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Regulatory Risk Rating
43
0
100
Score: 43
Severe Risk
It is said that around 90% of an iceberg can lie unseen below the surface and perhaps the same can be said for Greenland's regulation of its mining industry. The Mineral Resources Act really plays the role of an introduction - with the full story only revealed when the terms of a mineral licence are established. As Greenland only became responsible for the administration of its mineral resources in 2010 it is possible that it intends to address matters on a case-by-case basis - when or if they arise. Unfortunately this does not provide a solid foundation for potential investors, who will find themselves placed at the centre of a host of competing issues. Under the MRA the protection of Greenland's unique environment and the immediate need for Greenlanders to receive benefits from the exploitation of the country's natural resources look to take centre stage, with the aim of attracting foreign investment seemingly forgotten. The specific terms of the licence may ultimately make for a more attractive investment opportunity but as it stands the considerable infrastructure challenges are not the only hurdle the miner will have to overcome.

Corruption Potential Index

Score: 50
Moderate Corruption Potential

Corruption Risk Index

Score: 94
Very Low Corruption Risk

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Mining Overview Commentary plus sign

GREENLAND - MINING REGULATIONS

GENERAL

Greenland sits to the north-east of Canada and is, geographically speaking, part of the North American continent. The country is the world’s largest island, bordered by the Arctic Ocean to the north, the Greenland Sea to the east, the North Atlantic Ocean to the south and Baffin Bay to the west. Greenland is a part of the Kingdom of Denmark but an extensive type of self-rule applies in the country. In 2009, following the results of a guiding referendum, the Act on Greenland Self Governance was passed, replacing the system of home rule governance which had operated in the region since 1979. The purpose of the Self-Governance Act was to transfer additional authority to Greenland’s government, increasing the fields of responsibility which the country will administer directly. Greenland was formerly a part of the EU, joining the organisation as a member via Denmark in 1973. However, following the introduction of home rule, the country voted to leave the Union - mainly in an effort to keep control of its fishing industry. Following extensive negotiations Greenland officially left the EU in 1985.

Greenland has a small economy dominated by the fishing industry, which sits at the heart of it. Around 90% of Greenland’s exports are products from fishing, with shrimp and halibut being exported in the largest volumes. Fishing is also the second largest sector for employment in the country, with the public sector being the largest. Whaling and seal hunting were previously important, though the controversy that surrounds such activities, alongside the EU ban on seal products, has reduced their significance from an economic perspective. Greenland’s economy is further supported by annual grants from Denmark. Each year such grants amount to in excess of $500 million (USD) which is around 25% of Greenland’s GDP.

Greenland is believed to have considerable mineral resource potential and the government is aiming to use its natural resource wealth to diversify and grow the country’s economy. To date the mining industry has not been a major source of revenue for the country, at the time of writing (Aug. 2017) there are few operating and active mines in the country but interest is strong and the results of several large-scale exploration projects have been positive. In addition, climate change has caused some of the ice that covers the island to melt, thereby opening up new areas for exploration. Minerals in Greenland include (amongst others): rare-earth minerals; gold; zinc; lead; iron ore; platinum; uranium; diamonds; and rubies. Further exploration is needed to establish the commercial viability of the country’s mineral deposits and infrastructure issues remain a key hurdle for companies looking to operate in Greenland.

In 2016, Greenland was rated 64th out of 104 jurisdictions covered in the Fraser Institute’s Policy Perceptions Index.

PRINCIPAL LEGISLATION AND REGULATOR

Under the 2009 Act on Self Governance, the Greenland Self-Government was granted authority to exercise legislative and executive power in the area of mineral resources. In December 2009 the Mineral Resources Act (MRA) was passed by the Greenland parliament and is now the main piece of legislation applicable to the mining industry. The MRA has been amended several times – in 2012, 2014, 2015, and most recently in 2016. Other relevant legislation includes the Large-Scale Projects Act 2012; the government has also issued a number of guidelines for the sector including the EIA and SIA Guidelines and the Application Procedures and Standard Terms for Mineral Exploration and Prospecting Licences in Greenland (Application Guidelines / Standard Terms).

