Greenland Resources has signed a memorandum of understanding with Canadian Arctic mine infrastructure and logistics specialist Nuna Group to work on its proposed US$820 million Malmbjerg molybdenum project in east central Greenland.
The US OTC-listed junior, which has a current market value around US$68 million and circa-$1.7m in the bank, has signed a string of offtake MoUs and letters of intent in the past year and engaged Endeavour Financial in February to help it raise funds and project finance.
Nuna Group president Miles Safranovich was among a group of recent visitors to Malmbjerg. The group included Hermann Fruhstuck, managing director of Austrian aerial rope conveyor manufacturer Doppelmayr Transport Technology, and executives from a Canadian bank and potential buyers of moly.
Greenland Resources has looked at rope conveyor transportation of materials as part of studies up to last year’s definitive feasibility study that outlined the economic case for a 20-year openpit mine producing an average 24.1 million pounds a year of molybdenum at US$6.38/lb cash cost.
The DFS, which came up with an after-tax IRR of 33.8% and start-up capital payback of 2.4 years, was based on mineral reserves pegged at 245 million tonnes at an average grade of 0.176% MoS2 containing 571Mlb molybdenum metal with “very low impurity elements ideal for European high performance steel products”.
“We have chosen to prioritise the environment over capex,” Greenland Resources executive chairman Ruben Shiffman said.
“For example, we are hauling our ore with an EU-built rope conveyor that produces no CO2 instead of using cheaper diesel-powered mining trucks that would save us over US$80 million in capex but would generate a significant environmental footprint.
“We also designed our process plant operation to use salt water as process water, with very low reagent concentrations to mitigate any potential environmental contamination.
“Malmbjerg can be the industrial anchor for east coast development in Greenland, which is the nearest point to the EU.
“The project can supply 25% of EU molybdenum demand with a very clean product from a responsible EU associate member. The EU is the second largest molybdenum consumer in the world and has no domestic production of its own.”
Nuna is 49%-owned by TSX-listed North American Construction Group, with the balance controlled by Canadian Inuit-owned Kitikmeot Corporation.
“[Greenland Resources] views Nuna’s successful long track record in developing mine projects in the Canadian Arctic combined with the collaboration of the Nunavut Inuit and the Greenlandic Inuit people, as well as the government of Canada’s views of molybdenum as a critical mineral, as very favourable for the development of the project,” Greenland Resources said.
“The MoU sets the path for the construction and commissioning of the mining, processing and tailings management facility infrastructure to tie in all the unit operations associated with mining, rope conveyor transportation, metallurgical processing and shipping the final product to EU end users.”