Mon, Oct 04, 2004 - Page 7 News List

Precious material find raises independence hopes

NEW-FOUND WEALTH The discovery of gold and diamond deposits have given Greenland hope that it could achieve true autonomy from Danish rule

AFP , NUUK, GREENLAND

After nearly 300 years of Danish rule, Greenland is hoping that the recent discovery of gold and diamonds on the island and the promethean promises of oil exploration off its coasts could bring it a step closer to true independence.

Greenland, home to some 57,000 people, mainly indigenous Inuits, became a Danish colony in 1721, but has enjoyed internal autonomy for the past 25 years.

Now the local government in capital city Nuuk hopes the newly-found precious minerals will help the island diversify its economy which today, in addition to fish and shrimp exports, depends almost entirely on subsidies from "big brother" Denmark, which dishes out about 3 billion kroner (US$494 million) each year, or 57 percent of Greenland's total budget for next year.

Diversification would be a good thing in light of the plummeting price of "red gold," as shrimp are called here, and the harsh competition from other fishing nations like Canada.

When the Nalulaq Gold Mine in Kirkspirdalen in the south of the island opened on Aug. 26, Greenlanders were suddenly able to envision a future in which they would no longer be completely dependant on fluctuating fishing revenues or handouts from Copenhagen.

That mine, which is partially owned by Greenland mining company NunaMinerals, in which the local government is a majority shareholder, uncovered a 600,000-tonne mineral reserve. For each tonne of minerals, NunaMinerals expects to be able to extract 22g of gold, or a total of 13.2 tonnes.

Just one week later, NunaMinerals announced that it had discovered another huge gold reserve on Storoeen, just 40km to the east of Nuuk, which according to preliminary analysis contains 20g of gold for every tonne of minerals.

And in mid-September, the Canadian prospecting company Hudson Resources announced that it had made a promising diamond find in Sarfartoq, on western Greenland, where 120 diamonds, including nine which were larger than a half-millimeter in diameter, found in layers of kimberlite.

The diamonds were found in a sample of just 107.9kg of rocks.

"The size of the diamonds and their number in a relatively small sample is considered very interesting," geologist Lars Soerensen at Greenland's Bureau of Minerals and Petroleum.

But Greenlanders are perhaps most excited about the prospect of black gold, looking out to sea for potentially very lucrative oil and gas reserves.

For the third time since 1992, the local government in April invited tenders for oil exploration concessions off the island's western coast. The location is a mostly ice-free region between the 62nd and 69th parallels, divided into four sectors of between 5,000km2 and 11,000km2 each.

"We saw a lot of interest from oil companies at the information meetings we held in Houston and Copenhagen" earlier this year, Joern Skov Nielsen, Assistant Deputy Minister of the Bureau of Minerals and Petroleum said.

One of the world's largest oil companies lodged a complete application by the Oct. 1 deadline, the bureau said, without identifying the bidder.

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