Tag Archives: Nautilus

Marape Backs Moratorium, Leans Towards Ban On Experimental Seabed Mining

Matthew Vari | Post Courier | August 15, 2019

Prime Minister James Marape has indicated he will support a proposed regional moratorium on seabed mining, however, could not go as far as to say a ban outright would be needed.

In an interview with the Post-Courier at the opening ceremony of the Pacific Islands Forum on Tuesday, Mr Marape responded when asked in relation to Fiji’s stance on the matter, that he would support the move, making specific reference to what he described the Nautilus Solwara 1 project as “a total failure”.

During Fiji Prime Minister Frank Bainimarama’s opening remarks at the Sautalaga climate update meet on Monday, he informed leaders present of Fiji introducing its own climate change act, of which the country will push an ambitious proposal for both its national and a regional moratorium on seabed mining.

“I ask you all to join in this ambitious venture and also support a 10 year moratorium on seabed mining from 2020 to 2030 which would allow for a decade of proper scientific research of our economic zone and territorial waters,” Mr Bainimarama said.

Sentiments supported by James Marape regarding the proven viability of deep sea mining, which he said is not yet a proven concept. “As a nation we have lost over K300 million in a concept of deep sea mining.

“Until that deep sea mining technology is environmentally sound and takes care of our environment at the same time we mine it, then at this point in time, I support the call made by the Fijian Prime Minister, we just need to have the best technology available,” Mr Marape sternly said.

When asked if it could go as far as supporting a ban, the Prime Minister left this option out adding just as the moratorium aims to prove the viability- that process will prove “on a case by case basis going into the future”.

“If there is an opportunity for deep sea mining, so long as environmentally it is friendly and the harvest of resource is done in a sustainable manner then we can give considerations to this, but right now it is a show.

“We don’t have the luxury of that informed decisional research.

“This is because that technology is not proven anywhere and PNG we burnt almost K300 million in that Nautilus (Solwara) 1 project on a concept that someone told us it can work, but it is a concept that is a total failure as I speak,” the PM said.

Apart from 15 per cent state investment in the project, Kumul Mineral Holdings is also seeking redress for the unearned revenue to the tune of US$51 million (K173m).

Advertisements

Leave a comment

Filed under Environmental impact, Pacific region, Papua New Guinea

Fiji calls for sea-bed mining moratorium as Nautilus restructures

Nic Maclellan | Islands Business | August 13, 2019

Fiji Prime Minister Voreqe Bainimarama has again called for a 10-year moratorium on sea-bed mining, at a time that many Pacific island nations are preparing for new frontiers of resource exploitation in the marine environment.

Speaking in Tuvalu this week before the 50th Pacific Islands Forum, Prime Minister Bainimarama called on fellow Forum island states to “support a 10-year moratorium on seabed mining from 2020 to 2030, which would allow for a decade of proper scientific research of our economic zones and territorial waters.”

There is growing pressure from French, Canadian and US corporations to advance the deep-sea mining (DSM) agenda, as well as interest from the China Ocean Mineral Resources Research and Development Association. Just as energy corporations are looking towards deep-sea oil and gas reserves, companies are developing technology to exploit mineral ore deposits found on the ocean floor, including cobalt crusts, seafloor massive sulphides and ferromanganese nodules.

Fiji’s call for a moratorium comes as community groups across the region are campaigning against potential environmental hazards of deep-sea mining, especially to ecologically sensitive hydrothermal vents. A report from the Guam-based Blue Ocean Law argues:

“There is a general failure to incorporate sufficient environmental protections, as well as the norm of free, prior, and informed consent for indigenous peoples, who are most likely to be impacted by DSM. In the 21st century, and under well-established norms of international law, these omissions represent serious violations of international legal obligations.”

Bainimarama’s call comes the same week as major restructuring of the Nautilus Minerals corporation, which has been planning to commence mining off the coast of Papua New Guinea, under a world-first licence issued by the PNG government.

Fiji and oceans policy

In recent years, Fiji has taken a leading role in ocean policy at the United Nations, working with other Forum island countries through the Pacific Small Island Developing States (PSIDS) group.