Various government organisations and departments play a role in the administration and management of the mining industry. The Ministry of Mineral Resources (Ministry), which is headed by a Minister of the same title, is responsible for strategy-making, policy-making, legal issues and the marketing of mineral resources in Greenland. The Mineral Licence and Safety Authority (MLSA) (formerly the Bureau of Minerals and Petroleum) is responsible for issuing mineral licences in the country, as well as supervising and inspecting projects. The Environmental Agency for Mineral Resources (Agency) deals with environmental matters relating to resources activities, including the management of the environmental impact assessment process. Collectively the MLSA and the Agency form the Mineral Resources Authority (Authority). Also relevant is the Ministry of Industry, Labour, Trade and Energy (MILTE), which handles socio-economic matters relevant to the industry, including social impact assessments; MILTE is also responsible for co-ordinating with the Danish government on certain matters in the field of natural resources.

GRANTS AND FORMS OF MINERAL TITLE

The MRA provides for the following types of mineral licence:

  • Prospecting Licence: grants the holder the right to prospect for mineral resources, conduct mineral resource activities, or use the subsoil for storage or purposes relating to mineral resource activities or related activities (s. 15(1), MRA). Licences are non-exclusive and are granted for periods of up to five years at a time, with the specific term indicated in the licence itself (s. 15(2)-(3), MRA; see also §3, Standard Terms for Prospecting Licences (STPL). Applicants must provide sufficient information for the MLSA to assess the technical and financial capabilities of the applicant (see s. B(1.2), Application Guidelines). An application fee of 3,000 DKK (around $500 USD) must be paid within 14 days of an application. The application fee will be deducted from the licence fee (15,000 DKK ($2500 USD)) in the event the application is granted. Decisions in relation to prospecting licences are made by the MLSA unless the decisions are likely to have significant social or environmental effects in which case they shall be made by the government (s. 3c, MRA). Prospecting licences cover all mineral resources (except hydrocarbons, radioactive elements and hydro-power) unless otherwise stated in the licence (§ 1(101), STPL). If an Exploration Licence is granted over the area covered by a Prospecting Licence the Prospecting Licence shall no longer apply in the area covered by the Exploration Licence (§2(203), STPL). Licence holders may carry out the activities specified under §7(701), STPL, but must obtain permission from the MLSA if they wish to carry out other activities (see. § 7(702), STPL). Annual reports must be submitted to the MLSA (§ 10(1002), STPL).

 

  • Exploration Licence: grants the holder the excusive right to explore for one or more mineral resources (s. 16(1), MRA). The application for the licence must contain: details of the applicant; indication of the delineation of the area in accordance with s. 206-207 of the Standard Terms for Exploration Licences (STEL); sufficient information for the MLSA to assess the technical and financial capabilities of the applicant; and any other information required by the MLSA (s. A(1.5), Application Guidelines). An application fee of 5,000 DKK (around $800 USD) must be paid within 14 days of an application. The application fee will be deducted from the licence fee (25,000 DKK ($4000 USD)) in the event the application is granted. Applications shall be sorted into two batches – A and B, depending on which half of the month the application is submitted. A non-competing application is one which does not overlap with an area specified in another application in the same batch. Where competing applications are not amended the authorities will pay particular attention to an applicant’s previous exploration experience and / or field work, offers of the applicant in relation to training and employment of citizens and the registered date of the applications in making a decision between applications (s. A(4.5), Application Guidelines). Decisions on Exploration Licences shall ultimately be made by the Minister and the government. Exploration Licences shall cover all resources expect hydrocarbons and radioactive minerals, unless otherwise specified in the licence (s. C(1.1), Application Guidelines). The licence period shall be specified in the licence itself. According to the MRA, EL shall be granted for a period of up to 10 years or if special circumstances exist up to 16 years (s. 29(1), MRA). However under the STEL, Exploration Licences shall be granted for a first period of five years, with the option for renewal for another period of five years (s. C(3), Application Guidelines; see also §3, STEL). At expiration of the renewal period the licensee may be granted new 3 year licences up to a total period of 22 years (inclusive of the two 5-year terms) though grant is discretionary. Minimum expenditure obligations apply and land reductions may be specified in the licence (§ 6, STEL; see also s. C(4), Application Guidelines). Applications can be made for enlargement of the exploration area. Licence holders may carry out the activities specified under §7(701), STEL, but must obtain permission from the MLSA if they wish to carry out other activities (see. § 7(702), STEL). Annual reports must be submitted to the MLSA (§ 10(1002), STEL).

