Greenland Resources: Leveraging Critical Minerals to Power EU's Supply Chain Revolution

The European Union’s reliance on imported molybdenum—a critical mineral for specialty steels used in defense, energy, and infrastructure—has long been a vulnerability. Now, Greenland Resources Inc. (GRI) is positioning itself to fill this gap with its Malmbjerg molybdenum project, a venture recently validated by an oversubscribed private placement and strategic partnerships. With a projected levered after-tax IRR of 33.8%, a 10-year off-take deal with Europe’s largest stainless steel producer, and EU-backed supply chain support, GRI’s play is shaping up as a strategic bet on critical minerals self-reliance. Here’s why investors should take notice—and act now.

The Oversubscribed Private Placement: A Vote of Confidence

On May 16, 2025, Greenland Resources closed a CAD $3.3 million private placement, raising 10% above its initial target of CAD $3.0 million. The offering—facilitated by finders like PowerOne Capital—underscores investor conviction in the Malmbjerg project’s potential to disrupt Europe’s supply chain. Each unit sold includes one common share and a warrant exercisable at CAD $1.00, creating a leveraged position for investors.

Why This Matters:
- The oversubscription reflects confidence in GRI’s ability to execute its $820 million capital expenditure plan, with 70% of financing already secured through debt commitments from institutions like EKN (Sweden) and the Canadian government.
- Warrants provide a low-cost entry for investors betting on rising molybdenum prices, which currently hover near $21/lb—well above the $18/lb price used in the project’s feasibility study.

The Malmbjerg Project: A Goldilocks Opportunity

The Malmbjerg molybdenum deposit, located in central-east Greenland, is a high-grade, low-cost asset with Proven and Probable Reserves of 571 million pounds of molybdenum. Key highlights include:
- Production Scale: Initial output of 32.8 million pounds/year, meeting 25% of EU annual demand.
- By-Product Potential: Magnesium—a material 89% sourced from China—adds incremental value.
- Environmental Edge: Modular infrastructure and low water usage minimize environmental footprints, aligning with EU sustainability mandates.

The project’s economics are compelling:
- IRR of 33.8% at $18/lb molybdenum, with a 2.4-year payback period.
- A 20-year mine life and binding off-take agreements (more on those below) provide long-term revenue visibility.

Strategic Partnerships: Anchored in Europe’s Supply Chain

GRI’s 10-year off-take agreement with Outokumpu Oyj, Europe’s largest stainless steel producer, is the linchpin of its strategy. Key terms include:
- Volume: 8 million pounds/year (25% of Malmbjerg’s output), covering half of Outokumpu’s annual needs.
- Value: ~$1.6 billion over the deal’s lifetime, with a price cap/floor mechanism to insulate against volatility.
- Strategic Alignment: Supplies low-emission molybdenum, directly supporting Outokumpu’s Scope 3 emissions reduction goals.

Beyond Outokumpu, GRI has secured non-binding agreements covering the majority of production, including deals with Scandinavian Steel AB and magnesium buyers in the EU. These partnerships de-risk the project and position it as a cornerstone of EU critical minerals policy.

Geopolitical Tailwinds: ERMA and the Race for Supply Chain Autonomy

The EU’s European Raw Materials Alliance (ERMA) has flagged molybdenum as a “critical mineral” and is actively supporting domestic projects like Malmbjerg. This institutional backing reduces regulatory risks and accelerates permitting. In April 2025, GRI received an updated draft exploitation license, a key hurdle cleared.

The project’s geopolitical significance cannot be overstated:
- EU Dependency: The bloc imports 100% of its molybdenum, with China and the U.S. dominating global supply.
- Magnesium’s China Problem: 89% of global magnesium production is Chinese, creating a dual vulnerability for the EU.

GRI’s dual molybdenum-magnesium output addresses both gaps, aligning with the EU’s Raw Materials Initiative to reduce strategic dependencies.

Risks and Mitigants

No investment is without risks. Key concerns include:
1. Capital Raising: The remaining $120 million of the $820 million capex must be secured. GRI has expressed confidence in its pipeline of institutional lenders.
2. Regulatory Delays: Final exploitation licenses from Greenland’s government are pending, though progress has been steady.
3. Molybdenum Pricing: While current prices are strong ($21/lb), a sustained drop could pressure margins.

Mitigants:
- Off-take Agreements: The price cap/floor mechanism shields GRI from downside risk.
- Institutional Backing: ERMA and Nordic lenders (EKN, Finnvera) are incentivized to see the project through.

The Investment Case: Warrants as a Leveraged Play

The private placement’s warrants (exercisable at $1.00) offer a high-conviction, low-cost entry into the molybdenum story. Investors who buy units today pay $0.85 per share but gain upside exposure via the warrants. If molybdenum prices rise further (a plausible scenario given green energy demand and supply constraints), GRI’s share price could surge, magnifying returns.

Final Call: A Catalyst for Critical Minerals Self-Reliance

Greenland Resources is at the intersection of strategic supply chain diversification, European policy priorities, and high-return mining economics. The Malmbjerg project’s oversubscribed financing, off-take agreements, and ERMA support create a bulletproof narrative for investors seeking exposure to critical minerals.

Act Now:
- Buy the units—the $0.85 entry price is a steal given the project’s IRR and the warrants’ leverage.
- Hold for the long-term: EU molybdenum demand will only grow, and GRI is positioned to dominate this space.

The race to secure critical minerals is underway. With Malmbjerg, Greenland Resources is not just a player—it’s the EU’s best bet to break free from supply chain shackles.

This article is for informational purposes only and does not constitute financial advice. Investors should conduct their own due diligence.