In June 2017, Fiji and Sweden co-hosted the high-level UN Conference on the Oceans and Seas in New York. This conference issued a call for action, highlighting action on ocean acidification, plastics, and overfishing. UN Secretary General Antonio Guterres appointed former Fiji UN Ambassador Peter Thomson as the UN Special Envoy on the Ocean.

This global campaigning is also translating into domestic legislation. Speaking in Tuvalu this week, Prime Minister Bainimarama said: “In addition to playing a leadership role in the global Ocean Pathway, we are also developing a National Oceans Policy, under which Fiji plans to move to a 100 per cent sustainable managed Exclusive Economic Zone, with 30 per cent of this being earmarked as a marine protected area by no later than 2030.”

Under the Forum’s “Blue Pacific” agenda, island nations are seeking to draw the links between oceans and climate policy. Bainimarama noted that Fiji was working with the Republic of the Marshall Islands in the Pacific Blue Shipping Partnership to develop “a blended and innovative finance structure to support the decarbonisation of domestic marine transportation fleets and facilities in Fiji and across the region. This means replacing inter-island ships with more efficient hybrid ships, thereby reducing fuel costs and emissions.”

Pacific DSM initiatives

Under the provisions of the UN Convention of the Law of the Sea (UNCLOS), many Forum island countries with large EEZs have been in discussions with transnational corporations to partner in deep sea exploration for maritime resources. Under UNCLOS and the authority of the International Seabed Authority (ISA), developing countries can also partner with overseas corporations to licence exploration in “The Area”, international waters that include vast arrays of minerals in Pacific Ocean areas such as the Clarion-Clipperton zone.

Nauru has long been a champion of DSM – at last year’s Forum leaders’ meeting, Nauru President Baron Waqa hosted a side even with ISA Secretary General Michael Lodge and Samantha Smith, the former Head of Environment and Social Responsibility with the deep-sea mining corporation DeepGreen.

This new frontier has drawn in regional organisations, to address legal, technical and regulatory issues around DSM. Boundary limitation is a vital concern as Pacific nations seek to increase potential revenues from fisheries and seabed mining in their Exclusive Economic Zones (EEZs). From 2010-16, the European Union funded the Pacific Community (SPC) to develop model DSM legislation for Forum member states, with many civil society groups concerned this work was promoting rather than regulating DSM.

The SPC Maritime Boundaries Division has also been engaged in technical work to clarify borders between independent island states as well as with colonial powers like France and the United States (for example, Vanuatu and France have been involved in a decades-long dispute over Matthew and Hunter islands).

There are tensions between the administering powers and territorial governments over the control of seabed minerals in the remaining colonies in the region. With an EEZ of nearly 5 million square kilometres, ocean-floor resources could be vitally important for the newest Forum member, French Polynesia. However, as the French government moved to amend French Polynesia’s autonomy statue earlier this year, France’s constitutional court ruled that rare earths can be classified as “strategic metals”, which come under the control of the French State rather than the Government of French Polynesia.  

Independence leaders have long argued against the French State’s control of strategic metals, with former Senator for French Polynesia Richard Ariihau Tuheiava telling the UN Special Committee on Decolonisation in 2017: “We have continually emphasised the critical nature of the resource question as a core issue for our future development. Whether or not these resources are considered in Paris to be ‘strategic’ is irrelevant to the applicability of international legal decisions which place the ownership of natural resources with the people of the non-self-governing territories.”

Collapse of PNG initiative

Early initiatives to begin sea-bed mining in the Pacific have not come to fruition. This week’s set-back to a major project in Papua New Guinea provides a salutary warning about the complexity and potential costs of DSM.

Under a licence issued by the PNG government, Nautilus Minerals has long planned to mine seabed minerals beneath PNG’s Bismarck Sea. However, with widespread community resistance, falling share prices and the loss of a specialised support vessel, Nautilus constantly pushed out the date for commencement of mining.

