President-elect Donald Trump has reignited interest in acquiring Greenland, an idea first floated in 2019 during his first term.

Initially dismissed as ludicrous, renewed interest has caught attention owing to the island's increasing importance in geopolitical competition in the Arctic and its vast natural resource potential.

Notably, the Biden administration also showed interest in Greenland's resources, as Under Secretary of State for Economic Growth, Energy and the Environment Jose W. Fernandez visited Nuuk in November.

"Greenland wants to become the next mining frontier," he said after meeting Greenland's government officials and discussing foreign investment opportunities.

Despite its ambitions, the island faces challenges, including harsh terrain, insufficient mapping and an aging population. Nevertheless, Greenland remains rich in untapped resources, including oil, gas and rare earth elements critical to renewable energy and defense technologies.

A particular focus of interest is the Kvanefjeld project in southern Greenland near Narsaq. This site is one of the world's largest undeveloped deposits of rare earth elements, along with zinc and uranium. Over one billion tons of mineral resources have been delineated across three zones: Kvanefjeld, Sørensen and Zone 3.

Key elements include light and heavy rare earths, terbium, neodymium, dysprosium and uranium. These materials are critical for electric vehicle motors, renewable energy systems and advanced military technologies.

An Australian-listed micro-cap company, Energy Transition Minerals (formerly Greenland Minerals Ltd.), owns the project, while a Chinese firm, Shenghe Resources Holding Co., holds a 9.18% stake, making it the largest shareholder. This Chinese connection might fuel further concerns as Canada and the U.S. look to reduce Beijing's grasp on rare earth resources.

Even so, China's Arctic strategy has also become a factor.

As part of its Polar Silk Road initiative, China aims to utilize the Northern Sea Route (NSR), which could cut shipping distances to Europe by 23% compared to the Suez Canal route. Climate change-induced ice melt makes the NSR more accessible, enhancing the Arctic's strategic importance for Beijing. Keeping ties with Greenland, rich in resources and its proximity to Arctic shipping lanes, fits neatly into China's broader plans to reduce reliance on U.S.-controlled trade routes.

Thus, the Arctic — an area that falls under maritime laws and doesn't have a special treaty like Antarctica — slides toward becoming a chessboard for resource competition among global powers, with Greenland at its center.

Price Watch: Energy Transition Minerals closed the day at Australian dollar $0.079. The stock is up 97.50% year-to-date.

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Photo: Andrey Muravin via Shutterstock