form an important part of Greenlandic businesses.
In Table 5.4 below it is illustrated how the public sector can be divided into the administrative and service as well as corporate sector:
The Public administration and services include authorities and institutions that are generally providing services controlled by public authorities that are free for individuals and companies. Taxes and royalties mainly finance these services. Some services are, in a small degree, paid through user’s charges.
Many areas of responsibilities under the public authorities have been repatriated from Denmark to Greenland, but there are still areas of responsibilities that have not yet been repatriated, such as defense policy, foreign policy, justice, etc.
Some companies, such as Greenland Radio (KNR) are considered part of the public service and administration as the operational expenses are covered (less than 50%) by income from products and services.
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Table 5.4 Overview of the public sector. (www.stat.gl)
The Public sector
Public Administration and Service Corporate sector Corporate-like companies (independent Municipalities Self -Government State Sector economies) Public companies Nukissiorfiit (utility Administration Health Defence company) Royal Greenland A/S Public schools National Library Police Mittarfeqarfiit Tele Greenland A/S (Civil Aviation KNR Administration) Home care (Greenland Radio) Judicial system KNI Pilersuisoq Working Environment Town halls Business support Service A/S INI ASIAQ (Greenland Cemeteries survey) KANUKOKA (Association of Greenland Renovation municipalities)
Corporate-like companies (semi-private sector) are companies under the Self- Government where over 50% of the operational expenses are covered by sale of products and services.
Public companies are defined as owned or controlled by the Self-Government. These companies are usually limited companies with the Self-Government as sole or majority shareholder.
Table 5.5 Overview of public companies in Greenland (www.stat.gl). Public companies Brief description Royal Greenland A/S Fish and Lumpfish roes production Arctic Umiaq Line A/S Passenger sea transport within Greenland Greenland Venture A/S Provides funding for development for businesses Royal Arctic Line A/S Freight handling and shipping by sea Grønlandshavnens Ejendomme A/S Transport center in Aalborg, Denmark KNI A/S (incl. Pilersuisoq, Polaroil, Neqi Retail stores, fuel distributor and meat production A/S) Pisiffik A/S Retail stores Great Greenland A/S Seal skin production Nuna Minerals A/S Exploration company Arctic Greenfood A/S Food production Greenland Tourism- and Business Council Consultancy for onshore businesses A/S
Greenland has high public expenditure compared to Gross National Product (over 70% of GNP is made up of public expenditure). This is also partly due to the ownership of the larger companies such as Royal Greenland A/S. Public expenditure has been increasing over the last years as expenses regarding social services, administration and IT have increased. (Greenland Statistics, 2009).
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The national economy is very dependent on exports from the fishing industry and the Danish yearly economy transfer of DKK 3.4 billion. This is shown in the Figure 5-9 below. There are few large local businesses in the private sector, but many small ones, which does not induce much competition and economic stability in the country, with the difficult infrastructure and vast geographical distances. The tax income in Greenland is low as the income level is low for a large part of the workforce. Income and corporate taxes in Greenland are explained in section 6.6.
Greenland’s estimated GDP was 12,180 million DKK in 2010, which is about 215,800 DKK per capita (for comparison, in 2007 GDP was 11,063 million DKK, which roughly equates to 190,000 DKK per inhabitant). GDP decreased from the previous year before as a result of the global financial crisis and decreasing income from the fishing industry. The largest contributor to production is the public sector; which includes among others service, health service, administration and teaching (Ministry of Finance, 2011).
Greenland has a negative trade balance and it has been negative for over 20 years. It is possible because of the Danish block grant transfer. The import value of goods was 3,67 million DKK in 2009, but has gone up a little from 2006 where it was 3,454 million DKK. In 2009 the value of export was 1,923 million DKK and 2,418 million DKK in 2006. Exports were relatively stable from 2005 to 2006. As a result of the export and import balance, the trade balance in 2009 was negative 1,745 mio DKK (www.stat.gl).
19% Onshore businesses 27% Tourism 2% Building and construction 8% Raw material exploitation Fishing 2% Public sector 25% 17% Block grants
Figure 5-9 Distribution of the total income by sector in Greenland (Grønlandsbanken, 2007).
Figure 5-9 above shows that fishing and onshore businesses are the largest contributor to Greenland’s income. In 2009, imports have been larger than exports, except from January, which results in a negative trade balance. According to Greenlandic Statistics, 2010, this has been the case for at least the past five years.
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700.000
500.000
300.000
100.000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec -100.000
-300.000
-500.000 Trade balance Export Import
Figure 5-10 Trade balance in Greenland 2009 (Greenland Statistics 2010)
2005 2006 2007 2008 2009 0 -200.000
-400.000 -600.000
-800.000 -1.000.000 -1.200.000
-1.400.000 -1.600.000
-1.800.000 -2.000.000
Figure 5-11 Trade balance in Greenland 2005-2009 (Greenland Statistics, 2010)
5.6.2 Cost of living
Consumer price index Over the last ten years increases in the consumer price index have been relatively pronounced, with a 50% increase in prices since 1995. A steep annual increase of almost 7% was noticed between 2007 and 2008, at the time of the global economic crisis. The increase was also due to the tax increases of tobacco and alcohol (Departementet for Finanser, 2011).
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Table 5.6 Consumer price index annual increase (July 1995=100) (Greenland Statistics, 2010). Year January July Annual Average Pct. annual increase 2006 121,4 122,7 122,1 2,50% 2007 124,1 124,8 124,5 1,93% 2008 130,8 136,4 133,6 6,85% 2009 136,7 137,2 137,0 2,45% 2010 138,7 140,4 139,6 1,86%
Construction price index Complementing the consumer price index, the construction price index also displays a relative increase in prices, this time in freight, wages and material.
Table 5.7 Construction price index (January 2006 = 100) (Greenland Statistics, 2010). 2006 2007 2008 2009 2010 Jan July Jan July Jan July Jan July Jan July Total 100.0 102.9 105.1 109.7 111.7 112.5 115.4 115.5 116.3 117.4 Materials 100.0 103.3 106.8 115.5 118.2 118.9 122.8 122.0 121.5 121.9 Freight 100.0 100.5 102.2 102.2 101.3 104.1 110.6 109.6 106.7 111.6 Wages 100.0 102.8 104.0 105.7 107.4 108.2 109.8 110.8 113.1 114.4
January 2006 = 100
The total Construction Price Index is at 117.4 in July 2010, increasing from 115.5 in the previous year and from 112.5 in July 2008. The relative increase is explained by a large increase in prices of freight as well as smaller increases in wages and material.
The construction price index closely follows the Danish index as nearly all construction material is imported from Denmark.
5.6.3 Income
The following table shows the average taxable income per household (before tax) and shows that the average income for both Nuuk and Kommuneqarfik Sermersooq are well above the national average. Qeqertarsuatsiaat, however, is well below national average in this respect.
Table 5.8 Average taxable household income (in DKK) (Greenland Statistics, 2010) Greenland total 328,275 Sermersooq Municipality 385,838 Nuuk 433,406 Qeqertarsuatsiaat 276,269
In Greenland, household income is looked at in two ways: household income and the equivalent household income. The equivalent household income is an average of household incomes in Greenland where it is weighted how the families are composed regarding adults and children.
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The figure below shows the gross, the taxable and the disposable income in terms of general and equivalent household income brackets. The equivalent household income is close to being only half of general household income. The average disposable general income was about 243.000 DKK in 2008 and the equivalent was about 138.000 DKK.
350.000
300.000
250.000
200.000
150.000
100.000
50.000
0 Gross Taxable Disposable Household income Equivalent household income
Figure 5-12 The Qeqertarsuatsiaat population by gender and age group in 2010 (Greenland Statistics 2010)
The following table shows the taxable personal income according to place of residence and place of birth. Similar to average household income, personal income in Nuuk and in Kommuneqarfik Sermersooq is well above national average, while being well below in Qeqertarsuatsiaat.
Table 5.9 Taxable personal income (in DKK) per place of residence and place of birth (Greenland Statistics, 2010) Total Born in Born outside Greenland Greenland Greenland total 176,885 153,183 378,364 Sermersooq Municipality 214,708 175,689 406,679 Nuuk 244,000 NA Qeqertarsuatsiaat 140,314 NA
Moreover, significant differences in personal income between those born in Greenland and those born outside of Greenland are displayed. The average personal income of those born outside of Greenland equates with more than double of the average income of those born in Greenland. This is due to the large proportion of highly skilled and highly remunerated jobs held by foreign workers, especially the Danish workforce.
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The following table displays the taxable personal income according to gender, according to place of residence and place of birth. It further illustrates the inequalities in personal income for people in Greenland, with the dimension of gender also taken into account. In addition to the significant differences mentioned above, there are significant differences between men and women’s average personal income, both between those born in Greenland and those born outside of Greenland.
Table 5.10 Taxable personal income (in DKK) according to gender, place of residence and place of birth (Greenland Statistics, 2010) Men Women Total Born in Born outside Total Born in Born outside Greenland Greenland Greenland Greenland
Greenland 204,209 169,080 421,103 145,732 136,477 275,980 total Sermersooq 255,378 197,676 460,140 169.153 154,055 289,010 Municipality
It is essential to note that the economy of many Greenlandic households is not only dependent on wage jobs or taxable incomes, but also includes the use, consumption and/or exchange of the products of traditional activities such as hunting, fishing, handicraft, harvesting, etc. – a so-called ‘mixed cash- and harvest-based economy’ (Poppel et al, 2007).
Greenlandic people are, to a large degree, satisfied with the combination of salary income and hunting/fishing income, with less than 5% unsatisfied with the combination (SLiCA, 2007). In Qeqertarsuatsiaat, 75% are satisfied or very satisfied with the combination of productive activities within the most recent years (Poppel, 2011).
5.6.4 Businesses
Businesses in Greenland are registered in the Greenlandic Business Registry (GER) and assigned a number in which, by Greenlandic law, basic information such as owner, address, number of employees, branch type etc. are written and open to the public (www.nanoq.gl).
As per 2009, there are 3,310 businesses registered in Greenland, which constitutes a 13% drop in number of businesses since 2007 (Greenland Statistics, 2011). The explanation for the drop is the declining number of registered professional hunters that report their sales of game.
The distribution of industry is shown in the following graph (Figure 5-13):
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Fishing, agriculture and raw material extraction Building construction 4% 11% Water- and energy supply
7% Finance and business service
49% Industry 8% Public and personal services 3%
9% Transport, post and 0% telecommunications 9% Wholesale and retail, hotels and restaurants Undeclared
Figure 5-13 Relative size of the different industries in 2009 (Greenland Statistics, Erhvervsstrukturen 2007-2009, 2011)
Fishing, agriculture and raw materials extraction (49%) is by far the largest industry in Greenland, and the second largest is the wholesale and retail, hotels and restaurants (11 %) industry.
0% 5%0%
14% One-man businesses Limited companies 5% Other company types Foundations etc. Foreign branches Undeclared 76%
Figure 5-14 Businesses in Greenland based on company type (Greenland Statistics, Erhvervsstrukturen 2007-2009, 2011).
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The types of businesses in Greenland are mostly made up of small businesses (75%).
The figure below shows the number of people employed in businesses in Nuuk in 2008. The trade sector and the transport sector are those with the largest number of employees in 2008. The sectors health and welfare, education and mineral extraction have the lowest numbers of persons employed; these sectors have between 30 and 47 employees.
4500
4000
3500
3000
2500 2000
1500
1000
500
0 Electricity,Undeclared heat, Educationgas and Healthwater supplyandMineral welfare extractionOther collective,Banks, financing Hotelssocial andandIndustry and personalrestaurants insuranceFishing servicesReal estate,Construction rentals
Figure 5-15 Average numbers of employees according to business sector in 2008 (Greenland Statistics 2010)
5.6.5 Employment
The potential workforce in Greenland is about 29,200 people in total. In Nuuk this amounts to approximately 8,800 people. The division between genders is almost equal. In Nuuk there are about 4,300 men and 4,400 women counted as potential workers. The figure below shows the potential workforce divided by gender and age groups (Statistics Greenland, 2010).
Employment distribution across sectors is shown in the following graph. It should be noted that public administration and service includes the health and education sector. Those persons employed within government owned companies are not included in the public administration and service, but distributed within the other main sectors into which they belong.
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Public administration and 4% 2% service 10% Trading and repair
Other types 10% 47% Building and construction
Transport sector 12% Fishing
15% Industry
Figure 5-16 Employment distributed into sectors (Greenland Statistics, Beskæftigelsen 2009, 2010).
Table 5.11 Employment in Greenland by sectors and birthplace (Greenland Statistics, 2010). Total Born in Born Greenland outside Greenland Sum Percent Percent Total 29,473 77.8 22.2 Agriculture, hunting and forestry 14 100 0 Fishing 1,442 85 15 Extractive industry 159 23 77 Industry 924 88 12 Power, gas, heat and mater supply 421 69 31 Building and construction 2,904 52 48 Trading and repair 5,004 88 12 Hotel and catering 860 66 34 Transportation 2,582 75 25 Financial and insurance 165 68 32 Real property, rental and commercial 1,281 70 30 Public management, national defense, 13,064 81 19 and social insurance Education 50 90 10 Health and welfare institutions etc. 86 81 19 Other community service activities 515 85 15 Undeclared 2 50 50
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The table above, showing employment by sectors and birthplace, emphasizes that nearly half of all workers are employed within the public sector, which also includes the health and education sector. The next biggest sector of employment is trading and repair. It is shown that close to a quarter of those employed are born outside Greenland. The major sectors in which the Greenland-born persons are employed are within the fishing industry, education and industry.
Employment in Qeqertarsuatsiaat is by far the largest in the public sector, with somewhat lesser but still significant involvement in fishing and hunting. Females in settlements are most often employed in the public administration and service sectors as well as in production.
5.6.6 Unemployment
The largest increase in the number of unemployed persons has occurred in Nuuk where the unemployment rate has increased from 3,8% in the first 6 months of 2009 to 5.4% in the first 6 months of 2010, that is an increase from 324 to 474 unemployed persons. This also means that Nuuk has the highest rate of population affected by unemployment.
Unemployment rates in Greenland are highest among unskilled male workers. A total number of 830 and 514 unskilled men and women were unemployed during the first 6 months of 2010.
Table 5.12 Unemployment in Greenland per month and by gender in 2008 (Greenland Statistics, 2010). Average number of unemployed per Percent in average per month month Total Men Women Total Men Women Total 1549 957 592 5,3 6,4 4,2 Nuuk 172 102 70 2 2,4 1,6
Inhabitants in the age groups from 25-54 in Nuuk are the only age groups that received social help while being unemployed in 2008. The majority of unemployed supported by social help are men in the age group 45-49. Far more men received social help than women; in total 98 men and 40 women received social help in 2008.
The following figure shows the development and trends of unemployment in the period 2008-2010. Unemployment peaks in the winter and has a low occurrence during the summer. This figure is very representative for the unemployment situation all over Greenland. The summer season is when the fishing, building and construction industries are busiest, thus unemployment is low.
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2500
2000
1500
1000
500
0
May July May July May March March March January January January November November September September
2008 2009 2010
Figure 5-17 Medio unemployed in Greenland in 2008 -2010 (Greenland Statistics 2010).
Unemployment in Qeqertarsuatsiaat and Paamiut The potential work force in Qeqertarsuatsiaat is made up of 145 persons between the ages of 15 and 63. The following Figure 5-28 shows the distribution of the work force by gender and age group.
61-63
56-60 MALE FEMALE 51-55
46-50
41-45
36-40
31-35
26-30
21-25
15-20
15 10 5 0 5 10 15
Figure 5-18 Potential work force distributed by gender and age group in January 2011 (Greenland Statistics 2011).
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In January 2011 there were 10 male and 5 female persons unemployed. One is a carpenter the rest are unskilled. Of the 15 unemployed, only one is over 40 years old. This composition of unemployed persons is very characteristic of winter unemployment figures. During summer unemployment in Qeqertarsuatsiaat is close to zero. The average unemployed individual in Qeqertarsuatsiaat is unskilled and young. The active and skilled unemployed seek work in Nuuk or other more inhabited places. Unemployment often accompanies social problems such as drug and alcohol abuse problems (Hansen, Personal communication, 2011).
Paamiut has a work force of 1,186 in 2011 (Greenland Statistics, 2011). During the winter months there are about 100 unemployed and during the summer between about 50 and 70 unemployed (Greenland Statistics, 2010).
5.6.7 Income and corporate tax
Greenland’s taxation system is structured according to the Danish model, with a large share of the education system, health care and social institutions being paid by tax revenues. The legal framework and regulations on taxes and revenues applicable to the project taxation system is described in depth in section 2.4.
5.6.8 Greenlandic businesses
As the capital of Greenland, Nuuk is the centre of all trade, shipping, industry and administration. The town is home to many branches of public administration such as the Parliament, a law court, a hospital, the national library and the national museum. Moreover, there are head offices of banks, travel agencies, industrial companies, restaurants and a varied business life, similarly to other capitals in the world. Nuuk’s modern harbour serves as a lifeline to the outside world and as a connection to other ports in Greenland.
Among others, Royal Greenland A/S, one of the largest fish exporters and processors in the world, has its headquarters in Nuuk.
Business in Qeqertarsuatsiaat Qeqertarsuatsiaat is a settlement of a small size and therefore local businesses are rather rare. The settlement does have its own grocery and fish factory as well as a few smaller businesses such as kiosks and entrepreneurs.
According to the Greenlandic Business Register (GER), the largest businesses (by number of employees) in Qeqertarsuatsiaat are fishing, a fish factory (Royal Greenland A/S), a housing company (A/S INI), and various public services.
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Table 5.13 Number of businesses in Qeqertarsuatsiaat and number of employees (www.GER.gl, 2011) Number of Number of businesses employees each Hunt for walrus and seals 1 0 Fishing bigger than 79 BRT 1 5-19 Fishing smaller than 20 BRT 5 1-4 Fish factory 1 10-20 Stenhugger 1 0 VVS 1 0 Carpentry 3 1-4 Auto repair shop 1 0 Kiosks 2 1-4 Seller of fuel for household usage 1 0 Room rental 1 0 Cafeterias 1 0 Housing company 1 5-19 Cleaning 1 0 Public services 1 5-19 Other services 1 0
Apart from the registered companies in GER, for Qeqertarsuatsiaat there are the businesses that are registered nationally such as the grocery shop (Pilersuisoq A/S), the energy and waste company (Nukissiorfiit A/S), fuel supply (Polaroil A/S), Tele and postal office (Tele Post Greenland), public school, a home for the elderly, the health station, the child care centre, and the church.
The fishing factory, run by Royal Greenland A/S, employs 15-20 persons in the summer when production is highest. The fishing factory was the third largest based on the amount of fish received in 2010 compared to other fish factories. The fishing factory buys; Atlantic cod and Lumpfish roes in spring. There are 10 regular fishermen (all year mostly from Qeqertarsuatsiaat, 1 from Nuuk) that sell their fish to the factory. There are usually many more fishermen selling fish during summer. The transporting freight boat has room for transporting 15 tons of fish from Qeqertarsuatsiaat to Nuuk on the service boat. This puts a limit to the buying of fish from the fishermen (Konrad Boye, Personal Communication, 2011).
There are a number of service companies in Qeqertarsuatsiaat, among others: a cleaning company, room rental, handy craft, and auto repair shop.
5.6.9 Business development strategy
According to the Kommuneqarfik Sermersooq’s Business Development Politic and Strategy 2009-2013 (Kommuneqarfik Sermersooq, 2009) the following strategic focal areas, among others, are being initiated:
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Entrepreneurial development and growth o Establishment of an innovation centre including advisory for business development o Contribute with the establishment of new business initiatives in order to boost the declining employment in the fishing industry Tourism o Contribute to a cohesive infrastructure o Product development Sustainable business development and CSR o Environmentally friendly production o Reduce CO2 emission Municipality settlements o Strengthen local businesses Capital city o Strengthen and initiate competence development among construction- and service sector o Improvement of Nuuk infrastructural facilities Cooperation and communication o Establishment of local business council o Business friendly municipality.
5.6.10 Tourism and free time activities
In 2009, 21 cruise ships visited Nuuk with about 10,000 passengers on board, 31 cruise ships went into harbour in Nuuk in 2010 bringing about 15,000 passengers (www.sermersooq.gl). At Qeqertarsuatsiaat (Fiskenæsset), the harbour has been used by vessels up to 70 m length, 5 m draft. Naturally, as the passage is narrow and shallow bigger cruise ships do not visit the settlement.
There are 4 travel agencies in Greenland, handling ticketing for air and sea travel. There are 9 tourist guide companies in Nuuk ranging from outfitters to charter boats for whale safaris, approximately 10 boat charters (all between 0-4 employees) (www.ger.gl).
5.6.11 Challenges for the Greenland society
According to the Commission of Taxes and Welfares report (Skatte- og Velfærdskommissionen, 2011) the most dominant challenges for the society in economic terms are the increasing number of elderly, a young uneducated population, societal problems, and the negative trade balance. Especially the large group of people in their 40’s is a threat to the welfare burden in 2030 as this group is large and expected to live long. The groups that are a challenge to the economic society are abusers, handicapped, people under educated, and those receiving early retirement as this group has a large impact on public expenses.
5.7 Public Infrastructure and Services
5.7.1 Dwelling and accommodation
There is an average of 68.5 m2 per house/dwelling in Nuuk and 57.6 m2 in all of Greenland in 2008 (Greenland Statistics, 2009).
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There are on average 2.4 inhabitants per dwelling in a town, while there are 2.3 per dwelling in a village in the whole of Greenland (Greenland Statistics, 2009). In Nuuk, the respective numbers are 2.5 and 1.9 respectively.
There were a total of 23,112 dwellings in Greenland in 2010, among which 7,173 are private properties and 16,330 are either governmental or municipal properties, state- owned dwellings or dorm rooms and dwellings for the elderly. The rest of the dwellings, 2,680, are of unknown nature (Greenland Statistics, 2010). The average number of rooms for dwellings in Greenland is 2.9. In Nuuk there are 6,455 dwellings with an average size of 3.1 rooms.
Table 5.14 Rate of owner-occupied dwellings vs. rented dwellings in Greenland on national level (Greenland Statistics, 2010) Total 23,112 State-owned 182 Governmental property 7,973 Municipal property 5,495 Private property 7,173 Unknown 2,289 Dorm rooms and elderly 2,680
A/S INI, a limited company, administrates public housing, in which the Greenland Self-Government is the sole shareholder. The housing situation in Nuuk is under significant pressure as the immigration rate (mostly from other areas and towns from all over Greenland) has been very high for a number of years. This means long waiting lists for public housing (16-28 years), which has resulted in high rental rates. Although there are many new houses being built, the waiting lists stagnate. Even though some people living in public housing facilities buy their own houses or have shares in a housing association the pressure from the immigrants is so strong that the waiting lists only get longer (Copenhagen Economics, 2010).
