Tag Archives: DeepGreen

Mining the Deep Sea: Stories for suckers, and corporate capture of the UN

Catherine Coumans | Arena Magazine | 30 October 2019

When I mention that the global mining industry is eyeing the deep seabed as the next frontier in mining I am commonly met with gasps of disbelief and dismay. That gut reaction is often followed up with sensible exclamations about the fact that the world’s oceans are already overstressed by contaminants from human activity, such as plastics, and by overfishing, and, from those in the know, by acidification. Unsurprisingly, these apprehensions do not factor into the rapacious ambitions of industry pitchers for deep-sea mining, nor do they—another gasp of dismay—appear to temper the outright enthusiasm for this new form of mining shown by some highly placed officials in relevant UN bodies.

To overcome the aversion of a public already overwrought by reports of species loss, whales on the brink of extinction and the various horsemen of the climate apocalypse—drought, fires, floods, heat, sea-level rise, food insecurity and forced migrations—deep-sea mining’s frontier investors are surpassing themselves in the propaganda department. The front runner in this regard is a private Canadian company out of Vancouver called DeepGreen Metals Inc.

One of DeepGreen’s early promotional videos, DeepGreen—Metals for our Future, drives home lofty public messages that need to be critically interrogated: deep-sea mining is less environmentally and socially destructive than terrestrial mining; it is necessary in order to save the planet from climate change; and deep-sea mining, and indeed DeepGreen itself, come highly recommended, as both are enthusiastically promoted by the secretary-general of the UN’s International Seabed Authority (ISA). The private pitch of deep-sea-mining promoters is likely more focused on the bottom line: there is untapped wealth in them thar ocean depths for the savvy frontier investor ready to undertake an exciting new experimental mining adventure. DeepGreen’s CEO, Gerard Barron, concluded a sales pitch on the commercial and societal benefits of deep-sea mining in February 2019: ‘…whether you invest in a company like DeepGreen or not, everyone is a sucker for the story’.

DeepGreen’s focus is on polymetallic nodules found on the seabed in international waters of the Clarion-Clipperton Zone (CCZ) of the Pacific Ocean, an area covering some 4000 kilometres and roughly the size of the continental United States. These lumpy baseball-size nodes lie at depths of some 4000 to 6000 metres and contain primarily nickel, cobalt, copper, manganese and iron oxides. The two other targets for deep seabed mining are hydrothermal vents, typically found at depths of 1000 to 4000 metres, and cobalt-rich crusts, typically found on seamounts at depths of 800 to 2500 metres. Hydrothermal vents are believed to have hosted the earliest forms of life on earth and are famous for their abundant array of endemic species that feed on bacteria and other single-celled organisms that, remarkably, do not derive energy from photosynthesis but from the chemicals spewed out by the vents. The massive sulphide deposits built up around these vents contain copper, gold, silver, zinc and lead. Crusts that form on seamounts contain primarily cobalt and also manganese, iron, copper, nickel and platinum.

These geographic features of the deep sea are thrilling would-be miners, as the metals they contain are commonly more highly concentrated than on land, and advancing technology makes them potentially accessible for the first time. The feverish rush to lay claim to large swathes of the seafloor has all the hallmarks of the gold rush that once drew hordes of prospectors to the Wild West, including colourful claims of fabulous treasure lying ready for the reaping on the seafloor. Former UK prime minister David Cameron reportedly pledged to bring wealth from the seabed to the United Kingdom, claiming possible values of £40 billion over thirty years. Not to be outdone, The New Economy claimed that the industry ‘could be worth as much as $1trn to the US economy each year—the value of all the gold deposits alone on the seafloor is estimated to be around $150trn. It’s not hard to see why investors are getting excited’. Indeed, speculators are already making profits without a deep-sea spade in the ground.

