Sun, Oct 07, 2007 - Page 9 News List

Greenland: where discovery of diamonds meets hard geostrategy

By Paul Brown  /  THE GUARDIAN , GREENLAND

Helicopters have been hard to hire in Greenland this summer. In most countries that would not be a big problem, but for the locals on the world's biggest island -- where there are no road networks and sparse settlements are often 150km apart -- it can make life tricky.

The scarcity has been caused by a diamond rush with prospectors, mostly from North America, believing they can strike it rich. As the ice cap recedes due to rising temperatures, rock covered for centuries could produce spectacular finds. The interest in the Greenland tundra was sparked partly by the announcement this year of the discovery of a 2.4-carat diamond at Garnet lake in west Greenland, the largest of 236 diamonds found in a trial dig in the area by Hudson Resources of Vancouver.

While the Hudson company was willing to announce its find, presumably to encourage its investors, most prospectors are less keen to discuss their activities in this vast mineral rich wilderness.

The belief in Greenland's potential riches stems from the fact that the geology is identical to that found across the now ice-free northwest passage in Canada, which has led to large opencast mining in the Arctic region.

But Greenland has other potential riches too. Gold has been discovered and is already being mined, although so far at a loss, and there are deposits of other minerals such as zinc that could be exploited. Oil giants are negotiating licenses to explore blocks of the coastline covering thousands of square kilometers.

The dash for minerals is fueling another debate in Greenland: whether the country should go for independence from Denmark.

With its population of 56,000 scattered over an area almost the size of Europe, Greenland is heavily dependent on a subsidy from Denmark for survival. The island has internal self-government but Denmark is responsible for foreign policy.

Aleqa Hammond, the foreign minister in Greenland's home-rule government, hopes that the oil and mineral companies moving in will create sufficient wealth for her country to break from colonial rule.

"It is natural for a country to want to be independent. We do not feel ourselves part of Europe -- we are an Arctic people -- but our way of life is changing and we have to change with it. My mother's generation fought for Greenland homeland government and achieved it in 1979, leaving only foreign affairs and defense in the hands of Denmark," she said.

"Then, we could not strike out alone because we were so heavily dependent on Danish money, and we still are, but we can change that by exploiting our natural resources to achieve financial and political independence," she said.

But some argue that independence has dangers. Greenland is the land mass closest to the North Pole and has rapidly assumed greater strategic importance as its much more powerful and populous neighbors vie for a slice of the Arctic's supposed mineral wealth. The US is strengthening its air base at Thule on the extreme north of the island and the Russians have already planted flags on the sea bed.

But rather than putting her faith in mineral wealth, Hammond believes that her country's best prospect of buying its independence lies in hydroelectricity.

The vast lakes and melting ice cap provide enormous potential for electricity free from fossil fuel and the Greenland government is negotiating with Alcoa, an aluminum company, to built the world's second largest smelter. No contract has been signed but the minister hopes this project will provide 3,500 much-needed jobs.

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