Mineral Companies Eye Greenland's Untapped Wealth

In Greenland, the search is on for big deposits of oil and gas. Driven by high commodity prices, international companies are also looking for other riches, including diamonds and gold. And this is raising some environmental, social and economic issues.

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The push to tap into the riches of the Arctic is sometimes compared with the great scramble for Africa by powers of the 19th century. In Greenland, the search is on for big oil and gas deposits. Driven by high prices, international companies are also looking for other riches, including diamonds and gold, and this is raising fresh dilemmas, as NPR's Philip Reeves reports in our continuing series on the future of the Arctic.

Unidentified Woman: (Foreign language spoken)

PHILIP REEVES: This is how people get around on an island where there are no highways and where boats take an age to get anywhere. The handful of passengers on this Dash 7 are heading north up the coast of Greenland.

(Soundbite of plane)

REEVES: The plane fires up its propellers, taxies along the small runway, judders up into the sky and sets off slowly along an island three times the size of Texas.

It has to be one of the most beautiful sites of the world - a range of mountains topped with the remnants of summer snow, intertwined with a maze of fjords, deep glassy blue under a bright blue summer sky, no sign whatsoever of any people, no sign that any people have ever been here.

We're flying along Greenland's west coast towards the edge of the Arctic Circle, skirting the massive icecap that covers 80 percent of the island. After half an hour, our destination comes into view. It's a speck on this vast landscape.

Below me there's a tiny fishing village. That's the village of Maniitsoq. It's right by the sea. It's located in a kind of cove and is surrounded by this bright blue, luminescent blue water, small boxy houses set in a kind of amphitheater of granite hills and rocks and crags.

In this village, Maniitsoq, the global aluminum giant Alcoa is proposing to build a very large smelter. It'd be capable of churning out 340,000 tons of aluminum a year to be shipped across the world. Greenland's icecap's melting at the rate of about 52 cubic miles a year. The idea is to build several hydroelectric plants that'd use some of that water to power the smelter.

Alcoa and Greenland's government have yet to complete feasibility studies. If the project goes ahead, it would be one of the largest investments in Greenland's history.

We circle above Maniitsoq for a while. Then this...

Unidentified Man: Ladies and gentlemen (unintelligible)...

REEVES: Fog has rolled in from the ocean, swallowing up Maniitsoq's airstrip, so we can't land. We head back to where we came from, to Nuuk, Greenland's capital.

(Soundbite of traffic)

REEVES: Hermann Berthelsen drives a cab in Nuuk. He's actually from Maniitsoq, but moved out to find work as there was none at home. Berthelson hopes the smelter will be built.

Mr. HERMAN BERTHELSEN (Cab Driver): (Through translator) I think Alcoa could be good if it happens - good for the village and for Greenland. People need jobs.

REEVES: Some other Greenlanders not from Maniitsoq take a different view. Aqqaluk Lynge of the Inuit Circumpolar Council worries about the social and environmental impact.

Mr. AQQALUK LYNGE (Inuit Circumpolar Council): That community have decided they will have a good life for the next 100 years, but we are saying in fact it's not for you. You have to be very careful when you are giving away, and I think it's way out of touch when we are helping a multinational company like Alcoa gaining their feet in Greenland.

REEVES: Plenty of others are also gaining a foothold. Greenland is a dependency of Denmark, but it has self-rule and controls its mineral rights. Eager to diversify its fishing-based economy, it sold a bundle of exploration licenses in the last few years to international mineral companies that see Greenland as one of the world's last great frontiers of untapped wealth.

Unidentified Man #2: The Kvanefjeld project's an exciting opportunity...

REEVES: They're very keen to get at these riches, as their websites make clear.

Unidentified Man #3: The objective of the company is to find giant deposits of base metals, gold and diamonds.

REEVES: There's also nickel, zinc, uranium, copper, rare earth elements, and more - explorations driven by high global demand, especially from rapidly rising China. One British-based company, London Mining, is developing a big iron ore mine on the edge of Greenland's icecap, close to the Arctic Circle.

Chief executive Graeme Hossie says the conditions are right.

Mr. GRAEME HOSSIE (CEO, London Mining): Greenland is a wonderful place because it is effectively, you know, European law, and it's a very, you know, politically stable country.

REEVES: It is remote, yet conditions on the ground are good too, says Hossie.

Mr. HOSSIE: Plenty of water, which is key, good resource, good deposit. It's just cold in a new frontier but not too cold.

REEVES: The company plans to build a pipeline to send its product to Greenland's coast some 60 miles away to be shipped out worldwide. Hossie says one environmental issue did come up.

Mr. HOSSIE: Because there is caribou, sort of reindeer hunting grounds for the local hunters, and they don't want them to be disrupted. So it was about putting ramps so that the caribou can cross the pipeline.

REEVES: Greenland's had a taste of industrialization before.

(Soundbite of footsteps)

REEVES: This is a giant Soviet-style apartment block in the middle of Nuuk. It's crumbling, reeking and covered in graffiti. Although only mid-morning, an old woman staggers up, clutching a beer.

Unidentified Woman: (Foreign language spoken)

REEVES: The world's changing, she says, despairingly.

There are quite a few blocks like this in Nuuk. They were built in the '60s and '70s, when Greenland was under much tighter Danish control, to house Inuit hunters and fishermen forced out of their remote settlements to supply labor for fish factories. They are now gradually being demolished.

If there's now an industrial boom driven by mineral wealth, Greenland's again going to have to figure out where to find the workforce. Only 56,000 people -mostly Inuit - live in the entire island. Thousands will have to be brought in from outside. Greenland's Finance Minister, Maliina Abelsen, worries about this.

Ms. MALIINA ABELSEN (Finance Minister, Greenland): I want to make sure that this is done the right way and make sure that it's done in a sustainable way where you don't forget your culture, where we have respect about the people that live in this country. So I am concerned.

REEVES: Alcoa, the company planning the aluminum smelter, says it's too soon to say what its hiring plans are. Greenlandic government officials say the company's talking about importing 3,000 workers from China to build the project. That's nearly five percent of Greenland's entire population, and that's just one project. Overall, many thousands of outsiders could be needed.

Activist Aqqaluk Lynge believes Greenland needs to deal with this issue carefully.

Mr. LYNGE: We Greenlanders should sit here and say, yes, our country is so rich, so we have a choice which way to develop our country, but we cannot afford to be a minority in our own country. That would destroy the whole prospect of a free society.

REEVES: Philip Reeves, NPR News.

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