Students from other parts of Greenland are settled into dorm rooms and student houses. In recent years the number of students has risen and consequently there is a lack of number of dorm rooms. In 2010-2013, 150-200 dorm rooms for students will be built in Nuuk (www.nanoq.gl).
5.7.2 Communication
The largest Internet and phone line supplier TELE Greenland A/S provides telecom to all towns and most settlements in Greenland. There are 22,818 telephone main lines, 55,816 cell phone connections and 11,695 Internet connections by 2008 (Greenland Statistics, 2009).
5.7.3 Transporting facilities and infrastructure
Ships, boats, planes and helicopters mainly transport passengers and freight. As there are no roads and or railways in Greenland between towns and settlements, the infrastructure is very vulnerable to weather and climatic conditions. Six towns have a heliport for regular flights and larger settlements have a helipad (40 helipads in total) for evacuation purposes.
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The major airports are Narsarsuaq and Kangerlussuaq, which respectively consist of 1830 m and 2810 m of runway. These airports have regular flights to and from Denmark and also to Iceland in some seasons. There are an additional 11 airports near towns with smaller runways including Nuuk. Air Greenland A/S is the operating national airline company owned by the Greenland Self-Government, Scandinavian Airline System and the Danish State (www.airgreenland.gl). Mittarfeqarfiit, the Greenlandic Airport Authority, administers and runs airports, heliports and helistops in Greenland and is a company run under Greenland Self-Government (www.mittarfeqarfiit.gl).
The 16 town ports and 60 harbours in settlements in all of Greenland have different capacities for freight ships and passenger ferries as well as cruise ships. Nuuk has the largest port in Greenland, which also serves as a basis port for Southern Greenland. Royal Arctic Line A/S, a company owned exclusively by the Greenland Self-Government, is responsible for the daily operations on, and operates as the local port authority for, 13 ports in Greenland.
Most container freight is shipped to Nuuk and from here distributed to other towns and settlements; this is run and administered by the company of Royal Arctic Line A/S. Qeqertarsuatsiaat gets goods from the RAL ships (bygdeskibe) biweekly. The passenger ferries only run regularly between towns and settlements within Greenland. Qeqertarsuatsiaat has a call into port biweekly during the winter and weekly during the summer months. The passenger ferries are run by a Royal Arctic Line A/S subsidiary, Arctic Umiaq Line A/S (www.ral.gl).
5.7.4 Energy production
This section is compiled from numbers and information in Greenland Statistics, Grønlands Energiforbrug 2009, 2010.
The energy consumption in Greenland is dependent upon import of fossil fuels although the production of renewable energy from hydropower plants is increasing. The total energy usage in Greenland is 9,013 TJ in 2009, which is a 10.5% decrease from 2008 usage, mainly because of a mild winter.
Nuuk has received hydropower from Buksefjorden since 1993 (the largest hydropower plant in Greenland producing 785 TJ). The plant had a third turbine installed in 2008. There are currently 5 towns in Greenland receiving energy generated from hydropower plant operations. The total energy production from hydropower was in 2009 on the order of 916 TJ.
Diesel is used for production of power and district heating, for heating in households, institutions and businesses, for processing in the industry, fishing- and recreational vessels and for transport. As the production in the hydropower plants has been on the increase, the usage of diesel decreased in 2009. The consumption of diesel was equivalent to 6,473 TJ in 2009. That said the current Greenland energy mix amounts to about 10% from hydropower and about 90 % from fossil fuels.
Waste incinerators in Qaqortoq, Nuuk, Maniitsoq, Sisimiut and Ilulissat provide district heating to the respective towns. Electrical heat consumption has increased by 10% according to the production of hydropower in the before mentioned towns.
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5.7.5 Health services
All medical treatment in Greenland is free including dental work. This is financed by taxes (www.nanoq.gl).
The Queen Ingrid Hospital (Dih) is situated in Nuuk and works as the main specialist hospital centre in Greenland with modern equipment. The hospital houses 191 beds, in specialty and treatment wards. It also houses a patient hotel (www.peqqik.gl).
Other hospitals include 16 hospitals spread around in Greenland, one in each town (www.peqqik.gl). There are 60 settlement consultations and health stations, mostly in settlements of more than 50 inhabitants and staffed with one nurse or health care worker (www.peqqik.gl).
There are 17 dental care clinics, one in each town. There are no dental care clinics in settlements (www.peqqik.gl).
Health Research, The Greenland Institute for Circumpolar Health Research (GIHR) was established in 2008. The purpose is to “enhance cooperation between researchers from other countries and health professionals in Greenland and to further research cooperation in Greenland”. The institute is located in Nuuk (www.pi.gl).
Alcohol Treatment Centre, Qaqiffik. The centre is financed by the Greenland Self-Government and has been active since 1995 (www.qaqiffik.gl).
Peqqissaanermik Ilinniarfik, Centre for Health Education. The centre manages nurse, health-care worker and health porter educations in Nuuk (www.pi.gl).
Grønlænderhjemmet (Accommodation in Denmark for patients from Greenland).
The accommodation is to house patients and next of kin from Greenland before and after admission to hospital. Grønlænderhjemmet is located in Brønshøj, a suburb to Copenhagen (www.peqqik.g).
In the summer of 2010 telemedicine equipment (Pipaluk) was set up in all 16 health districts (11 districts have already installed telemedicine). All together 77 so- called ‘carts’ were to be set up so that all towns and settlements with more than 50 inhabitants would have a cart (www.peqqik.gl).
5.7.6 Health services for expatriates
Expatriates working in the sector of mining and exploration activities have to pay taxes to Greenland after a 2 weeks’ stay in Greenland. In Greenland, international employers are required to have health and accident insurance for the employees.
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Health service will be available for all involved in accidents, whether Greenlandic or expatriates, and the charge for the services will be clarified afterwards. The Greenlandic health service is responsible for transport of people from all-year inhabited areas for medical treatment during the entire year. The Greenlandic police are responsible for transport from all other on land areas and in sheltered waters in connection with medical treatment. The Danish defense is responsible for transport from open waters (Niclasen, 2010).
5.7.7 Infrastructure and services in Qeqertarsuatsiaat
Housing According to the SLiCA survey (Poppel, 2011) more than 9 out of ten citizens in Qeqertarsuatsiaat live in single-family houses, double or town houses. 62 % of those interviewed live in homes with 2 or 3 bedrooms. 26 % believe they have less space than needed. 90 % have a separate kitchen, and 9 out of ten have a bath room or shower with running cold and warm water. More than 50 % experience cold floors as a nuisance and almost 50% experience draft from doors and windows. About 40 % find their home in need of a larger renovation.
In Qeqertarsuatsiaat the number of dwellings (mostly one-family houses) is close to adequate, although most require maintenance or to be demolished and replaced (Nuuk Kommunea, 2006). The houses in Qeqertarsuatsiaat are often owned by A/S INI and are rented to the locals. There are several empty houses in Qeqertarsuatsiaat, but most need renovation or are ready to be torn down.
Communication and transport According to SLiCA in 2006, about one-fourth of those interviewed have no phone, while 30% have Internet (Poppel, 2011). There are about 40 main phone lines in Qeqertarsuatsiaat (TeleGreenland, 2011).
Qeqertarsuatsiaat is a settlement only accessible by sea, which considerably constrains access in harsh weather conditions. During the winter months from January through May the access from the sea way can be inaccessible because of fast ice formation. The port is used for freight-, passenger- and fishing boat handling. There is the port (length of 10 m, depth 4 m), a small pier (5 m, 1 m), a fishing pier (17 m, 2 m) and 2 pontoon bridges in Qeqertarsuatsiaat (www.havne.gl).
In Qeqertarsuatsiaat, Tele Greenland has a small helicopter landing deck, located at the Tele Greenland facility. There are no regular flights to Qeqertarsuatsiaat. The helicopter Landing Deck does not have an access road.
As a rarity in Greenland the road surfaces in Qeqertarsuatsiaat are tiled. The roads are not suitable for cars and there are only tractors and four wheelers.
Health services Qeqertarsuatsiaat has a health station staffed with one nurse or health care worker. The health station has a Pipaluk, telemedicine equipment, installed. The settlement is visited by a doctor or specialist, midwife and a dentist once a month when possible.
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Culture, leisure and institutions Kommuneqarfik Sermersooq has a local office in Qeqertarsuatsiaat and holds 4 office workers and other service workers. The office holds a couple of guest-houses for municipal workers travelling from Nuuk.
About 45 students go to the public school until 9th grade, with 5 teachers or temporary teachers employed. There is a day-care available for children in first through 5th grade after school.
There is a child care center for children aged 0-6. Child-care is priced according to the parents’ income.
Qeqertarsuatsiaat has a recreational club for teenagers, which is open after school and sometimes in the evenings, but is closed in the summer. The settlement also has an outdoor soccer field as well as a community hall that is also used for indoor sports.
Qeqertarsuatsiaat has a ski run area with lights following the lake, soccer field, the dump and the cemetery.
The home for the elderly in Qeqertarsuatsiaat is a commune, but is practically a nursing home. There are 10 residents and 9 workers in 2011 (Skatte- og Velfærds- kommissionens betænkning, 2011).
In Qeqertarsuatsiaat the church is located in the center and is a gathering place in the settlement every Sunday, during holidays, christenings, communions and weddings. The cemetery is located just outside the settlements center.
There is a small local museum in Qeqertarsuatsiaat.
Energy, water and waste services Qeqertarsuatsiaat power supply is a diesel generator that has a capacity of 736 MWh and is run by Nukissiorfiit A/S.
Qeqertarsuatsiaat has its own waste incinerator located near the drinking reservoir (Nuup Kommunea, 2006). The incinerator (run by the Kommuneqarfik Sermersooq) handles combustible material, household and industrial waste as well as dead animals. The dump in the east end of the settlement holds about 2,500 cubic meters and the area contains a sorting area for separating different material such as batteries, slag from the incinerator, non-combustible material, etc. Other waste such as scrap metal, environmentally unsafe material, asbestos, oil and diesel, etc. is shipped off to Nuuk 1-2 times a year.
There is a municipal collection of sewage and the human effluent is discharged to the sea in the northeast end of the settlement.
The local drinking water facility supplies the settlement with drinking water from the drinking water reservoir and is run by Nukissiorfiit A/S. Institutions and some consumers are connected to the drinking water supply. Some homes get drinking water from the 5 running tap water stations located around the settlement.
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Local development plans and initiatives The local municipal plan for Qeqertarsuatsiaat from 2005-2014 is to (Nuup Kommunea, 2004):
Renovate or tear down empty or outdated homes Study the need for handicap or elder friendly homes Study the potential for develop tourism in Qeqertarsuatsiaat Building a new fire station Improve the school facilities Expanding the community hall or building of a smaller gymnasium Develop more leisure time options for children and teenagers A new path around the lake A new pontoon bridge by the cemetery Reservation of a new area for a new helipad Connect slip tanks to all houses Move/expand the dump New housing area south of Qeqertarsuatsiaat.
The municipal council has established the developmental plan, which is a foundation for the physical layout and specifications for areas in Qeqertarsuatsiaat. Major construction projects or teardowns must be included in the municipal plan unless the physical areas are specified for the purpose of the construction project in question.
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Red area: Housing Purple area: Community areas Blue area: Industrial areas Yellow area: Technical facilities Contoured area: Future areas White area: ski path with lighting Figure 5-19 Map over Qeqertarsuatsiaat showing the development areas (Nuup Kommunea, 2004).
Security and Emergency response Qeqertarsuatsiaat firestation is a part of the Kommuneqarfik Sermersooq fire emergency response team. The fire station is equipped to handle fires in the settlement as well as smaller accidents.
The settlements in Greenland all have a municipal bailiff that takes care of simple police matters.
5.8 Education and training
5.8.1 Educational levels
The table below shows the education levels offered in Greenland.
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Table 5.15 Educational levels and length (www.nanoq.gl). Educational level Length Public school 1-10 years (9 years obligatory) High school 3 years Vocational/Professional education 3-4 year (req. public school graduation) Medium education 2-3 years Higher education and specialization 5 + years (req. high school graduation)
Greenland has obligatory attendance for at least the first 9 years of elementary school. Education is free of charge for Greenlandic citizens. All educational institutions have application deadlines on March 1 every year. Greenland has a quota of free student seats in Danish educational institutions (as long as the education is not offered in Greenland). Applications for these seats have deadline on March 1 every year and are administered by KOT (The Danish Coordinated Enrolment). All students accepted in the Greenlandic and Danish education systems receive a regulated monthly stipend and are eligible for a student loan. Most education programs offer dorm rooms.
There were 10,255 students attending grades 1 to 12 in the school year 2007/2008 (Greenland in figures, 2010). With 1,189 teachers in the entire country, there are 11.6 students per teacher in the same school year.
5.8.2 Education strategy (2005-2020)
Parliament adopted the long-term Greenland Education Programme (GEP) in 2005 in recognition of the low education level in Greenland. The aim of the Greenlandic education strategy is to provide two-thirds of Greenland’s workforce with an education providing them with academic or vocational qualifications by 2020 (www.nanoq.gl)4. In the first phase (2006-2012) emphasis will primarily be put on vocational training, the acquisition of real qualifications for jobs above unskilled level and training courses for the unskilled workers. The focus of the second phase (2013-2020) will be on higher education.
In 2010 the EU continued its support of the educational and vocational training sector in Greenland, providing €27,88 million Euros to the national budget with the aim of contributing to “a higher standard of living and quality of life through increasing education levels” (EC News, 2010). The sector was selected as focal point of the EU- Greenland cooperation strategy, besides fisheries (www.nanoq.gl). The support awarded by the EU to the Government of Greenland was in light of the clear and concrete focus put on the education and training sector since 2004, which was accompanied by extraordinary budget increases from 2004 onwards.
5.8.3 Primary and secondary Schools
The public schools in Greenland teach students in grades 1 - 10 from the age of 6 to approximately 16. Law requires education for the first 10 years. The municipality operates the public schools and there are currently 24 elementary schools in 18 towns and 58 lower grade public schools in settlements. About 45 students go to the public school in Qeqertarsuatsiaat until 9th grade with 5 teachers or temporary teachers employed.
4 http://uk.nanoq.gl/emner/international_relations/gep.aspx
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For most settlements the older classes are taught in the nearest town where the students live in controlled dorms. For Qeqertarsuatsiaat 15 students from age 13 are taught in Nuuk and stay at the dorm, which is called Elevhjem. The 10 school years are divided into three levels; a 3-year level for the younger students, a 4-year middle level, and a 3-year level for the eldest students. The students are organised into changing teams made up by levels and interests. The students are taught in Danish and Greenlandic. The end of 9th grade involves evaluation of a project assignment, written and oral exams (FSA) and end of 10th grade (advanced and extended level) involves also written and oral exams (FSUA).
There are 5 public schools in Nuuk with a total of 2,416 students and 40 students in settlements around Nuuk, (Greenland Statistics, 2010). There is one private school located in Nuuk. Public schools follow a school reform that was instituted in 2003 that was designed to suit the Greenlandic culture and language. There is an additional school in Sisimiut for the hearing impaired. (www.nanoq.gl).
The 10th grade can be attended in the public schools in most towns, but it is possible to attend it in Denmark as well as at a boarding school. Attending in Greenland is free. It is possible to apply for grants for attending in Denmark. The amount of a grant is typically DKK 2,500-3,000 per month (not including the ticket to/from Denmark) (www.nanoq.gl). Illiteracy is practically non-existent in Greenland.
According to grade point averages for the 10th grade FSA students, it is noticeable that the averages in towns are higher by 0.4 grade points (13 point scale).
Table 5.20 Grade point averages for FSA students (Nordregio, 2010) Town Settlement Males 7.1 6.5 Females 7.4 7.0 Total 7.2 6.8
There are 5 secondary schools spread along the west coast, attendance is free and all Greenlandic students may receive a monthly allowance from the government according to specific requirements. Acceptance depends on the individual grade point average of the final public school exam as well as an evaluation from the public school.
5.8.4 Vocational Training
Professional training and business schools are free for Greenlandic citizens, although Greenlandic students have to have a certain grade point average to enter or get accepted when applying (which includes a stipend). Most educations offer dorm rooms and most Greenlanders are eligible for stipends during attendance.
There are eight vocational schools in Greenland:
Saviminilerinermik Ilinniarfik (The Metal and Iron School) in Nuuk Sanartornermik Ilinniarfik (The Building and Construction School) in Sisimiut o Aatsitassalerinermik Ilinniarfik (The School of Minerals and Petroleum) Niuernermik Ilinniarfik (The School of Commerce) in Qaqotoq Niuernermik Ilinniarfik (The School of Commerce) in Nuuk Inuili (The Food Service and Preparation School) in Narsaq
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ATI (The School for Fishing Industry) in Maniitsoq Imarsiornermik Ilinniarfik (The School for Merchant Mariners) in Paamiut Aalisarnermik Piniarnermik Ilinniarfik (The School of Hunting and Fishing) in Uummannaq
The Greenland Government has initiated a number of different vocational training schools, which are suitable for, and partly targeting the mining industry.
The Industrial and Mechanical school has this year partly been merged with the Construction school in Sisimiut (has a department called mining school), where students can be trained as arctic entrepreneurs and in both surface and underground mining, to mention but a few. The school will now be called School of Minerals and Petroleum. The training is free for locals and students are required to submit an application and to go through an acceptance procedure (www.sanilin.gl). The merger between the two schools will strengthen the training and provide synergy with the teaching competences. In connection with the Schoola, a knowledge centre for Mining and Petroleum Industry will be established.
More than 100 people have completed the so-called Common Core course at the School of Minerals and Petroleum, which lasts 10 weeks and requires basic knowledge of English. The courses include, among others, first aid, fire fighting, personal safety equipment, technical equipment, etc. The courses are funded through AMA (business tax) and PKU (public education plan) (HS Analysis, 2010)
To get accepted to the Common Core program (mining competences) at the Construction School in Sisimiut, the applicant must be able to communicate professionally in English. Training and teaching material are free and a stipend is awarded to students (www.sanilin.gl).
The Industrial and Mechanical School is placed in Nuuk and some smaller departments of the Construction School. The Industrial and Mechanical School trains students from all over Greenland. The school has 100 full-time students and a total of 350-400 active students (Pedersen, 2010) yearly. The programs and majors include, among others:
Craft and Technique: Blacksmith, ship fitter, welder Mechanics: Machines, auto mechanic, aircraft, marine engines Technology and Communications: Electrician, IT Supporter, automation mechanic, etc. Transport and logistics: Terminal worker, storage and transport worker.
The Language Centre (Oqaatsinik Pikkorissarfik) in Sisimiut has training as an interpreter and translator, and provides training in Greenlandic, Danish and English. Other programmes include; the Police School, The School of Art, The Fire-fighter School, Social Education College (Perorsaanermik Ilinniarfik) and courses provided by Royal Arctic Line, Air Greenland and the Greenland Airport Authority.
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5.8.5 Higher Education
The University of Greenland (Ilisimatusarfik) covers both Master (5 years) and Bachelor (3 ½ -4 years) programmes. University attendance in Greenland is also free and is only offered in Nuuk. Students have to have a certain grade point average from high school to enter or get accepted when applying. There are these following three institutes:
Ilimmarfik Institute Institute of Learning Institute of Nursing and Health Science.
Departments present in the Ilimmarfik Institute are:
Department of Greenlandic Language, Literature and Media Department of Cultural and Social History Department of Theology and Religion Department of Social Sciences Department of Journalism Department of Social Affairs.
The institutes work with a number of humanistic research activities and projects, which also involves Greenlandic, Nordic, Canadian and American partners and alliances. These projects are financed through own funds and partly through foundations, Nordic funding and funding from research councils. The findings from the projects are published in a number of national, Nordic, and international journals and via participation in conferences and seminars etc.
The university, Ilisimatusarfik is an institution under Ilimmarfik, a corperation between Greenland Statistics, the National Archives, the Language secretariat, and the National Library.
ARTEK (Arctic Technology Centre) offers a special arctic engineering education in collaboration with the Danish Technical University (DTU) in Lyngby, Denmark. ARTEK offers a programme for specializing in Geology – Construction and Raw Materials. The specialization involves, among others:
Working with surveying and GIS Geological prospecting oil and mineral Construction for mining and hydropower.
The education can be extended to:
Civil Engineer in Petroleum Engineering Mining Engineer abroad Geologist.
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5.8.6 Courses for unskilled and skilled labour
PKU- Courses for unskilled labour PKU is directed primarily towards the unskilled workers, in order to develop their skills so they can meet new market opportunities. The courses typically run over four weeks and it is estimated that the funding (24 million DKK/year) is sufficient to upgrade 600 unskilled workers a year (HS Analysis, 2010). In 2010, the availability of courses targeting tourism, services and especially mining and oil industry have increased. It is expected that most of the funding in 2011 will be used on courses related to the mining and oil industries.
AMA – Courses for skilled labour AMA courses are designed and implemented for upgrading the qualification of skilled workers currently employed, but can also include unemployed skilled workers. Companies that enrol their employees must pay a fee to cover educational costs, and can get grants for travel and subsistence expenses. The various courses and training activities can be part of a modular training programme for a period up to 3 years. The courses are typically offered by or in cooperation with the Leadership Academy at the School of Commerce in Nuuk (HS Analysis, 2010).
Funds may also be granted for courses offered by private course organisers, for example with local Piareersarfiit centres in the Municipalities.
5.8.7 Selected Education Statistics
Since 1998 the number of women enrolled in education has exceeded that of men. Women dominate in middle-range and university education (Statistics Greenland, 2009). Education possibilities in Greenland are limited, which is why many Greenlanders go to Denmark to study. However, this requires students to be proficient in both Danish and Greenlandic. Greenland may send students to Denmark for free education in Danish educational institutions.
In 2009, 518 students completed their education in Greenland. The majority of these studied a basic technical education. About 1200 people commenced an education in 2009, which is more than twice as many as the amount who finished in the same year. The majority of those starting their education in 2009 were also enrolled in basic technical educations.
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1 71 Basic technical educations Further educations, short 115 Further educations 331 Other educations
Figure 5-20 Numbers of finished educations for types of education in 2009 (Greenland Statistics 2010)
The figure below shows the different education programmes contained within “basic technical educations”. The majority were educated in the social sector; this sector mainly focuses on welfare and health. A total of 557 students stopped their education in 2009; most of them have started another education instead.
