80% of Greenland is covered by snow. But under the snow exists an abundance of minerals and metals that are essential to the green transition. As the ice melts, due to increasing temperatures across the country, much of this wealth will be revealed, leading to Greenland to become a key mining hub.
AEX gold Is a Greenland-focused mining company on the forefront of the identification of gold properties and other strategic mineral assets in Greenland. We speak to its founder and chief executive officer Eldur Olafsson about AEX Gold’s operations and surveying of the region and the future potential of Greenland as a mining hub.
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By GlobalDataZachary Skidmore (ZS): What first attracted the company to the region, and specifically the Nalunaq deposit?
Eldur Olafsson (EO): Firstly, to put Greenland into context, it is half the size of Australia, with no surface cover (a lack of vegetation or soil on the surface), leaving just a rock formation. This means that you can see the area easier.
Also, the presence of glaciers that run through the folds and cracks of where water flow would occur in more temperate climates act as a giant shovel opening the ground from around it. Therefore, you can see the entire stratigraphy playing out in front of you.
The second thing that attracted us is that Greenland, along with Afghanistan and Colombia, remains relatively unmined. The jurisdiction of Greenland is Danish, so everything is like a European market as it pertains to legislation, law, and salaries, making it easier to obtain a mining license.
Regarding risks, Greenland’s sparse population of 50,000 means that there is no large working population, which in turn means a smaller mining industry. There are only two operating mines currently in Greenland, with mining laws only coming into place in 2009.
AEX Gold is therefore at the forefront of the industry, and thus we must lead by example, completing the works in a very monitored manner.
ZS: How will AEX gold leverage the existing infrastructure of the Nalunaq deposit in the redevelopment of the mine?
EO: The first benefit is coming into a brownfield rather than a greenfield area, with around $150m-$200m already invested in underground tunnels in the original deposit.
So, after we have completed our initial drilling, we can access those pre-built tunnels straight into the deposit, allowing for a reduction in the upfront capital needed to fund the project.
The second benefit is that you gain an operating base for the wider region. In the wider area, we have one drilled deposit called Vagar and a second one that is ready to be drilled called Manak. In turn, this becomes our operating base to do the wider exploration.
ZS: How important is the use of renewable energy in powering the mine and its operations?
EO: It is twofold. On the one hand, we need a longer mine life to justify the infrastructure spent on renewables. However, once you have assured a longer mine life, you can build up the renewables and energy efficiency measures simultaneously.
At first, we will use some diesel generators to power the mine, but we are focused on getting renewables – including wind, solar, and hydroelectric – on-site in the long term. To improve our energy efficiency, we will use battery-powered equipment, lowering the cost of the mine.
Ideally, we want to use the renewable capacity to also become a source of energy for the local populace, connecting the mine with the community. Additionally, to reduce our carbon footprint, we have been looking at forestry work on-site to leave the site greener than when we first arrived.
ZS: What influenced the decision of dry tailings facilities?
EO: In the previous operation, they had cyanide leaching underground, which was well monitored for the past five years with no chemicals in the mine or surrounding area.
However, when we started again, we decided to bring the processing plant to the surface, using flotation rather than cyanide leaching. We are using flotation and then dry stacking the processed materials to leave the area without any hazardous effect on the environment.
Dry stacking involves stacking the material on top of the already disturbed ground. We will then landscape and place vegetation on top of it, fitting into a green mining mindset.
ZS: How was the Nalunaq deposit surveyed?
EO: Unlike most mining deposits, which are mined to depletion, mining in the Nalunaq deposit stopped after producing only 350,000oz of gold. This happened because of a lack of investment, poor policy, and a lack of understanding of the potential of the mine.
To analyse the extent of minable gold, we used Leapfrog, a geological mining software, to predict whether the vein of gold continued through to the other side of the mountain and where it would come out.
We then had a former member of the SAS abseil down to take a physical sample of where the software had predicted the vein would end. After we had confirmed that the vein continued 1km upwards, we started drilling in a downward scope, discovering a potential two million ounce deposit.
We then used drones to understand the structure and where the higher-grade deposits were. The drones found several gullies on the top of the mountain, and by using Leapfrog and the surface imagery, we could see that the high-grade sections of the deposit followed the gullies.
We have been testing for two years, and if it comes out positive, we have the go-ahead to start drilling. That will allow us to decrease our mining costs in the long run as we will be targeting the highest-grade sections of the mine.
ZS: What technology was used to produce the geophysical surveys at Varga?
EO: When we acquired Nalunaq and Varga, we also acquired databanks. For the past 10 years we have had a geological team working on this data.
There are two ways you can work on data in an under-explored country. You can have geologists analyse the data, but we also used a machine learning mechanism and AI to determine whether the deposit existed.
We then used that information to decide what areas to secure licenses. Currently, we hold 4,000km2 of licenses.
The geography of Greenland assists in this regard because when you fly over it, you can see the gold deposits on the surface rock. Unlike other countries, where you start with a geological view, then do geophysics, and hope you drill in to find something. In Greenland, you find the deposit first, then quantify it. Through this geophysical work, we can understand the depth of the deposit and the size of its potential.
Additionally, we have used hyperspectral imaging to take high perspective images of samples of the granite-bearing gold vein found in Varga. The hope is to see where the minerals are deposited in the rock. We think using these technologies will allow us to find more deposits quickly and efficiently.
ZS: What is Greenland’s mining potential over the next 10-20 years?
EO: Greenland has excellent potential due to its known and potential deposits. However, the infrastructure is heavily underdeveloped, with no new mines built in a significant period of time.
This is despite the discovery of world-class deposits of rare earths, including titanium, platinum, and PGM, to name a few. In Greenland, the process of getting a mining permit is relatively streamlined, taking only two to three years compared to seven to eight in the rest of the world.
This lag means that Greenland is a potential boom area. 10 significant minable deposits have already been discovered, and Greenland has been relatively open to mining. Due to its sparse population, none of the mines will be near a populated area, and mining the deposits won’t require deforestation or wildlife damage.
As the energy transition continues, the demand for many of these key minerals will skyrocket, leading to considerable investments in Greenland’s mining sector.
