TRANSFORMING THE FUTURE OF GREENLAND
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Mi
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ining for
the future WRIT TEN BY
CATHERINE S TURM AN PRODUCED BY
RICHARD DE ANE
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AN AREA OF SIGNIFICANT POTENTIAL, AEX GOLD HAS BECOME THE ONLY ACTIVE GOLD LISTED COMPANY IN GREENLAND, PROVIDING A SIGNIFICANT BOOST TO THE LOCAL ECONOMY
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raditionally known for its fishing and hunting industries, Greenland is fast becoming the next significant area of exploration for
mining businesses. The largest island in the world, Greenland remains one of the least populated areas worldwide with 56,000 citizens, and it has sought to 04
attract local and foreign investment across a number of new projects. The island’s current position remains complex. A sovereign government, it is positioned under the Danish kingdom who provide grants to support its local economy. To further its independence and bolster its economy to create increased tax revenue, Greenland has embraced the exploration of new mining projects as well as utilising all the renewable and local resources it has to offer. Rich in rare-earth minerals, gold, iron-ore, uranium, in addition to hydro and wind power, Greenland’s favourable legal framework and robust infrastructure, particularly in South Greenland, have factored into AEX Gold’s vision to explore through its Greenlandic subsidiary, Nalunaq Gold Mine, situated in the Nanortalik Gold belt, Southern Greenland.
“ The government is very supportive, so it’s about having a sound exploration strategy. We are very much focused on that” — Eldur Olafsson, CEO, AEX Gold
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Acquiring an existing Exploitation Licence in 2015, the company is at the advanced exploration stage of its Nalunaq property, including the previously operating Nalunaq Gold Mine. It also holds Exploration Licences at the early exploration stage Vagar and Tartoq properties. Hosting a high-grade NI 43-101 compliant gold resource estimate of 263k oz (inferred) at 18.7 g/t and a number of regional exploration targets, AEX Gold has undertaken three years of exploration at Nalunaq, developing an up06
dated geological model and an extension of the main vein strike length up to 1km. “The government is very supportive, so it’s about having a sound exploration strategy. We are very much focused on that, as we have an asset package that we think we can grow and create a lot
Through this process, the business has
of value,” explains Chief Executive
turned its attentions solely towards
Officer, Eldur Olafsson.
gold exploration.
Originating from Iceland, Olafsson
“The known gold deposits in Green-
has gained extensive experience of the
land are in an area where the climate is
local geography. Focusing on mining
mild and, given our experience, logistics
projects in Greenland since 2012, he
are relatively easy. Gold opportunities
has analysed the country’s potential
are easier to finance than larger base
against the backdrop of environmental
metals projects and our perception
responsibilities and associated legalities
was that we could fully fund projects
with partner SRK Exploration Services.
like these through our support here in
“ We have a total of 690 sq km of licences in south Greenland and we’re the only active listed gold company in Greenland” — Eldur Olafsson, CEO, AEX Gold
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Iceland and in the UK market,” he explains. “We started looking for opportunities in the South Greenland Gold Province and became aware of this historically producing mine. We were attracted by the extremely high-grade potential of the resource and the fact that the project had significant infrastructure in place. We believed there were significant opportunities to materially improve the mining operation that had been run by previous operators.”
EXTENSIVE EXPLORATION Throughout the exploration of highgrade resources, Olafsson is proud to remain hands on and is regularly seen on site. By undertaking various technical studies, AEX has gained the ability to comprehensively analyse similar types of assets with potential. After w w w.a exgold . com
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acquiring the Nalunaq project in 2015 the company has continued to expand its portfolio. Whilst Nalunaq encompasses the required licence to explore and recommence production at the old gold mine, they own the larger Vagar exploration licence, situated a few kilometres to the west of the mine, where AEX believes the ground is prospective for the discovery of further Nalunaq-type deposits. In addition, they also own the early stage Tartoq Project to the North West of Nalunaq. Each licence area is at a different stage
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C OMPA N Y FA C T S
• Greenland is fast becoming the next significant area of exploration for mining businesses. • Obtaining an Exploitation Licence, AEX Gold is at the advanced exploration stage of its Nalunaq property • AEX Gold has undertaken three years of exploration at Nalunaq, developing an updated geological model and an extension of the main vein strike length up to 1km. • Focusing on mining projects in Greenland since 2012, Olafsson has looked at the company’s environmental impact and all associated legalities with partner SRK of exploration which supports AEX’s aim of having a continuous pipeline of projects being brought into
• The use of hydropower and wind power would complement AEX Gold’s operations, not only in its existing mine operations, but with the implementation of an electric mining fleet
production. “We have a total of 690sqkm of licences in south Green-
years at Nalunaq in order to support
land and we’re the only active listed
our exploration in the larger licences in
gold company in Greenland. Previous
the next 5-10 years,” he says.