2 Iron & metal 59 Construction 107 Trade and office Food industry 52 Shipping and fishing Agriculture 7 Social welfare and health 33 55 16 Service
Figure 5-21 Numbers of students that completed a basic technical education, 2009 (Greenland Statistics 2010)
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Less than 7 years of 19% schooling 27% Required Schooling FSA
FSUA
4% High School 3%
Other 47%
Figure 5-22 Survey over attended education in Qeqertarsuatsiaat in 2006 based on 52 interviews (Poppel, B., 2011)
5.9 Public Health
5.9.1 Health status
Health care expenditures in 2009 of 1.11 billion DKK were allocated as shown in the figure below.
Prevention and surveillance 2%3% 7% Diagnosis or treatment of criminal offenders 12% Acute transport within or 48% outside Greenland Treatment outside Greenland
Dronning Ingrids Hospital, 28% Nuuk Health districts
Figure 5-23 Health care expenditures in 2009, using DKK figures (Niclasen, B. and Mulvad, G., 2010)
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A survey of the Greenlandic population for 2005-2007 was published in 2008 by the Institute of Public Health in cooperation with the University of Southern Denmark as a follow-up on the 1993 survey. Greenland’s health status was mapped and depicted pictorially as a society faced with a number of deep-rooted issues. This survey was then used to design a preventive health programme, called Inuuneritta, with the following focal areas:
Alcohol and violence Nutrition and physical activity Smoking Sexual activity.
In addition, the programme will add on to the previous focal areas (Inuuneritta, 2007- 2012) (Statens Institut for Folkesundhed, 2008; Inuuneritta, 2006, www.paarisa.gl):
Prevention of suicide Early preventive efforts for children and youth Dental health Senior citizens Early effort for pregnant families.
The Greenland Home-Government established Paarisa in 1997. Paarisa “manages the preventive and health-promotive efforts through information and counselling as well as coordination of central and cross-sectional health-promotive activities” (www.paarisa.gl). The people’s health programme, Inuuneritta, was implemented in 2004 by the establishment of a steering committee in cooperation between the Ministry of Health and the Arctic Public Health Research (Center for Sundhedsforskning i Grønland). The programme defines a set of goals for people’s health from 2007 – 2012 in order to implement health-preventive measures and to force people to take responsibility for their own health. The programme is based on the report on the public health status in Greenland previously mentioned (Bjerregaard, 2004).
The Greenlandic public health programme Inuuneritta covers a broad range of major public health problems but focuses on a realistic implementation. According to the Greenlandic population assessment, the most important themes in the programme are the following: ‘Alcohol and violence’ stands out, followed by ‘Suicide’ and ‘Nutrition and physical activity’ (Bjerregaard, 2004).
The mortality rate has been at almost the same level since the 1960s, where it decreased quite significantly due to the cure of infectious diseases and tuberculosis. Death caused by cardiovascular diseases and hunting/fishing accidents have decreased, while deaths from cancer and suicide have increased since the 1960’s. One of the aspects described in the health status points to a relatively high infant mortality rate, where the infant mortality rate on the east coast is especially high in comparison to the rest of Greenland - 8.12 deaths/1,000 population (July 2011 estimate)
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The serious diseases with the highest frequency are: mental illnesses, diseases in extremities and joints, cardiovascular diseases, diabetes, obesity, cancer, smoker’s lungs (70% of Greenlanders smoke), infectious diseases, dental illnesses and allergies. Other health issues are unwanted pregnancies and abortion, suicide, violence and accidents.
The number of teenage pregnancies and motherhood is high in Greenland compared to other countries. To prevent teenage pregnancies a doll project was commenced in 2010 where over 1,100 students all over Greenland participated. The students took care of their doll, which simulated a baby’s need for constant care, for 1-3 days.
Not surprisingly, since teenage pregnancy is an issue, the occurrence of sexually transmitted diseases (STDs) is high among teenagers and young people. While there is a very high incidence of Chlamydia, gonorrhea and other sexual diseases, especially among young people, HIV/AIDS has a surprisingly low yearly incidence. Until 2008, 153 people were registered as infected with HIV and a third of these cases have developed into AIDS. About a third of those known to be infected with HIV have deceased, although not all from AIDS. 63% of those infected are male and most are middle aged. The average age of those infected has been rising within the recent years. Most of the registered HIV positive individuals live in Nuuk and Sisimiut (Landslægeembedet i Grønland, 2009).
Alcohol abuse is responsible for a number of the health issues and diseases (Bjerregaard, 2004). Beer is a popular alcohol and consumed most frequently. However, its consumption diminished considerably from 2008 to 2009, at the same time where the consumption of wine and light beer strongly increased.
In the Survey of Living Conditions in the Arctic, over half of the interviewees (53%) had experienced problems in their childhood home caused by alcohol. This number was at 37% in 1993 (Bjerregaard, 2004).
Tuberculosis (TB) is an infectious disease that has a high frequency of occurrence in Greenland compared to other countries. In 2009 there were 63 new cases. The screening among school children in 2008-9 showed 9% of the students in 10th grade were infected. (Landslægeembedet, 2009)
Violence and sexual assault are frequently occurring problems in Greenland. Research shows that 59% of the population has been, at some point in their adult life, subjected to various forms of violence or threats – the young people more than the older generation.
5.9.2 Social health and vulnerable groups
During the consultation with the different various informants for the baseline collection, the authorities and key informants identified different groups in the society as vulnerable groups. These include:
Teenagers that drop out of school Children, particularly in young families with addiction problems Unemployed, uneducated young males that have addiction problems.
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The list is not extensive and does not reflect any particular priority. The following sections briefly describe some of the key social health problems identified by authorities and key informants that are related to the most vulnerable groups in the Greenlandic society.
According to the SLiCA survey in Qeqertarsuatsiaat (Poppel, 2011) the following social problems play a role in the community:
Unemployment (74%) Alcohol abuse (67%) Drug abuse (67%) Suicide (16%) Violence in family (13%) Sexual abuse (9%).
Teenagers that drop out of school In Qeqertarsuatsiaat children from the age of 13 are sent to Nuuk to continue their required education. They are placed in a dormitory where high school students (age 16-19) also live. The drop put rate among these children is high and many of the children return to Qeqertarsuatsiaat without finishing their education. The teenagers do not have a lot of opportunities for activities other than going to the local youth club. (Local interviews, Personal Communication, 2011).
Suicide Suicide among the Greenland population is one of the main challenges for public health in Greenland. Suicide rates are among the highest rates in the world, especially among males aged 15-25, but also among young women (Leineweber 2000). The high number of suicides, especially among young men, represents a larger proportion of deaths than the growing number caused by cancer and heart disease (Bjerregaard, 2004).
Explaining this behaviour is a complex matter. Current research on the subject paints a picture where factors, such as upbringing, personal crises, for example caused by conflicts with boy/girlfriend or family, sexual assault, suicide among friends and family and alcohol problems, may contribute towards the decision to commit suicide (Bjerregaard, 2004).
In comparison to other Arctic countries, the number of those who ‘seriously thought of committing suicide’ in Greenland is considerably higher (SLiCA, 2007). In Qeqertarsuatsiaat 16% thought that suicide is a social problem in the community (Poppel, 1011).
The rapid pace of modernization of the Greenlandic society, through the emergence of new economic, social and political structures, has been attributed as an important factor behind the increasing numbers of suicides and suicide attempts (Bjerregaard, 2004) (Leineweber, 2000).
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Young mothers and abortions While most fathers are between 24-30 years old when their first child is born, most women, at the time of giving birth, are between 20 and 24 years old. In the same age group a large number of women have not reported the identity of the father to the authorities (Documentation Centre of Children and Youth, 2007-08).
In the last couple of years the number of abortions has surpassed the number of births. Previous studies have shown that it is not possible to pinpoint to a specific risk group (more likely to have abortions). Women of all ages have abortions and come from various social classes. Moreover, previous studies have also shown that women are looking to prove their worth as a woman by getting pregnant and that it gives status to become a mother (Bjerregaard, 2004).
In Qeqertarsuatsiaat the prevalence of young mothers and abortions are not perceived as a social problem in the community (Local interviews, Personal Communication, 2011).
Violence Violence and sexual assault are frequently occurring problems in Greenland that affect public health in a negative manner. The big populations study in Greenland (Befolkningsundersøgelsen 2005-2007, Bjerregaard, P. og Aidt E.C., 2010) reveals that 59% of the population has been, at some point in their adult life, subjected to various forms of violence or threats – with young people more vulnerable than the older generations. Sexual assault and violence are clear health and societal issues and both are a part of the problems associated with alcohol abuse. The Paarisa programme puts clear emphasis on these interconnected aspects in the strategy for 2007-2012.
According to a survey done on domestic violence among 23 convicted men collected from police reports from 2001 (Poppel, 2002) the offenders have a number of similarities mentioned below:
The group of male offenders is over-represented (about age 40-50) A tendency of the group to be under-privileged according in terms of to education and employment The offenders have a number of problems, apart from the ones mentioned, to a higher degree than comparable groups Alcohol is involved in most cases of violence.
Homelessness The following sections are from the Homeless Survey conducted by the Ministry of Family and Health in 2008 (Departementet for Familie og Sundhed, 2008).
In 2008, 526 people were registered as homeless. Particularly persons in the 41-60 age bracket are homeless in Nuuk.
Table 5.21 Number of homeless in Nuuk in 2008 (Ministry of Family and Health, 2008). Municipality No. Of adults Men Women Married or co- Homeless without their habiting with young own dwelling children Nuuk 22 18 4 1 2
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Out of 22 homeless in Nuuk there were 16 receiving welfare support and 8 were job seekers. 15 of the 22 had an alcohol or drug abuse problem. (Data from same report, table 3 and table 4).
The homeless in Greenland can be divided into two equally large groups. A temporarily vulnerable group consisting of students, newly divorced or separated persons, young people who want to move away from home and people who are not entitled to staff housing. The second group is of the long-term variety and encompasses persons struggling with other social problems including long-term jobless, substance abusers, criminals, persons with mental disorders as well as disability pensioners. Those temporarily homeless usually solve their problems on their own but can become vulnerable again and in the long run end up as part of the long-term homeless. Those in the long-term homeless group cannot help themselves and require external assistance. The survey shows that 13% of the homeless have children in their custody.
Crime In Greenland the judicial system, police and defence are still under the Danish government. The police district in Greenland is divided into 17 sub-districts with a police commissioner in Nuuk. In addition, the police are responsible for land and coastal rescue services. The Greenland Command is responsible for sea rescue services, defence, fishing inspections and sea surveying. The Greenland Command is headquartered in Kangilinnguit (Grønnedal) (www.forsvaret.dk/GLK).
The Greenlandic crime system was originally formed in the 1950s according to Greenlandic traditional and cultural values (www.kriminalforsorgen.dk).
Greenland’s penal code comprises offences of public authority, theft and crimes against life and health. Special legislation includes traffic laws and illegal drugs, among others. Currently there are no prisons in Greenland, but 5 “open” institutions with room for 182 convicts in total. These institutions allow prisoners to go out on a daily basis to attend work, studies or substance abuse treatment. In addition, approximately 20 persons serve treatment sentences or serve in “closed” institutions in Denmark. Within the next years the following expansions will be implemented so as to allow the accommodation of up to 229 persons (www.kriminalforsorgen.gl and Anstaltsektoren i Grønland, 2010):
In 2015 a “closed” institution will be available in Nuuk for the prisoners currently serving in Denmark (a total of 76 rooms of which 20 are currently placed in Denmark) A new “open” and “semi-closed” institute in Tasiilaq in East Greenland Expansion of “closed” and “semi-closed” institutions in Ilulissat, Aasiaat, and Qaqortoq.
The waiting list for placement in an institution in the start of 2010 amounted to 260 persons. Even allowing for the proposed expansions listed above, the capacity of the institutions is too small.
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The number of offenders and convicts in Greenland is three times higher than in other Nordic countries. The percentage of number of convicts compared to the number of inhabitants is among the world’s highest (www.kriminalforsorgen.dk).
Greenland’s High Court in Nuuk and 18 district courts in the rest of Greenland hold the judicial power.
Compared to other countries, crime in Greenland is characterised by many violent acts, hereof sexual offences, homicide and homicide attempts. During the past few years drug offences (especially hashish) and different forms of economic crimes have also been common (www.kriminalforsorgen.dk).
According to data surveyed throughout 1999-2008, almost five out of 100 persons over 15 years of age were found guilty of a criminal offence for each of these years by a court of law. Out of these, 82.4% were men and 17.6% women. The most frequent age bracket represented in the statistics is the 20-24 year old one, with the average age of offenders being 34.
1600
1400
1200
1000
800
600
No. of sentenced of No. 400
200
0 2004 2005 2006 2007 2008 2009 Year Penal law Police regulation Traffic law Special laws
Figure 5-24 Number of persons sentenced by judicial courts 2005 – 2008 (Statistics Greenland, 2009).
Figure 5-24 shows that in Greenland the majority of offenders have violated the penal code. In 1999-2008, 870 persons per year on average were found guilty of offences against property, which constitutes the major part of all penal code violations. This is followed by rape crimes with an average of 356 persons found guilty in 1999-2008, other crimes comprising another 185 guilty charges and finally sexual offences with 96 found guilty during the same period. It should be stressed that the same person may appear more than once in the statistics, according to the number of offences the person was found guilty of. In 2008, theft was the most frequently committed criminal offence.
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6 PROJECT INTERACTIONS WITH THE COMMUNITY DURING EXPLORATION PHASE
6.1 Exploration activities
TNG has been actively exploring the area since 2004 after signing an agreement with a Canadian company called Brereton Engineering and Development, Ltd. By December 31, 2010 TNG had invested DKK 92 million ($17.4 million) in ruby exploration. TNG now plans to develop a mine at Aappaluttoq to extract rubies and pink sapphires for sale around the world.
Ruby Island, located at sea level, was the first confirmed ruby occurrence in the Fiskenæsset district and was discovered in 1966 by GEUS, the Danish Geological Survey. TNG discovered the Aappaluttoq prospect in 2005. Work by TNG peaked in 2007 and 2008, when as many as 13 Greenland residents and 13 foreign workers were employed on the project. During this period, several large bulk samples were taken and almost 7000 metres of drilling was completed. The geological work conducted by the company in 2007 and 2008 and subsequent engineering analysis forms the basis for the exploitation (mining) permit application.
During the peak employment period, approximately half of the staff was based in the Company’s camp located near the proposed mine site. The other half was located in Qeqertarsuatsiaat, with the non-residents living in two locally owned houses rented by the Company.
The following table summarises the exploration activities performed by TNG in the period between 2004 and 2010 in the concession area.
Table 6.1 Summary of exploration activities performed by TNG in 2004-2010 Period Activities 2004 Four cutting sites at the Siggartartulik ruby occurrence, where 2584 kgs of ruby mineralization were excavated using diamond chain saws. Collection of 450 kg of mineralised samples in the vicinities of the cutting sites.
Comments: Assess gemstone quality and allow geologists to target the important deposits in SW Greenland Under Greenlandic law TNG are not allowed to sell anything. All samples are currently in the secure vault at TNG- Vancouver under yearly audit by the BMP. 2005 Five (5) 3-tonne mini bulk samples; one for each of 5 ruby showings:
Lower Annertussoq Upper Annertussoq Kigutilik Ruby Island (Tasiusarsuaq) Qaqqatsiaq
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Diamond chain saws were used to excavate ruby mineralization from outcrop.
Comments: Were extracted from the 5 main deposits (at the time) and were sent for gemstone processing (to get the gemstones out of the rock) in Canada They were then assessed by gemstone professionals to get a value This was used to target the most economic deposits Under Greenlandic law TNG are not allowed to sell anything. All stones are currently in the secure vault at TNG- Vancouver under yearly audit by the BMP. 2006 30 tonne samples from Aappaluttoq and Kigutilik.
Comments: Kigutilik was found to be one of the better sites, and a larger sample was required to plan the engineering and test the economic viability on a larger scale. Aappaluttoq was only discovered in late 2005, so this would be the first test of its economic importance. Stones were sent for cutting tests Under Greenlandic law TNG are not allowed to sell anything. All stones are currently in the secure vault at TNG- Vancouver under yearly audit by the BMP. 2007 3 separate samples totalling 82,5 tonnes of mineralized overburden and bedrock from Aappaluttoq. 46 holes using diamond core drilling.
Comments: Completing the geological and gemmological information This dataset was the first conclusive evidence that Aappaluttoq was an economically viable deposit Stones were sent for cutting tests Under Greenlandic law TNG are not allowed to sell anything. All stones are currently in the secure vault at TNG- Vancouver under yearly audit by the BMP. 2008 125 tonnes of material was collected from Appaluttoq by blasting and 30-40 tonnes of ruby bearing overburden was collected.
Comments: Confirmation of economic grade and tonnage calculations Engineering flowsheet development for the internal workings of the mine processing plant
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Research and development on new extractive technologies Final evidence that Aappaluttoq was economically viable Under Greenlandic law TNG are not allowed to sell anything. All stones are currently in the secure vault at TNG- Vancouver under yearly audit by the BMP. 2010 A geologist and a field assistant spent 13 days in the Appaluttoq area in a short exploration campaign aimed to further testing area. Multi-element soil sampling, rock chip sampling, magnetic surveys. 162 samples of core from 6 drill holes were cut, sample and sent to Act Lab laboratory in Nuuk.
Comments: The samples were of a geological nature rather than gemstones. This kind of sampling (geochemical, multi elemental soils, rock-chip etc) are destructive, Act Labs in Nuuk pulverized the samples to a fine powder and assessed the individual elements within the sample. Very little gemstone material was recovered or sampled during 2010, instead the samples were taken to improve the mine 3D model and increase our confidence that we had got things correct. These activities are basic exploration techniques. Very few samples were removed from Greenland, and those are currently in secure storage at TNG- Vancouver. Under Greenlandic law TNG are not allowed to sell anything.
6.2 Community relations between 2005-2011
Generally speaking, relations between the community and the Company have been channelled through the highest-ranking Company employee on site. Each of the Company representatives has had a different approach to community relations based on their own experience and personal relationships with the individuals involved.
The person in charge of the Company’s exploration programs and community relations during the first three years of the project, 2004, 2005 and 2006, enjoyed a good relationship with the community and still maintains occasional communication with certain members of the community. However, perhaps due to his enthusiasm for the project, unrealistic expectations of the value of the ruby and pink sapphire material in certain portions of the community can be directly traced to this manager.
The person responsible for the Company’s exploration programmes during 2007 had focus on regional exploration and his contact with the community was more limited. After the assignment of a person responsible to operate a pilot plant located in Qeqertarsuatsiaat, in 2008 community relations were facilitated by a more regular presence and local staff was hired to operate the pilot plant.
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During the 2009 field season a female TNG employee operated with a small staff based part time out of the company camp and part time in Qeqertarsuatsiaat. TNG appointed a local contact person from Nuuk, who has been the stable contact person for the community. In September 2011 TNG appointed a General Manager for the Greenlandic subsidiary, True North Gems Greenland A/S. The General Manager is based in Nuuk from where he facilitates during exploration, meets with relevant institutions, companies and organisations, and travels to Qeqertarsuatsiaat and into the field when needed.
All of the above operated community relations in an ad-hoc manner based primarily on open and informal communication. Formal meetings were held irregularly but generally at least once per year. Community information was distributed by posting on the community bulletin board and through the municipal office. Conflict resolution was similarly ad-hoc. No formal record of complaints or conflicts or their resolution was kept.
All exploration activities took place in the summer months, as the camp, plant and office were all closed between the months of October and May. During the weeks of activities in Qeqertarsuatsiaat, some services and goods were supplied locally, such as housing, some diesel fuel, some food, and some equipment rental. Most of boat charters services and helicopter services were provided from Nuuk.
TNG also provided some temporary jobs to local people, including translation, security, operation of the processing plant, and field assistance during exploration.
Meetings and Community development initiatives Some of the community meetings and development initiatives identified during interviews with TNG and the community include:
July, 2004 – Community meeting held in the town of Qeqertarsuatsiaat. This is the first formal introduction of TNG to the local community. 250 people attend the meeting, which was translated into both Danish and Kalaallisut August 2004 – Two drums of ruby bearing ore were donated to the local lapidary shop in Qeqertarsuatsiaat. Also, three large ruby-bearing boulders were donated to the playground at the Qeqertarsuatsiaat Elementary School July 7, 2005 – Community meeting held in the town of Qeqertarsuatsiaat. 120 people attend August 18, 2005 – Community meeting and BBQ in Qeqertarsuatsiaat February, 2006 – Two week course held in Qeqertarsuatsiaat to teach jewellery manufacturing and faceting to the local community June 26, 2006 – Community meeting held in the town of Qeqertarsuatsiaat. 31 people attend May 9, 2007 – Community meeting in Qeqertarsuatsiaat September, 2007 – End of season party in Qeqertarsuatsiaat for all local personnel and their families May 2 – Community meeting in Qeqertarsuatsiaat, with presentations from BMP and TNG´s Project manager, interpretation by N. Mikkelsen May 3 – Community meeting in Nuuk, with presentations from BMP and TNG´s project Manager, interpretation by H.Pavia Rosing. Both meetings in May announced in weekly newspaper Sermitsiaq, local radio and posters in bus stops according to official agenda of meetings (BMP, April 2008)
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August 11-22, 2008 – Another course held in Qeqertarsuatsiaat, teaching jewellery design and manufacture. TNG also donated supplies and equipment worth $5,000 necessary to upkeep and repair damaged equipment at the lapidary shop.
6.3 Conflicts identified
In this section, the conflicts identified in meetings with stakeholders are listed and described. Stakeholders were not specifically asked to identify conflicts, but some situations perceived as problematic, directly or indirectly related to TNG´s exploration activities were registered during the fieldwork in February 2010.
Helicopter landing During the exploration period, helicopters were occasionally used to transport samples from the site to the pilot processing plant in Qeqertarsuatsiaat. Due to the accessibility problems to the existing helicopter landing deck close to the Tele Greenland facility, the helicopter was landing in other designated areas close to the settlement. The noise of the helicopter caused nuisances like disturbing the rest of children in the nursery and elderly in the Elders Home.
