Arctic Metal Race Intensifies as West Seeks Mineral Security

The race for critical minerals has intensified as Western nations seek to reduce their dependence on China, the dominant supplier in the sector. Earlier this month, the European Union announced plans to begin stockpiling these vital resources to prevent potential supply disruptions that could arise from geopolitical tensions. This move highlights the pressing need for diversification in the supply chains of critical minerals, which are essential for various industries, including electronics and defense.

In response to China’s recent export restrictions, which were implemented amid escalating trade disputes, the EU outlined its strategy to establish a centralized body for purchasing and coordinating mineral stocks. This initiative aims to bolster the economic security of European nations and ensure a stable supply of critical minerals.

As the EU formulates its purchasing strategy, the United States is taking steps to secure its own mineral production, particularly in Europe. A U.S.-based company, Critical Metals, is set to commence operations at the Tanbreez mine in Greenland, which is one of the world’s largest rare earth deposits. The mine is estimated to contain around 45 million tons of rare earth elements, valued at approximately $3 billion.

Thomas McNamara, Director of Corporate Development & Investor Relations at Critical Metals, emphasized the significance of Tanbreez, stating, “Being the largest REE/HREE [heavy rare earth elements] resource outside of China, Tanbreez is the solution to realign global supply chains to more stable, secure and safe sources.” He projected that the mine could meet nearly all of the West’s rare earth needs for generations.

The growing interest in Greenland is not limited to the U.S. The United Kingdom is also pursuing a cooperation agreement with the self-governing Danish territory, while the EU’s energy commissioner recently visited the island to discuss its mineral potential. According to Marc Lanteigne, an associate professor at the Arctic University in Norway, “Greenland is starting to be looked at much more carefully as a potential alternative source for a lot of these strategic materials to China.”

As climate change alters navigation patterns in the Arctic, mining in Greenland becomes increasingly feasible. The region is believed to host a wide range of essential minerals, including rare earths, graphite, uranium, and gold. In a 2023 survey, it was reported that Greenland possesses 38 different raw materials, each with significant strategic value.

The broader Arctic region is witnessing heightened activity as major nations ramp up their resource development efforts. Both Russia and Canada are increasing investments in Arctic projects, while Sweden is also advancing exploration in the north, where rare earth deposits were identified two years ago.

Despite the optimistic outlook, experts urge caution regarding the long-term viability of Arctic mineral production. A report from the Oxford Institute for Energy Studies, authored by Philip Andrews-Speed, warns that developing Arctic resources will take time and is unlikely to match the scale of operations already established in Africa. Currently, the Arctic contributes only about one-tenth of the total global supply for critical minerals such as platinum, palladium, and nickel.

Andrews-Speed concludes that “the Arctic is unlikely to make a significant contribution to the future global supply of critical minerals,” emphasizing the importance of diversifying supply sources for Europe and North America.

As the competition for critical minerals escalates, the strategic importance of Arctic resources will continue to grow, shaping the future landscape of global supply chains and international relations.