Movers and SHAKERS
Cobalt and Rare Earth Metals from the Ocean Floor Eyed to Meet Growing Battery Demand
(Note: companies that could be impacted by the content of this article are listed at the base of the story [desktop version]. This article uses third-party references to provide a bullish, bearish, and balanced point of view; sources are listed after the Balanced section.)
The pursuit of seabed minerals, including polymetallic nodules containing nickel, copper, cobalt, and manganese is being driven by growing demand for batteries to power electric cars and to store wind and solar energy. Discoveries of rich deposits on the seafloor and advances in technology are generating renewed interest in seafloor mining. The International Seabed Authority (ISA), representing 168 countries as the trustee of the mineral resources of the deep seabed, has approved 30 contracts for exploration in international waters. These contracts encompass 0.7% of the world’s seabed. ISA is currently developing exploitation regulations for deep-sea marine minerals. Technology advances, including remotely operated vehicles, robotics, and communications technology, make deep-sea mining more feasible, the deep ocean is starting to look increasingly attractive. We look at the bull and bear arguments for opening the ocean seafloor to mining.
The ocean floor contains an abundance of minerals. Over one million square miles of underwater plain on the deep ocean floor at depths of 12,000 to 18,000 feet deep contain polymetallic nodules which are rich in manganese, iron, copper, nickel, cobalt, and rare-earth elements. Increasing the supply of certain metals could allow green technologies to be deployed on a greater scale or at a lower cost.
Deep-sea exploration could help diversify the supply of metals. The world’s supply of valuable metals is spread unevenly across the globe. The Democratic Republic of Congo is known for Cobalt, Chile possesses significant copper reserves, South Africa accounts for a large percentage of global manganese reserves, while China is recognized for rare earth metals. Allowing deep-sea mining could unlock new resources and enhance access to needed minerals.
Environmental management is not a new concept. A range of environmental management measures are available for mitigating the impact, such as protecting certain portions of the seabed and imposing reclamation obligations on mining companies.
Mining operations could pollute the ocean floor and destroy fragile eco-systems. Mining operations on the seabed could cause a disturbance, sediment plumes, noise and vibration, and changes in water chemical characteristics. Some worry that this could inhibit life and habitats at varying depths.
Deep-sea mining could accelerate global warming. Mining could negatively impact large areas of the seafloor which could have an impact on how the ocean plays a role in carbon storage and climate regulation.
Regulation is still taking shape. No international body is currently mandated to plan and oversee the conservation and sustainable use of geologically scarce mineral resources for the long-term future. However, the ISA is currently in the process of developing a set of rules, regulations, and procedures – the Mining Code – for eventual exploitation of the mineral resources. An important part of the ISA’s mandate is ensuring appropriate environmental assessments and safeguards in the activities it regulates.
While ocean floor mining is a controversial topic, some will argue that offshore oil and gas resources have been exploited for decades and mining is no different. While the technology is available, financial and regulatory uncertainty has constrained investment. Deep sea mining is certainly more challenging and more costly than mining land-based resources and reserves. As a result, it would likely be focused first on highly valued minerals whose market price justify the effort. Additionally, because regulatory frameworks are still evolving, deep sea mining activity is likely accelerate at a slow pace, allowing scientific and environmental considerations to be evaluated and incorporated into regulations.
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The Race is on to Mine the Deep Sea – But Scientists Are Wary, National Geographic, Jon Letman, August 29, 2018.
Scientists Fear impact of Deep-Sea Mining on Search for New Medicines, The Guardian, Karen McVeigh, May 20, 2019.
Should Deep Seabed Mining be Allowed? Marine Policy, Rakhyun E. Kim, May 10, 2017.
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Seabed Mining is Coming – Bringing Mineral Riches and Fears of Epic Extinctions, Nature, Olive Hefferman, August 16, 2019.