Access to hunting areas (Direct translation from the focus group) The fishermen/hunters use the Tasiusaa area as an escape area when the wind from south east gets too fierce in Tasiusarsuaq, but they have been reluctant to enter the gate as they don’t want to disturb the mining activities. They would like to be able to enter the area in these circumstances - also during the reindeer hunting season as the stream on the north side of Tasiusaa is a good char area. Fishermen and hunters declared to be uncertain about the limits of the mining concession, the exploration areas and activities and suggested clear agreements and a better communication between the company and the hunters in the future. Other related issues: the fishermen/hunters have noticed that there are about three barrels of fuel for the helicopter that may have been dropped or lost by the activities at the mine site. The fishermen/hunters recommend that they are contacted if that happens again so they can transport these safely.
Collection of rubies in the concession area during exploration On August 14th 2007 representatives of TNG contacted BMP stating that a number of local collectors were interfering with TNG work by remaining in a work area, thus causing danger for both TNG personal and the collectors. As the event unfolded, when approached by TNG personal, the collectors took a negative stance and displayed some hostility while demanding to collect minerals from the area. The incident led to the focus on the fact the old mineral resources act was not designed to regulate small-scale mining activities suited for the local population. Since then self- governance was introduced into Greenland with effect from June 21st 2009. As a result the Greenland self-government passed a new mineral resources act in the autumn of 2009 and the self-government took over the mineral resource area with effect from January 1st 2010. As a result Greenland now has a full authority over the mineral resources. In the new mineral resources act specific provisions regarding the local population’s right to collection of mineral resources have been outlined including regulations on small-scale mining.
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TNG are supportive of a regulatory environment that encourages prospectors and small-scale miners, since these entrepreneurs are an important component of a thriving and prosperous mineral exploration and mining community, and are often the first step in the long process of new deposit discovery.
TNG would also like to emphasize that they are supportive of an active artisanal jewellery industry and, as such, supports creation of a system of selling rough corundum to Greenlanders for their own use and further sale.
TNG will continue to support local craftsmen and jewellery designers by ensuring that ruby and pink sapphire is available to stimulate the creation of industry in Greenland. A successful mining operation for TNG, and successful marketing campaign for Greenland rubies around the world, will stimulate exploration by local prospectors and small-scale miners to find other commercial gemstone deposits in Greenland.
As previously stated TNG has no problem co-existing with small-scale miners and sees an opportunity for synergy. In particular, TNG sees potential for:
Selling rough corundum to locals under formalized conditions and as long as all material is sold at market prices. Continuing to organize courses in polishing and design. Sharing know-how regarding exploration techniques and findings of corundum.
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7 IMPACT ASSESSMENT
7.1 Methodology
The potential impacts of the Aappaluttoq Project are assessed for both the construction and operation phases, as well as for the closure of the project.
To carry out the assessment, valued social and socio-economic components were identified and prioritised in consultation with stakeholders and authorities. Consultation was carried out in February 2011 in Nuuk and Qeqertarsuatsiaat.
The socio-economic components identified have been grouped into the following categories:
Economic environment (employment, tax and revenues and business opportunities) Education and training Public service and plans Social aspects Health Culture and natural values.
For the impact analysis three phases of the project were considered: construction, operation and closure. Furthermore, the following activities and components during the operation were included in the analysis of impacts and identification of mitigation measures:
Transport of goods and staff Shipment of concentrate and product (ruby and pink sapphire) Operation of camp, mine and processing plant Infrastructure for the camp and mine (electricity, waste water, waste management etc.) Support infrastructure (inner and outer port, internal roads, explosives and fuel deposits) Operation of sorting house in Nuuk.
The impact assessment is based on an assessment of the positive and/or negative effects of the different activities during the project phases based on a set of social/socio-economic aspects with the use of an Impact Matrix.
For each combination of project activity and social/socio-economic aspect, for both the construction and the operation phases, potential impacts of the project have been predicted and their magnitude quantified as far as possible.
The impacts identified have been evaluated according to the following factors:
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What is the certainty of impacts? - Is it certain, likely, known or unknown to happen? Where are the impacts? Will the impact be Local (Qeqertarsuatsiaat), Regional (Kommuneqarfik Sermersooq), Greenland in general or International? Are there regional “winners” and “losers”? What is the duration and frequency of impacts? – What will be the occurrence of the impact - Temporary, short lasting or permanent? When will the impact be noticed? – Will it be noticed immediately or over time by the community?
The public concerns identified during the consultations with stakeholders in Nuuk and Qeqertarsuatsiaat have also been considered when assessing the significance of the impacts.
Mitigation measures have been identified for all impacts likely to occur that are adverse in nature and significant enough to require mitigation (i.e. medium and high- level negative impacts)
The result of the assessment of the impacts before the implementation of mitigation measures is presented using the following colour codes indicating whether the impact is positive, neutral or negative and whether the significance of the impact is low, medium or high.
low Medium High Positive +L +M +H Neutral 0 Negative -L -M -H
A similar matrix is also presented for the residual impacts; these are the impacts as they are expected to be after the implementation of proposed mitigation measures.
7.2 Economic environment
Under economic environment the following aspects have been analysed:
Direct employment at the project Indirect employment created from outsourced activities related to the project Business opportunities created by the project Taxes and revenues.
7.2.1 Employment
Approximately 40-50 people are expected to be involved in the construction phase, where approximately 75% of the workforce is expected to be Greenlandic (resident and tax payers in Greenland).
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The total number of staff during the production phase is 80, of which 15 staff are professionals and are expected to be mainly from outside Greenland at the beginning of operations. The jobs generated by the project will be seasonal (8 months a year) for the workforce in Aappaluttoq (except security staffs that will be on site 12 months/year) and all year round for the workforce in Nuuk. Catering and housekeeping duties will most probably be outsourced locally. It is expected that the majority of the employees will work on a rotation schemes like: 1 week at site and 1 week at home (1:1), and 2 weeks at site, 1 week (2:1) at home for the employees related to mining duties.
The unemployment rate for Greenland in 2010 is 7% equivalent to 2045 people and 10% (January 2010) in Qeqertarsuatsiaat. Paamiut, located south from Qeqertarsuatsiaat has been mentioned during the consultations as a place with high unemployment that could highly benefit from employment in the mine.
Unemployment in Kommuneqarfik Sermersooq is mainly seen among unskilled workers, however, workers with vocational training in areas such as iron and metal, building and construction, trade and office, shipping and navigation and fishing are also experiencing unemployment. During the SLiCA (2004, 2011) the adults of Qeqertarsuatsiaat identified unemployment as the biggest social problem in their community.
Potentially unemployed workers from Qeqertarsuatsiaat, Paamiut and Nuuk can benefit from the job opportunities created by the Aappaluttoq Project both during the construction phase and the operation phase. However, the most likely scenario is that the project will attract mainly workers already employed in other sectors. Indirectly this will create new opportunities for the unemployed workers also from other regions.
Whether some of the people who left Qeqertarsuatsiaat due to the lack of jobs will move back if new job opportunities are created is uncertain. In general the mobility of people is very high in Greenland, and it is likely that people will move for job opportunities (Mobilitetsstyregruppen, 2010), (SLiCA 2007) but available part time jobs may be not attractive enough to return to Qeqertarsuatsiaat.
There are 8 people from Qeqertarsuatsiaat who have finished their education at the School for Minerals and Petroleum in Sisimiut. They are all currently employed in Nuuk, Sisimiut, Nalunaq and Qeqertarsuatsiaat (Local interviews, personal communication Feb 2011).
Based on experience from previous mining projects and consultations in Nuuk and Qeqertarsuatsiaat, barriers for achieving the expected high percentage of local workforce at Aappaluttoq may include:
Lack of minimum qualifications/experience for the required positions Low interest in seasonal work (8 month a year) particularly in the summer when other productive and recreational activities also take place Low levels of retention of local workers due to difficulties to adapt to the working conditions.
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For example, there are 25-30 licensed hunters and fisherman (male adults) that could be qualified for some of the unskilled work or trained for some specific positions. A seasonal job at the project can result in losing their professional hunting license if more than 50% of their income is earned from activities other than fishing and hunting.
On the other hand, it is expected that jobs at the sorting facility and the office in Nuuk will be very attractive both to men and women, and no particular retention problems are foreseen. Many people have expressed interest in the training on gemmology and in sorting of gems, as well in a long term, full-time work.
One possible barrier to employment of people not already living in Nuuk is the availability of houses. If TNG wants to employ people from outside Nuuk at the sorting facility, for example, it is highly probable that working contract conditions should include housing support.
The positive impact of employment at household and community level goes beyond the financial benefits. Providing for the family is considered as the main role of a Greenlandic man and woman. The groups of young families with children and middle- aged men and women where the children have left home or can take care of themselves are expected to be the groups where positive impacts of employment in the mine will be most noticeable.
In Qeqertarsuatsiaat, young unemployed people have been identified as the group in the population that is most likely to benefit from job opportunities in relation to the project. Other adult men have also expressed an interest in working on the project.
On the same line, positive impacts of direct and indirect employment will be more clearly perceived at community level in settlements and small towns like Paamiut than in large towns.
The impact of direct employment during construction is considered positive medium if the expected rates of Greenlandic employment are achieved. The extension of the impacts will be perceived mainly at national level for a period of 6 months.
The impacts of the direct employment during operation are characterised as positive medium. The number of positions is relatively high in an area with few economic opportunities. The fact that most of the jobs are seasonal was perceived as problematic for a season of 3 months, but it is expected that a season of 8 months will mitigate this perception5.
The positions at the sorting house in Nuuk will be highly valued because they are whole-year jobs, but also because of the special training and practice with gems, a sector that was identified as very attractive to a number of stakeholders, especially women.
5 The mine plan with a season of 8 months was finalised in May and has not been consulted with stakeholders so far.
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A majority of job positions are available to Greenlandic workers (from Qeqertarsuatsiaat, Paamiut, Nuuk and others), but measures should be taken in order to maximise the share of Greenlandic employment. While the duration of the employment will cease together with the project, the benefits related to employment, such as enhancement of qualifications and experience, pension and savings, etc. will last beyond the employment time.
Proposed measures related to employment:
Prepare a description of the requirements for the different job categories for the operation phase. Undertake an assessment of training needs. Develop a job training program for the required job categories. Job advertisement in Greenlandic newspapers and national television (KNR) Design and implementation of an intense recruitment campaign in Qeqertarsuatsiaat, Paamiut and Nuuk, including advertising, community meetings, open day events, etc. Contact and coordination with labour organization SIK and employment office for advertising the available job positions and identifying potential workers. Evaluate the possibility of making agreements with the School of Minerals and Petroleum for allocating a number of seasonal job positions as internship for advanced students. Discuss with the Municipality and the School of Minerals and Petroleum the possibility of involving TNG employees in training courses during the non- working months, in order to make Aappaluttoq a more attractive work place.
7.2.2 Taxes and Revenues
Dividend tax Greenlandic companies are to withhold a dividend tax corresponding to the personal tax in the municipality of registration. For companies with permits under the Mineral Resources Act, the present dividend tax rate is 37%.
Corporate tax For mining companies, the corporate tax is levied at a flat rate of 30%. The taxable income is determined on the basis of the profit shown in the statutory annual report, adjusted to comply with the prevailing tax provisions. The amount of corporate tax is therefore dependant on profitability, which depends on the highly uncertain price for ruby and pink sapphire.
The Greenland Government has not yet decided final taxations and royalties for the Aappaluttoq project. Based on the conservative valuations received by TNG, the mine is expected to be marginally profitable, generating taxes of approximately 16 million dollars (90 million DKK) over the life of the mine. This calculation is based on the following assumptions:
o All profit will be returned as dividends; therefore the 37% tax rate is used. o Peak production (20,000 tonnes of corundum-bearing ore per year) will be achieved by the third year of, resulting in production of approximately 1 tonne of rough ruby and 6 tonnes of rough pink sapphire per year.
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o Of the 7 tonnes of rough corundum annually, approximately 35% will be either gem or near-gem, with the balance being non-gem material for which no market has yet been located and which is not considered in the economics. o For polished corundum, retention is estimated to be approximately 9%. Therefore, the mine production will result in about 220 kg of polished gemstones per year, of which only a very small fraction will be top quality, size or colour. o All ruby (for which there is well established demand) will be sold either as polished gemstones or as rough at an equivalent price (less the cost of polishing) o For pink sapphire (for which there is a less established market), 60% will be sold as polished gemstones at the valuation price for polished pink sapphire, and 40% will be sold as rough at the valuation price for rough pink sapphire. o The price of ruby and pink sapphire (both rough and polished) will increase by 2% per year, as Greenland gemstones become better known.
Offered Turnover Advance Tax TNG has offered to pay an advance tax to Greenland in an amount equal to 5% of the sales of ruby and pink sapphire. This tax is not required by the taxation rules of Greenland, but has been offered by TNG to demonstrate TNG’s commitment to sustainable mining in Greenland, with the understanding that the money paid by TNG will be used by Greenland in part to train and educate Greenlanders so they may participate in the mining industry.
The advance tax will be paid quarterly based on sales during the three-month period. If sales of ruby or pink sapphire are made after the material is polished, the cost of polishing will be deducted before the tax is calculated.
The advance tax will be credited against corporate income tax payable in the future so that the total tax paid by TNG remains the same, as required by Greenland tax law.
Based on the production and revenue models in the mine plan, the advance tax will be approximately $1.2m annually at full production (year 3)
Personnel taxation
Income taxation of personnel
The income taxation is based on the calculated number of employed staff, and the corresponding budgeted annual income per staff member.
A total of 80 persons are employed at full production of which 15 are categorized as professionals.
The figures show a total of 84 and 15 professionals in year 2, and for the years 3 – 9, the annual number of staff is total 87 persons including 15 professionals.
The total wages – or tax-base – is DKK 19.431.650 in year 1, and DKK 20.967.650 in year 2. In the years 3-9 the tax-base is calculated to DKK 33.323.975 annually, and from 2018 to 2020 the tax base is declining to DKK 27.828.350.
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The combined income tax rate is 41% for Kommuneqarfik Sermersooq, and 37% for areas outside municipal classification. Personal allowance is DKK 58.000
In calculating the total annual tax, the tax rate for Kommuneqarfik Sermersooq has been applied, and only the personal allowance is taking in to the calculation, as individual deductions in the final statements are unknown.
All the professionals are calculated based on the flat tax rate of 35% (assuming that they are foreign nationals, who are subject to the 35% tax rate). All non-professional are calculated based on a tax-rate of 41% and a personal allowance of DKK 58.000. The total number of staff both at the mine site and in Nuuk, the average annual salary, the tax-base and the related income tax are shown in Table 7.1 below.
The tax contribution from the professionals is based on the average income of the professionals for each of the years 1-9. For year 1 the average income is DKK 395.000 and the corresponding income tax is DKK 138.250 / person generating a total tax from the professionals of DKK 2.1 Mio in year 1.
However, for the professionals there is only a small margin in the tax payment based on the flat rate tax and the standard income tax calculation. The flat rate tax only generates an annual tax reduction of DKK 3.290 compared to the standard income tax calculation
The tax contribution from the remaining other 65 staff is based on the average income of other staff for each of the years 1-9. For year 1 the average income for this group of staff is DKK 207.733 / person generating a total tax from the other staff of DKK 4.1 Mio in year 1.
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Table 7.1 Total tax base and income tax generated from the project
Year 1 2 3 4 5 6 7 8 9 Total
Total number of staff
Professionals 15 15 15 15 15 15 15 15 15 Other staff 65 69 72 72 72 72 72 72 72 Total staff 80 84 87 87 87 87 87 87 87
Average annual salary*
Professionals 395 395 515 515 515 515 495 465 455 (1000 DKK) Other staff 208 218 355 355 355 355 333 301 292 (1000 DKK)
Tax-base
Professionals 5,9 6.0 7.7 7.7 7.7 7.7 7.4 7.0 6.8 64.0 (Mio DKK)
Other staff 13.5 15.0 25.6 25.6 25.6 25.6 24.0 21.7 21.0 197.6 (Mio DKK)
Total Tax-base 19.4 21.0 33.3 33.3 33.3 33.3 31.4 28.7 27.8 261.6 (Mio DKK)
Income tax
Professionals 2.1 2.1 2.7 2.7 2.7 2.7 2.6 2.4 2.4 22.4 (Mio DKK)
Other staff 4.1 4.6 9.0 9.0 9.0 9.0 8.3 7.4 7.1 67.5 (Mio DKK)
Total Income tax 6.2 6.7 11.7 11.7 11.7 11.7 10.9 9.8 9.5 89.9 (Mio DKK) * Although the total number of staff remains relatively constant, the Average annual salary fluctuates because of changes in the number of months worked in any year. The Average annual salary is over a 12-month period. Some employees have different rotation frequencies than others, while some do not rotate at all.
To the extent that the employees spend their earnings on consumption in Greenland, this will create new jobs, and hence new revenue. This new revenue, in turn, will be spent partly on consumption, with a constant decrease in the secondary, tertiary and subsequent effects generated.
This effect is generally referred to as the “multiplier effect” and is normally calculated as a percentage of primary income. The size of the multiplier effect depends on how much of the income is used for savings or surplus imports to the society.
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Studies from Canada and Alaska indicate a multiplier employment factor of 1.6 – 1.8 in the mining sector. In Greenland’s case the very large proportion of imports has the effect of making the multiplier effect relatively low. For the project as a whole the multiplier effect has been estimated at 30% for both the international and Greenlandic staff wage share, as the weight of the international staff in the multiplier effect in this calculation is very small.
Based on a multiplier employment factor of 1.3, the total annual tax base has been calculated in the table below.
Table 7.2 Total tax base generated by the project based on a multiplier factor of 1.3
Year 1 2 3 4 5 6 7 8 9 Total
Tax-base Mio DKK 25.3 27.3 43.3 43,3 43.3 43.3 40.9 37.3 36.2 340.1
Table 7.3 Summary table of expected impact from taxes Taxes and dues Status
Concession fee Nominal
Corporate taxation Approx. 90 million DKK over the life of the project after repayment of deferred expenditures Turnover Advance Tax Approximately $1-1.2m/year at full production Income taxation of Calculated to be in the range of personnel 9.5 to 11.7 million DK/yr
7.2.3 Various Taxation Scenario’s dependent upon marketing success
True North Gems has all intentions of maximising the returns from the Aappaluttoq Ruby and Pink Sapphire deposit. As the material is an unknown commodity in the gemstone industry it will take education and patience to achieve these goals, but with market research and the expertise built within the Company, we feel beneficial rewards in the form of increased tax payments can be delivered to the people of Greenland.
* The following examples in Table 7.4 try to define possible scenarios of increased returns based on strictly un substantiated prices as material has not been exposed the world gemstone trade, though could be achieved if one takes into consideration gemstones in a similar market environment.
All scenarios are founded upon the economics found within the Pre-Feasibility Study using the prices placed upon the material by independent valuators in 2008.
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Scen 1: Scen 2: Scen 3: Base case Limited Moderate Aggressive Summary Base Case with Rough Marketing Marketing Marketing Transition increase increase increase Projected Tonnes Waste Tonnes 2615.533 2615.533 2615.533 2615.533 2615.533 Ore Tonnes 161.604 161.604 161.604 161.604 161.604 Total Tonnes 2777.137 2777.137 2777.137 2777.137 2777.137
Production Increase 0% 0% 0% 0% 0% from Base
Revenue Ruby (USD) $45270.663 $45130.252 $67595.853 $77665.444 $77665.444 Sapphire (USD) $151770.358 $151770.358 $178450.858 $243199.576 $293699.088 Total Revenues (USD) $197041.021 $196900.610 $246046.711 $320865.020 $371364.532
Operating Costs Site $50085.000 $50085.000 $50085.000 $50085.000 $50085.000 Nuuk $26925.162 $26925.162 $26925.162 $26925.162 $26925.162 Polishing $6771.838 $2632.449 $2632.449 $2632.295 $2052.429 Marketing $3940.820 $3938.012 $4920.934 $6417.300 $7427.291 Corporate $3940.820 $3938.012 $4920.934 $6417.300 $7427.291 Contingency $7791.409 $7439.084 $7606.181 $7860.550 $7982.960 Total Operating Costs $99455.050 $94957.720 $97090.660 $100337.608 $101900.133
Earnings (USD) Operating Profit (EBITDA) $97585.971 $101942.890 $148956.051 $220527.412 $269464.399 Depreciation -$33595.000 -$33595.000 -$33595.000 -$33595.000 -$33595.000 EBIT $63990.971 $68347.890 $115361.051 $186932.412 $235869.399
Interest Expense $0 $0 $0 $0 $0 EBT $63990.971 $68347.890 $115361.051 $186932.412 $235869.399
Estimated Tax Tax Losses $0 $0 $0 $0 $0 Corp. Taxes Before Loss -$25890.724 -$27502.785 -$44895.454 -$71378.219 -$89484.904 Corp. Tax Payable (USD) -$15954.724 -$17566.785 -$34959.454 -$61442.219 -$79548.904 Corp. Tax Payable (DKK) -90941.929 -100130.673 -199268.885 -350220.647 -453428.753 (@5.7 exng)
NPV & IRR After Tax NPV 5% $25010.380 $26838.390 $46871.362 $75706.851 $96000.661 After Tax NPV 8% $15632.304 $20603.999 $20603.999 $55447.813 $71410.699 IRR 16,20% 16,81% 22,94% 28,44% 31,83% Table 7.4 Scenarios of increased returns
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Base case These economics, drawn from the original 2008 Pre-Feasibility Study and the figures used for the sale amount, are derived from independent valuations for both the polished and the rough.
When valuating rough and polished rubies and pink sapphires back in 2008, the valuations were very conservative due to various factors. Greenlandic gemstones were unknown to the market. Valuators had no experience with the quality of the stones. Especially the rough stones were challenged since the valuators had no experience with retention and change of colour variation when changing from rough to polished.
The valuators set a fair market price for the polished stones recognizing that these had a good quality whereas the rough received a low valuation due to uncertainty based on lack of exposure to the material. This has to be seen in conjunction with the uncertenties of the rough stones.
In the base case the Company assume, that all of the rubies will be sold as polished, whereas for the sapphires, 40% will be sold as rough and 60% as polished throughout the whole life time of the mine.
To have a conservative estimation of the business case, the Company has set the price escalation per year at 2%, which is estimated to be an annual expected escalation within the gemstone market.
Using these conservative numbers and not realising any upside from marketing, the company estimates corporate tax to be DKK 90 million over the course of the mine.