To date, twenty-nine exploration licences have been granted in extraterritorial waters, called the Common Heritage of Mankind in UN speak. Granted by the ISA, which has jurisdiction over the seabed in this area, the licences cover some 1.5 million square kilometres in the southwestern Pacific alone (claims also exist in the Atlantic and Indian Oceans). The licences are held jointly by industrialised countries such as China, Korea, the United Kingdom, France, Germany and Russia, as well as small Pacific island countries such as Kiribati, Nauru, Tonga and the Cook Islands, and subsidiaries of corporations, such as Lockheed Martin (UK Seabed Resources), and Canada’s DeepGreen (Nauru Ocean Resources Inc.) and Nautilus Minerals Inc. (Tonga Offshore Mining Limited).

No exploitation, or mining, licence has yet been issued for any of these claims in extraterritorial waters: the ISA is still ironing out some details, such as novel governance regimes and brand-new environmental regulations. The first exploitation licence was issued for a project in territorial waters: the government of Papua New Guinea (PNG) granted Nautilus a mining licence in January 2011, but the company’s Solwara 1 project has already tanked. Faced with concerted, vocal and growing community opposition, and apparently insufficient ‘suckers’ for the Nautilus story, the company is now facing bankruptcy. The state of PNG is on the hook for about US$125 million, which it borrowed after Nautilus used arbitration to force the state to live up to its commitment to assume and finance a 15-per-cent stake in the venture. However, some early investors in Nautilus, such as Barron, made a profit: Barron ‘turned a $226,000 investment into $31 million’ in six years before exiting in 2007. It was the founder of Nautilus, David Heydon, who created DeepGreen in 2011 and brought Barron into that company as CEO.

Perhaps if hydrothermal vents and deep-sea nodules could serve solely as inspiration for speculative investing, all would not be so dire. But investors are applying intense pressure on the ISA to finalise the deep-sea-mining regulations, not simply to create another major bump in their investments—which of course it will do—but to open the door to putting massive mining machines onto the seafloor. The ISA has proved to be an all-too-willing and shadowy agency, as pointed out by the Deep Sea Mining Campaign, and Greenpeace:

The ISA has recently rejected the establishment of an environmental committee to better include environmental considerations in its functioning, and key environmental information is not public. Its Legal and Technical Commission meets mostly behind closed doors, and its composition is such that biological and ecological considerations are underrepresented.

So what is at stake? Each of the metal-rich geological features that are of interest to miners is slowly revealing itself to be an incredible ecosystem. In spite of existing at great depths, under immense pressure, in very cold water and in inky darkness, hydrothermal vents, polymetallic nodules and cobalt crusts host diverse, mostly undiscovered and scarcely studied creatures that have amazed the few humans who have seen them in their natural habitats. Hydrothermal vents and cobalt crusts host an abundance of organisms. Those on cobalt crusts have great diversity; many of these creatures are long lived but slow to reproduce and may exist only in certain areas. Those on hydrothermal vents are abundant, though thought to be less diverse, and are often unique to a particular vent. Polymetallic nodules host a wide variety of species, but they are spread more thinly; very few have been identified, but they are also thought to be long lived and slow growing. The habitats around hydrothermal vents are, according to deep-sea biologist Cindy Lee Van Dover, ‘relatively rare on the sea floor, and they’re different from one site to the next because the animals have adapted to the fluid chemistries’. The deep ocean expanses of polymetallic nodules are among the least-disturbed ecosystems on earth. Each of these geological phenomena of the deep sea have taken a very long time to form. Cobalt crusts grow at a rate of 1 to 6 millimetres per million years. Each polymetallic nodule, commonly between 5 and 10 centimetres in diameter, has grown by 2 or 3 centimetres every million years. Furthermore, as trillions of these baseball-size polymetallic nodules lie spread in a thin layer on the surface of abyssal plains, an extensive area would be disturbed if they were to be sucked up by the huge tread-wheel-driven machines envisioned for this task. While the chimney-like structures associated with hydrothermal vents can grow by 40 centimetres over five days, it is unknown whether vent species can recover once a vent chimney has been removed by mining.

While mining methods differ for each of these targeted geological features, deep-sea marine experts agree on the following points: crusts and nodules will take millions of years to reform; entire unusual species that we have never had a chance to study will be lost in the mining of all three types of ecosystem; and the dense sediment plumes that will be created as the seabed is disturbed and the pumping back down of process effluent will negatively impact and smother species over many more kilometres. Recent peer-reviewed papers by marine scientists have titles such as ‘Deep-Sea Mining With No Net Loss of Biodiversity—An Impossible Aim’ and conclusions such as ‘Seabed mining will cause irreparable damage to marine ecosystems’.