In February this year, Nautilus filed for court protection from its creditors under the Canadian Companies’ Creditors Arrangement Act (CCAA), and the Canadian-based company was later delisted from the Toronto Stock Exchange. This week, major shareholders MB Holding and Metalloinvest have moved to take control of company assets at the expense of major creditors and smaller shareholders (The PNG Government holds 15 per cent equity in Nautilus’ PNG subsidiary and the Solwara 1 project through the company Eda Kopa).

The looming collapse of the Solwara seabed mining initiative has been welcomed by civil society groups in Papua New Guinea, which have been campaigning against potential adverse impacts on ocean ecology.

Jonathan Mesulam of PNG’s Alliance of Solwara Warriors stated:

“We rejoiced when the company filed for protection from creditors in Canada. Our opposition and our court action have helped push it to that point. Communities across Papua New Guinea want to see the nightmare of deep-sea mining removed from PNG waters. We will re-double our efforts to ensure that the new Nautilus will never operate at Solwara 1.”

Fiji’s call for a moratorium on DSM will be debated in the corridors at this week’s Pacific Islands Forum, but there’s a way to go before all Forum member countries are willing to delay action on the supposed ocean El Dorado.

Leave a comment

Filed under Environmental impact, Fiji, Pacific region, Papua New Guinea

Nautilus emerges, barely alive and impotent: just can’t get that deep sea mining project up

The PNG Government applied to the Canadian Court unsuccessfully to regain some of its failed investment

Deep Sea Mining Campaign | 13 August 2019

In a court appointed meeting today in Canada the creditors of Nautilus Minerals voted to effectively liquidate the company.  The two main shareholders – MB Holding and Metalloinvest – have taken control of a very much shrunken Nautilus at the expense of major creditors and hundreds of hopeful small shareholders.

Nautilus, which has been seeking to start the Solwara 1 mine off the coast of Papua New Guinea, filed for court protection from its creditors under the Canadian Companies’ Creditors Arrangement Act (CCAA) in February 2019. With its court-appointed monitors, Price Waterhouse Cooper, Nautilus has given up trying to find possible buyers of its assets.

Andy Whitmore of the Deep Sea Mining Campaign said,

“This is effectively a ‘smash and grab’ raid by the two main shareholders. But the company is essentially worthless. Its equipment is tailored to the mining of deep sea hydrothermal vents which the world now agrees are too ecologically valuable to mine. Even other DSM companies such as DeepGreen suggest mining hydrothermal vents creates an unacceptably high level of environmental impact..

In addition to this, Nautilus still faces an ever-widening community opposition over its Solwara 1 mine.

Jonathan Mesulam of the Alliance of Solwara Warriors stated,

“We rejoiced when the company filed for protection from creditors in Canada. Our opposition and our court action have helped push it to that point. Communities across Papua New Guinean (PNG) want to see the nightmare of deep sea mining removed from PNG waters. We will re-double our efforts to ensure that the new Nautilus will never operate at Solwara 1.”

Andy Whitmore continued,

“Under the deal minor creditors will be fully repaid, while major ones will get 10% of what they are owed. The biggest loser is the PNG Government which held 15% equity in Nautilus PNG and the Solwara 1 project. It has been left stranded with a debt equivalent to one third of its annual health budget for country of 9 million people.” 

“The main shareholders through Deep Sea Mining Finance (DSMF) – the vehicle lending money to Nautilus – have swapped those debts for ownership of the company. While a cheap purchase, they end up owning very littleNautilus is a company with still no capital or support vessel to realise its deep sea mining ambitions. Also, because Nautilus was delisted from the Toronto Stock Exchange as part of the insolvency proceedings, the new Nautilus will now be a private company, and not open to the same level of scrutiny.” 

The PNG Government through its company Eda Kopa applied to the Canadian Court unsuccessfully to regain some of its failed investment. Smaller shareholders are considering a class action against the new company.

Leave a comment

Filed under Environmental impact, Financial returns, Papua New Guinea

Nautilus Minerals’ plans to mine the seafloor sink deeper

NAUTILUS HAS LEFT THE PAPUA NEW GUINEA GOVERNMENT FACING A DEBT EQUIVALENT TO ONE-THIRD OF THE COUNTRY’S ANNUAL HEALTH BUDGET FOR ITS 9 MILLION PEOPLE

Cecilia Jamasmie | Mining .com | August 13, 2019 

Struggling Nautilus Minerals, one of the world’s first companies to plan on mining the seafloor, will soon join a long list of companies that have failed at attempts to extract minerals in remote places, as its creditors have voted this week in favour of liquidating the company.