Year 0 1 2 3 4 5 6 7 8 9 Total Revenue DKK mio. 0 2 71 149 116 128 137 128 126 265 1.123 OPEX DKK mio. 0 35 45 71 68 69 69 67 66 77 567 Depreciation DKK mio. 0 1 9 26 28 29 29 29 31 8 191 EBT DKK mio. 0 -34 17 52 20 30 39 32 29 180 365 Tax DKK mio. 0 0 0 0 0 0 1 12 11 66 90 Net Income DKK mio. 0 -34 17 52 20 30 38 20 18 114 274
Price Ruby Rough DKK/g 2 2 2 2 2 3 3 3 3 3 Ruby Polished DKK/ct 189 193 196 200 204 208 213 217 221 226 Sapphire Rough DKK/g 2 2 2 2 2 3 3 3 3 3 Sapphire Polished DKK/ct 149 152 155 159 162 165 168 172 175 179
Price Escalation per year Total Ruby Rough % 2 2 2 2 2 2 2 2 2 20 Ruby Polished % 2 2 2 2 2 2 2 2 2 20 Sapphire Rough % 2 2 2 2 2 2 2 2 2 20 Sapphire Polished % 2 2 2 2 2 2 2 2 2 20
Sale of Rough vs Polish Total Ruby Rough % 0 0 0 0 0 0 0 0 0 0 Ruby Polished % 100 100 100 100 100 100 100 100 100 100 Sapphire Rough % 40 40 40 40 40 40 40 40 40 40 Sapphire Polished % 60 60 60 60 60 60 60 60 60 60 Table 7.5 Base Case as described in Pre-Feasibility Study
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Base case with transition to rough sales The assumptions behind this scenario are that the Company has been able to complete further research since the original 2008 valuations and from new data and figures available, it is shown that a sales model where the majority of the economics are derived from selling rough shows a higher corporate tax return as the turnover of material is faster and more efficient. This produces a lower cost of operations, improved security, as there are less links in the chain, and maximises cash flow. This scenario does not take into consideration any concerted marketing but is drafted to point out the price needed for rough to polished equilibrium. The concept of transition from sales of polished to rough have been proven effective in other gem and colored gemstone markets, and like in this scenario, it has been proven that it is possible to gain a higher net income from selling rough than polished. Estimated Corporate Tax: DKK 100 million.
Year 0 1 2 3 4 5 6 7 8 9 Total Revenue DKK mio. 0 2 70 149 116 128 137 128 126 265 1.122 OPEX DKK mio. 0 35 45 71 67 67 64 62 62 68 541 Depreciation DKK mio. 0 1 9 26 28 29 29 29 31 8 191 EBT DKK mio. 0 -34 16 52 21 32 44 36 34 189 390 Tax DKK mio. 0 0 0 0 0 0 4 13 12 70 100 Net Income DKK mio. 0 -34 16 52 21 32 40 23 22 119 290
Price Ruby Rough DKK/g 2 2 2 93 95 97 99 101 103 105 Ruby Polished DKK/ct 189 193 196 200 204 208 213 217 221 226 Sapphire Rough DKK/g 2 2 2 2 17 27 46 47 48 49 Sapphire Polished DKK/ct 149 152 155 159 162 165 168 172 175 179
Price Escalation per year Total Ruby Rough % 2 2 3.833 2 2 2 2 2 2 4.508 Ruby Polished % 2 2 2 2 2 2 2 2 2 20 Sapphire Rough % 2 2 1 610 60 70 2 2 2 2.062 Sapphire Polished % 2 2 2 2 2 2 2 2 2 19
Sale of Rough vs Polish Ruby Rough % 0 5 30 50 95 95 95 95 95 Ruby Polished % 100 95 70 50 5 5 5 5 5 Sapphire Rough % 40 40 40 50 60 95 95 95 95 Sapphire Polished % 60 60 60 50 40 5 5 5 5 Total Sale of Rough vs Polish Rough (g) Ruby Rough G 0 9.140 113.216 143.921 295.371 310.654 282.806 274.845 564.370 2.672.635 Ruby Polished Ct 2.608 80.752 122.840 66.923 7.229 7.603 6.921 6.727 13.812 Sapphire Rough g 15.511 505.222 1.043.015 994.296 1.287.583 2.144.424 1.954.990 1.897.444 3.900.105 18.461.790 Sapphire Polished ct 10.819 352.392 727.503 462.348 399.151 52.482 47.846 46.437 95.450 Yearly sales-% from total rough (g) Total Ruby Rough % 0,00 0,34 4,24 5,38 11,05 11,32 10,58 10,28 21,12 74,62 Ruby Polished % 0,21 6,50 9,88 5,38 0,58 0,61 0,56 0,54 1,11 25,38 Sapphire Rough % 0,08 2,74 5,65 5,39 6,97 11,62 10,59 10,28 21,13 74,44 Sapphire Polished % 0,13 4,10 8,47 5,39 4,65 0,61 0,56 0,54 1,11 25,56 Table 7.6 Base Case with transition to rough sales
Scenario 1, Limited marketing: In this scenario all operating costs will stay fairly close through out the mine, and the adjustments are made to the prices the Company feel can be a possibility through marketing and awareness of product once Greenlandic Ruby and Pink Sapphire become a consistent product in the gemstone industry.
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As the Company feel the migration to a majority of rough sales will bring stronger balance sheet numbers, this scenario shows conservative increases with limited marketing of product. The highest increase in prices will be shown in the rough rubies and pink sapphires. Because the valuations of rough in 2008 were very conservative the Company forsee the rough stones to be where the highest potential for price increase can be found. Estimated Corporate Tax: DKK 199 million.
Year 0 1 2 3 4 5 6 7 8 9 Total Revenue DKK mio. 0 2 72 156 119 166 186 172 171 358 1.402 OPEX DKK mio. 0 35 45 71 67 68 66 64 64 72 553 Depreciation DKK mio. 0 1 9 26 28 29 29 29 31 8 191 EBT DKK mio. 0 -34 18 58 24 69 90 79 76 278 658 Tax DKK mio. 0 0 0 0 0 6 33 29 28 103 199 Net Income DKK mio. 0 -34 18 58 24 63 57 50 48 175 458
Price Ruby Rough DKK/g 2 6 44 93 117 146 175 179 182 186 Ruby Polished DKK/ct 189 193 196 200 204 208 213 217 221 226 Sapphire Rough DKK/g 2 5 6 9 17 46 58 60 61 62 Sapphire Polished DKK/ct 149 152 155 159 162 165 168 172 175 179
Price Escalation per year Total Ruby Rough % 156 650 113 25 25 20 2 2 2 8.062 Ruby Polished % 2 2 2 2 2 2 2 2 2 20 Sapphire Rough % 105 25 50 94 173 26 2 2 2 2.621 Sapphire Polished % 2 2 2 2 2 2 2 2 2 19
Sale of Rough vs Polish Ruby Rough % 0 5 30 50 95 95 95 95 95 Ruby Polished % 100 95 70 50 5 5 5 5 5 Sapphire Rough % 40 40 40 50 60 95 95 95 95 Sapphire Polished % 60 60 60 50 40 5 5 5 5 Total Sale of Rough vs Polish Rough (g) Ruby Rough g 0 9.140 113.216 143.921 295.371 310.654 282.806 274.845 564.370 2.672.635 Ruby Polished ct 2.608 80.752 122.840 66.923 7.229 7.603 6.921 6.727 13.812 Sapphire Rough g 15.511 505.222 1.043.015 994.296 1.287.583 2.144.424 1.954.990 1.897.444 3.900.105 18.461.790 Sapphire Polished ct 10.819 352.392 727.503 462.348 399.151 52.482 47.846 46.437 95.450 Yearly sales-% from total rough (g) Total Ruby Rough % 0,00 0,34 4,24 5,38 11,05 11,62 10,58 10,28 21,12 74,62 Ruby Polished % 0,21 6,5 9,88 5,38 0,58 0,61 0,56 0,54 1,11 25,38 Sapphire Rough % 0,08 2,74 5,65 5,39 6,97 11,62 10,59 10,28 21,13 74,44 Sapphire Polished % 0,13 4,10 8,47 5,39 4,65 0,61 0,56 0,54 1,11 25,56 Table 7.7 Scenario 1, Limited Marketing
Scenario 2, Moderate marketing: In this scenario the Company, through its marketing strategy, becomes an experienced supplyer in the Gemstone industry within 3 years. Consistent supply, consistent grading and consistent marketing allows the Company to push the price of material upwards. If one adds to this a concerted marketing campaign, product endorsement and a certified supply of product from a clean and new origin (Greenland) studies from other gemstone markets shows that buyers are willing to increase the price they pay for the goods as they know they can build a profitable relationship with the company supplying the rough.
A certain element of polished stones will still be supplied to clientele who request as such but do not have the capacity to polish their own gemstones, as TNG has already established contacts for this, a portion of material will be sold as polished. Estimated Corporate Tax: DKK 350 million.
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Year 0 1 2 3 4 5 6 7 8 9 Total Revenue DKK mio. 0 2 74 161 130 157 195 234 283 593 1.829 OPEX DKK mio. 0 35 45 71 68 68 67 67 69 82 572 Depreciation DKK mio. 0 1 9 26 28 29 29 29 31 8 191 EBT DKK mio. 0 -34 19 63 34 60 99 138 183 502 1.066 Tax DKK mio. 0 0 0 0 0 9 37 51 68 186 350 Net Income DKK mio. 0 -34 19 63 34 51 62 87 115 316 715
Price Ruby Rough DKK/g 2 6 44 93 146 175 204 208 213 217 Ruby Polished DKK/ct 189 193 200 208 217 221 225 230 234 239 Sapphire Rough DKK/g 2 5 6 9 17 29 58 88 117 119 Sapphire Polished DKK/ct 149 152 158 165 175 175 175 175 175 175
Price Escalation per year Total Ruby Rough % 156 650 113 57 20 17 2 2 2 9.423 Ruby Polished % 2 4 4 4 2 2 2 2 2 27 Sapphire Rough % 105 25 50 94 72 100 50 33 2 5.131 Sapphire Polished % 2 4 4 6 0 0 0 0 0 17
Sale of Rough vs Polish Ruby Rough % 5 5 30 50 95 95 95 95 95 Ruby Polished % 95 95 70 50 5 5 5 5 5 Sapphire Rough % 40 40 40 50 60 95 95 95 95 Sapphire Polished % 60 60 60 50 40 5 5 5 5 Total Sale of Rough vs Polish Rough (g) Ruby Rough G 280 9.140 113.216 143.921 295.371 310.654 282.806 274.845 564.370 2.672.635 Ruby Polished Ct 2.478 80.752 122.840 66.923 7.229 7.603 6.921 6.727 13.812 Sapphire Rough G 15.511 505.222 1.043.015 994.296 1.287.583 2.144.424 1.954.990 1.897.444 3.900.105 18.461.790 Sapphire Polished Ct 10.819 352.392 727.503 462.348 399.151 52.482 47.846 46.437 95.450 Yearly sales-% from total rough (g) Total Ruby Rough % 0,01 0,34 4,24 5,38 11,05 11,62 10,58 10,28 21,12 74,63 Ruby Polished % 0,20 3,50 9,88 5,38 0,58 0,61 0,56 0,54 1,11 25,37 Sapphire Rough % 0,08 2,74 5,65 5,39 6,97 11,62 11,59 10,28 21,13 74,44 Sapphire Polished % 0,13 4,10 8,47 5,39 4,65 0,61 0,56 0,54 1,11 25,56 Table 7.8 Scenario 2, Moderate Marketing
Scenario 3, Aggressive marketing: In this last scenario, with the growing World demand for coloured gemstones and TNG having a primary host deposit at Aappaluttoq that can offer consistency of material, there is an opportunity for a marketing campaign aimed at the growth in China and the East that will produce higher consumer requests for both the Rubies and Pink Sapphires produced from Greenland. Again, with an aggressive marketing strategy stronger returns may well be seen, resulting in higher taxes. Although the price escalation in percentages over the life time of the mine, especially for the rough stones, seems very high, experiences from other gemstone markets shows that the price increase for grams and carats are realistic, Estimated Corporate Tax: DKK 453 million.
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Year 0 1 2 3 4 5 6 7 8 9 Total Revenue DKK mio. 0 2 74 154 132 177 256 290 337 695 2.117 OPEX DKK mio. 0 35 45 70 67 67 70 70 71 87 581 Depreciation DKK mio. 0 1 9 26 28 29 29 29 31 8 191 EBT DKK mio. 0 -34 19 58 36 81 157 192 235 600 1.344 Tax DKK mio. 0 0 0 0 0 15 58 71 87 222 453 Net Income DKK mio. 0 -34 19 58 36 66 99 121 148 378 891
Price Ruby Rough DKK/g 2 6 44 93 146 175 204 208 213 217 Ruby Polished DKK/ct 189 193 200 208 217 221 225 230 234 239 Sapphire Rough DKK/g 2 5 6 17 29 58 88 117 146 146 Sapphire Polished DKK/ct 149 152 158 165 175 175 175 175 175 175
Price Escalation per year Total Ruby Rough % 156 650 113 57 20 17 2 2 2 9.423 Ruby Polished % 2 4 4 4 2 2 2 2 2 27 Sapphire Rough % 105 25 191 72 100 50 33 25 0 6.310 Sapphire Polished % 2 4 4 6 0 0 0 0 0 17
Sale of Rough vs Polish Ruby Rough % 5 5 30 50 95 95 95 95 95 Ruby Polished % 95 95 70 50 5 5 5 5 5 Sapphire Rough % 40 40 50 60 95 95 95 95 95 Sapphire Polished % 60 60 50 40 5 5 5 5 5 Total Sale of Rough vs Polish Rough (g) Ruby Rough G 0 9.140 113.216 143.921 295.371 310.654 282.806 274.845 564.370 2.672.635 Ruby Polished Ct 2.608 80.752 122.840 66.923 7.229 7.603 6.921 6.727 13.812 Sapphire Rough G 15.511 505.222 1.303.768 1.193.155 2.038.673 2.144.424 1.954.990 1.897.444 3.900.105 18.461.790 Sapphire Polished Ct 10.819 352.392 606.252 369.878 49.894 52.482 47.846 46.437 95.450 Yearly sales-% from total rough (g) Total Ruby Rough % 0,00 0,34 4,24 5,38 11,05 11,62 10,58 10,28 21,12 74,62 Ruby Polished % 0,21 6,50 9,88 5,38 0,58 0,61 0,56 0,54 1,11 25,38 Sapphire Rough % 0,08 2,74 7,06 6,46 11,04 11,62 10,59 10,28 21,13 81,00 Sapphire Polished % 0,13 4,10 7,06 4,31 0,58 0,61 0,56 0,54 1,11 19,00 Table 7.9 Scenario 3, Aggressive Marketing
Notes to the considered: None of the scenarios described here have been proven, this cannot be done until production from the mine has been established and the consistency and estimated grade of material can be known.
All these economic predictions have to have a variance, as it is the Gemstone Industry that will drive the prices, and it will be the marketing that will solidify them. Supply and demand will always be the determining factors.
Production throughout the mine life has stayed consistent in all scenarios, the company does have the ability to increase production if the market place is willing to consistently purchase at higher levels.
The Government of Greenland will also receive income tax paid by the employees of the Company a number estimated to be upward of 80 staff, and the benefit of taxes paid by the secondary industry built around supplying services to the mine and all its ancillary facilities.
7.2.4 Business life
For the Aappaluttoq project, TNG will outsource activities related to transportation of goods and staff as well as service of the camp, including catering, cleaning of the camp and offices, and laundry during construction.
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The significance of impacts on business life is rated high in Greenland: spin off impacts of recent oil and mining activities are perceived as very high. A good example is the recent oil exploration activities undertaken by Cairn Energy in the Disko Bay. Despite the low employment of Greenlandic workforce, it is perceived to have produced a high positive impact on the general business life and economy in Nuuk and the west coast (Consultation in Nuuk, personal communication, 2010).
The main direct positive impact on business life is expected to be related to the following activities:
Transport of goods and staff Services to the camp Provision of fuel Provision of goods and food Provision of technical services.
All equipment and goods used in connection with the mobilization and construction will be shipped from Aalborg (Denmark) to Nuuk by Royal Arctic Line (RAL) or from Halifax (Canada) to Nuuk by Eimskip. Equipment and goods will be unloaded in Nuuk before further shipping to the site. In Nuuk, equipment and goods will be loaded onto a barge tugged by tugboat/service vessel. For transport of goods on a regularly basis to Greenland, Royal Arctic Line (RAL) will be involved. Transport of bulk materials, equipment, etc. could be by chartered ship from either RAL or another company.
During operation, transport of goods and staff will mainly be by boat between the mine site and Qeqertarsuatsiaat and Nuuk. Transport of staff from other localities like Paamiut will most probably also be by boat. The same boats will probably transport goods and staff. The transportation is tentatively scheduled once a week from/to the mine site and once a week from/to Nuuk via Qeqertarsuatsiaat. This service will be tendered with preference to Greenlandic companies that can fulfil the requirements.
The ruby concentrate will be transported from the site to Nuuk once per week or when convenient. Frequency of trips is estimated to 50 trips per year during full production. Furthermore, helicopter service will be used to and from the mine, probably provided by Air Greenland. This service will be used for transportation of selected staff and visitors as well as a service for emergency use.
The service of the camp will most probably be tendered and is expected to involve approximately 6 workers. Such services include catering services, cleaning, laundry and similar tasks. Moreover, there will be a number of services provided for the mine when contracting Greenlandic tradesmen (carpenters, engineers, electricians etc). Also IT services could be requested during the operation and provided locally.
The catering services of the camp will require the provision of food and consumables, which is highly desirable to source locally to the extent possible. The menu will include both local/traditional and international food. Arrangements can be made by the catering company with local fishermen and hunters for the provision of fish and meat for traditional food.
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Consumables during operation include drill equipment, explosives for more than 1 mill DKK a year the first years and decreasing over the life of the project. Other consumables to be directly purchased during the operation phase of the project include: light vehicles and vehicles supplies, furniture and equipment for the camp, stationery, clothes and safety shoes, protective gear and equipment. Most of these articles are likely to be purchased from outside Greenland.
Provision of fuel will be purchased from Polaroil A/S, a Greenland Government owned company. The consumption of between approximately 600,000 litres/year of fuel and 9,000 to 20,000 litres/year of lubricant are expected (MTHøjgåard, 2010).
Regarding accommodation services, although the majority of all international staff will be on a fly-in fly-out basis (FIFO), it is expected that some international experts and consultants will stay in Nuuk and Qeqertarsuatsiaat for shorter periods of time, demanding accommodation services. In Qeqertarsuatsiaat temporary accommodation services of good quality are available, operated by a local businessman (Local interviews, personal communication, Feb 2011).
Due to the type of commodity, security protocols and procedures are needed at site, during transport and in the sorting house in Nuuk. Security services will be needed and will be provided by local companies if conditions can be met.
Technical Services The acid cleaning of dirty rough is expected to be performed by the local laboratory such as Actlab (parent company in Canada) during the whole period of operation.
Equipment for the mining activities such as dump trucks, excavators, wheel loaders, drillrigs etc. are expected to be purchased directly from outside Greenland.
The transport of goods and staff to the mine, services to the camp, provisions of fuel, goods and food will start during the construction of the mine, peak during the operation months (May to October) and run until the closure of the mine.
Purchasing of goods and services from Qeqertarsuatsiaat will have a significant impact on the local economy and community life. So far, possibilities identified include: provision of meat and fish from local hunters, groceries from the local Pilersuisoq, accommodation services, rental of some equipment, and rental/charter of local boats. Paamiut could also benefit from some of the outsourced contracts if local companies can provide services at competitive prices and quality.
The direct impact on the local business life is conservatively characterised as positive medium. The more services and goods are purchased from providers in Greenland, and especially from Qeqertarsuatsiaat and eventually Paamiut, the more positive and lasting the significance of the impact on local business.
Recommended measures related to business life
All measures are based on the condition that they are economically viable, or cost competitive, and not detrimental to the overall cost of the contract.
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Preferential contracting practices for Greenlandic contractors (locally based in first place and secondly in Greenland) for logistics, transport of staff and goods, fuel etc. including sensitive elaboration of tender documents, specifications, etc. Unbundling of contracts for services and supplies to camp where no cost hindrance to the project Preferential purchase of local goods and services to the mine camp and Nuuk operations: Security, laundry, catering, office supplies, IT maintenance, etc. TNG´s Greenlandic company, TNGG, to become member of Greenlandic Employers Association (GA) and participate in the initiatives of local business actors Organise and participate in open days to inform, identify and attract potential services and goods suppliers and possible workforce Requirement in contract with the providers of catering services to supply local/traditional food. Agreements with local fishermen and hunters for the provision of fish and meat to the canteen. Engaging the local grocery store in Qeqertarsuatsiaat in providing some of the regular food and consumables for the canteen and camp in general
7.2.5 Closure of mine
The main potential negative impact on the employment will be the closure of the mine either at the end of planned operation or if stopped before planned. For the closure activities, including closure, remediation and demobilization, a workforce similar to the one used for mobilization and construction, around 20 people, will be required for a period of approximately 3 months.
Recommended measures related to mining closure
In order to decrease the potential negative impacts it is recommended developing an exit strategy early in the operation of the mine project that may include gradual transfer of workers to other mining projects where the workers’ training and experience are valued. A fund to support the workers’ moving to alternative workplaces and occupations (education, training, initial capital to new business, etc) and coordination with the business development division of the Municipality and/or Greenland Business Council (GTE) should be considered.
7.2.6 Conflict and synergies with other economic sectors
Unless stated otherwise, the identification and evaluation of the potential impacts in this chapter are based on the input provided during interviews and focus group sessions with stakeholders and community members of Qeqertarsuatsiaat.
Fishing Factory in Qeqertarsuatsiaat The fish factory in Qeqertarsuatsiaat has 5 full-time employees and a peak of 15-20 during the summer. 10 regular fishermen provide the fish all year round. There are concerns that the Aappaluttoq Project will compete with the fishing factory for the workers, particularly during the summer. No further study that can confirm or reject this concern has been performed.
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Professional fishing and hunting As previously stated in the baseline, there are 25-30 professional fisherman and hunters in the area. While the mining area is not directly impacting their activities, it can have effects on their access to valued areas. Hunters and fishermen use the Tasiusaa area as an escape when the southeast wind gets too strong in Tasiusarsuaq and would like to have an agreement with the Company to enter the area under these circumstances, particularly during the reindeer hunting season.
The fishermen/hunters are mostly busy and earn the most during summer and they are worried that they will lose their hunting license if they choose to take jobs at the mine site. They are only allowed to earn 50% of their earnings as hunters/fishermen on the side, or they lose their professional hunting license.
