Map showing Greenland's offshore hydrocarbons concessions

This morning Maplecroft issued a new Country Risks Report on Greenland, focusing on opportunites and risks in the territory’s mining and oil and gas sector.

Just a few years ago, issuing a report on Greenland’s investment prospect would have seemed willfully quixotic, akin to issuing a report on lunar agricultural opportunities.

Today, however, driven by a combination of high and rising commodity prices, improved technology and a Greenland government that is keen to encourage foreign investment, Greenland is increasingly on the agenda of both junior and well established extractive businesses.

Leaving aside the potential financial inventives offered by Greenland’s vast and largely unexplored oil, gas and mineral deposits , there are several factors that help to explain this intense interest in Greenland:

1. Strong regulatory framework. Although Greenland is still developing its legal frameworks as it gradually wins more autonomy from Denmark, legislation governing its natural resources is largely clear and transparent, with uncertainty currently existing only around the contentious issue of extracting radioactive materials.

2. Attractive business environment: Greenland’s government has rapidly worked to create a welcoming business environment for investors. Corporate tax at 31.8% is comparable with other countries and other initiatives – such as industry-relevant training programmes for local workers are also important. (more…)