- Junior miner Greenland Resources (TSX:MOLY) signed a memorandum of understanding towards a long-term molybdenum supply agreement with ROGESA Roheisen-und Rohstoffgesellschaft Saar mbH, a joint subsidiary of Dillinger and Saarstahl, two of the world’s top steel producers
- The deal centres on Greenland Resources’ Malmbjerg project in Greenland, which hosts proven and probable reserves of 571 million pounds of molybdenum
- Greenland Resources stock last traded at C$1.55 and has given back 7.74 per cent year-over-year
Junior miner Greenland Resources (TSX:MOLY) signed a memorandum of understanding (MOU) towards a long-term molybdenum supply agreement with ROGESA Roheisen-und Rohstoffgesellschaft Saar mbH, a joint subsidiary of Dillinger and Saarstahl, two of the world’s top steel producers. Molybdenum is a major input in the steel, defense and green energy technology industries thanks to its ability to enhance material strength, temperature resistance and corrosion resistance.
The deal centres on Greenland Resources’ Malmbjerg project in Greenland, which is recognized as a priority EU project and hosts proven and probable reserves of 245 million tons at 0.176 per cent MoS2, working out to 571 million pounds of molybdenum, yielding a 2022 definitive feasibility study detailing US$820 million in CAPEX, a levered after-tax internal rate of return of 33.8 per cent and a payback period of only 2.4 years, using a base case of US$18 per pound of molybdenum.
According Friday’s news release, Malmbjerg holds the potential to meet about 25 per cent of EU molybdenum demand, including 100 per cent of defense-related demand, spanning ferro-molybdenum, molybdenum-oxide and briquettes, with ore to be extracted in Greenland and refined in Belgium under low scope 1&2 emissions.
The deal positions the bloc to hold more of its future in its own hands, as it’s currently the second largest molybdenum user worldwide, accounting for about 19 per cent of global demand, according to the International Molybdenum Association, bosting significant processing infrastructure but no extraction capacity, with China (87 per cent) and the USA (13 per cent) standing as the world’s primary suppliers.
About Greenland Resources
Greenland Resources is developing its 100-per-cent owned Malmbjerg molybdenum project in central east Greenland. The project is estimated to generate an average of 32.8 million pounds of molybdenum per year during its first decade in production, plus magnesium and rare earth elements by-products.
Greenland Resources stock (TSX:MOLY) last traded at C$1.55 and has given back 7.74 per cent year-over-year.
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