 

  • Exploitation Licence: if the holder of an Exploration Licence has found and delineated commercially viable deposits which the licensee intends to exploit and the terms of the Exploration Licence have been complied with, the licensee is entitled to be granted an Exploitation Licence (s. C(7.1), Application Guidelines). The area for exploitation must be delineated in accordance with § 14(1406), STEL. The application for the Exploitation Licence must contain: a declaration that the deposit(s) are commercially viable and the licence holder intends to exploit them; a bankable feasibility study of the deposit(s) including a geological evaluation of the deposit(s) and a specification of the assumptions as regards exploitation technology, economics, and environmental matters; and details of the delineation of the area (§ 14(1402), STEL). Exploitation Licences may only be granted to limited liability companies which are not jointly taxed with other companies (unless such taxation is mandatory). Generally, companies are required to have a registered office in Greenland and trade at arm’s length prices and on arm’s length terms. The company cannot be more thinly capitalised than the group of which the company forms part, but the company’s loan capital may exceed the shareholder’s equity up to a ratio of 2:1. Licensees are also required to have the expertise and financial background to carry out the exploitation (see s. 16(3), MRA). The licensee must also work with the MLSA to produce a joint timetable of development activities in order to co-ordinate the preparation and submission of an exploitation plan, a closure plan and an EIA. Such documentation must be submitted in accordance with the timelines stipulated by the MLSA (see §14, STEL) and must be approved before the commencement of exploitation activities. The licence fee is 100,000 DKK ($16,000 USD). The licence shall cover the same mineral resources as covered by the Exploration Licence (§ 14(1404), STEL). Exploitation Licences are granted for a period of 30 years, unless a shorter period has been specified as a condition for granting the licence (s. 29(2), MRA). The exploitation period may be extended up to a maximum period of 50 years (ss. 29(3) & 16(5), MRA).

 

Decisions to grant, significantly change, transfer, withdraw and approve the relinquishment of a mineral resource exploration or exploitation licence are made by the government (s. 3c, MRA). The MRA also states that direct or indirect transfers of licences to third parties are subject to government approval (s. 88, MRA).

The MRA also provides for special exploration licences for areas in North and East Greenland, which cover larger areas and have slightly varied terms from standard licences (s. C(8), Application Guidelines); personal prospecting licences (s. D(7), Application Guidelines); small-scale exploration and exploitation licences (Part 8, MRA); and exploration and exploitation licences for hydrocarbons (Part 6, MRA).

DEVELOPMENT CONSIDERATIONS

Holders of Exploration and Prospecting Licences must endeavour to employ manpower from Greenland or Denmark but may employ foreign workers if manpower with similar qualifications does not exist or is not available (§13(1301), STPL & STEL). Holders of Exploration and Prospecting Licences must also endeavour to assign contracts, subcontracts, purchase of supplies and services to Greenland enterprises unless such enterprises are not commercially competitive (§ 13(1302), STPL & STEL). The extent to which licence holders must use labour or businesses from Greenland can be laid down within the terms of the licence (s. 18, MRA). The government may also stipulate the extent to which the licensee must keep exploited minerals in Greenland and sell them to persons who are permanently residing and fully liable to pay tax in Greenland; the licensee must sell the minerals at arm’s length prices and on arm’s length terms (s. 18(4), MRA).

The government must approve an Exploitation Plan, including details on production organisation and related facilities, prior to the commencement of activities (s. 19, MRA). When approving the Plan the government may, on specified terms, allow the licensee to establish and operate power facilities and grant such right as part of the Exploitation Licence (s. 20, MRA); annual fees may apply. A pipeline licence may also be approved as part of the Exploitation Plan (s. 21, MRA). A Closure Plan must also be approved prior to the commencement of activities; as part of the approval the government may stipulate terms on protection of the environment and health and safety measures (s. 43, MRA).