While the fishermen and hunters believe that the project and their activities can coexist with open communication and cooperation, they have expressed concerns regarding the impact that further exploration activities beyond the project area could have on their livelihood. It is important to note that the fish and meat consumed by almost 60% of the people interviewed during the SLiCA report was caught by family members, and 72% also bought traditional Greenlandic food. Sharing of traditional Greenlandic food is an important part of the Greenlandic culture that has been preserved in the settlements despite the influence of modern and western lifestyle (Poppel, 2011).
Small scale miners and stone collectors During the SLiCA interviews in 2004, collection of stones was identified neither as a productive activity nor as an activity important in order to preserve the Greenlandic identity by any of the people interviewed in Qeqertarsuatsiaat. Collection of corundum by the local community in the Aappaluttoq areas was not observed during several exploration activities between the late eighties and 2004 (Appel, personal communication 2009), but is locally recognised as a strong free time activity.
Greenlandic stones and collection of the semi-precious stones are very popular in Greenland. The recently disbanded Mineralogical Society of Greenland had approximately 400 formal members and organised a number of formal divulgation activities, like creation of a museum, publications, prospector’s courses, organization of exhibitions, etc. A number of the people interviewed have manifested collecting and possessing both rough corundum and polished rubies. BMP provided support to the Mineralogical Society until 2009 when a failed intent of smuggling rubies out of Greenland by non-Greenlandic people motivated a change in governmental attitude towards informal stone collection (Ljungdahl B. personal communication, March 2011.
Standard Terms for Small Scale Exploitation (BMP, 2009) requires special licences for activities that used to be free for all local people.
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The present information seems to indicate that the interest in the collection of rubies as a form of livelihood became relevant mainly during the exploration activities performed by TNG, when information on the potential value of the rubies in the area was informally provided by some of the Company employees. During the exploration period, training of seasonal workers and training courses in Qeqertarsuatsiaat financed by TNG since 2006 (sorting, polishing, etc.) contributed to an increased interest in ruby and pink sapphire mining, polishing and jewellery making in Nuuk and Qeqertarsuatsiaat.
In January 2010, a new regulation on small scale mining was implemented, regulating small scale mining and “collection of stones”. This was revised in 2012 so that issues concerning small-scale miners are now in the applicable legislation.
There are six non-exclusive small scale mining licences (2010), three of them in Kommuneqarfik Sermersooq, and one exclusive in Southern Greenland. Other mining licences in the area include 21st North, north of Qeqertarsuatsiaat and small scale mining concession hold by a person from Nuuk
Issues and questions identified in relation to small scale mining include: regulation perceived as constraint to scale of small scale mining, right to access to areas rich in corundum, lack of independent valuation of gems, bureaucracy and constraints associated with the export of Greenlandic stones for small miners and handcrafters.
While none of the issues identified are direct impacts of the project, the project can provide possibilities of easing some of the constraints faced by small producers.
The vast majority of the people interviewed find that small, local mining and stone collection and the Aappaluttoq Project can coexist. A few of the people interviewed see advantages of the activities of a large company involved in the rubies if the small ones will operate as miners or jewellers. Nevertheless, basic conditions such as mutual good will, clear and timed communication on project activities, outspoken presence of the mining authorities, transparency in the valuation and taxation of the rubies need to be fulfilled.
The future impact of the project on small scale mining and stone collection activities before mitigation measures are implemented is considered medium negative, temporary, reversible and can be mitigated. The negative signs are mainly related to access to areas rich in corundum, and the public concern identified gives significance to this impact, which will otherwise, and according to subjective baseline information, be non-significant.
Jewellers and handcrafters The jewellers and owners of souvenir shops consulted in Nuuk have identified the following positive impacts of the project:
International marketing and branding of Greenlandic rubies Increased knowledge and capacity in the field of gemmology Expected capacity building on sorting, polishing and faceting Clear framework for the valuation of local rubies.
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Nowadays, it is mainly Greenlanders and people with an affective relation to Greenland that buy Greenlandic jewels made of local gold and stones, particularly as gifts to their dear ones. Both rough and polished stones are of interest.
The interest in Greenlandic rubies has increased during the last years, but some of the constraints identified regarding the commercialization of jewellery and handicraft with rubies include: lack of knowledge of quality and value of the stones and uncertainty as to legality of the stones after the new regulations. TNG can provide rubies and pink sapphires to local polishers, jewellers and designers, with certification of being legally mined.
A polishing and carving workshop run by the municipality has existed in Qeqertarsuatsiaat since 2001-2002. Originally it was used by people to polish local stones and create basic jewellery (pendants, etc,) to be sold to hotels and tourist. TNG has previously donated some equipment, such as faceting machines, handbooks, etc. 2-3 people use the workshop during the winter and more during the rest of the year. The number of people using the workshop has not increased between 2002 and 2011. The municipality believes that more people will use the workshop if the faceting machines are available again (the equipment donated by TNG has been stolen or missing spare parts) (Local interviews, personal communication Feb 2011).
A limited number of people in Qeqertarsuatsiaat and Nuuk have polishing and faceting skills and experience with rubies. There is an increasing interest in training in faceting from men and women of all ages and informal, independent courses are being arranged in Nuuk. High quality training and specialization of local, Greenlandic- speaking polishers for a “training of trainers” approach to local capacity building has been suggested by different stakeholders. The business development division of the Kommuneqarfik Sermersooq is also interested in increasing the local capacity in the area.
The impact on jewellery and handcraft without any enhancement measure is considered low positive, permanent, will be noticed a short time after start to commercialise the ruby and sapphire. It will be relevant mainly at the local level (Qeqertarsuatsiaat and Nuuk) and by a limited number of people directly involved with the activities. Nevertheless, this impact could have an intangible, high cultural and social value and open possibilities for a new economic activity that can be performed the whole year and by all individuals with physical or health limitations. Management measures can improve the significance of this positive impact and are further described in the Impact and Benefit Plan.
Tourism It is expected that international branding and marketing of Greenlandic rubies can have a positive impact on international tourism and sales associated with this. Impacts on tourism activities have been scarcely mentioned during the consultations and mostly in connection with the possibilities of new tours to Qeqertarsuatsiaat and possible synergies with local stonecutters and jewellers. It is difficult to assess the significance and magnitude of the impact at this point.
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According to inputs from the stakeholders and international best practices, the following management measures can contribute to eliminating or mitigating significant negative impacts and to enhancing the positive ones related to small scale mining, hunting and fishing, jewellery and tourism:
Recommended measures related to other economic activities
Participatory design, implementation and communication of information and communication procedures with the community in Qeqertarsuatsiaat and small scale miners close to the concession areas. Public and accessible information on concession limits, exploration activities and restrictions on the access to and use of the area. Design and implementation of a grievance mechanism agreed with the community representatives in order to register, identify and solve potential nuisance and problems with the community in Qeqertarsuatsiaat. Participation of TNG experts and in general support on divulgation and training activities related to gemmology, etc. organised by private (i.e. Mineralogical Society of Greenland) and official initiatives (municipality, University, etc). Formal collaboration/coordination with the School of Minerals and Petroleum on vocational and professional education planning and implementation. Consider the support of a “training of trainers” program targeting local people with skills and experience both on polishing/faceting and teaching others, preferably Greenlandic speaking, interested and committed to train others. Quantitative and qualitative monitoring of impacts on jewellery and handicraft
7.2.7 Changes in traditional production systems
A significant percentage of people in the potential workforce are very attached to the traditional activities in the settlements of Kommuneqarfik Sermersooq. A majority of the population in Qeqertarsuatsiaat covers an important part of their consumption of Greenlandic food with their own catch. The household fishing and hunting activities have significance as financial contribution (decreases the need for buying food) and at the same time this means that the income is used on tools to guarantee a partial subsistence economy (Poppel, 2011).
3 out of 4 people interviewed responded that half or more of the fish and meat consumed is traditional food, like fish, seal and reindeer. Several activities related to fishing and hunting have been an important part of the upbringing of the inhabitants of Qeqertarsuatsiaat: to manage oneself in nature, to fish and hunt, prepare and preserve the catch, predict weather as well as collecting berries.
Similar patterns apply to the rest of the area of influence of the project: that “a combination of wage job and participation on traditional activities as fishing and hunting is the preferred life style among the inuits in the Arctic. It is expensive to do fishing and hunting; households with higher incomes can choose (and they do) spending more money on these activities. Nine out of ten Inuit consider traditional activities as fishing and hunting important for their identity” (Poppel et al, 2007).
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For local employees who will be employed at the Aappaluttoq mining project it is likely that their opportunities for going fishing and hunting may be reduced when working full time at the mine site. Furthermore, it is illegal for the employees to fish and hunt in the mining concession area according to the Mineral Resource Act (2009).
Nevertheless, it is important to mention that work on the mine is not incompatible with traditional activities, as rotation-working systems allow time for traditional activities on a spare time basis. Furthermore, a regular income will allow the purchase of equipment for fishing as well as hunting of marine mammals (seals) and birds in households where these activities have a high priority. It is expected that only young professional fishermen and hunters will be attracted to work in the mine, either as looking for an alternative livelihood or for earning money to buy fishing/hunting equipment for spare time hunting and fishing.
In case there is an impact on the subsistence economy it will be local, but the consultants consider that negative impacts are unlikely to happen. It is uncertain whether the impact can be slightly negative or positive in a medium-long term. Due to the high importance of traditional subsistence activities for the household economies, cultural and identity values, the impact predicted can be characterised for the time being as low negative.
Recommended measures related to traditional production systems
It is suggested incorporating social indicators related to traditional productive systems to the monitoring program
7.2.8 Salary boost
Due to the limited number of local employees in Nuuk, it is unlikely that a noticeable cycle of boost and boom of salaries will be perceived at community level.
In the case of Qeqertarsuatsiaat, it is expected that the increased and stable salaries will have a positive effect during the life of the mine. Termination of these effects at mine closure will be noticed in the community if Aappaluttoq is the only mine in the area at that time, but it is unlikely that negative effects of a cycle of boom and boost will be severe in Qeqertarsuatsiaat, as most of the work force is actually active and there will not be drastic differences in salary levels. The same can be applied to Paamiut or others where the workers may come from. This impact is characterised as non-relevant for the project.
The impact of salary boost is considered low positive for this project.
7.3 Education and training
The following sources of potential impacts on education and training have been analysed:
Training and skills development opportunities Motivation for development of relevant training courses
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Increased administrative focus on Greenlandic employment opportunities in the mining sector.
All contributions to training and skill development in Greenland contribute to sustainability and improved level standards.
Training and skills development opportunities People employed on the project, as well as Greenlandic companies to which some of the services will be outsourced will benefit from training on health and safety procedures, working standards for international companies, place and from improved language skills.
Specific on the job training will be provided for all the operators at mine front, processing plant and sorting house. Some of the training is specific for the gem industry, like low intensity blasting techniques, the specially designed processing plant and sorting activities, but most of training can be applied to the mining industry in general, improving significantly the employability of all workers involved in the operations.
Increased wage levels and standards of living can be expected for staff working all the years, and to a lesser extent for the seasonal workers at site. The diverse employment opportunities created by the project (40 direct jobs during construction and closing, approximately 80 during operation, plus a number of indirect jobs yet to be determined) may motivate young people and students to continue their education or initiate vocational training programmes and higher education on areas related to the project or the services associated.
For employment during construction and closure activities, Greenlandic qualified workers will have first priority on employment. Nevertheless, up to half of the positions can be filled by unskilled workers that will receive basic training on the job. Details on the training programmes for upgrading of skills, including potential strategic alliances with SIK, Suliffissarsiuussisarfik (The Unemployment office), etc. will be developed as part of the final Impact and Benefit Plan.
During operations, skilled local workforce from Qeqertarsuatsiaat and Paamiut will have first priority. Upgrading of general and specific skills and project specific on the job training will be provided at site. In case of not filling all positions with qualified local workers, a more intensive training plan will be developed, probably in coordination with the Schools of Minerals and Petroleum. For the positions requiring a higher technical level, it is hoped but not expected to fill all the positions with local workers. A gradual upgrading of qualifications and transfer of knowledge and skills is expected to take place, in order to enable the local workforce to undertake technical and management positions.
It is not expected that local workers qualified for sorting gemstones will be identified. Workers for the 4-5 positions as sorters in the Nuuk facility will receive full pre employment training by TNG in order to achieve the desired level of qualifications and skills required for the job.
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Motivation for development of relevant training courses It was identified that a number of students from the former School of Metals could not finalise their studies because of lack of workplaces to complete the 6 months of required traineeship in their speciality (Pedersen, personal communication, Nov 2010). The possibility of providing trainee positions to students from different careers at the Greenland School for Minerals and Petroleum and the Food Service and Preparation School will be discussed as part of the Impact and Benefit Plan. This will have a significant positive impact on the vocational training sector.
So far, no plans to provide workforce preparation or pre-employment training for local people have been made or agreed with the authorities.
Furthermore, stakeholders have identified increased knowledge and experience of gemmology and gemstone mining as one of the most positive impacts of the project.
Increased administrative focus on Greenlandic employment opportunities in the mining sector Given the existing and upcoming activities in the mining and oil sector, it is expected that the local administration will increase efforts on relevant training courses and employment opportunities targeting the sector. Despite the relatively small size of the Aappaluttoq Project, it will be one of the first mining projects in the Municipality; the first operating gemstone mine in Greenland and therefore the impact on the training development is very significant.
The skills developed during the engagement at the project will also exist after closure of the mine.
The impact on education and training within the known conditions and before the application of mitigation measures is characterised as medium positive.
Recommended measures related to education and training
Develop a recruitment programme, for both unskilled and skilled workforce, in collaboration with strategic allied. Involve the School of Minerals and Petroleum in the training and recruitment program On the job-employment training programme for staff on specific duties, safety, etc. Dedicated, local based Human Resources Manager to develop and follow up on recruitment, training and career development of the staff Active participation of TNG experts on capacity building initiatives in the field of gemmology, and mining Early development of a reinsertion programme for workers after mine closure
7.4 Public service and development plans
7.4.1 Existing infrastructure and services
The possible sources of impacts related to infrastructure and services are: Housing
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Waste incinerators in Qeqertarsuatsiaat and Nuuk Use of airports in Nuuk and Kangerlussuaq Use of Air Greenland flights for transport of international workers or personnel associated with the project Use of ports in Nuuk and Qeqertarsuatsiaat (possibly Paamiut) for transport of staff, goods and concentrate Increased frequency and opportunities for transport of passengers and goods Pressure on the budget of health services in case of evacuation of victims of accidents by helicopter.
Housing As part of the project specific controls on public services and development plans, international staff in Nuuk (approx. 3 full time) will be accommodated in private, rented houses or apartments, with no impact on municipal housing. In case employment positions in the sorting house in Nuuk are filled with persons with residence outside Nuuk, the Company may need to include private housing arrangements as part of the contract.
Due to the low number of people and the reversibility of the impact, and despite the reduced availability of housing and accommodation in Nuuk, the impact on housing in Nuuk is expected to be non-significant.
A limited number of people/month (approximately 1-4 persons/month) are expected to be housed in Qeqertarsuatsiaat on a part time basis during the operation phase of the project. Both private and municipal accommodations are available for short term. There are houses available that may need some upgrading and repair in case that long term accommodations are required in Qeqertarsuatsiaat. The impact on housing in Qeqertarsuatsiaat is expected to be low and positive.
Municipal waste treatment During construction and operation, most waste (including oil waste) will be incinerated on site when possible and according to local regulations. Ash from the incinerator, metal scrap, glass, and other waste types that cannot be incinerated on site for some reason will probably be transported to Nuuk for treatment or disposal (Kommuneqarfik Sermersooq, personal communication, March 2011).
The amount of waste to be sent to municipal treatment facilities has not been calculated so far, but is not expected to be significant. The impact of the project on the municipal waste treatment facilities is considered negative low to medium as the waste management facilities in Nuuk already work over their capacity and are receiving additional pressure from oil exploration and upcoming mining projects.
Airport and air services It is estimated that there will be a total of approximately 10-13 round trips per year during the operation phase to North America for international staff associated with the project, excluding possible consultants or customers. Unless Air Greenland and the existing airport services expand their capacity as a consequence of the generally increasing demand from the oil and mineral activities, the use of the air transport services, particularly during the summer months, will affect the actual availability of flight seats for Greenlanders and tourism.
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Despite the relatively low numbers in the actual conditions of air transport services the impact cannot be mitigated and can be considered negative low for Nuuk and non-significant at national level.
In Qeqertarsuatsiaat there is a primitive helicopter landing deck close to the Tele Greenland tower. Its access is in poor condition, which makes it virtually useless. Helicopter landings outside the helipad during exploration activities produced nuisance among the population and are not desirable in the future by the community. It has been suggested by stakeholders in Qeqertarsuatsiaat to TNG to collaborate with the upgrading of the existing helipad if helicopters providing services for the company need to operate in Qeqertarsuatsiaat.
The actual project contemplates the construction of a helipad close to the mine site and infrequent need of landings in Qeqertarsuatsiaat is expected, except in case of emergency situations. The impact is therefore assessed as non-significant.
Use of port facilities Most of the shipping will go directly to the mine site, using the specially constructed port facilities. The port in Qeqertarsuatsiaat is therefore expected to be used mostly during the transport of staff, 4-6 times a year during the working season, plus additional, non-regular boat trips from the mine site or Nuuk. The impact is therefore considered non-significant.
The port of Paamiut may be used for transport of staff, but the impact can be considered non-significant.
It is estimated that the port of Nuuk will receive approximately 50 small boats a year (staff, concentrate), 4 round trips of tugboats for transport of goods, plus 6-7 containers a year. Shipping of concentrate overseas is not included.
The port of Nuuk is heavily used, and will receive an increased pressure from upcoming oil and mining projects in the area. The impact from the project is considered low negative, will be experienced immediately but only during few months a year, is reversible and cannot be mitigated.
Transport of passengers and goods The passenger ferries connecting Qeqertarsuatsiaat and Nuuk are run by a Royal Arctic Line A/S subsidiary, Arctic Umiaq Line A/S (www.ral.gl) every second week during the winter and once every week during the summer. The freighting ships (bygdeskib) run every 2 weeks to Qeqertarsuatsiaat from Nuuk. Capacity and frequency are perceived as insufficient for business life (mainly the fishing factory) and for the community.
The community hopes that more frequent boat trips will be available as a consequence of the project and perceives this potential impact as very positive.
Recommended measures related to impacts existing infrastructure and services:
Assess the type and quantities of waste potentially produced and consider alternative waste disposals methods. Avoid in all cases municipal housing and use private rental.
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For short-term accommodation in Qeqertarsuatsiaat, consider a frame contract with the local providers of existing private accommodation facilities where expected services and approximated time plan will be specified. Discuss with the community and authorities a framework for the use of charter boats directly related to the project.
7.4.2 Pressure on development plans
None of the activities and initiatives described in development plan for Qeqertarsuatsiaat for 2004-2015 (former Nuup Kommunea) will be affected by the project. The same can be said about Nuuk, as the sorting facility will be located on existing areas dedicated to business, with no particular high or extraordinary requirement of any service.
Kommuneqarfik Sermersooq is working on identification and development of tourism opportunities for Qeqertarsuatsiaat and Kapisillit (Interview, Feb 2011). An evaluation of possible synergies with the project has not yet been discussed but is strongly recommended. In the meanwhile, impacts on the project both at local and municipal development plans can be classified as non-significant
7.4.3 Social and health services
All work-force during operations will go through a pre-employment medical check and annual checks before the working season. There will be health personnel on site during construction and operation, able to provide first aid services and consultation of simple health complications. In case there is a health issue with the workers on site that requires more specialised diagnostic or treatment, the telemedicine consultation (Pipaluk) in Qeqertarsuatsiaat or medical facilities in Nuuk will be used.
All international workers will be covered by a private health insurance. The cost caused to the public health system will be negligible. The event that potentially may cause severe negative impacts and put pressure on the already heavily loaded health service is related to the evacuation by helicopter of injured from the mine site to Dronning Ingrids Hospital in Nuuk.
Proposed measures related to social and health services
Develop clear criteria and conditions for use of local health services; communicate these to health providers and assess need of supplementing capacity where necessary (upgrading of services or infrastructure, specific training of staff, etc), in cooperation with local authorities. Establish contact with local health service and work out cooperation between both parties.
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7.5 Social aspects
7.5.1 Demography and population
There will be 14 job positions for the operations in Nuuk, most likely the majority will be covered by local people already residents in Nuuk. Demography and population changes at municipal and local level will therefore be considered non-significant.
In the case of Qeqertarsuatsiaat, two aspects are considered in the impact evaluation:
the net change in population community impacts related to the project location in a small, homogeneous community of limited economic and human resources.
Net change in population A scenario with significant demographic changes and/or population profile is unlikely, as most of the job positions are seasonal and priority is given to local community members or people living in the two nearest towns: Nuuk and Paamiut. The possibility of having one or two persons, and eventually their families taking permanent positions in Qeqertarsuatsiaat for managing community relations and logistics aspects is being studied.
The workers will work in rosters between the mine camp and their place of residence, and visits to Qeqertarsuatsiaat will not be encouraged or planned from the project. It may happen that staff on the way home or to the camp gets delayed in Qeqertarsuatsiaat because of weather conditions or other unplanned situations.
If the possibilities of long season employment and business related to the project benefit the community as expected, it is likely that some former residents, who previously left Qeqertarsuatsiaat because of lack of opportunities, may return (Interview, Feb 2011).
If people are employable and without serious social/health problems, the influence of Greenlandic newcomers could be very positive and desirable. Some concerns have been expressed that the project could also attract people that are not employable or who could eventually become unemployed and stay in Qeqertarsuatsiaat hanging around. Even in small numbers, such changes in population are perceived as serious in a small community, particularly if newcomers are affected by alcohol or drug abuse.
Due to the seasonality of the majority of the jobs, no significant demographic or population changes are expected, but this needs to be verified.
Recommended measures related to demographic changes
It is recommended yearly revisiting and monitoring social indicators, like population numbers and profile, unemployment, cost of living and perception of well-being, teenage pregnancy, STDs and HIV level. This monitoring information will allow an early “alarm” if demographic changes and social problems are larger than or different from what was predicted. This recommendation is also applicable to impacts in social conflicts.
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7.5.2 Social conflicts
The following existing or potential social problems that could potentially be exacerbated by the project have been identified during the consultations:
Existing social problems related to alcohol and drug abuse, particularly among unemployed and young, unskilled men. New exploration and mining concessions in the area, provided without informing or consulting with the community. Risk of security issues and social conflict if people are attracted to Qeqertarsuatsiaat and its surrounding with criminal intentions regarding the rubies.
