Tag Archives: Nautilus

Call for PNG seabed mining licences to be cancelled

Benjamin Robinson-Drawbridge | Radio New Zealand | 14 March 2019

Groups opposed to sea bed mining in Papua New Guinea want the government to cancel licences given to embattled miner Nautilus.

The company’s Canadian parent has been granted protection from its creditors while it restructures, which the groups say will lead it to selling its PNG licenses.

For more than a decade, New Ireland civil and community groups have opposed the Nautilus Solwara mining project in the Bismarck Sea over its potential to damage the environment.

Gold and copper deposits on the sea floor enticed Nautilus to form a PNG subsidiary of which the government acquired a 15 percent share.

But with Nautilus now selling its assets to pay debts, the groups want its licenses cancelled so other miners can’t continue the project.

With support from the Centre for Environmental Law and Community Rights, the groups went to court to seek the disclosure of the licenses and other documents they say the government is constitutionally bound to produce.

But since the court case finished in September, the centre’s executive director Peter Bosip said the judge had not issued a decision.

“The reasons for withholding the decision is not known. It’s kind of holding people at ransom. So, we need to know whether we lost or we were successful in this instance,” he said.

“We don’t know and we are still waiting.”

The former chief justice Sir Arnold Amet also wants the licenses cancelled.

Sir Arnold said if the documents were released, they might show the government is liable for the company’s debts and was unable to sell its stake.

They should also reveal if the government could reacquire or cancel the licenses, he said.

“All of those are going to be packaged and put on the market for any potential bidders,” he said.

“So, our abilities to actually extricate ourselves from those binding licenses and agreements, and to free ourselves from ongoing liabilities may be limited considerably by the current legal entitlements of Nautilus in the region.”

The mining minister Johnson Tuke could not be reached for comment.

But given the company’s financial strife and the local opposition to deep sea mining, it would be futile for the government to continue to back Nautilus or any entity that tried to acquire the licenses, Mr Bosip said.

“The government has to think about cancelling this licenses because apart from economic loss, they also have to realize that the fight to reject deep sea mining in PNG is not over,” he said.

“The communities have mobilized.”

Jonathan Mesulam is from a village on the west coast of New Ireland Province is just 25km from the Solwara 1 project.

Speaking for the Alliance of Solwara Warriors, Mr Mesulam said New Irelanders had “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.”

Christina Tony, from the Bismarck Ramu Group agreed “local communities have consistently opposed Nautilus Minerals”.

“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.”

PNG is not equipped to regulate foreign mining companies, especially those experimenting with deep sea mining, Sir Arnold said.

“Regulations, governance, accountability mechanisms, in a developing country like Papa New Guinea, and if I might say so in the Pacific region, are considerably wanting.

“We don’t have the capacity of professional institutions to hold to account sufficiently, all the mining giants, multinationals of the world that are continuing to exploit our natural resources.”

Tonga, Samoa, Cook Islands, Fiji and Vanuatu may have also given rights to Nautilus that could be sold, Sir Arnold said.

The people of Pacific needed to band together to stop the exploitation of the sea floor and the islanders who depend on the ocean, Mr Bosip said.


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Nautilus trying to sell Solwara 1

Seabed mining project in PNG moves to sell assets

Radio New Zealand | February 26, 2019

A troubled deep sea mining project in Papua New Guinea is selling its assets while it fends off creditors.

Nautilus Minerals was to mine the sea floor between New Ireland and New Britain but has run into financial trouble and local landowner opposition.

Last week, the company obtained a court order from the Supreme Court of British Columbia protecting it from its creditors.

Nautilus said the protection will enable it to “restructure its business and financial affairs”.

One of its lenders, Deep Sea Mining Finance, has agreed to loan it a further $US4 million. To date, Nautilus has been loaned $US18 million by the financier.

But the company is also being advertised for sale, including its Solwara 1 project in PNG. PwC are acting as solicitors.

If sold, investors would also have access to its mining licenses elsewhere in PNG and in Tonga.

