Greenland advances Tanbreez rare earths project

Critical Metals (Nasdaq: CRML) has won Greenland government approval for the mining and closure plans at its Tanbreez rare earths project, clearing a major hurdle towards construction.

Tanbreez, in southern Greenland, ranks among the larger undeveloped heavy rare earth projects outside China. It has an after-tax net present value of $2.1 billion (C$2.99 billion) at a 15% discount rate, according to a preliminary economic assessment (PEA) issued in March 2025. The study estimated initial capital costs at $290 million.

“Approval of the mining and closure plans is a defining milestone for Tanbreez and for Critical Metals Corp.,” Chairman and CEO Tony Sage said in a release on Monday. “It gives us a clear framework through 2050 to responsibly develop one of the world’s largest heavy rare earth deposits, in partnership with the Government of Greenland and the communities of South Greenland.”

The approval comes as the U.S. and its allies step up efforts to develop critical mineral supply chains outside China. Greenland’s strategic role was highlighted again in September when the U.S., Denmark and Greenland signed a new security agreement that cited existing cooperation on minerals, economic development and investment.

Shares in Critical Metals gained 4.4% on Monday morning in New York to $7.34 apiece, valuing the company at $1.08 billion. They’ve traded in a 52-week range of $5.12 to $32.15.

Permits remain

Signed Sept. 29, the mining and closure plans set out how the mine, processing plants, port and supporting infrastructure are to be built, operated and eventually closed and rehabilitated through September 2050.

They don’t yet allow Critical Metals to begin construction of the mine. The company still requires activity-specific approvals covering environmental management, marine transport, health and safety and mineral exports, as well as a required financial security.

Construction can start once those approvals have been issued and the financial security is in place, Critical Metals said Monday.

The company’s exploitation licence, granted in 2020, requires it to provide financial security and a company guarantee by the end of this year and begin exploiting minerals by June 2029, according to its latest annual filing.

Critical Metals continues to target first ore production in the fourth quarter of 2028 or first quarter of 2029, followed by concentrate exports in the third quarter of 2029.

Project economics

The PEA outlined initial production of about 85,000 tonnes annually, with potential modular expansion to about 425,000 tonnes. Tanbreez has no mineral reserves, though an April resource put the project at nearly 45 million indicated and inferred tonnes grading 0.4% total rare earth oxides.

Critical Metals has already begun some supporting infrastructure work. In June, it said footings were underway for a pilot-plant headquarters and other project infrastructure, separate from construction of the mine itself.

The company also started a 10,000-metre drilling program in June and acquired a former cruise ship to provide accommodation for project workers.

U.S. supply

Critical Metals signed a binding 15-year offtake agreement with REalloys (Nasdaq: ALOY) in May covering 15% of Tanbreez’s initial production. REalloys plans to use the material in a U.S.-based mine-to-magnet supply chain serving defence and other industrial customers.

The project has also received a $120-million letter of interest from the U.S. Export-Import Bank for potential financing, though the funding has not yet been committed.

Critical Metals is also moving towards full ownership of Tanbreez. European Lithium (ASX: EUR), which holds the remaining 7.5% stake, is being acquired by Critical Metals in an all-stock deal announced in May. Shareholders and optionholders are due to vote Oct. 22.