Difficulties with legal framework Already in 2004, before TNG started their exploration activities, less than half of the people interviewed were satisfied with their influence on the administration of non- living resources and one of every 5 interviewed was very dissatisfied. In contrast, administration of living resources was considered satisfactory for more than half of interviewees and only 1 out of 10 manifests dissatisfaction (Poppel, 2011). The reasons can be related to the uncertainties and conflicts connected with the exploration of ruby deposits in the area since the 70’s and particularly in the 80’s (Interview, 2010). The results of the consultations in February seem to indicate that the perception of influence on the administration of non-living resources has worsened since 2005. In February 2010 a new Mineral Resources Act was implemented. This has later been revised in 2012.
The perceived historical and general lack of information on the rules and procedures for exploration from authorities and international companies, contradictory or overstated information on the value of the rubies, and the lack of continuity or follow up on what happens with the explorations samples have caused a feeling among the community that rubies are “stolen” by foreigners and local community gets nothing in exchange.
The new regulation on small scale mining is poorly known or understood by the majority of the people consulted and is perceived from the local community as a worsening of the situation. Local people feel criminalised for their interest or collection of red stones and excluded from the possibility of a possible commercial benefit.
TNG´s code of conduct and contract conditions include clear rules of acceptable and non-acceptable behaviour from their employees. During the exploration period, there was no agreed (nor legally required) framework for TNG community relations. Information, community development initiatives, local employment and business have been dependent on the personality and criteria of the site project manager. This lack of continuity and consistent information, and the breach of contractual conditions by one employee have created confusion and distrust among some residents in Qeqertarsuatsiaat and direct conflict with a limited number of people.
Nevertheless, despite the described baseline situation, no one identified the project as unwanted during the consultations. With a remarkably constructive approach the same stakeholders have identified the needed mitigation measures, which are listed at the end of the section and integrated into the Impact and Benefit Plan.
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Alcohol and drug abuse During the SLiCA survey, alcohol and drug abuse were identified as important social problems for the local community in Qeqertarsuatsiaat: two out of three people interviewed perceive this problem as significant (Poppel, 2011).
Concern regarding alcohol and drug abuse was confirmed during the scope and baseline consultations in February 2011 and was also connected with the young people without opportunities being restless. Unlike in other parts of Greenland, violence towards women is not identified as a social problem in the community.
TNG has a very clear policy related to prohibition of intake of alcohol and drugs in the workplace, camp and transport, during construction, operation and closure activities for their employees and contractors as part of the Health and Safety plan. A negative impact on the abuse of alcohol and drugs as direct result of the project is unlikely, but measures can be taken to ensure, as far as possible within the influence of the Company, that a negative impact will not take place. Besides the existing “dry” policies, additional preventive measures are included at the end of the section and further developed in the Impact and Benefit Plan.
New exploration and mining concessions It is likely that successful mine and permitting experiences will encourage other mining companies, both small scale and large. No mitigation measures can be taken by the Company in this respect.
All new exploration activities, application for concessions or any other activity related to the Aappaluttoq Project should be timely and clearly communicated to the local authorities and by agreed means to the local community. Open dialogue and discussion should take place when required by the community or considered relevant by the company. It could be expected that both community and local authorities will demand similar information flow from other projects and national authorities.
The impact of new exploration and mining concessions in the area is likely and mitigation measures to minimise the social impact will require coordinated efforts with national authorities and the companies and people applying for concessions, beyond the influence of TNG. It is important to remark that new mining activities in the area are also likely to provide economic opportunities and benefits for the local community. Such potentially positive economic impacts are considered likely although they were not identified during the public consultation and the time did not allow this issue to be analysed further.
Public security During the SLiCA survey in 2004-2005, more than 90% of the people manifested to feel safe or very safe while walking around in the nighttime, and just as many declare to be satisfied or very satisfied with the authorities’ contribution to public security in the local area.
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During the consultations with stakeholders, concerns have been expressed that people with criminal intentions will be attracted to Qeqertarsuatsiaat, particularly if they believe they can steal rubies or Company’s assets during the winter closure. It is important to clarify that these concerns are based only in perceptions, as TNG has planned that there will not be rubies at the site during winter shutdowns and security guards will be posted full time.
Control and records of who comes in and out the camp and Qeqertarsuatsiaat in relation to the project, permanent, year round guards at the site and outspoken procedures on how TNG will prevent smuggling of rubies and drugs among the employees have been suggested by the people consulted. Other measures suggested include clear communication on the activities related to the project, so the local community can identify in an easier way who and where project staff is working and who could be outsiders.
Public security is likely to be negatively impacted, although the significance of impacts is hard to predict. Nevertheless, the public concern and the perception of risk, independent of the real magnitude of the impact, is already affecting the local perception of security and is therefore conservatively estimated as negative medium.
Recommended measures related to social conflicts
Assign a full time, Greenlandic speaking Human Resources and Community Relation person based in Qeqertarsuatsiaat to handle recruitment, opportunities for local business and ensure timely information and open dialogue with the community. Develop and implement an agreed Grievance Mechanism to receive, register and handle complaints from the community. Extend alcohol and intoxicant prohibition policies and contractual conditions to all service providers while on duty for the Company, particularly freight and passenger boats coming to Qeqertarsuatsiaat and the mine site. Develop a programme and allocate resources to facilitate and support alcohol and drug counselling to staff and their families. Support local initiatives and campaigns related to prevention and treatment of abuse and social health problems (Paarisa and others). Support local initiatives aiming to improve the integral development and living conditions of children, teenagers and young people. Include indicators of social health in the social monitoring program. Keep an open constructive dialogue with local and municipal authorities in order to find coordinated and timely solutions if social problems may arise or increase.
7.5.3 Vulnerable groups
Young men (and young women) that have not completed their education and therefore are unskilled and unemployed have been identified by stakeholders as the vulnerable group in Qeqertarsuatsiaat, particularly the ones suffering from other health and social problems like alcohol or intoxicants. This is also the group affected by the highest rate of suicide and other social health problems, like STDs, alcohol and intoxicants at national level.
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This target group was also identified by the community as the most desired group to be provided with job opportunities from the project.
The best case scenario is that some of these are employed directly or indirectly and can overcome the challenges of going through training and adapting to a working discipline and rules. The worst-case scenario is that the vulnerable groups cannot really contribute to the positive development of the community, and the gap between the weak and strong in the local society will become bigger, worsening their relative social position and increasing their vulnerability.
The scope of this assessment and the information collected during the field research do not provide enough basis for predicting the significance of the risk on the vulnerable group of young, unskilled and unemployed men affected by social health problems.
The proposed mitigation measures to protect or non-harm this vulnerable group should be identified in coordination with local authorities and will be covered under public health in general.
7.6 Health
7.6.1 Occupational health and risk of accidents
There is a risk of accidents associated with shipping of goods and concentrate, and transport of staff, mainly due to the harsh weather conditions in Greenland. Even though the likelihood of accidents is low, the repercussions are very serious if anything is to happen to workers and transporters. The risks of accidents during mining and transportation are present from the beginning of the construction, and through the operation and closure of the mine.
Local special conditions that increase the risk at the work place may include: Wild animals Sudden change of weather conditions Loss of personnel in terrain Chill factor causing hypothermia Loss of communication Snow blindness.
Although the implications are permanent, the risks of accidents are considered to be negative low based on an overall assessment.
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By March 2011, Conceptual Health and Safety Plans have been developed for the construction phase, as well as for the operations in Aappaluttoq and Nuuk. The Health and Safety organization, plans and corresponding procedures were developed according to existing regulations Table 7.10 summarizes the key aspects of the HS Plans so to date6.
6 REP 0003 Conceptual Health and Safety Plan for Construction Phase, Aappaluttoq Rubi Project- MT Højgaard and EBA, 18 March 2011 REP 0004 Conceptual Health and Safety Plan for Operation Phase on Site, Aappaluttoq Rubi Project- MT Højgaard and EBA, 18 March 2011 REP 0005 Conceptual Health and Safety Plan for Operation in Nuuk, Aappaluttoq Rubi Project- MT Højgaard ad EBA, 18 March 2011
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Construction Phase Operation Phase Aappaluttoq Nuuk Areas assessed On site operations On site operations Handling of chemicals for risk Technical equipment Technical equipment Technical equipment Camps Camps Roads Roads Storage areas, permanent pier Storages areas, permanent pier Fuel storage and handling Fuel storage and handling Storage of explosives Storage of explosives Handling of ANFO (Ammonium Nitrate and Fuel Oil) Handling of ANFO Blasting Blasting Key elements of Health and Safety HS coordinator HS organization General safety meetings every month Health & Safety Safety induction to all new personnel Initial and regular health checks Safety introduction to all new personnel (HS) Plan Safety meetings every two weeks7 Promotion of healthy food and physical HS coordinator Extraordinary safety meetings in case of severe activities Policy on alcohol and intoxicants accidents or near missed Policy on alcohol and intoxicants WPA Weekly site inspections WPA PPE Safety groups PPE MSDS Safety objectives MSDS Signs in Greenlandic, Danish and Work place assessment (WPA) Local response team English Personnel Protective Equipment (PPE) 8 MOB response teams Emergency drills twice a year Signs in Greenlandic, Danish and English Safety meetings every 2 weeks3 Material Safety Data Sheets (MSDS)9 General safety meeting per month Emergency response, including medical plan and Extraordinary safety meetings in case fire fighting plan. of severe accidents or near missed. HS related Safety induction First aid Basic first aid to all personnel training to staff Basic first aid Search and Rescue Basic fire fighting to all personnel Basic fire fighting Basic fire fighting Use of MSDS Fire fighting and rescue10 Man over board (MoB) rescue Use of Material Safety Data Sheets MSDS Drills of diverse hazardous scenarios Use of Material Safety Data Sheets MSDS HS in Marine operations11 ) Table 7.10 Key aspects of preliminary Health and Safety Plans for the Aappaluttoq Ruby Project. Source: Grontmij, based on data from MTHøjgaard
7 Also mandatory for subcontractors 8 E.g. Eye protection, gloves, hearing protection, respiratory protection 9 Instruction of how to handle the specific chemical or material and what to do in case of injuries and accidents related to the specific chemical or material 10 Only for fire safety teams 11 Only for port staff
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Risk during construction phase The risk of accidents during construction is mostly related to operation of heavy machinery, use of explosives and harsh weather conditions.
Risks during operation phase The risks of operation of a mine and processing plant are mainly during operation of heavy machinery, explosives, and processing along with human error and harsh weather conditions. Because of the relatively large amount of workers involved, and type of accidents involving explosives and heavy machinery the risks are significant and considered negative medium.
Implementation of the proposed Health and Safety Plans and their corresponding training, procedures and monitoring for all workers, contractors and visitors will certainly reduce the likelihood and severity of accidents in the mining and processing operations.
The risks of accidents from construction and operation on site are assessed to be negative low. The risk of accidents and occupational health problems is considered insignificant for the sorting house in Nuuk.
Proposed measures related to Health and Safety
Strict implementation of HS plans as developed for construction and operation. Contractual requirements to providers of shipping and transport services (Air Greenland, charter boats for staff, etc) regarding safety measures, response time, etc. in order to minimise risk of accidents, appropriate and timely response in case of accidents, emergency evacuation from mine site, etc. Pre-notification of operations, exploration activities or similar and traffic of vessels to local authorities and community in Qeqertarsuatsiaat, hunting and fishing groups and users of area. Community development action: evaluate the possibility of organizing basic first aid, fire fighting courses to the community in Qeqertarsuatsiaat, in coordination with their fire fighting services.
7.6.2 Public health and quality of life
The operation of a mine project may have an impact on the health and quality of life of the employees and the public in general.
The negative impacts on health and quality of life of the community related to a mining operation are often related to interactions between the local community and the influx of staff. In other parts of the world mining, particularly during the construction phase, has resulted in increase in STDs and HIV/AIDS among the general population and sex workers (Desmond N, 2005; Campbell C, 1997).
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Given the organization of the project, the local origin of the vast majority of the expected workforce, the expected low contact of local population with workforce, etc. it is considered unlikely that a similar development will be observed in Qeqertarsuatsiaat, and even less in Nuuk, where the number of workforce is so limited, particularly expatriates. However, it is necessary to monitor the incidence of both STDs and unwanted pregnancies as important public health indicators. If the situation changes and more international staff and workers outside the community will be engaged in the project, the potential impact on public health needs to be assessed further.
Other potential public health consequences may include changes in eating habits leading to cardiovascular problems, incidence on alcohol and intoxicants abuse, etc. Some of them have been discussed previously.
Potential positive impacts on public health from mining projects may include improving nutrition, general life standards and access to medical services. According to the SLiCA report, the majority of the adults in Qeqertarsuatsiaat perceive their health as good and very good. More than 15% answers that their daily activities are restricted due to chronic physical or psychological problems. Moreover, 65% answers to be satisfied with the health services.
No concerns have been expressed during the consultation and it is the general assessment of the consultants that occurrence of significant impacts on public health, negative or positive, are unlikely to be perceived in Qeqertarsuatsiaat and therefore can be assessed as not relevant for this project.
Nevertheless, based on the pre-cautionary principle and the advantages of a strong preventive and corrective health and life style campaigns among the workers, measures are proposed in order to prevent as far as possible the occurrence of negative impacts on public health, and even contribute to a better local life standard.
Proposed measures related to public health and quality of life
Promotion and availability of healthy nutrition and physical activity. Initial and regular health checks for employees (screening of TB, Cholesterol, diabetes, etc.). Develop and implement strategies for making healthy choice the easy choice at the mine site: healthy food, local food, attractive and available exercise programme, hand washing facilities and campaigns, etc. Counselling services for staff and their families. Active part of community health campaigns (e.g. safe sex, alcohol, non- smoking).
7.6.3 Environmental impact
As required by the Mineral Resources Act of 7 December 2009, a full Environmental Impact Assessment (EIA) has been performed for the project, including environmental baseline studies from 2007 to 2011 (Rambøll, 2011).
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According to the report, none of the expected environmental effects of the project analysed seems to have a significant impact on socio economic values at local level. The impact categories assessed were:
Landscape and Geology Fresh water quality and hydrology of Ukkaata Qaava Sea water quality and hydrology Terrestrial nature and wildlife Emissions Archaeology Socio economics.
The impacts on land use and access to natural areas also analysed in section 6.1.4 of the EIA report will be discussed on section 7.7.2.
Noise is easily spread in the area. Mining activities from vehicles, crushing, explosives, ore transport and mechanical processing by nature are noisy and can cause hearing impairment among workers at the processing plant, open pit area, port area and workers working outside for hours. Hearing protection is mandatory for all the persons exposed in the Aappaluttoq project.
The low negative implications of environmental impact are short term and only during the duration of the mining operations. The implications are considered low because of the small-scale project, the processing of the ore will happen indoor, and the barrenness of the surrounding area.
7.7 Cultural and natural values
7.7.1 Sites of monumental or cultural importance
The Greenland national Museum and Archives prepared an archaeological report in the fall of 2010 (Knudsen et.al, 2010). According to the conclusions of the report, a number of cultural heritage sites made from naturally occurring material were found in the area, none of them considered unique or outstanding. The map below shows the project road and campsites and the archaeological findings. The archaeological findings are marked with green.
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Figure 7-1 Archaeological findings and planned infrastructure. Elaborated by: MTHøjgaard
From the identified cultural heritage sites, only 5 of them are close enough to the planned components of the project so that they can be considered directly impacted:
A cairn of several stones, a shooting blind and a probable tent ring close to the area where the roads to the mine and explosive deposits are projected Two fox traps close to the projected road between inner and outer port.
Furthermore, there are a number of sites located at the north of the existing camp.
The impact on sites of cultural importance is considered negative low, as none of the archaeological findings is considered unique or outstanding, and it is possible to avoid their destruction during the construction and operational phases.
Proposed measures related to sites of importance:
As recommended by the National Museum, if possible avoid sites with cultural remains, keeping a minimum of 20 m around the archaeological structures for preservation. During construction and operation, clear vegetation around the archaeological sites potentially affected and mark them clearly to raise awareness and avoid destroying them by accident.
7.7.2 Access to natural areas
This section is based on the information provided by a focus group of professional fisherman and hunters in Qeqertarsuatsiaat, in February 2011.
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The Tasiusarsuaq and Tasiusaa areas are widely used by the fishermen and hunters in Qeqertarsuatsiaat as they are rich in most animals and fish found in west Greenland - except for redfish. The local hunting and fishermen’s association has 25- 30 hunters/fishermen members in Qeqertarsuatsiaat – they are 21 professional hunters/fishermen with hunting licenses in Qeqertarsuatsiaat – mostly using dinghies or smaller boats, using equipments such as tidal zone nets, long lines and rifles.
The local hunters hunt land animals all around the Tasiusarsuaq and Tasiusaa The northern part of Tasiusaa and Tasiusarsuaq is especially used for hunting reindeer. Reindeer cross the inner gate area to enter the Puilasut area from the inland. The hunters use the char areas as a starting point and camping area for hunting reindeer.
The whole area in Tasiusaa and Tasiusarsuaq is used for picking berries and for recreational use by the local people from Qeqertarsuatsiaat. Sometimes there are fast boats coming through (mostly Nuuk people) during the summer months. But they do not stay long.
The fishermen/hunters use the Tasiusaa area as an escape area when the wind from southeast gets too fierce in Tasiusarsuaq, but they have been reluctant to enter the gate as they do not want to disturb the mining activities. They would like to have an agreement with the mining company to be able to enter the area under these circumstances - also during the reindeer hunting season as the stream on the north side of Tasiusaa is a good char area. One hunter told about an incidence on September 2010 when he had tried to camp close to the mining camp, but did not feel welcome and so quickly left the area. The fishermen/hunters would like an easy communication with the mining Company or a representative to contact in these situations mentioned.
The fishermen/hunters are worried that there will be areas (outside the project area) they cannot use if there is more exploration in the area. They believe the hunting and the mining activities are able to coexist if the communication and cooperation is done openly.
Given the importance of access to fishing and hunting areas for the local community, particularly, and the concerns expressed by the main users of the area, the impact is assessed as negative medium, temporary and reversible. The mitigation measures proposed by the fishermen and hunters previously described are included in the Impact and Benefit Plan.
Recommended measures related to access to natural values:
In case of the good relations and communication with fishermen and hunters, a traditional grievance mechanism per se may not solve the communication problem. It is unlikely that fishermen/hunters will take the initiative of expressing a concern or complaint regarding a nuisance. But if one asks them, they will be glad to provide information, express their grievance and provide constructive solutions. It is recommended that this be a high priority task for the HR person of the Company to develop an agreed grievance mechanism.
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7.8 Summary impact matrix
The following table shows the social impact assessment matrix for the current situation, with the potential impacts before any mitigation measures have been implemented.
Table 7.11 Potential Impact of Aappaluttoq Project before the implementation of mitigation measures General Impacts Local Specific Impact categories (Municipal/National) (Qeqertarsuatsiaat) Economic environment Employment +M +L Local business life +M +L Conflict/synergies with other sectors +L -M Changes on traditional production systems -L Salary boost Not relevant +L Taxes and revenues +M Not significant Education and training +M +M Public service and development plans Existing infrastructure and services -L Not significant Pressure on development plans Not significant +L Social and health services Not significant Social aspects Demography and population Not significant Social conflicts Not significant -H Vulnerable groups Not significant -L Health Occupational health and risk of accidents -M Public health and quality of life Not significant Not significant Environmental impact Not significant -L Cultural and natural values Sites of monumental or cultural importance Not significant -L Access to natural areas Not significant -M
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Table 7.12 Potential Impact of Aappaluttoq Project after the implementation of mitigation measures General Impacts Local Specific Impact categories (Municipal/National) (Qeqertarsuatsiaat) Economic environment Employment +M +M Local business life +M +M Conflict/synergies with other sectors +M -M Changes on traditional production systems -L Salary boost Non relevant +L Taxes and revenues +M Not significant Education and training +H +M Public service and development plans Existing infrastructure and services -L +L Pressure on development plans Not significant +L Social and health services Not significant Social aspects Demography and population Not significant Social conflicts -L -M Vulnerable groups Not significant -L Health Occupational health and risk of accidents -L Public health and quality of life +L +L Environmental impact Not significant -L Cultural an natural values Sites of monumental or cultural importance Not significant Not significant Access to natural areas Not significant -L
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8 DRAFT IMPACT AND BENEFIT PLAN
Table 8.1 Overview of Impacts, proposed mitigations and impacts after mitigation (draft Benefit and Impact Plan) Description of the Impact Existing mitigation Proposed mitigation Impact after mitigation Economic environment Employment (direct during construction phase) Engagement of Greenlandic Training course at the During construction phase there will be training of the engaged Greenlandic The workforce will include workforce from the beginning of the School of Minerals and workforce in order to continue the engagement in the operation phase and to ensure 75% of Greenlandic construction phase. Petroleum a high degree of Greenlandic employment when entering the operation phase; personnel Undertake an assessment of training needs; SIK has prepared Develop a pre-employment and on-the-job training programme for the required job proposals for training categories; initiatives for the mining Develop local sensitive rotation schemes, human resources development program and oil sector. and benefit packages to make Aappaluttoq an attractive work place for Greenlandic workers.12 Employment during operation phase (direct) During operation phase TNG Training course at the Prepare a description of the requirement for the different job categories for the The goal is for the estimates a seasonal workforce of School of Minerals and operation phase; workforce to engage 95% approximately 80 people at Petroleum Undertake an assessment of training needs; of Greenlandic personnel in Aappaluttoq including 14 in Nuuk. Develop a job training programme for the required job categories; the project after 4-5 years Job advertisement in Greenlandic newspapers and national television (KNR); Design and implementation of an intense recruitment campaign in Qeqertarsuatsiaat, Paamiut and Nuuk, including advertising, community meetings, open day events, etc. Contact and coordination with labour organization SIK and employment office for advertising the available job positions and identifying potential workers; Evaluate the possibility of making agreements with the School of Minerals and Petroleum for allocating a number of seasonal job positions as internship for advanced students; Discuss with the Municipality and the School of Minerals and Petroleum the possibility of involving TNG Greenlandic employees in training courses during the non-working season.
12 Ensuring that local workers are able to continue their traditional way of living including fishing and hunting, and providing job opportunities for unskilled workers.
