Наталя Хандусенко Hot News 9 January 2025, 16:59

Why Trump has his eye on Greenland: the island's technological value

Greenland is the largest island in the world with almost untouched land and scarce resources, which is an autonomous territory of Denmark. Located above the Arctic Circle between the United States, Russia and Europe, the island is a geopolitical prize that the United States and other countries have been hunting for for over 150 years. During his first term as president, Donald Trump expressed interest in purchasing Greenland. Now, after winning the election, the island could become his gift to American Big Tech and crypto miners.

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Trump is not the first US president to propose buying Greenland. The idea was first floated in the 1860s during the presidency of Andrew Johnson.

A treasure trove of rare minerals, essential for modern technologies

Locked inside Greenland are valuable rare-earth minerals needed to make batteries and high-tech devices, as well as uranium, billions of untapped barrels of oil, and vast reserves of natural gas that are becoming more accessible due to global warming.

Many of the same minerals are now supplied mainly by China, so other countries such as the United States are also interested in them. Three years ago, the Danish government suspended offshore oil production in the area, which is home to 57,000 people.

Here are some figures cited by The Economist:

Currently, reserves of 43 of the 50 minerals considered «critically important» by the US government are known, including what is likely the largest deposits of rare earth elements outside of China.
According to a 2008 estimate by the US Geological Survey, wells off the coast of Greenland could yield 52 billion barrels of oil, about 3% of proven global reserves;
Companies are currently drilling in 170 areas.

Greenland’s minerals are attracting Amazon founder Jeff Bezos' companies and the U.S. Department of Defense. For example, molybdenum strengthens steel for offshore wind farms. Terbium is used in magnets in tanks. Copper is used in everything from electrical wiring to artificial intelligence chips.

«While mining in Greenland is still in its early stages, it is accelerating. Companies are now drilling at 170 sites, up from 12 a decade ago. Such exploration is one of the oldest and riskiest forms of economic speculation; profits depend not only on what lies beneath the ground but also on whether market prices hold up long enough to extract it. KoBold Metals, funded by Bill Gates, the founder of Microsoft, and Mr Bezos, uses artificial intelligence to find sites to drill and has spent $15m developing the Disko Nuussuaq cobalt and copper deposit. Other investors say they have spent more than $100m and sent hundreds of workers to live in camps in sub-zero temperatures. Some are reported to be building a road on the glacier,» The Economist wrote back in October.

Potential base for data centers, which is the foundation for the development of AI

AI, which requires increasingly powerful chips and intensive cooling systems, is a major driver of the projected growth of data centers.

According to the US Department of Commerce, US data center electricity demand could nearly triple over the next three years and consume up to 12% (or 132 gigawatts) of the country’s total electricity consumption.

USA to maintain status world leader in technology, you need a lot of powerful data centers. But where to get so much energy? — In Greenland.

With Greenland’s growing renewable energy capacity, 70% of which is generated from hydropower, the island is an ideal location for data centers. Greenland’s cold climate significantly reduces the energy needed to cool these centers, making the country an attractive option for energy-intensive data operations.

«Greenland has attracted a lot of interest from companies around the world, especially in hydropower. Our location and cold climate are advantageous, especially for data centers that need energy for cooling,» said Greenland’s Energy Minister Kallistat Lund in November 2024.

Currently, Greenland has only one data center, located in the capital Nuuk and owned by Tusass, which also laid an undersea cable, which may be another reason why the island is so attractive to Trump.

Potential for laying submarine cables

There are currently two submarine cables in Greenland, both owned by Tusass. Greenland Connect, which began operating in 2009, connects Greenland with Canada and Iceland. An inland extension to Asia, Greenland Connect North, was added in 2017.

In December 2022, the company received financial support from the EU to conduct seabed surveys along the coastline from Qaqortoq to Ilulissat to strengthen critical infrastructure with a backup submarine cable connecting Qaqortoq, Nuuk and Asiat, and to explore the feasibility of a route to Ilulissat.

In addition to all of the above, it should be noted that Greenland is home to a large US space facility. The waters around the island are also a gateway for Russian and Chinese vessels that Washington seeks to track.

«Greenland is an incredible place, and the people will benefit immensely if and when it becomes part of our country,» Trump said. «We will protect it and cherish it from a very cruel outside world.»

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