The Aappaluttoq mine, located in southwest Greenland and also known for producing pink sapphires, began commercial operations in 2017. However, the mine was put on care and maintenance last January and was fully shut down in August.
Despite successful extraction efforts and significant investments in infrastructure and the local community, rising interest rates and inflation have made the gemstone market increasingly difficult, according to CEO Arnt Eirik Rornes, who announced the restructuring plan.
Majority-owned by Norway-based LNS Group, Greenland Ruby initially estimated a 10-year lifespan for the deposit.
Last September, the Danish news website Sermitsiaq reported that the company held a large stock of rubies in Thailand, but sales throughout 2022 were "very low." By the end of the year, Greenland Ruby had a negative equity of DKK 509 million ($73 million) and total debts of DKK 513 million ($74 million).
Despite these challenges, the company remains optimistic about resuming operations under new ownership. Rornes emphasized that Greenland Ruby holds an extraction license for one of the world's richest ruby deposits and has developed an innovative business model offering certified and traceable gemstones of the highest quality.
"The board also believes that Greenland Ruby has untapped potential to create jobs and value in Greenland," Rornes added.
Petitions for restructuring will be filed with the Maritime and Commercial High Court in Copenhagen, Denmark, and the bankruptcy court in Nuuk, Greenland.