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Nautilus Minerals files for bankruptcy protection

Deep sea mining firm seeks creditor protection

Peter Kennedy | Resource World | February 22, 2019

Nautilus Minerals Inc.  a company that was hoping to become the world’s first deep sea mining firm, has sought protection against bankruptcy.

Nautilus said Friday February 22 that it has obtained an order from the British Columbia Supreme Court that provides the company with protection from its creditors under the Companies Creditors Arrangement Act. (CCAA). The move is to enable Nautilus to restructure its business and financial affairs.

Nautilus has said it is the first company to explore the ocean floor for polymetallic seafloor massive sulphide deposits. To achieve its production goals, Nautilus planned to use existing technologies adapted from the offshore oil and gas industry, dredging and mining industries to facilitate the extraction of high-grade seafloor massive sulphide systems, containing copper and gold, on a commercial scale

In January, 2011, the company was granted the first mining lease for such deposits at a prospect known as Solwara 1, in the territorial waters of Papua New Guinea, where it was aiming to produce copper, gold and silver.

The Solwara Seabed Massive Sulphide deposit sits on the seabed at a depth of 1,600 metres and contains a copper grade of 7% as well as gold grades of over 20 grams per tonne. The company hoped to grow its holdings in the exclusive economic zones and territorial waters of Papua New Guinea, Fiji, Tonga and the Solomon Islands, and others.

In April, 2017, the company issued a press release stating that its Seafloor Production Tools had arrived in Papua New Guinea, and would shortly commence submerged trials. It said the submerged trials would occur in an existing facility on Motukea Island, near Port Moresby in PNG.

Aside from its ocean mining aspirations, Nautilus is also known for its powerful shareholders. Major shareholders include Russian iron ore giant, Metallionvest, (19%) and the MB Holding group (30%), which is controlled by Nautilus director Dr. Mohammed Ali Al Barwani. MB Holding is the parent of a number of companies with wide ranging interests in the oil and gas, mining, marine and engineering services. MB Group has operations in over 20 countries and employs over 6,000 employees. Metallionvest is controlled by Alisher Usmanov, Russia’s richest man with a net worth estimated at $15.1 billion.

Nautilus said Friday it is not bankrupt and remains in possession and control of its business, while continuing to receive support in the form of loans from a lender.

On Friday, the shares were trading at 5 cents, leaving the company with a market cap of $34.15 million based on 683.03 million shares outstanding.  The 52-week range is 39 cents and 4.5 cents.

Shortly prior to the company’s application for protection under CCAA, the company said it received a US$750,000 loan from Deep Sea Mining Finance Ltd. The loan was made available under a loan agreement between the company, two of its subsidiaries, and the lender, which provides for a secured structured credit facility of up to US$34 million.

Nautilus said the lender is a private company held equally by each of USM Finance Ltd., a wholly-owned subsidiary of USM Holdings Ltd., an affiliate of Metallionvest Holding (Cyprus) Ltd.; and Mawarid Offshore Mining Ltd., a unit of MB Holding Company LLC.

As the lender is indirectly controlled by affiliates of the company’s two largest shareholders, the lender is a “related party” of the company and the loan transaction constitutes a “related party transaction.” Therefore it is exempt from the formal evaluation of minority shareholder approval requirements.

Nautilus said it has already received US$18.25 million in loans from the lender, which it said has agreed to advance the company up to $4 million to fund its ongoing operations and restructuring. These loans bear interest at 8% annually and are payable bi-annually in arrears. All loans have a maturity date of March 8, 2019.

Nautilus said it continues to seek short and long term solutions while assessing its options, including various restructuring options. It said negotiations with various third parties continue.

Meanwhile, the company said it can offer no assurances that it will be able to successfully negotiate and complete any funder or other transactions. It said any transactions will be subject to all necessary stock exchange, third party and government approvals, as well as compliance with all other regulatory requirements.

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Deep sea mining threatens indigenous culture in Papua New Guinea

Seabed Mining (Graphic: Greenpeace)

John Childs | The Conversation | February 19, 2019

When they start mining the seabed, they’ll start mining part of me.