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Business opportunities During operation TNG will GA’s (Grønlands All measures are based on the condition that they are economically viable, or cost Transport will be outsource activities of transport of Arbejdsgiverforening) competitive, or non-detrimental to the overall cost of the contract outsourced to local goods and staff will mainly be by initiatives to promote local businesses boat between the mine site and business for mining Preferential contracting practices for Greenlandic contractors (locally based in first Qeqertarsuatsiaat and Nuuk, companies (network place and secondly in Greenland) for logistics, transport of staff and goods, fuel etc. Service of the camp will be probably also from Paamiut. workshops). including sensitive elaboration of tender documents, specifications, etc. outsourced to local Unbundling of contracts for services and supplies to camp where no cost hindrance businesses The service of the camp may be to the project; tendered and is expected to involve Preferential purchase of local goods and services to the mine camp and Nuuk approximately 6 workers involving: operations: Security, laundry, catering, office supplies, IT maintenance, etc. TNG´s Greenlandic company, TNGG, to become member of Greenlandic Employers Camp manager Association (GA) and participate in the initiatives of local business actors; Chef Organise and participate in open days to inform, identify and attract potential Cleaners services and goods suppliers and possible workforce; Requirement in contract with the providers of catering services to supply The catering service of the camp local/traditional food; requires local provision of food and Agreements with local fishermen and hunters for the provision of fish and meat to the consumables. canteen;
Engaging the local grocery store in Qeqertarsuatsiaat in providing some of the
regular food and consumables for the canteen and camp in general.
Conflict/synergies with other economic sectors The project will have potential Participatory design and implementation of information and communication impact on other economic sectors procedures with the community in Qeqertarsuatsiaat and small-scale miners close to in the local community e.g. fishing concession areas; and hunting, small-scale mining, Public and accessible information on concession limits, exploration activities and and jewellers and handcrafters restrictions on the access and use of the area; Design and implementation of a grievance mechanism agreed with the community representatives in order to register, identify and solve potential nuisances and problems with the community in Qeqertarsuatsiaat; Participation of TNG experts in general support on divulgation and training activities related to gemmology, etc. organised by private (i.e. Mineralogical Society of Greenland) and official initiatives (municipality, university etc.); Formal collaboration/coordination with the School of Minerals and Petroleum on vocational and professional education planning and implementation; Consider the support of a training of trainers programme targeting local people with skills and experience both on polishing/faceting and training, preferable Greenlandic speaking, interested and committed to train others; Quantitative and qualitative monitoring of impacts on jewellery and handicraft.
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Education The project will Improve the level of Develop a recruitment programme for both the unskilled and skilled workforce, in The proposed mitigations education in Greenland, both with collaboration with strategic allied; measures will even further regard to development of general Involve the School of Minerals and Petroleum in the training and recruitment stimulate the improvement skills and specific training. program; of education in Greenland, On-the-job training of staff on specific duties, safety etc. both with regard to general Dedicated, local based Human Resource Manager to develop and follow up on development of general recruitment, training and career development of staff; skills and specific training. Active participation of TNG experts on capacity building initiatives in the field of gemmology and mining; Early development of a reinsertion programme for workers after mine closure. Public service and development plans Existing infrastructure and plans The project will have potential Local and national plans Assess the type and quantity of waste potentially produced and consider alternative impact on infrastructure through and programmes waste disposals methods; e.g. waste and housing Avoid in all cases municipal housing and use private rental; For short term accommodation in Qeqertarsuatsiaat consider a frame contract with the local providers of existing private accommodation facilities where expected services and approximated time plan will be specified; Discuss with the community and authorities a framework for the use of charter boats directly related to the project. Social aspects Social conflicts The project will have potential Assign a Greenlandic speaking Human Resources and Community Relations person impact and risk for exacerbations of based part-time in Qeqertarsuatsiaat to handle recruitment, opportunities for local existing social problems in the local business and ensure timely information and open dialogue with the community; community Develop and implement an agreed Grievance Mechanisms to receive, register and handle complaints from the community; Extend alcohol and intoxicant prohibition policies and contractual conditions to all service providers while on duty for the company, particularly freight and passenger boats to Qeqertarsuatsiaat and the mine site; Develop a programme and allocate resources to facilitate and support alcohol and drug counselling to staff and their families; Support local initiatives and campaigns related to prevention and treatment of abuse and social health problems (Paarisa and others); Support local initiatives aiming to improve the integral development and living conditions of children, teenagers and young people; Include indicators of social health in the social monitoring program; Keep an open constructive dialogue with local and municipal authorities in order to find coordinated and timely solutions if social problems may arise or increase.
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Health Occupational health and risk of accidents The risks of accidents are mainly Regulations which promote Strict implementation of Health & Safety (HS) plans as developed for construction associated with shipping of goods instruction and supervisions and operation; and concentrate and transportation in order to reduce the Contractual requirements to providers of shipping and transport services (Air of staff. accidents and to focus on a Greenland, charter boats for staff, etc) regarding safety measures, response time, health and safety working etc. in order to minimise risk of accidents, appropriate and timely response in case of environment. accidents, emergency evacuation from mine site, etc. Pre-notification of operations, exploration activities or similar and traffic of vessels to local authorities and community in Qeqertarsuatsiaat, hunting and fishing groups and users of area; Community development action: evaluate the possibility of organizing basic first aid, fire fighting courses to the community in Qeqertarsuatsiaat, in coordination with their fire fighting services. Cultural and natural resources Overall the mining activities will As recommended by the National Museum, if possible avoid sites with cultural have little impact on local use of remains, keeping a minimum of 20 m around the archaeological structures for natural resources. preservation; During construction and operation, clear vegetation around the archaeological sites potentially affected and mark them clearly to raise awareness and avoid destroying them by accident.
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9 DRAFT MONITORING PLAN AND DRAFT EVALUATION PLAN
The draft monitoring and the draft evaluation plan are prepared with the use of a logical framework according to recommendation of high international standards and best practices (ICMM, 2005)
The draft SIA report contains the draft monitoring and evaluation plans to be consulted with authorities and stakeholders. When developing the Impact Benefit Agreement, these plans will be incorporated as final versions, including the feedback received during the consultations.
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9.1 Draft monitoring plan
Impact and Benefit Plan Objectively verifiable indicators Sources of verification Risks and Assumptions (Monitoring Plan) Results Economic Environment Monitoring Plan for Recruitment Programme for Greenlandic Workforce Goal: Achieve the proposed percentage of Percentage of Greenlandic workforce (95%) after local workforce per job category year 4-5 of operations
Outcome 2: Increased awareness on the Greenlandic workforce available requirements for applying for the different job and interested in working in the categories for the operation phase mine operations Output a): Training Needs Assessment Number of initiatives taken by authorities and Training Needs Assessment report Resources allocated to the carried out in cooperation between TNG and organisations to improve qualifications of potential Reports of training activities of relevant cooperation between the mining authorities candidates organisations company and authorities Output b): Authorities and relevant Number of people enrolled in specific courses on organisations take measures in order to relevance to the mining sector ensure qualifications of Greenlandic workers Input: Detailed job description and Job descriptions and qualification requirements Report and list of distribution requirements for all categories of job during developed and distributed to all relevant stakeholders operation phase made public available to community, municipality, unions and technical schools Outcome 1: Creating an attractive working place for recruitment and retention of seasonal Greenlandic workforce Output: Elimination of main cultural, gender Number of workforce from Qeqertarsuatsiaat and Annual report Female and monolingual workers and geographical barriers within the Paamiut available and interested in municipality of Kommuneqarfik Sermersooq Percentage of female workforce per job category working in mine operation and Definition of an optimal rotation scheme for Percentage of fisherman and hunters per job related services the workforce on site category Workers available in both Percentage of Greenlandic workforce Qeqertarsuatsiaat and Paamiut Input: Addressing cultural, gender and Stakeholder engagement process conducted Meeting protocol geographical issues under SIA, with emphasis on the seasonality and co-existing with fishing and hunting activities, incorporating findings into planning of the project (rotation scheme,
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Impact and Benefit Plan Objectively verifiable indicators Sources of verification Risks and Assumptions (Monitoring Plan) transport arrangements and working conditions at camp) Monitoring Plan for Business Life Goal: Positive impact on general business life Outcome: High level of purchase and contracts with Greenlandic businesses Output a): Local actors engaged and informed Number of local actors involved in the tender process Received proposals Local business has the necessary about tender procedure and type of contracts capacity to invest in service available from the mine delivery Output b): Local actors able to engage in specific contract agreements with the mine Input a): Open days events in Nuuk, Number of participants of open days events in Nuuk, Meeting protocol Qeqertarsuatsiaat and Paamiut for local Qeqertarsuatsiaat and Paamiut Tender documents actors Input b): Unbundling of contracts for services Number of contracts tendered and supplies to camp with no cost hindrance to the project Input c): Sensitive elaboration of tender documents Monitoring Plan for Education and Training Goal: Contribute to the development of skills and competences of the workforce in Greenland Outcome: High level of skills and competences among the workforce Output: Provision of high quality competency Staff motivated to invest time in development of staff training activities Input a): Recruitment programme involving Number of participant in the recruitment programme the School of Minerals and Petroleum Input b): On-the-job training programme for Number of on-the-job training conducted Training protocols staff on specific duties, safety etc. Agreement with School of Minerals and Input c): Trainee positions available for Number of trainee and internship per year Petroleum students from School of Mineral and Petroleum. Input c): Reinsertion programme for workers after mine closure
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Impact and Benefit Plan Objectively verifiable indicators Sources of verification Risks and Assumptions (Monitoring Plan) Outcome: General capacity building in the fields of gemology, polishing of precious and semiprecious stones and jewlery design Output Improved knowledge on gemmology, and skills related to classification and manufacturing of gemstones. Input a) Participation of TNG on initiatives and Number of initiatives and events supported by TNG Agreements with Greenland Stone Club, Agreement between key events for divulgation and education on fields Municipality, BMP, etc. on education and stakeholders agree and TNG on related to mining and gemmology Number of persons trained which are not included in knowledge/skills development initiatives. the terms and scope of the Input b) Support to training of trainers the workforce of the Aappaluttoq project. collaboration. initiatives on the field of polishing, faceting, Annual reports carving and jewellery design. Public services and development plans Monitoring Plan for impacts on Existing Infrastructure and Services Goal: Minimize pressure on municipal waste incineration already working over their capacity Outcome: Ensuring necessary upgrading of Local services willing to services and infrastructure on waste cooperate in the upgrading of incineration and treatment services and infrastructure Output: Assessment of need of supplementing Assessment carried out Assessment report Local services willing to capacity for waste incineration on site or on cooperate in the assessment municipality incineration facility Input a): Assessing need for waste Assessments carried out Assessment report incineration on site Input b): Assessing need for waste treatment (e.g. metal scrap) on municipality incineration facilities in Nuuk Social Aspects Logical Framework Matrix for Demography, Social Conflicts and Vulnerable Groups Goal: Minimizing social pressure on the local community Outcome: Ensuring dialogue with the local community
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Impact and Benefit Plan Objectively verifiable indicators Sources of verification Risks and Assumptions (Monitoring Plan) Output a): Local community engage in Number of information send out Protocols continuous dialogue with the project and Number of participants in dialogue meetings Minutes of meetings receives timely and relevant information on project activities
Output b): Ensuring that the project responsible are aware of any issues of Number of complaints received Complaints register importance for the local community and able Number of actions taken Handlings register to register and handle complaints from the community and act upon dissatisfaction Output c): Ensuring relevant information on Information collected every six month Bi-annual social monitoring report social development in Qeqertarsuatsiaat, including early warning mechanism Input a): Assign a full time, Greenlandic Employee hired Payrolls speaking HR and Community Relation person Communication strategy developed Strategy paper based part time in Qeqertarsuatsiaat Input b): Establish a grievance mechanism for Grievance mechanism established Grievance mechanism guideline local community complaints and local community information dissemination Community information procedures developed Information materials Input c): Establish a social monitoring List of social indicators developed Monitoring indicator document programme to be carried out every six month Baseline established Baseline document Health Monitoring plan for Occupational Health and Safety Goal: Avoid accidents related to the mine (0-tolerance) Outcome: High standard of OHS on the mine site and in related operations Output a): Minimize the risks of accidents Number of accidents at the mine site Quarterly report on accidents Local authorities has the directly at the mine site necessary capacity and Output b): Minimize the risks of accidents Number of accidents related to the mine operation Emergency report from authorities resources allocated for response related to the mine operation Output c): Ensuring appropriate and timely Preparedness exercise Report - authorities response in case of accidents and emergency evacuation from mine site
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Impact and Benefit Plan Objectively verifiable indicators Sources of verification Risks and Assumptions (Monitoring Plan) Input a): Emergency and contingency plans in Emergency and contingency plans developed Emergency and contingency plan document coordination with Greenland Contingency Acknowledgement from Greenland Committee Contingency Committee Input b): Health and safety plan for the mine Health and safety plan developed Health and safety plan document site
Input c): Contractual requirements to suppliers Supplier contracts regarding safety measures and response time Requirements to suppliers developed Training protocols Input d): Training of staff on safety and Number of staff trained emergency response on the mine site Input e): Establish health and safety H&S committee established List of committee members committee with joint participation of workers Agreement on committee authority helping to monitor and advice health and safety programmes Input f) Pre employment and annual medical check of workforce
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10 ANALYSIS OF ALTERNATIVES
The following alternatives were evaluated during the planning of the project:
Housing of the workers in a camp on site vs. housing of workers in Qeqertarsuatsiaat with daily transport back and forward from the site. Sorting house in Nuuk vs. sorting house in Qeqertarsuatsiaat Polishing of rubies in Greenland vs. polishing in Asia No project.
In this chapter, all alternatives are evaluated on terms of the benefits and detriments to the community and the company.
10.1 Mine camp on site vs. housing of workers in Qeqertarsuatsiaat
An analysis has been undertaken of the possibility of housing workers in Qeqertarsuatsiaat.
Benefits to the Community:
More economic benefit to the community of Qeqertarsuatsiaat through the rental of accommodation, spin-off benefits such as purchases at store Participation by employees in the community.
Benefits to the Company:
Reduced cost of housing Qeqertarsuatsiaat-resident employees: no accommodation needs to be constructed for these people. Possible increased employee satisfaction through participation in community during non-work hours.
Detriments to the community:
Spin-off benefits mitigated by seasonal nature of employment Unlikely that a significant number of non-Qeqertarsuatsiaat resident employees would move permanently to Qeqertarsuatsiaat, or would move with their families Disruption to the community if 50 or more additional personnel move to Qeqertarsuatsiaat Strain on community infrastructure and resources Increased social problems if employees remain in Qeqertarsuatsiaat during time off without social links Weather affects on daily transportation of employees.
Detriments to the Company:
Cost reductions to the company for housing workings Qeqertarsuatsiaat-resident mitigated by small number of Qeqertarsuatsiaat-resident workers expected Greatly increased cost of housing due to inappropriateness of container camp within town Greatly increased transportation costs: daily transportation instead of weekly or bi- weekly
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Increased scheduling difficulties as transportation is weather dependent Accommodation will be required to be build on site for occasions when transportation to Qeqertarsuatsiaat is not possible because of weather or other factors Greatly increased difficulty in security with greater frequency of trips to and from minesite Loss of workdays because of bad weather conditions for transportation of workers.
10.2 Sorting house in Nuuk vs. sorting house in Qeqertarsuatsiaat
The actual project provides for the Company’s sorting house to be located in Nuuk. An analysis has been undertaken of the possibility of a sorting house in Qeqertarsuatsiaat.
Benefits to the Community:
Full time year/round jobs in Qeqertarsuatsiaat Probably people would have to move to Qeqertarsuatsiaat potentially improving community Increase gemstone awareness and knowledge in Qeqertarsuatsiaat Potential increase of tourism activities in Qeqertarsuatsiaat.
Benefits to the Company:
Potential improved relationship with local community in Qeqertarsuatsiaat.
Detriments to the community:
Outsiders into community strain on resources Take employees from other businesses, something that has already been identified as a possible issue.
Detriments to the Company:
Increased security risk: transport rough to Nuuk for cleaning then back to Qeqertarsuatsiaat for sorting then back to Nuuk for export Increased cost for valuations to be done in Qeqertarsuatsiaat Duplication of administration - will still need office in Qeqertarsuatsiaat Difficult to attract non Qeqertarsuatsiaat people to work there-increases cost and decreased retention.
Detriment to Greenland:
Gemstone knowledge is harder to share with people outside Qeqertarsuatsiaat.
10.3 Polishing of rubies in Greenland vs. polishing in Asia
The actual project provides for polishing to be done by contract factories in Asia. An analysis has been undertaken of the possibility of polishing in Greenland.
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Benefits to Greenland:
Jobs New skills for small number of workers Will require a large number (hundreds) of workers from Asia to move to Nuuk Larger tax base.
Benefits to the Company:
Possible improved relationship with Greenland Possible improvement in Social License.
Detriments to Greenland
Large number of immigrants will put strain on country resources Demographic changes in Nuuk, and its associated unwanted risks and impacts, (risk of social conflicts, spreading of STDs, pressure on health and education services, etc.) Pressure on the already critical housing demand in Nuuk Jobs are not sustainable - factories will not be competitive and will eventually close.
Detriments to the Company:
Polishing in Greenland will be far more expensive than outsourcing to Asia Polishing is a large expense - to polish in Greenland will make project uneconomically viable Attracting and retaining skilled polishers or trainers to Greenland will be very difficult and expensive Housing of foreign polishers will be very expensive.
10.4 Project Vs No project
An analysis of the option of not proceeding with project has also been undertaken.
Benefits to the Community:
No risk of social conflicts or impacts related to the project No restriction to access to natural areas No risk of changes in traditional production systems.
Benefits to the Company:
None.
Detriments to the community and Greenland:
Lost opportunities of employment, direct business opportunities and spin-off benefits originated by the project Lost income in from of benefit and taxes.
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Lost opportunities of education and training, including internships and trainee positions Lost opportunities of synergy with other economic sectors, like tourism, handicraft and Greenlandic organizations, particularly on international marketing and profiling of Greenland Lost opportunities related to experience and motivation for creating/updating a legal and practical framework for the gemstone industry in Greenland.
Detriments to the Company:
Economic loss related to investment during exploration phase, feasibility studies, environmental baseline and assessments and socio economic assessments.
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11 ACTIVITIES INVOLVING STAKEHOLDERS
11.1 Activities involving stakeholders
Throughout the phase of making both the Environmental Impact Assessment (EIA) and the Social Impact Assessment (SIA) the company and the consultants responsible for the EIA and SIA processes have held activities such as public meetings, workshops and interviews in order to involve and listen to suggestions and concerns that may occur among stakeholders regarding the project. The activities have been registered and comments have been registered and take them into consideration during the elaboration of the EIA and SIA, as well as for improving diverse aspects of the project.
It is the opinion of the Company and the consultants involved, that all concerns have been addressed respectfully as shown in the EIA and the SIA.
Both EIA and SIA are and should be understood as continuous processes throughout the life of the project, where the EIA and SIA reports for the licensing process are only a first step. An open and transparent dialogue with all stakeholders during the lifetime of the project is required to ensure the economic, social and environmental sustainability for the benefit of all parties.
As part of the Impact and Benefit Plan, the Company is committed to implement clear and cultural sensitive channels and arrangements for dialogue, stakeholder involvement and mechanisms for addressing concerns and suggestion from all stakeholders.
The following list describes the activities involving stakeholders related to the SIA process so far.
Consultations and activities involving stakeholders are expected to continue beyond the hearing process and throughout the lifetime of the project.
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Scoping Date Type of Participants Organization meeting Consultation and coordination with BMP 04/02/2011 Meeting Bureau of Minerals and BMP Petroleum Consultation with stakeholders in Nuuk and authorities in Kommuneqarfik Sermersooq 07/02/2011 Workshop Hans Pavia Rosing Translator 3 Kommuneqarfik Semersooq 1 National Museum 2 Foreningen af 16. August 1 Kanukoka 1 SIK 3 NUSUKA Gerth Lynge Noah Mikkelsen 10/02/2011 Meeting 3 Kommuneqarfik Semersooq
Organizations invited that declined participation to workshop and/or meetings: Bureau of Minerals and Petroleum, Greenland Employers Organization GA, Fishermen and hunters organization KNAPK, University of Greenland, Greenland Tourism and Business Council, INUSSUK Consultation with community in Qeqertarsuatsiaat 08/02/2011 Open 1 Chairperson of the settlement community council meeting 42 participants from the community, hereof: - 13 women - 5 elderly people - 4 young people Consultations with 16 of August, small scale mine licence holders, Mineralogical Society of Greenland (Nuuk) Individual 2 male based in Nuuk Small scale miner SMM licence 09- semi holders 10/02/2011 structured 1 board member, 3 regular Grønland Stenklub interviews members, 1 of them woman (Mineralogical Society of Greenland) 05/02/2011 Group Leader and 8 members, 3 of Foreningen af 16. August interviews them women
Table 10.1 Scoping activities involving stakeholders
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Baseline and Impact Date Type of Participants Organization meeting Interviews with stakeholders in Nuuk 10/02/2011 Semistructured 2 Shop owner and member of interview the Mineralogical Society Board member of the Mineralogical Society
Interviews with focal groups and key informants in Qeqertarsuatsiaat 09/02/2011 Focal group 7 fishermen and hunters, Qeqertarsuatsiaat fishing and fishermen and aged 33 to 65 hunting association hunters 09/02/2011 Focal group 3 women of diverse age and Manager of kindergarten women occupations Retired Owner of a grocery store 09/02/2011 Female community member Employee at elders home 09/02/2011 1 Gem workshop representative 09/02/2011 Semi- 1 Municipal worker 09/02/2011 structured 1 Manager of Fishing factory interviews 2 male, community members 09/02/2011 Municipal authorities and Chairperson of the settlement workers. 1 male, one female council, municipality worker Interviews with key informants and key stakeholders (personally, by phone or mail) Telephone and Birger Poppel Greenland University meetings Telephone Peter Appel GEUS Telephone and Bjarne Ljungdahl Grønland Stenklub mail Phone and Lars Henrik Larsen MT Højgaard mail Interview Bjarne de Renouard True North Gems Inc. Mail Greg Valerio Cred Jewelery Meeting and consultation with Danish jewellers13 (15 invited to participate) 18/08/2011 Focus group Anja Steensig Aeon Jewelery interview Anna Moltke-Huitfeld Jewelery in Life Klaus Oliver Nybo Goldfinger 16/08/2011 Mail Claus Teilmann Petersen Pandora Table 10.2 Baseline and Impact activities involving stakeholders
13 More than 15 were invited to participate, including Greenlandic designers working in Denmark and 15 ethical jewellers. Unfortunately there was a jewellery fair the week after and most of the invitees were busy with production and arrangements for the fair.
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