Rare-earth elements have become strategically key to the 21st-century economy, with a wide range of uses in everyday products such as phones and medical equipment, as well as in magnets crucial to the auto, electronics and defence industries.

Canadian group Amaroq, which operates a gold mine in Greenland and is developing a critical-minerals deposit, is now considering mining rare earths on the vast Arctic island, chief executive Eldur Olafsson said in an interview.

China, which currently controls most of global rare-earths mining, has introduced restrictions on their export, prompting Europe to announce a new plan to escape Beijing's stranglehold.

Greenland, a Danish autonomous territory, could provide some hope on the horizon: The territory is home to around 1.5 million tonnes of rare-earth oxides considered economically and technically recoverable, according to a recent report by the US Geological Survey (USGS).

In November, Amaroq said it had found rare earths in its licenced zone on Greenland.

"I can build your mine and I can deliver the material in Denmark," Olafsson told AFP.

But "it's not only about the deposit, it's about the processing", which would require "a lot" of outside funding, Olafsson said.

Greenland's inhospitable polar environment and barely-there infrastructure are among the hurdles facing mining companies.

There is, for example, no smelter to convert minerals into metals.

Greenland's soil and natural resources are, however, extremely well-mapped.

- Trump effect -

Olafsson said US President Donald Trump's outspoken desire to take control of Greenland and its natural resources had revived Denmark's own interest.

"There's a lot more interest on both sides of the Atlantic, both from Denmark, the EU and the US, which is great and has been helpful for us," said Olafsson, whose company has been present in Greenland since 2017.

In 2019, the United States signed a memorandum of understanding with Greenland on cooperation over mineral resources.

The European Union did the same four years later, identifying 25 of the 34 minerals on its official list of critical raw materials.

"Denmark is putting in place investments, it's putting in place various different means and much quicker than the US at the moment," said Olafsson, whose company is backed by Danish investors.

Greenland has managed its raw materials itself since obtaining self-rule in 2009.

Fisheries are the island's main source of revenue.

While the local government boasts of the island's mineral wealth, only two mines are currently active, including the Amaroq-operated Nalunaq gold mine, and production is limited.

Black Angel, a mine in northwestern Greenland that Amaroq plans to develop, could begin production in 2027 or 2028, thanks to infrastructure already in place from when it was an active mine in the 1940s and then again from 1973 to 1990.

Amaroq hopes to mine zinc, lead and silver there, as well as critical minerals such as germanium, gallium and cadmium.

"In 2027, 2028, Nalunaq will be one of the biggest taxpayers in Greenland," Olafsson said.

If Black Angel were to be of a similar scale, it could contribute to "Greenlanders' dream of seeing if mining could allow them to be economically independent" from Copenhagen.

One of the main challenges however is the workforce in the territory of 57,000 inhabitants.

Olafsson said 40 to 50 percent of workers on the Nalunaq site were Greenlanders.

"We import some skills that either don't exist and then have to train people... but over time, with more and more work going on in Greenland, there will be (a) need to import people," he said.