The Canadian firm, which tried for years to fully develop its Solwara 1 gold, copper and silver project off the coast of Papua Guinea, faced relentless community opposition, culminating in legal action and public appeals to the government.

Those issues, together with environmental concerns and the fact that the company lost its only production support vessel last year, eroded investors’ support, forcing Nautilus to delist from the Toronto Stock Stock Exchange in March.

Since then, the Vancouver-based firm’s assets, including equipment, intellectual property and mining leases, have been put up for sale through PricewaterhouseCoopers.

In the process, Nautilus has left the Papua New Guinea government, which still owns a 15% stake in the Solwara I project as well as equipment, facing a debt equivalent to one-third of the country’s annual health budget for its nine million people. 

“The company is essentially worthless. Its equipment is tailored to the mining of deep sea hydrothermal vents which the world now agrees are too ecologically valuable to mine,” Deep Sea Mining Campaign’s (DSMC) Andy Whitmore, said in a statement.

“Even other deep-sea mining companies such as DeepGreen suggest mining hydrothermal vents create an unacceptably high level of environmental impact,” Whitmore noted.

Unlike other seafloor mining companies, including Nautilus, DeepGreen doesn’t want to drill, blast or dig the bottom of the ocean. The explorer, also Canadian, plans instead to scoop up small metallic rocks located thousands of metres below the surface in the North Pacific Ocean.

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.

Not enough studies

Academics and scientists, including the DSMC  — a group of non-profit organizations and citizens from the Pacific Islands, Australia, Canada and the US — 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 effects on the wider ocean environment.

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, has been the only company to go beyond the exploration stage for what was supposed to be the first polymetallic seabed mine.

More projects may be surfacing soon, as the ISA is expected to open up the high seas to mining.

Leave a comment

Filed under Environmental impact, Financial returns, Papua New Guinea

Nautilus liquidation looming

Cedric Patjole | Loop PNG | July 31, 2019

Nautilus Minerals Inc will be liquidated if a plan of compromise and arrangement is approved and backed by a court order.

The company revealed this when announcing that they, along with its subsidiaries, have obtained an order of the Supreme Court of British Columbia in Canada to convene a meeting of creditors to vote on a plan of arrangement.

This includes an acquisition agreement and the filing of a plan of compromise and arrangement.

Nautilus Minerals announced yesterday that the granted court order was given under the Companies’ Creditors Arrangement Act authorizing:

(i) Nautilus to enter into an acquisition agreement with Deep Sea Mining Finance Ltd (DSMF) for the acquisition of certain subsidiaries and certain intercompany indebtedness; and

(ii) Certain subsidiaries or “Nautilus Restructuring Entities” of the Company will file a plan of compromise and arrangement among the subsidiaries and their unsecured creditors, and to convene a meeting with those creditors for the purpose of voting on the approval of the plan of compromise and arrangement.

A plan of compromise or arrangement sets out a company’s intentions to deal with its debts and restructure its business and operations.

The plan will be presented to Nautilus creditors on August 9, 2019, who will then vote on whether they accept the proposal or reject it.

Nautilus states that in the event that the plan of compromise and arrangement is approved by a majority of the Affected Creditors, its subsidiaries will bring an application to the Court for an order approving and sanctioning the plan of compromise and arrangement and various transactions related to the Plan and the Acquisition Agreement on August 13, 2019.

If the Sanction Order is granted as sought, and the conditions precedent to the Acquisition Agreement and the plan of compromise and arrangement are met, the Company will have effectively no assets, and, will be liquidated upon implementation of the plan of compromise and arrangement.

Eda Kopa (Solwara) Limited has led a claim of K163 million (US$51 million) against Nautilus Mineral Limited for failing to meets its funding obligations of the Solwara 1 Project.

Early this month, Chairman of Kumul Mineral Holdings Limited (KMHL), Peter Graham, said the Project has stalled with a substantial proportion of the development work still to be undertaken.

