Canada invests in Greenland critical minerals project to strengthen strategic supply chains

Monday 29 June 2026 - 07:10

By: Sahili Aya

Canada invests in Greenland critical minerals project to strengthen strategic supply chains

Canada has announced financial support for a major mining project in Greenland, reinforcing Western efforts to secure reliable supplies of critical minerals used in defence, aerospace, energy, and advanced manufacturing.

The Canadian government will provide C$7 million (approximately US$4.9 million) in non-repayable funding to support the development of the Malmbjerg molybdenum project in eastern Greenland. The investment will be made through Natural Resources Canada’s Critical Minerals Research, Development and Demonstration programme.

The project is being developed by Greenland Resources, which said the contribution makes Canada the first G7 country to directly support a mining development in Greenland.

Malmbjerg hosts one of the world's notable undeveloped deposits of molybdenum, a metal prized for its ability to increase the strength, heat resistance, and corrosion resistance of steel alloys. These properties make it an essential material for defence equipment, aerospace components, energy infrastructure, and a wide range of industrial applications.

The project reflects a broader strategy among Western governments to diversify supplies of critical raw materials and reduce dependence on dominant producers. Both the European Union and the United States classify molybdenum as a strategic mineral due to its importance for industrial resilience and national security.

Concerns over supply security have intensified since China, which accounts for roughly 40% of global molybdenum production, introduced export controls on the metal in early 2025. The restrictions have accelerated efforts by North American and European partners to develop alternative sources of supply.

Greenland has increasingly attracted international attention because of its significant untapped reserves of critical minerals. Interest from Western governments has grown alongside heightened geopolitical competition in the Arctic and renewed efforts to strengthen strategic supply chains.

Despite its vast mineral potential, Greenland’s mining sector has expanded slowly. Industry participants cite lengthy permitting processes, challenging operating conditions, limited infrastructure, and financing constraints as key barriers to large-scale project development.

Canada’s investment signals growing confidence in Greenland’s long-term role within global critical mineral markets and highlights the increasing importance of international partnerships aimed at securing essential resources for future industrial and defence needs.