So, let us revisit the messages in DeepGreen’s Metals for our Future video. DeepGreen maintains that deep-sea mining is less environmentally and socially destructive than terrestrial mining. Nautilus tried the same spin, which the Deep Sea Mining Campaign adeptly refuted as Nautilus fought to counter vehement opposition to the Solwara 1 project by PNG coastal communities—these communities had already noticed a negative impact on their subsistence livelihoods and cultural practices related to marine species such as sharks as a result of Nautilus’ exploration activities offshore. While it is fascinating to see a new breed of would-be miners throw their terrestrial counterparts under the bus and expose the immense environmental and social harm done by mining on land, this is hardly an argument for opening up another entire ecosystem to exploitation by this rapacious industry, especially an ecosystem as immensely fragile and little understood as the deep sea. In fact, the comparison with terrestrial mining provides many arguments to show why deep-sea mining is a terrible idea, including, just as a start: it is much more challenging, technically and financially, to produce comprehensive baselines in the deep sea than it is on land; it is completely unclear how credible toxicity testing could be done in a deep-sea environment; independent scrutiny by communities, NGOs, independent scientists, media and so on would be much more limited; when things go wrong, such as spills, pipe breaks or unpredicted impacts, it would be much more difficult, nay impossible, to rehabilitate the unintentionally impacted area; modelling of the likely impact zones of toxic sediment plumes created by all forms of deep-sea mining is in its infancy; there is zero experience to draw on regarding impacts and mitigation at each step of the mining process; and the impacts of disturbances in the deep sea on critical food security, livelihood and commercial activity related to species such as tuna are not well understood.

DeepGreen maintains that mining the deep sea is necessary to avert the global climate crisis. Barron casts himself in the company’s video not as a mining CEO or a profit-seeking frontier investor but as a humanitarian eco-warrior, concluding, ‘it is a big responsibility on our shoulders’. The argument is simple: the green economy requires metals for such things as wind turbines, solar panels, and batteries for electric vehicles. While this is true, there is currently no global shortage of critical metals and minerals such as cobalt or lithium. Furthermore, technology is rapidly evolving to reduce or replace cobalt use, recycle lithium, develop urban mining of all kinds of waste products and even, according to experts, ‘biomining to extract rare earths from electronic wastes using microorganisms…use of sodium and magnesium in place of lithium, or alternative batteries based on graphene, hydrogen fuel cells, or even water and table salt. BNEF [Bloomberg New Energy Finance] has said new battery chemistries will probably shift to different source materials after 2030’. There are even reports of batteries using hemp rather than lithium-ion.

Finally, the DeepGreen video prominently features the secretary-general of the ISA, Michael Lodge. Lodge is on what appears to be a DeepGreen vessel, he wears a hard hat with the DeepGreen logo on it, and he both makes the case for deep-sea mining and discusses the ‘partnership’ DeepGreen has with the ISA. It is remarkable, and perhaps telling, that the head of this UN agency, which is tasked with environmental protection of the seabed in the Common Heritage of Mankind, and expects to soon become the regulator and issuer of mining licences for a whole new extractive industry, seems to be oblivious to the appearance of conflict of interest inherent in appearing in DeepGreen’s promotional video. Lodge has yet to respond to a recent report that raises concern about corporate capture of the ISA’s mining-code drafting processes.

It should be obvious that we cannot save the planet by continually expanding our exploitation of it and by trashing new, as yet unexploited ecosystems, such as those in the deep sea. It has taken time for communities and governments to become aware of the existential threat to our oceans, to global biodiversity and to life on earth posed by deep-sea mining. Within the last year the call for a ban or moratorium on the development of regulations by the ISA, and on the practice of deep-sea mining itself, has grown louder. The call is being made by NGOs and civil society organisations such as the Deep Sea Mining Campaign, the Deep Sea Conservation Coalition and Greenpeace, individuals such as Sir David Attenborough, and also by governments of Pacific island countries; even the European parliament has called for a moratorium on deep-sea mining.

