January 26, 2016 / 4:35 PM / 4 years ago

Greenland rare earth mining to remain contentious due to uranium - minister

TROMSOE, Norway, Jan 26 (Reuters) - Greenland’s push to extract rare earth metals will remain a contentious political issue for years to come because the mining also produces uranium as a by-product, the nation’s finance minister told Reuters.

Greenland has been opening up to foreign companies with hopes that its vast resources in metals and minerals, including rare earths, would help finance its ambition to become independent from former colonial master Denmark.

Greenland banned uranium mining decades ago due to its potential use in nuclear weapons but lifted it in 2013 and the government’s majority in parliament supports the new policy.

The main opposition party, which narrowly missed winning a general election in November 2014, wants to re-impose the ban and is still bitter at the 2013 decision which was passed in parliament by the slimmest of majorities with barely a debate.

This uncertainty has been criticised in the past by foreign investors seeking regulatory stability on the issue.

Greenland signed a deal with Denmark last week on how it would cooperate in the mining and export of uranium found in rare earths, an agreement some investors saw as a sign the domestic conflict was over.

But Greenland’s minister of finance, mineral resources and foreign affairs, Vittus Qujaukitsoq, said that was not the case.

“I don’t expect it to be resolved among the parliamentary parties,” he told Reuters on the sidelines of a conference held in northern Norway.

“The opposition includes two parties opposing the extraction of uranium, whether it is a by-product or not. It will be an issue for the upcoming elections.”

Rare earths, a collection of over a dozen of chemical elements, are used in high-tech components and China supplies the vast majority of the world’s demand.

The minister declined to give details of last week’s deal with Denmark but said he “did not expect it to be a financial disadvantage for any parties”, referring to the two signatories.

Greenland became a Danish colony in the early 19th century but has been gradually gaining its own powers since World War Two and is seeking to win its independence.

Editing by David Evans

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