Applicants for Exploitation Licences will need to conduct an EIA and SIA. The EIA and SIA may extend to exploration activities if they can be assumed to have a potentially significant impact on the environment, culture or climate change, though such decision is at the discretion of the government. Regardless, during the exploration phase the procedures and requirements for the EIA process should be integrated into the explorationist’s plans. Requirements for the EIA and SIA are clearly given. Decisions on EIA are made collectively by the MLSA and Agency; decisions on SIA are made by the MILTE. As part of the SIA process, proponents will need to negotiate an Impact Benefits Agreement (IBA) with the government. The IBA must be signed before approval for the Exploitation and Closures Plans can be approved and the Exploitation Licence granted (see also ‘Environmental Overview Commentary’ below).

The government may grant subsoil licences for use of the subsoil for storage purposes or for purposes relating to prospecting, exploration or exploitation of minerals (s. 39, MRA). Such licences may be granted for a period of up to 50 years and annual fees may apply (s. 40, MRA). There is no system of privately owned land in Greenland, instead land is owned collectively by the people of the country. As such, the MRA does not provide for surface rights in relation to private land. The MRA does contain provisions relating to compensation for environmental damage which may be claimed for certain types of damage including damage to property (s. 68, MRA). The government may also allow steps to be taken for the compulsory acquisition of real property in accordance with existing laws (s. 93, MRA).

The government may insert terms and conditions on royalty rates and fees into a licence, with reference to the area covered and the value of the mineral resources extracted. It also permits terms on government participation into a licence, though in the case of an Exploitation Licence this will only be permitted if the terms were originally contained in the Exploration Licence or if certain tax breaks apply (ss. 17 & 30, MRA). Current royalty rates according to the STEL are: rare earth minerals and uranium – 5%; gemstones – 5.5%; minerals other than rare earth mineral, uranium and gemstones – 2.5%.

All decisions of the MLSA or the Environmental Agency may be appealed to the government by parties to the case, those deemed to have a material individual interest in the outcome of the case and associations and organisations which have a statutory objective to safeguard important recreational, environmental, nature or social issues (s. 3b, MRA). The time limit for an appeal is six weeks. Decisions may also be appealed to the courts (s. 3d, MRA).

ENVIRONMENTAL REGULATION

See Greenland- Environmental Overview Commentary.

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GREENLAND - ENVIRONMENTAL REGULATIONS

GENERAL

Greenland sits to the north-east of Canada and is, geographically speaking, part of the North American continent. The country is the world’s largest island, bordered by the Arctic Ocean to the north, the Greenland Sea to the east, the North Atlantic Ocean to the south and Baffin Bay to the west. Ice sheets, caps and glaciers cover around 80% of Greenland, can run as deep as 3km and are believed to hold around 10% of the world’s freshwater. The ice coverage gives way to a rocky, mountainous and sparse coastline where the majority of the country’s 56,000-person population live in small townships, settlements, villages and the capital city, Nuuk. Greenland is also home to the world’s largest national park – Northeast Greenland National Park – which covers an area of over 970,000km2.

Greenland has an Arctic climate, with cold summers and colder winters. Average temperatures in summer rarely rise above 10°C and can drop as low as -20°C in winter in the northern parts of the country. In the summer months of June, July and August the melt season occurs, though due to global warming the season is beginning earlier and ending later each year. Though a large portion of Greenland is white ice, the country does have some interesting fauna. Orchids, horsetails, ferns, fireweeds and various forms of berries are common. Small trees can be found amongst some of the country’s fjords. Wildlife in Greenland includes: seals, walruses, whales, polar bears, arctic foxes, arctic wolves, reindeer, collard lemmings, snow hares, white tailed eagles, fulmars, auks and black guillemots.

Unsurprisingly, Greenland’s major environmental concerns relate to climate change, which is impacting upon the country’s ice sheets and effecting sea temperatures.