These are the words of a clan chief of the Duke of York Islands – a small archipelago in the Bismarck Sea of Papua New Guinea which lies 30km from the world’s first commercial deep sea mine site, known as “Solwara 1”. The project, which has been delayed due to funding difficulties, is operated by Canadian company Nautilus Minerals and is poised to extract copper from the seabed, 1600m below the surface.

Valuable minerals are created as rapidly cooling gases emerge from volcanic vents on the seafloor. Mining the seabed for these minerals could supply the metals and rare earth elements essential to building electric vehicles, solar panels and other green energy infrastructure. But deep sea mining could also damage and contaminate these unique environments, where researchers have only begun to explore.

The industry’s environmental impact isn’t the only concern. It’s been assumed by the corporate sector that there is limited human impact from mining in the deep sea. It is a notion that is persuasive especially when compared with the socio-ecological impacts of land-based mining.

But such thinking is a fallacy – insights from my research with communities in Papua New Guinea over the past three years highlight that the deep sea and its seabed should be thought of as intimately connected to humanity, despite the geographical distances involved. For the people of the Duke of York Islands, deep sea mining disturbs a sense of who they are, including the spirits that inhabit their culture and beliefs.

Young people on Duke of York Islands. Paul Hearne, Author provided

Out of sight, out of mined

In Western thought, the sea has not only been considered to be marginal to politics, but also as entirely distinct from the land. Separating nature from humanity has proved useful in enabling exploitation of the natural world for human means. Deep sea mining, with all its material connections between a dynamic seabed and sites of consumption on land, provokes new questions.

If humanity can’t physically encounter the deep seabed, then how are we to treat it ethically?. By conceptually “distancing” the deep ocean, who is being marginalised?

For the people who live close to Solwara 1, the answer is pointed. These communities have long understood the world as a connection between “nature”, “spirits” and “beings”. Central within this cosmology are the spirits – masalai – some of which are understood as guardians of the seabed and its resources.

The people of Duke of York Islands are tied spiritually to events in the deep sea. John Childs, Author provided

Masalai are a fundamental part of the islanders’ world. Thus, the prospect of deep sea mining means not just social and economic disruption, but spiritual turmoil. The digging up of the seabed and the extraction of its resources cuts through the very fabric of their spiritual world and its sacred links to the sea and land.

As the historian Neil Macgregor put it in the Radio 4 series “Living with the Gods”, masalai are not

out there… [like] tourists in the human realm, from somewhere else … but in a world in which we co-inhabit.

The political implication for island communities here is clear. The copper which might be mined from the seabed is effectively constituted by these spirits. Thus, as copper “resurfaces” in the objects and technologies of the future – in batteries and wiring – it also carries a spirituality from the region where it originated.

Spirits infuse the traditions and everyday practises of the people on the Duke of York Islands. “Shark calling” is one such example which is practised along parts of the west coast of New Ireland Province – the closest point on land to Solwara 1.

Every few weeks, when the sea conditions allow, “shark callers” attempt to attract sharks to their hand-carved wooden canoes by rattling a mesh of coconut shells in the water, before capturing them by hand. Shark meat is a key part of local diets that generally lack protein.

Shark callers communicate with spirits which are “resident” in stones found on local beaches prior to their expeditions. It’s no surprise then, that these communities fear noise pollution generated by deep sea mining and the physical disturbance of the seabed which could sever the cultural connections they have with the ocean.

Deep sea mining companies should consider the spirituality of the people their work affects and other kinds of environmental knowledge as important in their own right. As this new industry collides with cultural belief systems in different parts of the world, it will be essential to understand the complex ways in which deep sea mining does have “human” impacts after all. Culture is a key part of any understanding of environmental politics, no matter how extreme the environment in question.

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Nautilus stays afloat for another 28 days

GlobeNewswire | February 07, 2019

Nautilus Minerals Inc. and Deep Sea Mining Finance Ltd. have agreed to extend the maturity date of the existing secured loan facility which is currently due on February 8, 2019, for 28 days ending on March 8, 2019.

