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 Beyond PNG, in international waters, regulation and royalty terms
for mining the planet's subsea wealth have also yet to be finalized.
The world waits for the judgment of a United Nations agency based in
Jamaica.
"If we can take care of the environment we have a brand new day
ahead of us. The marine area beyond national jurisdiction is 50
percent of the Ocean," said Nii Odunton, secretary general of the
U.N.'s International Seabed Authority (ISA).
"I believe the grades look good, the abundance looks good, I believe
that money will be made," Odunton said from the ISA offices in
Kingston.
High-tech advances, depleted easy-to-reach minerals onshore and
historically high prices have boosted the idea of mining offshore,
where metals can be fifteen times the quality of land deposits.
In Newcastle, the "beasty", as engineer Keith Franklin calls his
machine, lies in wait, resembling a submersible tank with four meter
wide cutting blades.
Built by Soil Machine Dynamics (SMD), it will put Canadian listed
Nautilus Minerals <NUS.TO> on course to become the first company to
commercially mine in deep water.
Nautilus' primary resource, Solwara 1, about 1,500 meters
underwater, is a Seafloor Massive Sulphide (SMS) deposit, which
forms along hydrothermal vents where mineral-rich fluids spurt from
cracks in the ocean crust.
Equipped with cameras and 3D sonar sensors the robot is driven by
two pilots from a control room on the vessel above, attached via a
giant power cable.
"The cameras aren't enough by themselves because the machine will be
working by vents where black soot spurts from the ocean crust and it
will sometimes be near impossible to see anything," said Stef
Kapusniak, business development manager for mining at SMD. "The 3D
sonar will allow it to make images and send it back to the control
room."
The machine then cuts up the sea floor and sucks the rocks through a
pipe to deposit it in mounds behind — "like icing a cake," Kapusniak
said. Another machine, yet to be built, will then help suck the ore
to the surface.
Nautilus aims to produce 80,000-100,000 metric tons of copper and
100,000-200,000 ounces of gold — equivalent to a modest onshore
mine. It was supposed to be producing by now, but disagreements with
the PNG government over financial terms have set it back.
Chief Executive Mike Johnston told Reuters he was confident a
resolution would be sorted out and the company would be mining
within two to three years.
Most of the world's best deposits lie even deeper than Nautilus'
Solwara 1, at around 6,000 meters in an area known as the Clarion
Clipperton Zone.
Large numbers of manganese nodules — potato sized rocks rich in
copper, cobalt and nickel — lie across this 4.5 million square
kilometer abyssal plain between Hawaii and Mexico.
LICENSES ALREADY AWARDED
The U.N.'s ISA is drawing up a code to deal with some environmental
concerns and the commercial terms for deep-sea mining. It predicts
it will be finished in around two or three years, with mining still
5-10 years away.
"It's only after the code is in place and people are happy with it
that the huge investments needed to start deep-sea mining will
occur," ISA's Odunton, a Ghanaian, said.
[to top of second column] |
ISA is, however, already doling out exploration licenses — 19 have
been approved. Odunton said interest in them had "catapulted" in the
past five years.
In order to get a license through ISA an applicant must be sponsored
or partnered with a country. For nations like Japan which lack their
own resource wealth, deep-sea mining is a potential way to secure
mineral supply for the future.
China, the world's largest metals consumers, is also one of the most
active in exploring the area.
Britain has an exploration license in partnership with UK Seabed
Resources, a subsidiary of defense firm Lockheed Martin <LMT.N>.
"These are the days you have to take a position, especially as a
government," said Martijn Schouten, managing director at IHC's
mining division — an equipment maker which targets seabed mining as
its next growth driver.
IHC is the leading partner in an European Union funded project
called Blue Mining, begun in February, and will look at the business
case and technology for deep-sea mining over the next four years.
This new frontier is an exciting prospect for developing island
nations like Tonga and Nauru, which both have exploration licenses.
For Tonga, where Nautilus says it has been collecting encouraging
exploration results, it could be a game changer.
"The revenue stream and taxes from a medium sized mine would have an
enormous benefit to the country," Nautilus' Johnston said.
The main companies looking to mine the seabed, like Nautilus and UK
Seabed Resources, are not, however, traditional mining firms,
although Anglo American <AAL.L> does have a 5 percent stake in the
former.
IHC said most of its contracts were with technology-based companies
that were not in the mining industry, although it would not specify
further due to confidentiality clauses.
IHC said it has had discussions with oil majors who are beginning to
show an interest in deep-sea mining.
But, with little of the deep ocean mapped or explored,
environmentalists worry about the potential loss of fauna and
biospheres whose existence is not yet understood.
"Only 3 percent of the oceans are protected and less than 1 percent
of the high seas, making them some of the least protected places on
earth. The emerging threat of seabed mining is an urgent wake-up
call," Greenpeace said in a report last year.
"I think we really have to be careful about what happens to the
environment," said ISA's Odunton. "We don't know enough to take some
of the risks we've taken on land."
(Editing by William Hardy)
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