European Lithium’s Greenland Venture Gains Momentum with Construction Milestone

A strategic majority stake in Critical Metals Corp (CRML) is delivering tangible progress for European Lithium. The official commencement of construction for the Tanbreez pilot plant in Greenland triggered a significant market response, sending shares in the subsidiary soaring 16% on the Nasdaq. This operational advancement raises a pivotal question for investors in the Australian parent company: could this development finally begin to close the substantial valuation gap between its holding and its own market capitalization?

Beyond project-specific news, the broader battery metals sector is providing a favorable backdrop. European lithium carbonate prices saw an increase of approximately 10% in December 2025, fueled by strengthening demand from the electric vehicle industry. In China, futures contracts reached a 19-month high, trading at 138,500 CNY per tonne. While Tanbreez is primarily a rare earths project, this positive sentiment across related commodities strengthens the overall investment case for European Lithium.

The company also bolstered its financial position in October 2025. Through a partial divestment of its CRML shareholding, European Lithium generated gross proceeds of $50 million USD (around 76 million AUD). These funds are earmarked to support ongoing project development.

Arctic Construction Officially Underway

Critical Metals Corp has formally approved and initiated the build of a specialized storage and pilot processing facility in Qaqortoq, Greenland. The execution is being managed via a turnkey contract with partner 60° North Greenland, which covers all stages from logistics through to commissioning. Designed to withstand extreme Arctic conditions, the structure will cover an area of 80 by 20 meters.

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CEO Tony Sage described the move as a structured approach to deploying essential infrastructure in a challenging environment. The timeline is ambitious, with the pilot section targeted to be operational by May 2026. In a parallel logistical step, the company has acquired a local residential property to serve as its operational base.

Valuation Discrepancy and Market Performance

The market response to this progress was immediate. Critical Metals' stock surged to $13.73 in New York trading, marking its highest level in two months. This rally values the company at approximately $1.5 billion USD. The Tanbreez project, hosting resources of at least 45 million tonnes, is ranked among the world's largest rare earth deposits. A preliminary economic assessment previously estimated the project's net present value (NPV) at around $3 billion USD.

For European Lithium, this valuation dynamic remains central. The market value of its stake in Critical Metals continues to significantly exceed the parent company's own total market valuation on the Australian exchange.

Operational Focus and Next Steps

Management's immediate focus is on the current quarter. A key objective is to finalize remaining offtake agreements for Tanbreez concentrate by the end of March 2026. Agreements are already in place for 75% of the planned production, including a contract with a Romanian state-owned enterprise. Meeting the scheduled commissioning date in May 2026 will serve as the next critical test of the management team's execution capabilities.