Critical to the effort to protect the deep sea from mining is the need to review the role of the ISA in governing both the protection of the deep seabed as our ‘common heritage’ and its exploitation by for-profit corporations. This agency and its secretary-general have proven themselves to be deeply conflicted and captured by the corporations they are meant to regulate. It is time for a global treaty that will protect the entire international deep seabed from industrial exploitation.

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Deep-sea mining risks ‘irreversible’ harm, warns Greenpeace

A subsea mining machine under construction © Reuters

Campaign group intervenes over UK exploration licences for Lockheed Martin

Henry Sanderson| Financial Times | 3 July 2019

Deep-sea mining risks “severe and potentially irreversible” environmental harm and the UK should prioritise protecting the ocean rather than extracting minerals from it, Greenpeace, the campaigning group, said.

The government has awarded deep-sea exploration licences to a subsidiary of Lockheed Martin, which could lead to deep-sea mining despite Westminster being aware of the environmental risks, said Greenpeace.

David Cameron promised as prime minister in 2013 that deep-sea mining would generate £40bn for the UK economy over the next 30 years. But Greenpeace said it is unclear what this figure includes.

It pointed out that in 2017 the government’s deep-sea mining working group was shown a report by the National Subsea Research Initiative, a research body, warning of the environmental impact on the seabed.

“The activities involved in subsea mining could have detrimental impacts on localised populations as well as an impact on world oceans through the potential extinction of unique species which form the first rung of the food chain,” said the report, which was commissioned by Scottish Enterprise and seen by Greenpeace through a Freedom of Information request.

The UN-backed International Seabed Authority, which regulates all mineral activities in international waters, has given countries, including the UK, 29 licences to explore the oceans, covering an area of 1.3m sq km, or five times the surface area of Britain. But mining cannot begin until regulations, currently being negotiated, are agreed. The ISA expects to have finished them by July 2020.

The UK government in 2013 granted Seabed Resources, a Lockheed Martin subsidiary, the rights to explore 133,000 sq km of the ocean it had received from the ISA. Seabed Resources said it was waiting for the regulations to be approved before assessing the viability of mining at the sites.

Daniel Jones, a principal researcher at the National Oceanography Center, said scientists still do not know enough about life in the deep sea compared to life on land.

“We are finding out a lot more but we can’t answer how organisms will respond to disturbance from deep-sea mining without doing experimentation on the sea floor,” he said. “We are missing quite important information.”

A spokesman for the UK government said: “The UK continues to press for the highest international environmental standards, including on deep-sea mineral extraction. We have sponsored two exploration licences, which allows scientific marine research to fully understand the effects of deep-sea mining. We will not issue a single exploitation licence without a full assessment of the environmental impact.”

Deep-sea mining has had a chequered history. The first company to try to mine the deep sea, Nautilus Minerals, was delisted from the Toronto Stock Exchange in March after financial difficulties. The company had planned to mine around Papua New Guinea.

But last month Deep Green, a deep-sea mining start-up, said it had raised the bulk of the $150m it needed to press ahead with plans to collect mineral-rich nodules from the floor of the Pacific for metals such nickel and cobalt used in electric-car batteries. The company is backed by miner Glencore as well as shipping giant Maersk.

DeepGreen said “it is built with a deep appreciation and respect for ocean health and the earth’s environment”.

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DeepGreen closer to ocean mining battery metals after Swiss cash injection

[A highly misleading] computer rendition of a seabed mining operation. (Image by Phil Pauley | Twitter.) In reality the mining will be done in almost complete darkness thousands of metres below the surface!

Cecilia Jamasmie | Mining News | June 10, 2019

Canada’s DeepGreen Metals, a start-up planning to extract cobalt and other battery metals from small rocks covering the seafloor, has secured the bulk of the $150 million it needs to carry out its first feasibility studies.