PRINCIPAL LEGISLATION AND REGULATOR

Greenland has a Ministry of Nature and Environment (Ministry) within which sits the Environmental Agency for Mineral Resources (Agency), the Department of Environment and Contingency Management, and the Department of Nature and Climate. The Agency was established in 2013 following an amendment to the MRA and is responsible for managing the environmental impact assessment (EIA) process for mining projects in Greenland. The Agency works closely with the Mineral Licence and Safety Authority (MLSA) and together the two form Greenland’s Mineral Resource Authority (Authority). The Agency also works with various Danish institutions, which support the Authority’s work through the provision of scientific and environmental expertise. In addition, the Ministry of Industry, Labour, Trade and Energy (MILTE) manages social impact assessments (SIA) which are required for certain mining projects.

Generally speaking, environmental protection is regulated by the Greenland Parliament Act No. 9/2011 on Protection of the Environment and Regulation No. 5/2013 on the Effect of Certain Installations on the Environment and the Regulation of Fees for Environmental Supervision. However, in terms of mining the Mineral Resources Act (MRA) provides a much more detailed set of environmental provisions which apply to the industry. According to section 51 of the MRA, the rules on environmental protection aim to help protect nature and the environment so that society can develop on a sustainable basis respecting human conditions of life and respecting preservation of animal and plant life. The Large-Scale Projects Act 2012 also includes requirements on EIA and SIA for projects that are considered to be large-scale. The provisions of the MRA and Large-Scale Projects Act are further supplemented by guidelines issued by the Agency, including the Guidelines for Preparing an Environmental Impact Assessment (EIA) Report for Mineral Exploitation in Greenland (EIA Guidelines). The MILTE has issued similar guidelines on the SIA - Guidelines on the Process and Preparation of the SIA Report for Mineral Projects (SIA Guidelines).

EIA PROCESS

According to the terms of the MRA, a licence for and approval of certain activities can only be granted following an EIA, once the government has approved the EIA Report (s. 73(1), MRA). Activities that require an EIA as mandatory include: mineral exploitation; use of the subsoil for storage or purposes relating to mineral resource activities; the establishment or location and use of large facilities used for activities under the MRA; and the cessation of an activity or the operation or closure of certain facilities (s. 73(1), MRA; see also s. 6, Large-Scale Projects Act). Other activities not explicitly referenced in the MRA but which must be assumed to have a potential significant impact on the environment may also require an EIA if the government makes a decision to that effect (s. 73(2), MRA). The EIA will also apply to activities or facilities that are presumed to have a significant negative impact on the climate, which may only obtain a licence or approval following an assessment of the impact of the activity or facility on the climate and after the public and authorities and organisations affected have had an opportunity to express their opinion on it (s. 57, MRA). According to the EIA Guidelines, the procedures and requirements for the EIA process should be integrated into the company’s plans at the exploration phase and the company should analyse and evaluate potential environmental impacts during this stage of operations.

The aims of the EIA are: to estimate and describe nature and the environment, as well as the possible environmental impacts of the proposed project; to provide a basis for the consideration of the proposed project for the government; to provide a basis for public participation in the decision-making process; and to give authorities all information necessary to determine the conditions of permission and approval of a proposed project. Requirements of the EIA include that it shall identify, predict, describe, assess and communicate potential environmental impacts of a proposed mining project in all its phases including exploration, construction operation, closure and after closure and that it shall present measures to address and mitigate the identified impacts. All costs relating to the EIA shall be covered by the project proponent.

The following stages form the EIA process (summarised from the EIA Guidelines):

  • Scoping Stage: Scoping should identify environmental issues to be addressed in the EIA Report and be used to plan the environmental study programme of the project. The project proponent will hold preliminary consultations with the Authority and its advisors and prepare a scoping report and terms of reference (TOR). The documentation will be sent to the Authority who will publish the report and TOR, thereby triggering a 35-day pubic pre-consultation period (see s. 87a, MRA). The proponent must consider comments from the public pre-consultation and revise the project accordingly where necessary. A final scoping report and TOR must be prepared and forwarded to the Authority for approval.

