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Raw material shortages: Nordic countries as key to EU supply?

The search for critical raw materials in Europe is well underway and many are looking to Nordic countries such as Sweden, Finland and Greenland to meet the huge demand needed for the energy transition and to supply the numerous gigafactories planned across Europe is required.

The draft EU law on critical raw materials , presented in March this year, contains some ambitious targets for Europe: The EU Commission aims for 10% of the total EU requirement for critical raw materials from mining in the EU, 40% from local processing and 15% covered by recycling in the EU.

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EU demand for critical raw materials is likely to increase significantly from current levels. In order to achieve the declared goal of climate neutrality by 2050, it is estimated that the EU would need 60 times more lithium and 15 times more cobalt in 2050 than today.

Demand for rare earths, used in permanent magnets for wind turbines, is expected to increase 10-fold by 2050. Europe wants to eliminate the massive imbalance in supply, with some countries covering almost all EU imports.

Some examples from the German Raw Materials Agency (DERA) from 2021:

98% of Europe’s supply of nickel oxide comes from Russia, 72% of rare earths from China, 86% of vanadium from Russia and 56% of molybdenum from Uzbekistan.

No wonder there was great joy in Europe when the Swedish state-owned mining company LKAB announced earlier this year that more than a million tonnes of rare earth oxides had been discovered in northern Sweden. The size of the possible resource has yet to be verified, but at over 1 million tonnes it would be the largest rare earth deposit in Europe. However, it is now known that the percentage of oxides in the deposit could be quite low (0.18%), which could make it difficult to obtain permits in Sweden.

In Greenland – long recognized as a potential mine of critical minerals and rare earth elements – Australian explorer Eclipse Metals Ltd is working in a historic mining district of potential high strategic value.

Eclipse Metals’ Ivigtût Project, located in southwest Greenland, was once the world’s largest historic cryolite mine with rare earth potential. The Company has commenced preliminary drilling in 31 percussion holes. Early stage sampling indicates a possible economic resource from the mine’s extensive onsite tailings containing visible cryolite, fluorite and quartz.

Drill sampling was also completed at the Grønnedal project and initial sampling returned encouraging values ​​of praseodymium (Pr) and neodymium (Nd). These initial results indicate that Eclipse Metals’ Grønnedal carbonite complex may be of global importance in terms of Pr and Nd content.

Neodymium magnets are the most common type of rare earth magnets, and the EU imports about 16,000 tons of rare earth magnets from China annually, accounting for 98% of EU needs.

A small Australian company, Prospech Ltd, also believes the region offers good exploration and strategic opportunities. Prospech has assembled a portfolio of three projects that are highly prospective for rare earths, lithium and precious metals. The Jokikangas REE project has returned initial samples up to 2% REE in elongated bodies and possible vanadium deposits.

Prospech CEO Jason Beckton said of the Finnish projects, “The Company is very pleased with the preliminary exploration and compilation of historical drill core data” from the Jokikangas project and “Demand for EU-produced critical minerals in Europe has increased significantly “, with the Finnish government committed to meeting demand from local sources.

Another Australia-based company, Neometals Ltd, is developing a sustainable Vanadium Extraction and Processing Plant (VRP) in the Finnish city of Pori. The project aims to recover high-purity vanadium pentoxide from vanadium-containing steelmaking by-products or “slags” produced or recovered by Scandinavian steelmaker SSAB.

Over a 10-year period, Neometals VRP aims to reduce CO2 emissions into the atmosphere by 1.5 million tons compared to conventional mining. The VRP will generate no overburden and according to the European Raw Materials Alliance (ERMA) will set a new benchmark for the circular economy in metal processing”. A final investment decision on the project is planned for June 2023, with construction to start in July and operations in early 2026 be included.

The diversification of processing and supply of vanadium is of great interest to the EU. Vanadium is on the Critical Raw Materials List and is increasingly used in vanadium flow batteries, which are ideal for storing large amounts of renewable energy over long periods of time and releasing it quickly when needed.

With Finland, Sweden and Greenland likely to have significant deposits of critical raw materials, and with the government and EU agencies taking a pro-mining approach, it is not surprising that the Nordic region is also attracting growing interest from investors.


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