The financing, provided by Switzerland-based offshore pipeline company Allseas Group, is a welcome sign of progress for the deep sea mining sector, which has been stalled due regulatory uncertainty and environmental concerns.

Unlike other seafloor mining companies, including pioneer Nautilus Minerals, the Vancouver-based explorer doesn’t want to drill, blast or dig the bottom of the ocean. DeepGreen’s main goal is to scoop up small metallic rocks located thousands of metres below the surface in the North Pacific Ocean.

Its exploration focus is the Clarion-Clipperton Zone (CCZ), a mineral-rich, 4,000-kilometre swath of the Pacific that stretches from Hawaii to Mexico, where billions of potato-sized metals-rich rocks lie in a shallow layer of mud on the seafloor.

The deep sea, more than half the world’s surface, contains more cobalt, nickel, copper, manganese and rare earth metals than all land reserves combined, according to the US Geological Survey.

Companies exploring or already developing projects to mine the seafloor argue the extraction of those deep-buried riches could help diversify the sources currently supplying metals needed for electronics and evolving green technologies, such as electric vehicles (EVs) and solar panels.

Academics and scientist, however, are concerned by the lack of research on the possible impacts of high seas mining. They fear the activity could devastate fragile ecosystems that are slow to recover in the highly pressurized darkness of the deep sea, as well as having knock-on effects on the wider ocean environment.

Not enough studies

Last year, the European Parliament called for a ban on seabed mining until the environmental impacts and risks of disturbing unique deep-sea ecosystems are understood. In the resolution, it also urged the European Commission to persuade member states to stop sponsoring and subsidizing licenses to explore and exploit the seabed in international waters as well as within their own territories.

Shortly after, an international team of researchers published a set of criteria to help the International Seabed Authority (ISA), a UN body made up of 168 countries, protect biodiversity from deep-sea mining activities.

So far, it has granted 29 licences to governments and companies, authorizing them to explore in international waters.

Nautilus, however, is the only company that has gone beyond the exploration stage and has gotten close to open the first polymetallic seabed mine off the coast of Papua New Guinea. Its Solwara 1 project, however, has been slowed by funding issues and local opposition.

Anglo American (LON:AAL) sold its 4% stake in Nautilus a year ago, as part of efforts to retain only its most profitable assets. And, in March, it had to delist from the Toronto Stock Exchange.

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Deep sea mining start-up secures bulk of $150m funding round

Cut cobalt cathodes. More than 60% of the world’s cobalt comes from the Democratic Republic of Congo © Bloomberg

DeepGreen’s financing follows years of regulatory uncertainty and environmental concerns

Henry Sanderson | Financial Times | 9 June 2019

DeepGreen, a start-up that wants to suck cobalt and other battery metals from the bottom of the ocean, has secured the backing of offshore pipeline company Allseas as part of a $150m funding round.

The financing is a rare sign of progress for deep sea mining after years of regulatory uncertainty and environmental concerns.

Switzerland-based Allseas will provide the bulk of the $150m and contribute engineering expertise, DeepGreen said. The money will enable the company to carry out feasibility studies on how it can suck small metallic rocks containing cobalt, nickel and manganese from the seabed, thousands of metres below the surface.

“Our partnership with Allseas will ultimately help us open up a new, disruptive source of battery metals for the green revolution and transform the mining industry as we know it,” Gerard Barron, the chief executive of DeepGreen, said.

Supporters of deep sea mining say it offers an alternative to land-based mining and can help the world meet an expected surge in demand for metals from batteries over the next decade. More than 60 per cent of the world’s cobalt comes from the Democratic Republic of Congo, while nickel is mined in Indonesia, Russia and New Caledonia.

DeepGreen says the carbon dioxide produced from lifting nodules from the sea floor is lower than land-based mining since the process requires no blasting, drilling or digging.

But critics say mining the deep sea risks destroying sensitive and unexplored habitats at the bottom of the ocean. Environmental group Greenpeace has called for an international agreement to protect the oceans from mining.

“Scientists warn that deep sea mining risks inflicting severe and potentially irreversible harm to ocean ecosystems that we know so little about,” Greenpeace said. “Profit is being placed before protection and we urgently need a strong ‘Global Oceans Treaty’ that safeguards the deep ocean from reckless exploitation by companies such as DeepGreen.”