 

  • Planning and Study Stage: A detailed plan for the EIA process must be prepared and shall include an environmental study programme and a preliminary assessment of the potential environmental impacts of the project. The environmental study programme shall include programmes for environmental baseline studies, project related studies and other studies required by the Authority and its advisors. Overviews of the various studies are provided by the EIA Guidelines. The environmental baseline studies should describe the state of the environment prior to exploration, construction and operation of the mine; these are required in order to assess the potential environmental impacts from the mining operation and to establish a baseline for the monitoring programme during the construction and production phases. Project-related studies should identify and quantify sources of possible contamination. Other environmental studies may include issues that need to be clarified for the EIA such as distribution and migration of wildlife and chemical testing. The environmental study programme must be approved by the Authority and kept updated to secure data necessary to produce the final EIA.

 

  • Draft EIA Stage: The proponent shall submit a proposed table of contents for the EIA Report to the Authority and its advisors who shall review the proposal and provide feedback. The proponent will then prepare a draft EIA Report. The Report must contain: an extended non-technical summary including maps and figures; an introduction; a description of the environment before mining activities were started; a description of the mining project (covering all phases from exploration to closure); a description of considered alternatives and why they were rejected; an assessment of the environmental impacts of the projects (from exploration to closure) and an evaluation of alternative options; cumulative impacts of existing and expected planned projects that could influence the EIA; an environmental management plan describing management, control and mitigation of the identified impacts, emergency plans and training programmes; an environmental monitoring plan; an assessment of issues related to archaeological findings; an assessment of environmental issues related to the closure plan and post-monitoring; public consultation; conclusions; and references and a glossary of terms (for detailed content guidelines see Parts 5-8 & Appendix 1, EIA Guidelines). The draft EIA Report will be submitted to the Authority and its advisors who will review and provide feedback. The proponent will revise the draft EIA report (where necessary) and resubmit the documentation to the Authority.

 

  • Consultation Stage: The Authority will publish the draft EIA Report for public consultation for a minimum period of eight weeks (s. 87b, MRA). Public meetings must be held in the towns and villages affected by the project or the towns and villages determined by the government if necessary (s. 87c, MRA). A minimum 14-day notice period shall be given prior to consultation meetings. The meetings must be advertised in local newspapers and other media (s. 87d, MRA). Minutes must also be taken. The consultation period may be extended if it proves impracticable to conduct public meetings or the government cannot attend the meetings in the eight-week timeframe (s. 87b(3), MRA). Following the end of the consultation the company shall prepare a White Paper to address the comments and questions that were raised during the public consultation. The White Paper shall be submitted to the Authority and its advisors who shall review and give feedback.

 

  • Final EIA Stage: A final EIA Report (revised in light of the public consultations where necessary) alongside the White Paper shall be submitted to the Authority in order to obtain approval from the government. The Report, summary, appendices and White Paper must be prepared in Greenlandic, Danish and English. Should the government decide to grant an Exploitation Licence, the Authority will use the EIA as a basis document for defining terms and requirements for approval of the company’s Exploitation and Closure Plans.

 

The MRA also contains provisions on compensation for environmental damage (ss. 68 – 72, MRA).

SIA PROCESS

Under section 76 of the MRA, if an activity must be assumed to have a potential significant impact on social conditions, a licence or approval may only be granted following the completion of an SIA. Projects that fall within the Large-Scale Projects Act must conduct an SIA as mandatory (s. 9, Large-Scale Projects Act). The SIA Guidelines also state that significant impacts on social conditions may occur in connection with prospecting projects and exploration projects but this will depend on a specific assessment of the project’s impact on social conditions (s. 1.2, SIA Guidelines). The SIA process is overseen by the MILTE. All costs relating to the SIA shall be covered by the project proponent (s. 1.4, SIA Guidelines). The approval process can take between 4-12 months.

According to the SIA Guidelines, all mineral projects must be socially sustainable and meet high international standards with regard to financial planning, health, safety, the environment and social and cultural initiatives.