The Company continues to seek short and long term funding solutions while assessing its options, including various restructuring options. Negotiations with various third parties continue. There can be no assurances that the Company will be able to successfully negotiate and complete any funding or other transactions. Any transactions will be subject to all necessary stock exchange, third party and government approvals, as well as compliance with all other regulatory requirements. The Company will provide further updates as circumstances warrant.

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Deep Sea Mining Campaign | January 21, 2019

Nautilus Minerals has edged back from the brink of bankruptcy with an extension to the bridging loans provided by its two main shareholders Russian mining company Metalloinvest and Omani conglomerate MB Holding. They were due for repayment on Tuesday 8th January when Nautilus begged for a one week reprieve, hoping to raise USD 5 million to maintain a holding pattern while it sought a long term funding solution. Unable to attract a lender the floundering company has been thrown a temporary life line once more by its 2 shareholders in the form of a small USD 500,000 loan to be repaid on 8th February.

It looks like 2019 will herald the end of Nautilus’s long struggle with its Solwara 1 deep sea prospect in Papua New Guinea. The most recent in the string of bad news stories was the loss of their crucial production support vessel after payments stopped to the shipyard building it. Nautilus’s share price has been hovering around a historical low of CAN $0.05.

Andy Whitmore, of the Deep Sea Mining Campaign, said, “How long can Nautilus be kept on life support?  And what is the point of extending the loan by one month? The company has no start date penciled in, no operational capacity, and is in no position to repay its growing debt. The high level of opposition within PNG to Solwara 1 is another obstacle Nautilus is yet to address. It’s time to euthanize this company.”

Concerned about the impacts the Solwara 1 project will have on marine ecosystems and fisheries based livelihoods the Alliance of Solwara Warriors has brought legal proceedings to assess whether the Solwara 1  project was approved lawfully. Jonathan Mesulam from the Alliance of Solwara Warriors said, “My village is located in New Ireland province, only 25km from the proposed Solwara 1 project.  New Irelanders are now well informed of the potential impacts of Nautilus Minerals experimental seabed mining project. They are giving their undivided support to ensure the project is stopped at all cost.

Sir Arnold Amet, former Papua New Guinean Attorney General stated, “I have repeatedly warned our Government of the financial liabilities of holding a 15% stake in this experimental company. The wisest thing for the PNG Government to do now would be to cut its losses, learn from its very expensive mistake, and terminate the Solwara 1 operating licence. Nautilus clearly shows that deep sea mining is not financially, socially, or environmentally viable for PNG. Our Government should explore recouping its failed investment by suing Nautilus for breach of contract.“

Dr. Helen Rosenbaum, of the Deep Sea Mining Campaign, added: “This loan extension really changes nothing. The financial, ecological, and social risks associated with the Solwara 1 project continue. Local opposition will grow as long as this perilous project persists.”

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Nautilus remains on life-support

Prospective experimental seabed mining company, Nautilus Minerals, is to remain on life-support after it was rescued Monday by another $500,000 loan from its principal shareholders.

The longer-term future still looks bleak though, with its part-built mining support vessel already sold-off by the ship builder, and $5 million in funding needed before it can resume even basic company operations… 

Nautilus Receives Us500, 000

Post Courier | January 18, 2019

Deep Sea Mining Finance has lent Nautilus US500, 000 (K1.6m) to meet its short term funding obligations.
According to Nautilus’s corporate update this funding now will allow the company to assess its options, including various restructuring options while waiting to receive a US5million loan (K16m).
This loan if received would enable Nautilus to continue operations.
In its last week’s update the company stated that they are still in discussions with an arm’s length party to secure this loan.
The company also advises that a further press release will be made once these funds have been received later this week and further updates will be provided as circumstances warrant.
Nautilus is the first company to explore the ocean floor for polymetallic seafloor massive sulphide deposits. Nautilus was granted the first mining lease for such deposits at the prospect known as Solwara 1, in the territorial waters of Papua New Guinea, where it is aiming to produce copper, gold and silver.
The Company has also been granted its environmental permit for this site. Nautilus also holds highly prospective exploration acreage in the western Pacific (granted and under application), as well as in international waters in the Central Pacific.

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