The first company to attempt to mine the deep sea, Nautilus Minerals, was delisted from the Toronto Stock Exchange in March after financial difficulties. The company had planned to mine the deep sea in waters surrounding Papua New Guinea.

The International Seabed Authority, a UN body that grants licences to mine in international waters, is expected to complete its first set of regulations to enable deep sea mining to go ahead by 2020, according to UK Seabed Resources, a subsidiary of Lockheed Martin.

“Uncertainty in the future regulatory regime for mineral exploitation remains the principal barrier to development of an environmentally responsible and commercially viable deep seabed mining industry,” Christopher Williams, head of UK Seabed Resources, said.

DeepGreen is looking to extract metals in a 75,000 sq km zone in the Clarion-Clipperton Zone in the Pacific, granted to the island state of Nauru.

Allseas is a private company known for having built the world’s largest construction vessel, the Pioneering Spirit, which can install and remove offshore oil rigs in a single lift.

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Call for Nautilus seabed mining licences to be cancelled in Papua New Guinea

On 21 February 2019, Nautilus Minerals Inc. filed for protection from creditors under the Canadian Companies’ Creditors Arrangement Act.  Whilst claiming this as a victory in their decade-long campaign to stop the Nautilus Solwara 1 Project in the Bismarck Sea, local communities and civil society in Papua New Guinea are taking heed that the fight is not over until all Nautilus licences are cancelled.

“This is very welcome news!” stated Jonathan Mesulam, Alliance of Solwara Warriors whose village on the west coast of New Ireland Province is situated only 25km from the Solwara 1 project. “New Irelanders and communities from Provinces across the Bismarck sea have given their undivided support for many years to stop experimental seabed mining.”

“The longer Nautilus is delayed and tied up in protecting itself from bankruptcy the longer they are in debt and not able to get Solwara 1 up and operating, and the closer we are to stopping the project and protecting our livelihoods and seas.”

“The voices of local communities through the Alliance of Solwara Warriors, Churches and civil society in PNG have consistently opposed Nautilus Minerals,” declared Christina Tony, Bismarck Ramu Group. “We strongly believe this unified voice is what is driving Nautilus Minerals out of our country and towards bankruptcy. Other companies thinking of mining the sea floor in PNG or the Pacific should pay attention.”

The court order under CCAA is an agreement between Nautilus and its two main shareholders, MB Holding & Metalloinvest. Nautilus’ auditor the accountancy firm PwC is acting as court monitors to oversee a plan to sell company assets so Nautilus can either continue as a smaller business or those it owes money to will get the best value if the company goes bankrupt. Nowhere in the court order does it mention the PNG Government who owns a 15% in Solwara 1 and the equipment.

“This small group of key interested players will advantage themselves to the detriment of the PNG Government,” alleged Sir Arnold Amet, former Papua New Guinean Attorney General who has repeatedly warned the PNG Government of the financial liabilities of holding a 15% stake in Nautilus Minerals.

“While this is good news for those of us who have been calling for the project not to go ahead, the fight is not over. Not until the PNG Government terminates the Solwara 1 operating licence, as well as all of Nautilus’ licences in the Bismarck and Solomon Seas, will we be able to claim victory.”

The court order briefly lists three potential legal cases: contract arbitration with Sichuan Hungua Petroleum equipment; Gunner Cooke over legal fees for MAC and the continuing problems with loss of the support vessel; and threatened legal action by MDL Energy over “alleged misleading public disclosure”.

“There appears to be no legal action listed regarding the PNG Government” continued Sir Amet. “Has the PNG Government been ‘taken for a ride’ by Nautilus? Did they ever really intend to mine at Solwara 1? Our Government should explore recouping its failed investment by suing Nautilus for breach of contract.”

Peter Bosip, Executive Director, Centre for Environmental Law and Community Rights, who are supporting the landmark case bought by coastal communities challenging the Solwara 1 project under Sections 51 and 59 of the PNG Constitution[2] claimed, “We have seen the original company directors and officers of Nautilus Minerals walk away with a lot of money in their pockets to form DeepGreen Metals, a company promising riches to other Pacific Island nations.” 