The claim has been filed under a Canadian court supervised creditors process initiated by the parent company of its joint-venturer in the Solwara 1 Project, Nautilus Minerals Niugini Limited (Nautilus PNG).

The Solwara 1 Deep-Sea Mining Project is a venture to mine polymetallic sulphide deposits located on the seabed in an area approximately 50km north of Rabaul and 30km west of New Ireland Province.

Leave a comment

Filed under Financial returns, Mine construction, Papua New Guinea

‘Urban mining’ can save the deep seabed from exploitation

Collecting copper wires from a dismantled washing machine in the Philippines (Image: Greenpeace)

Improved recycling and a circular economy negates the need for costly and damaging mining of the deep seabed

Natalie LowreyDr Helen Rosenbaum | China DialogueJuly 29, 2019

The world’s first deep-sea mining project to be given an operating licence – Nautilus Minerals’ “Solwara 1” project off Papua New Guinea – appears to have ground to a halt in the face of concerns about its environmental impact and community opposition, culminating in legal action and public appeals to the new national government.

With a resulting lack of investor interest and the loss of its production support vessel last year, it’s difficult to see what the company might now achieve. In its wake, Nautilus has left the Papua New Guinea government facing a debt equivalent to one-third of the country’s annual health budget for its nine million peopleThe fate of Nautilus should send a warning to investors, and nations considering joint ventures with companies.

Early investors jumped ship to form DeepGreen Resources, which is working hard to build its image as a cleaner source of minerals than companies like Nautilus, which aspire to mine hydrothermal vents, or land-based mining companies. Their website describes a sanitised vacuuming up of mineral-rich nodules sitting on the seafloor and claims they will provide “clean metals” for a “sustainable planet”. However, comparisons between the impacts of seabed and terrestrial mining have been shown to be fraught and readily misconstrued by vested interests.

Next year, a little-known UN agency, the International Seabed Authority (ISA), is expected to open up the high seas to mining. The body, which is based in Kingston, Jamaica, is due to finalise its mining code: a set of regulations for exploiting the sea floor in international waters. The ISA has already completed regulations and recommendations for exploration. These have enabled it to grant 29 exploration licences in international waters.

While there is intense interest in the future financial returns that may be available through seabed mining, no commercial seabed mine has yet been established. Thus far the industry remains a speculative and experimental activity driven in large part by commercial and geostrategic competition, as states consider ways to secure access to rare earth minerals that may become increasingly valuable.

In reality, little is known about the impacts of nodule mining. What is known points to serious and irreversible impacts on marine ecosystems. Industry narratives also totally ignore the rights of maritime communities to maintain their social, economic, cultural and spiritual connections to their oceans. They omit the fact that the minerals they seek to exploit – cobalt, nickel, copper, manganese and rare earths – are finite even on our deep seabeds. 

Interest in alternative sources of minerals is growing among civil society, scientists and companies, with work being undertaken towards “urban mining” and the shift to a circular economy.

The circular economy describes an economic system grounded in “cradle to cradle” product design, reconditioning, waste prevention and closed-loop production processes. In response to the momentum, several companies have already put circular economy principles into practice. 

Apple announced in 2017 it would “stop mining the Earth altogether” and the European commission has introduced a circular economic framework. Interestingly, the European parliament has called for a moratorium on deep-sea mining until the need for it has been proven, as have prominent scientists, academics and civil society organisations.

There is already investment in urban mining, which is the process of “reclaiming compounds and elements from products, buildings and waste”. A staggering 320 tons of gold and more than 7,500 tons of silver estimated to be worth $US21 billion is used annually to make personal computers, mobile phones, tablets and other electronic products worldwide. There is an abundance of gold, silver, rare earths and copper in the waste generated by the disposal of these products. It is estimated that electronic waste contains precious metal “deposits” 40 to 50 times richer than the ores currently mined.

Urban mining could be more lucrative as well as dealing with an otherwise intractable waste problem, while at the same time capable of meeting future global mineral demand.

