European Lithium Secures Greenland Project Control and Major Funding

Greenland approves ownership transfer for Tanbreez rare earth project, unlocking financing and sending European Lithium and Critical Metals Corp shares sharply higher.

Shares in European Lithium surged after Greenland's government approved a critical ownership transfer, clearing the path for development of one of the world's largest rare earth deposits. The decision grants Nasdaq-listed Critical Metals Corp full operational control of the Tanbreez project, in which European Lithium holds a direct 7.5% stake. The Australian-listed firm also owns a 37.5% equity interest in Critical Metals Corp itself.

The market reaction was swift and substantial. European Lithium's stock climbed 6.52% on Friday to close at A$0.245. Across the Atlantic, shares of Critical Metals Corp soared 35.49% to $12.56, building on a pre-market gain of 22.4%. The approval removes a major structural risk for European Lithium's rare earth strategy and unlocks significant project financing.

Financing for the Greenland venture is now taking shape. The U.S. Export-Import Bank has signed a letter of intent to provide up to $120 million in project funding. A separate $30 million acceleration program is set to advance drilling, engineering, and metallurgical testing. The project timeline targets a pilot plant start in May 2026, followed by a 150-tonne bulk sampling program in June. First ore extraction is slated for late 2028 or early 2029, with initial concentrate exports planned for the third quarter of 2029.

On the commercial front, Critical Metals has signed a heads of agreement for a joint venture with Saudi Arabian partner TQB. The partners aim to build a fully integrated supply chain from mine to processing, with anticipated investment costs reaching $1.5 billion. Under the deal, Critical Metals retains a 50% interest without contributing capital for the processing plant's construction. A long-term off-take agreement with Saudi Arabia already covers a quarter of the project's future production, effectively securing a buyer for Tanbreez's entire output.

Despite these operational strides, auditors have raised concerns about European Lithium's holding company finances, pointing to a negative net current asset position and ongoing operational losses. These warnings persist even though the company recently raised approximately A$124 million from a partial sale of its Critical Metals shares. Management, arguing the stock price fails to reflect the true value of its holdings, launched a six-month share buyback program on April 15. The plan authorizes the repurchase of up to 135 million shares, representing 10% of the issued capital.

The Tanbreez site contains eight rare earth elements essential for electric vehicles, wind turbines, and defense technology. Its location features fjords with year-round deep-water access to the North Atlantic, enabling future exports without costly infrastructure projects. The development is seen as a strategic move to reduce Western reliance on China, which currently controls about 90% of global rare earth processing.

While momentum builds in Greenland, progress at European Lithium's Wolfsberg lithium project in Austria has stalled. A final investment decision with partner Obeikan is pending, making a start before the end of 2026 unlikely. However, the broader market backdrop has improved, with prices for battery-grade lithium carbonate more than doubling in the first quarter to over $26,000 per tonne.