“This is a case of companies mining the market. Whether they have intentions of mining, or not mining the resource, they are cheating the PNG government and its citizens.”

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After the loss of a ship, deep sea mining plans for PNG founder

Marine life in Papua New Guinea. Image by martinnemo via Flickr (CC BY 2.0).

David Hutt | Mongabay | 26 December 2018

  • In 2011, Nautilus Minerals was granted a license to mine precious minerals from the seabed off the coast of Papua New Guinea, the first project in the world to gain deep-sea mining rights.
  • Nautilus said the project would be less destructive than land-based mining, but met with protests due to the potential impact on the complex deep-sea ecosystems as well as coastal communities.
  • A year ago, Nautilus failed to make a payment on a specialized ship being built for the project. Now the ship has been sold to another company, making it unlikely Nautilus will be able to fulfill its mining ambitions.

An ambitious plan to mine precious minerals from the ocean floor off the coast of Papua New Guinea looks to have run aground due to the developer’s financial problems.

In 2011, the government of Papua New Guinea granted Canada-based Nautilus Minerals a 20-year mining license covering roughly 500,000 square kilometers (193,000 square miles) of the Bismarck Sea, off the country’s eastern coast. The Solwara 1 project was the first in the world to be granted rights for deep-sea mining, whereby enormous machines would dig into the ocean floor, harvesting zinc, copper and gold, and other commodities essential to building electrical equipment.

The Papua New Guinea government took on a 15 percent equity stake in the venture with Nautilus, but repeatedly delayed payments as its politicians and citizens protested against the environmental impact of the project, as well as the substantial cost to taxpayers.

In the meantime, Nautilus suffered numerous additional setbacks, including a shortage of investors, a declining credit line, and the decision by multinational mining firm Anglo American to divest from the company.

Now, the company has lost a ship essential to its deep-sea mining plans.

Nautilus chartered Emirati shipping operator MAC Goliath (MAC) to oversee construction of a production support vessel (PSV) designed to collect the extracted materials via pumps from the seabed. This vessel is essential to the entire operation.

The ship was being built at the shipyard of Fujian Mawei Shipbuilding in southern China. In December 2017, MAC missed a payment to the Chinese builder, which Nautilus was also unable to cover. At that point, the vessel was about 70 percent complete.

Late last month, news broke that because of financial woes and missed payments, the shipbuilding company had found a new company to take over the vessel’s construction contract: an Indian firm that is also planning to engage in deep-sea mining explorations on behalf of the Indian government.

Fujian Mawei Shipbuilding announced that the vessel had indeed been sold to the Indian firm, MDL Energy, although Nautilus reportedly thought negotiations were still ongoing. There are reports that Nautilus is attempting to seek new investment so it can reclaim the vessel, but the Chinese shipbuilder maintains that the ship has already been sold.

Mongabay attempted to contact representatives of Nautilus, but emails and telephone calls went unanswered. Nautilus’s interim CEO, John McCoach, told the Economist recently that specifics of the story, as mentioned above, were “not accurate from our perspective.”

Residents of New Ireland province, which lies in the northeast of Papua New Guinea, feared Nautilus’ deep sea mining project could have impacts on coastal marine life. Image courtesy of Google Maps.

It’s not clear how Nautilus will proceed from here, though it appears almost impossible that it will be able to build another tailor-made vessel from scratch, given the firm’s current financial situation. On Dec. 14, the company announced it had received a new loan worth $455,000; the unpaid installment on the PSV exceeded $18 million.

“Given Nautilus’ dire financial circumstances, it is fair to say the game is over,” Helen Rosenbaum, of the Deep Sea Mining Campaign, the author of a major report critical of the project, recently told local media. “The people of the Bismarck Sea of Papua New Guinea have hopefully been spared an environmental disaster.”

“It will be good news for my people if Nautilus goes bankrupt, instead of bankrupting our sea. We will fight this project to the very end,” Jonathan Mesulam, from the Alliance of Solwara Warriors, a community-based organization that opposes the project, said in a press release.