operators undertook very little forward-
“Iceland is a short distance from
looking exploration once the mine was
Greenland, so logistically it’s good for
in production. It’s a very under-ex-
us. Additionally, in Iceland you need to
plored region so we intend to recom-
be really self-sufficient, and the same can
mence production within the next two
be said for those in Greenland. We w w w.a exgold . com
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don’t have as many people or the multitude of services that you would have in other countries which encourages you to think creatively,” he adds. Consequently, the company has sought to maximise efficiency whilst keeping costs down, yet all the time adding increased value across its operations. By acquiring a high-grade deposit, less material is needed to be broken down, lowering AEX Gold’s carbon footprint. Everything taken out of the mine from underground will be processed and shipped out to a different processing facility, or processed on site adhering to the current environmental guidelines. Historically, electricity has been generated through the use of traditional fossil fuels, something which is steadily changing throughout Greenland. 12
“We’re using oil to put in generators or to power mobile mining equipment which is high cost both in monetary and environmental terms. Greenland currently has five hydroelectric power plants and they are looking at building more in south Greenland,” says Olafsson. Seeing huge opportunities, he explains that the use of hydropower and wind power would complement AEX Gold’s operations, not only in its existing exploration activities, but with the implementation of an electric mining fleet with electricity being obtained from local renewable resources.
PROVIDING LOCAL OPPORTUNITIES In the future, it will be essential for Greenland to gain further revenue to unlock opportunities and services for its citizens. This is something Olafsson believes that AEX Gold can help with due to its knowledge of Iceland as it has many similarities to Greenland and has been
“ There are an increasing number of Greenlandic students attending Danish Universities so that now, for example, we are seeing well qualified Greenlandic geologists available for employment” — Eldur Olafsson, CEO, AEX Gold
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‘ Greenland remains one of the least populated areas worldwide with 50,000 citizens’
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through a period of comparable change. “Greenland is in a similar position to Iceland not so long ago. Iceland didn’t have a high education rate and wasn’t wealthy compared to other European countries, with economic and cultural activities that were very insular. We are now at the highest level of all parameters in terms of education, wealth per family, etc. and this has stemmed from improving the breadth of schooling and creating opportunities for people to grow and develop outside of the traditional areas of agriculture and fisheries. “Our aim is that the majority of employees will be Greenlandic, but it will take time. Greenland has a large number of people competing for jobs in the fisheries and tourist centres. It is important that Greenlanders are able to access programmes that will allow them to consider other career options. In Iceland we are importing a lot of people to work in different industries in our country because we don’t have enough people. This might be the case for Greenlanders as well if the anticipated growth of the mining sector materialises but we want to ensure that, where possible, we use local people first before looking elsewhere. “The Greenlandic Government provides good support for those who seek education. There are an increasing number of Greenlandic students attending Danish Universities so that now, for example, we are seeing well qualified Greenlandic geologists available for employment. There has been a Mining School at Sisimiut for the last 10 years which provides local qualified labour who can take advantage of opportunities in the mining sector. You need skilled labour and as we own a mine that was in production for 10 years previously, there is a fair bit of w w w.a exgold . com
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“ We are creating revenue for local communities, creating highly skilled jobs, and are providing benefits where local communities can live better lives and individuals can grow” — Eldur Olafsson, CEO, AEX Gold local knowledge that we have been able to use during our exploration work and which we are keen to utilise going forward,” he says. “We are creating revenue for local
Cartwright Drilling, due to the company’s extensive experience in Greenland
communities, creating highly skilled jobs,
and subsequent knowledge of the
and are providing benefits where local
island’s government systems, process-
communities can live better lives and
es and practices.
individuals can grow. We need to create opportunities for young people.” Additionally, by working with local
Planning to mine high-grade resources using significant infrastructure already in place, AEX Gold holds
businesses as well as those who have
extensive licences managed by an
been operating in Greenland for some
experienced team. Previous operations
time, AEX has made a conscious effort
produced between 50,000 to 100,000
to hire companies which can support its
ounces a year at 15.4 grams/ton
growth. AEX have therefore acquired
produced and this has provided a
a longstanding relationship with
benchmark for the company, who will
NOVEMBER 2018
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utilise this cash flow to explore the wider
a number of projects,” notes Olafsson.
region in the long-term.
“It will create a dramatic effect on the
“We have a five-year plan where we
local community and hopefully be
want to get into production at Nalunaq
a springboard for unlocking much larger
and use the cash generated to fund
potential in Greenland. There are plenty
exploration in the wider district. We
of deposits that have been found, but
envisage investing a significant amount
you have to be able to develop them. You
in exploration assets to provide a portfolio
can only do that that with support and
of different deposits that we can bring
cooperation from the local people who
into production. We are creating a com-
believe in your vision.”
pany that has a long-term mission in Greenland to build up local know how to support our aim of ramping up to very profitable production across w w w.a exgold . com
123 Front Street W Suite 905 Toronto M5J 2M2 Canada 1-416-587-9801 www.aexgold.com