The choice for all of us, including investors, should be clear – and in fact is a “no brainer. On the one hand there are the financial, social and environmental risks of deep-sea mining. On the other, there is the financial, social and environmental win-win of a metal resources future which focuses on urban mining and the transition to a circular economy, in which virgin mining plays only a minor role.

1 Comment

Filed under Environmental impact, Pacific region, Papua New Guinea

Failed Nautilus CEO resurfaces in Bougainville

Kalia Limited’s new Director Corporate Development and Strategy, Michael Johnston, jumped ship as Nautilus sunk, leaving PNG tax payers $120 million poorer

Having duped the PNG government out of K375  million the former CEO of bankrupt Nautilus Minerals has joined another debt heavy exploration company, this time hoping to strike gold on Bougainville 

Board moves boost Kalia Bougainville copper/gold play

Matt Birney | The West Australian | 25 July 2019

Bougainville Island focussed porphyry copper-gold exploration company, Kalia  Limited, has restructured its management ahead of a significant ramp-up in regional

The company has this week appointed two new directors with a wealth of resources sector experience, following the increased activity of private investment firm Tygola Pty Ltd, who continue to strongly support Kalia via a series of loan facilities, that amount to $6m.

Michael Johnston has joined the company as the Director Corporate Development and Strategy, bringing his extensive experience working in PNG and the wider Asia-Pacific region to the Board, particularly as General Manager of Placer Dome’s exploration team in Australia and Asia in the early 2000s.

More recently, Mr Johnston was the President and CEO of TSX-listed Nautilus Minerals, where he managed the development of the world’s first sea-floor mining company, whose main project was the Solwara 1 Field in the Bismarck Sea, in PNG waters, just northwest of Bougainville.

Kalia has also hired accountant Jonathan Reynolds as a non-executive director.

Mr Reynolds has more than 25 years’ experience across a range of sectors, including a current role as Finance Director with ASX-listed Allegiance Coal, a company focussed on investing in advanced or producing metallurgical coal assets.

Kalia recently sought out one of the world’s leading experts on porphyry, epithermal and “Carlin-style” copper-gold mineralisation, Dr Steve Garwin, to run the ruler over its comprehensive technical data set on Bougainville.

Dr Garwin has been involved in numerous exploration and mining projects, including the Batu Hijau porphyry mine in Indonesia that holds an ore reserve of 9 million ounces of gold and 4 million tonnes of copper.

His recent discovery of the world-class Alpala porphyry deposit in Ecuador is even better, holding about 11 million tonnes of copper and just over 23 million ounces of gold.

Dr Garwin’s review highlighted the geochemically “fertile” nature of the Mt Tore region’s rocks, holding significant potential for multiple copper-gold porphyry centres and epithermal mineralisation, which confirmed Kalia’s belief that it is sitting on some prospective ground on Bougainville.

The investigation unearthed five significant regions of interest on the company’s tenements, including a new unexplored target 60 square kilometres in size, characterised by anomalous copper-gold assays in geochemical stream sediment samples dating back 30 years.

The exploratory overview of the company’s two tenements located at the northern tip of Bougainville also delineated three potential porphyry copper-gold centres and one substantial epithermal gold region bridging the Teosiri – Teoveane areas, for follow-up exploratory field work.

The regional exploration to ground-check the interpreted geological features will be helicopter-supported, given the challenging terrain and the remote locations of individual targets.

Kalia said it would focus its field sampling programs around the key locations, to identify and rank targets for maiden drilling programs in the project holdings, expected to kick off later this year.

The company completed a detailed airborne geophysical survey over its Mt Tore leases in 2018, which threw up 64 individual porphyry and epithermal exploration targets for evaluation.

The style of porphyry copper-gold deposits the company is seeking on Bougainville are highly sought-after globally because they boast some of the largest ore reserves of these desirable commodities.

And it couldn’t reside in a better postcode globally, with Kalia exploring in the “Pacific Ring of Fire” region, which holds many world-class copper-gold porphyry systems and its Mt Tore JV tenements located only 130km northwest of one of them, the gigantic mothballed Panguna copper-gold mine.

Watch this space for developments.

1 Comment

Filed under Bougainville, Exploration