The Solwara 1 project planned to harvest mineral deposits found near seabed hot springs, or hydrothermal vents. Doing so, opponents said, could have had grave effects on rare deep-sea ecosystems.

Nautilus commissioned several environmental impact studies before it was granted the mining license in 2011. “The overall conclusion is that Solwara 1 has the potential for far fewer social and environmental impacts than the existing terrestrial mines examined,” reads one report it commissioned, written by U.S.-based consultancy Earth Economics.

Opponents of the project dismissed these studies as unsatisfactory and misleading, warning that since the Solwara 1 project was the first of its kind and would rely on as-yet-untested technology, it was too soon to say that it would definitely be safer than onshore mining. Moreover, they said the project would almost certainly destroy thousands of hydrothermal vents, each of which is host to complex ecosystems — and possibly species not yet identified by scientists.

Others critics warned that because the proposed extraction site lies only about 30 kilometers (18 miles) from the mainland, it could affect coastal ecosystems and, by extension, the livelihoods of fishing communities on Papua New Guinea.

While the likely demise of Solwara 1 is considered a victory by environmentalists and some residents of Papua New Guinea, the financial problems facing Nautilus are far from advantageous for the poor Pacific nation.

Arnold Amet, a former attorney general, said in a recent press release that because his country had purchased a 15 percent stake in the venture, it would also be responsible for 15 percent of payments to creditors if Nautilus went bankrupt. “I have been warning our Government publicly and privately about the financial mess they will find themselves in when this experimental company fails,” he said.

It’s not clear whether Papua New Guinea will manage to escape this financial burden. Opponents of the project say the government should now annul the concession and cancel all of Nautilus’s permits. But this may not be the end of the region’s underwater mining saga.

DeepGreen, a new deep-sea mining venture founded by Gerard Barron, an Australian entrepreneur who was also the first financial backer of Nautilus (he sold his shares in 2007), is reportedly exploring mining possibilities off the shores of Nauru, a nearby Pacific island. Unlike Nautilus, DeepGreen aims to mine materials from the ocean shore by simply hoovering it up, rather than digging into volcanic rock, ostensibly a less environmentally harmful method of extraction. If Nautilus is unable to fulfill its concession in PNG, then it is possible DeepGreen will fill Nautilus’ shoes as the pioneer of deep sea mining in the South Pacific.

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New deep sea mining venture to launch

International Mining | 10 April 2018

A historic ocean mineral resource expedition, using the Maersk Launcher, launches from San Diego on April 12 to further a mission to responsibly produce the world’s future metal supply from the deep-ocean floor. This is the first of five offshore campaigns that are part of a strategic alliance with Maersk, one of the world’s largest shipping groups.

DeepGreen’s subsidiary, Nauru Ocean Resources Inc (NORI), will be carrying out extensive scientific and resource surveys within a 75,000-km2 contract area of the Eastern Pacific’s abyssal plain, granted to NORI by the United Nations’ International Seabed Authority (ISA). DeepGreen and NORI are developing technology that will allow the responsible production of polymetallic nodules, which sit on the ocean surface, and contain metals in growing demand and critical to global social and economic growth.

The intention is that, when collected and brought to the surface using state-of-the-art technology, the polymetallic nodules — usually small enough to fit in the palm of your hand — will be processed for metals such as cobalt, nickel, copper and manganese. Those future metals are becoming increasingly harder and more difficult to find on land, but are in great demand for technologies such as electric cars, battery storage, wind turbines and many more digital technologies essential to a sustainable future.

“This voyage is a continuation of the work required in preparation of an Environmental Impact Statement that NORI aims to submit to the ISA, a necessary step to move the Exploration license to exploitation license, which will enable NORI to bring these essential metals for our future to the surface where they will be treated onshore using DeepGreen’s patented processing technology, which aims to produce zero waste,” said Gerard Barron, CEO of DeepGreen. “We believe these future metals can be produced responsibly, protecting ocean health, while avoiding the deforestation, pollution and child labor that too often are part of traditional mining.”

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