[[{“value”:”
- Greenland boasts significant hydropower, rare earth elements, and potential oil and gas reserves.
- The island’s future energy development is uncertain due to a moratorium on fossil fuels and environmental considerations.
- The US interest in acquiring Greenland for its resources and strategic location faces political opposition.
Most people aren’t very knowledgeable about the geography, history, and politics of Greenland, given its reputation as an icy landmass with a small population of fewer than 57,000. However, since President Donald Trump announced plans to take control of Greenland, global interest in the Arctic country has grown. So, what’s Greenland’s energy potential; what is the likelihood that the U.S. will take control of the country; and what are the possible risks of developing its energy sector?
Greenland is the world’s largest island, lying in the North Atlantic Ocean. It is part of the Kingdom of Denmark, although its national government is responsible for most domestic affairs. Two-thirds of the island lies within the Arctic Circle and the country’s population is largely Inuit, owing to the harsh, icy terrain, which is difficult to inhabit.
Greenland’s electricity generation totaled around 600 megawatt-hours in 2021. Hydropower contributed approximately 83 percent of the country’s electricity mix in 2021, with oil accounting for the rest. The Government of Greenland says, “Greenland’s enormous untapped hydropower resources exceed our domestic demands many times over, and Greenland has the potential to become a net energy exporter.” The country is currently developing new hydropower plants to eventually reduce its carbon emissions to net-zero, as one of the countries most affected by climate change.
There is significant potential for rare earth elements (REE) mining in Greenland, as the global demand for REEs grows. The global demand for critical minerals is expected to quadruple by 2040 as they are widely used for the production of batteries for electric vehicles, wind turbines, and solar panels. A 2023 survey of Greenland’s resource potential suggested there were deposits of 38 raw materials on the island, including the REEs graphite, niobium, platinum group metals, molybdenum, tantalum, and titanium. However, it remains unclear whether mining for critical minerals in Greenland is economically viable due to the expense associated with drilling into ice, not to mention the potential environmental repercussions.
Greenland is also home to significant quantities of oil and gas. The Arctic Circle may contain as much as 160 billion barrels of oil and 30 percent of the planet’s undiscovered natural gas, including Norway, Russia, Sweden, Finland, Iceland, the U.S., Canada, and Denmark / Greenland, according to the U.S. Geological Survey. However, in 2021, the Inuit Ataqatigiit-led government signed a moratorium to ban all future fossil fuel extraction. The government said in a statement, “The future does not lie in oil. The future belongs to renewable energy, and, in that respect, we have much more to gain.”
In December, then-President-elect Donald Trump stated that U.S. ownership of Greenland was “an absolute necessity.” He had previously stated aims to take over Greenland in his first presidency, although this was overshadowed by other policy aims. Trump deems ownership of the Arctic country necessary for U.S. security. Greenland is located closer to the U.S. than to Denmark and is viewed as strategically important to ward off any threat from Russia. However, it is important to note that the Danish government, with support from the EU, has emphatically rejected Trump’s push to acquire Greenland, and a recent survey suggested that around 85 percent of Greenlanders oppose the move.
This is not the first time the U.S. has shown interest in Greenland. In 1867, President Andrew Johnson bought Alaska and considered purchasing Greenland. Meanwhile, after World War II, the Truman administration reportedly offered Denmark $100 million for Greenland. While neither attempt was successful, a 1951 defence treaty provided the U.S. with the Pituffik Space Base air base, in northwest Greenland, halfway between Moscow and New York.
In recent years, China and Russia have expanded their influence in the Arctic region, with Russia having reopened former Soviet military bases across the Arctic since 2015. Kalus Dodds, a professor of geopolitics at Royal Holloway, University of London, stated, “Greenland is almost a kind of ground zero for how the Arctic has become more and more geopolitically and strategically significant.”
However, it is not only foreign security that is driving President Trump’s interest in Greenland. An analysis by the U.S. Geological Survey suggests that Greenland “contains approximately 31,400 million barrels oil equivalent of oil” and other fuel products, including around 148 trillion cubic feet of natural gas. While there would be technical difficulties in extracting the fossil fuels, if these reserves were discovered anywhere else in the world there would be great enthusiasm around potential development.
Other than obvious geopolitical concerns, environmentalists fear what a U.S. takeover of Greenland could mean for climate change. The International Energy Agency has repeatedly stated that there must be no new oil, gas, or coal development if the world is to reach net zero by 2050. Much of Greenland’s ice is already thawing at an alarming rate, leading to rising sea levels and harm to flora and fauna. Any new mining or fossil fuel projects would have an extremely detrimental effect on both Greenland and the rest of the world. However, with Trump’s promise to “drill, baby, drill”, when it comes to oil and gas, it is unlikely that the President is concerned about the potential repercussions of developing Greenland’s fossil fuel sector should he take power.
By Felicity Bradstock for Oilprice.com
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