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Greenland Minerals hoping to salvage mine

·2-min read

Junior explorer Greenland Minerals says it may be able to salvage a planned rare earth minerals project despite the Greenland parliament voting to stop it.

The Australian company has been trying to develop the Kuannersuit mine - also known as Kvanefjeld - near the island's southern tip, which has been touted as one of the world's biggest rare earth minerals deposits, since 2007.

But its years-long efforts were jolted when the Greenland parliament on Wednesday passed legislation to ban uranium mining and halt the development of the mine.

"Under the currently proposed development strategy for Kvanefjeld, uranium oxide, if recovered as a by-product of rare earth production, would contribute approximately 5 per cent of project revenues," Greenland Minerals said in a statement to the Australian Securities Exchange on Friday.

Greenland Minerals "is seeking further advice as to how the legislation may impact the proposed development strategy for Kvanefjeld, and whether modifications to the Project will be required."

Shares in the company plummeted by a third after resuming trading on the ASX, after having been in a trading halt since Wednesday. By 1045 AEDT, the stock was down 32.8 per cent to 8 cents each.

Greenland is an Indigenous, autonomous self-governing territory, which is part of the Kingdom of Denmark, sitting between the Arctic and Atlantic oceans.

The law passed by its parliament was put forward by the Inuit Ataqatigiit party, which came to power in April.

It had campaigned on banning uranium mining and halting the Kuannersuit project on environmental grounds.

On its website, Greenland Minerals touts the mine as having the potential to become the most significant western world producer of rare earth minerals.

"Rare earth products are forecast to generate over 80 per cent of the project's revenue, with uranium, zinc and fluorspar by-products contributing to the balance," it says.

China is the world's major producer of rare earth minerals.

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