The main objectives of the SIA are: to provide a satisfactory and impartial description for society about what Greenland, the local communities and individuals will gain from the project; to inform and involve relevant parties via on-going dialogue; to provide a detailed description of the social pre-project baseline situation to form the basis for planning, mitigation measures and monitoring; to provide an assessment based on collected baseline data to identify positive and negative social impacts at local and national level; to optimise positive impacts and mitigate negative impacts throughout the project and ensure sustainable development; to involve in a meaningful manner those who may be directly or indirectly impacted; and to develop an Impact Benefit Agreement / Plan.

In practice the EIA and SIA are often combined and an ESIA is conducted prior to the commencement of exploitation activities. Below is a summary of the standalone SIA process:

 

  • Scoping Stage: Scoping should identify the key issues to be addressed by the SIA. During the scoping stage the proponent should prepare a non-technical document in Greenlandic and Danish, explaining the most relevant aspects of the project. The document will form the basis for pubic pre-consultation. The full scoping study shall be submitted to MILTE for approval prior to the writing of the terms of reference (TOR) for the SIA. An announcement on the project will be made and the scoping study will be published, marking the beginning of the 35-day pre-consultation period. The content of the TOR and SIA report will be determined on the basis of input from the public pre-consultation. Incoming consultation statements will be sent to the proponent, which is obliged to include input from such statements in further work on the SIA Report. Statements must also be included in the White Paper on equal footing with statements submitted during the second consultation phase. TOR must then be prepared and submitted for approval (s. 2.5, SIA Guidelines).

 

  • Draft SIA Stage: The proponent will prepare a draft SIA Report. The SIA Report shall estimate the socio-economic impacts that will arise in connection with the mining project and address how such impacts will be dealt with. The SIA Report shall include: a non-technical summary of the project; an introduction and background information; a project description; positive and negative impacts of the project; benefit and impact plan with stakeholder involvement; analysis of alternative project proposals; cumulative effects; baseline data summary; and appendices and references. The SIA Guidelines contain detailed information on the SIA Report requirements (see. ss. 2 - 4, SIA Guidelines).

 

  • Consultation / Final SIA Report Stage: The draft SIA Report will be used for the second round of public consultations. Generally speaking the second consultation stage must begin within four weeks of the submission of a correct draft SIA Report. As with the EIA Report, a public consultation will be held for a minimum duration of eight weeks. Meetings must be held, usually in several different towns and settlements. Minutes of all meetings must be taken. The feedback from the consultation stage must be incorporated into the SIA Report. A White Paper must then be prepared in order to address the relevant statements and comments on the project which have arisen during the consultation phase. The White Paper must be prepared in Greenlandic and Danish. A final version of the SIA Report can then be produced.

 

  • Impact Benefit Agreement (IBA) Stage: The IBA is an agreement between the proponent, the municipalities and the government, the aim of which is to safeguard Greenlandic interests and provide a social commitment from the parties involved throughout the mining project. Negotiation of the IBA can commence at the end of the 8-week consultation stage. Parties to the negotiation will include the proponent, the government, the municipalities, the MILTE, Ministry of Finance, Ministry of Natural Resources and Ministry of Education, amongst others. The SIA Guidelines describe the IBA as a tool to convert the initiatives of the SIA Report into more specific and measureable initiatives. The SIA Report will form the basis for negotiation of the IBA. According to the SIA Guidelines, areas with high priority in the IBA include: recruitment of Greenland labour; engaging Greenland enterprises, local suppliers and industrial promotion initiatives; local processing and infrastructure; socio-cultural values and traditions; training and education, internships and apprenticeships; and long-term capacity building and knowledge transfer (s. 2.9, SIA Guidelines). The IBA will contain specific targets to be updated year on year on the basis of regular monitoring and evaluation. Model IBA will be produced by the MILTE.

 

  • Approval Stage: Once the SIA Report and White Paper have been finalised, the Exploitation Licence and any other relevant documents will be submitted to the government in order to obtain an approval for the project. The IBA must be signed before the final Exploitation Plan and Closure Plan can be approved and before construction can commence.

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