Greenland to block ETM Kvanefjeld rare earth project

Energy Transition Minerals (ASX: ETM) said Tuesday that Greenland intends not to renew the exploration licence for its Kvanefjeld rare earths project.

The draft decision deals a fresh blow to one of the largest undeveloped critical minerals assets, which will consist of a mine, a concentrator and refinery.

It stems from the country’s 2021 Uranium Act, which effectively bans uranium prospecting, exploration and exploitation, and is the subject of ongoing legal proceedings challenging its application to Kvanefjeld.

ETM said similar licences have been renewed since the Act’s introduction, raising questions about regulatory consistency.

“This draft position appears inconsistent with the historical treatment of the project,” the company said in an emailed statement, noting Greenland had previously extended the licence even after the uranium legislation came into force and during active legal disputes.

Greenland stance

The move risks sending a broader signal to investors at a sensitive time for Greenland, which sits at the centre of intensifying geopolitical competition over critical minerals supply, ETM said. Western governments, including the U.S. and Europe, are seeking to reduce reliance on China.

Mining is widely viewed as a pathway for Greenland to diversify its economy, so policy shifts that appear to change the rules may heighten concerns about regulatory stability and long-term commitment to the sector, ETM said.

The draft outcome also follows Greenland’s outreach to industry at January’s PDAC convention in Canada last month, adding to questions about policy direction.

Shares of ETM fell 7.4% to A5¢ in Sydney in the first session after a trading halt last week, giving the company a market value of about A$118.7 million. The broader S&P/ASX 200 rose 1.5%. Year-to-date, the stock has halved its value.

Spain support

The share price drop came despite ETM also securing foreign direct investment approval from the Spanish government for its proposed acquisition of the Penouta tin-tantalum mine.

The approval clears a key regulatory hurdle, confirms the investment meets national security requirements and endorses the company’s financial capacity and suitability to operate strategic assets in Spain, marking progress toward closing the deal.