Greenland is one of the largest countries in the world – twice the size of Britain, France and Germany combined. Sparsely populated and covered in snow for most of the year, the island can be an inhospitable place for locals and visitors alike.
But Greenland is also home to vast, untapped deposits of valuable minerals. Eldur Olafsson, a geologist turned entrepreneur, is on a mission to convert some of these resources into commercial mines, benefiting investors and local communities along the way.
Early signs suggest the 38-year-old Icelander is making good progress. Having founded Amaroq Minerals in 2017, he has acquired assets stretching across almost 4,000 square miles of the country, making this AIM-listed business the largest holder of mineral licences in Greenland. Exploration is well underway and the firm expects to move into production at its flagship goldmine, Nalunaq, later this year.
Midas recommended Amaroq in June 2022 at 44p. Olafsson and his team have been working flat out since then and the shares have soared more than 60 per cent to 72p. There have been extensive drilling campaigns for copper, nickel, gold and other valuable metals, and money has been raised so the company can carry on exploring and move towards commercial production.
A processing unit should be running later this year at Nalunaq, with initial gold production coming thereafter. Olafsson will start slowly but intends to create a plant capable of delivering 50,000 ounces of gold a year.
Vast: Greenland is one of the largest countries in the world – twice the size of Britain
Results from last year’s drilling campaign are imminent, and Amaroq’s supporters are highly optimistic. Millions of years ago, Greenland was part of a landmass stretching from North America to the Nordics, so it once abutted Canada to the west and Sweden to the east. Today, Canada is home to Voisey’s Bay, one of the world’s largest copper asses, while Northern Sweden boasts the biggest underground iron ore mine in the world, Kiruna, a happy hunting ground for rare earth minerals too.
That bodes well for Amaroq and its shareholders. The company has money in the bank to cover exploration expenses and it has amassed a keen following among Nordic investors, listing on the Icelandic stock market after joining Aim.
Brokers believe the company will deliver nearly £9 million of revenue in 2024, surging to £56 million in 2025 with profits of £11 million. In a show of faith, Olafsson recently spent nearly £45,000 of his own money on Amaroq shares, taking his holding to 3.45 per cent.
Midas verdict: Too often, mining seems to epitomise the triumph of hope over experience. But Amaroq seems to be delivering results. The company has already proved its mettle and updates this year should give the shares a further boost. At 72p, investors may want to bank some profits but they should not sell out completely. Olafsson is committed to making this business work and the long-term outlook is sound.
Traded on: AIM Ticker: AMRQ Contact: amaroqminerals.com or Camarco on 020 3 989 5712
