Deep-sea mining initiatives expanding reach to national waters

Norway steps in front of a long line of countries contemplating turning to mining within their own national waters as consensus around mining activities in international waters between world powers remains elusive.

A wave of deep-sea mining companies have emerged with the aim of extracting battery metals such as nickel, cobalt and rare earths used in the energy transition from the depths of international waters. But the slow pace of international regulations has opened a new avenue. Countries do not require permission to undertake economic activities in their exclusive economic zone (EEZ), an area that extends up to 200 nautical miles from their shore.

In the latest development, on Jan. 9, Norway's parliament gave the green light to begin exploration activities for deep-sea mining off its coast, bringing Norway in step with the Cook Islands as the first countries to open their coastal waters to seabed mining. The US, Japan and India are expected to follow suit.

"What gets missed in the discussion is the fact that the International Seabed Authority is only one of a dozen jurisdictions that are in various stages of enacting deep-sea mining regulations. ... It's going to happen," Oliver Gunasekara, CEO and co-founder of deep-sea mining technology provider Impossible Metals, told S&P Global Commodity Insights in November 2023.

A decision on whether to start deep-sea mining in international waters continues to be delayed by backlash from several countries over the possible environmental harm that could be caused by beginning activities before there is sufficient scientific data or robust regulation.

In a follow-up email after Norway's approval, Gunasekara said there will be no need to open new land-based mines for nickel, cobalt and manganese after 2030, as all supply will come from recycling and the seabed. Still, that does little to allay the fears of the groups concerned about the potential harm of mining the world's oceans.

"This is not what we need in the middle of a global biodiversity and climate crisis," Kaja Lønne Fjærtoft, global policy lead for WWF's No Deep Seabed Mining Initiative, told Commodity Insights.

Countries go their own way

Norway will open exploration in an area roughly the size of the UK within its EEZ, which is estimated to hold about 185 million metric tons of manganese, 45 MMt of zinc, 38 MMt of copper, 24 MMt of magnesium and 4.1 MMt of cobalt, according to a report by the Norwegian Petroleum Directorate.

The 1982 United Nations Convention on the Law of the Sea granted sovereign states exclusive rights over the exploration and extraction of marine resources found within their EEZs. Norway hopes to create a new revenue stream that would help move the country away from oil and gas, according to a 2020 presentation from the Norwegian Offshore Directorate.

The Cook Islands approved mining exploration within its EEZ in the South Pacific Ocean in 2009. In 2022, its Seabed Minerals Authority granted three exploration permits to CIC Limited, CIIC Seabed Resources and Moana Minerals Inc. in the hopes of diversifying its tourism-based economy after the pandemic, Prime Minister Mark Brown said in a 2021 statement.

Even earlier than the Cook Islands' approval, Papua New Guinea took a 15% stake and provided a PGK 375 million loan to the Solwara deep-sea mining project in mineral-rich hydrothermal vents. The project was owned by Nautilus Minerals Inc. until the cash-strapped company went under in 2019. Papua New Guinea Prime Minister James Marape told local media Post Courier in August 2019 that the country "burnt" its funds and would not support the industry until the technology was "environmentally sound."

Deep-sea mining has also reportedly piqued the interest of an island nation with an EEZ 12 times its size: Japan.

The Japanese government tested new technology for extracting rare earths from mud off the coast of Minami-Torishima Island in 2023. It also explored the mineral-rich hydrothermal vents off the coast of Okinawa in 2017.

"We are seeing a lot of interest despite what the NGOs are saying. We are communicating, for instance, with Japan," Walter Sognnes, CEO of Norwegian deep-sea mining company Loke Marine Minerals, said in an interview. The company has licenses to explore for polymetallic nodules in international waters and plans to apply for permits in Norway.

Current US law permits mineral leasing in the outer continental shelf, and the Pentagon is expected to present a report assessing deep-sea mining to President Joe Biden by March 1, as required under the National Defense Authorization Act adopted Jan. 3. India also presented draft regulation outlining a framework for auctioning off deep-sea mining claims in its national waters in December 2023.

Sweden granted an exploration permit to Scandinavian Ocean Minerals for polymetallic nodules in parts of the Bothnian Bay in July 2023.

Plundering or plucking?

As countries move to begin activities in their own waters, scientists and environmental activists warned that patchwork regulation could only worsen the risks of deep-sea mining, which includes potential conflicts with commercial fisheries and oil and gas exploration.

"Ecosystems don't really care about national borders," Andrew Thaler, deep-sea ecologist and CEO of Blackbeard Biologic, told Commodity Insights.

Norway opening up its waters to exploration of polymetallic sulfides and manganese crusts will bring a host of environmental risks that have yet to be fully researched, including the possibility of unearthed sulfides releasing toxins as miners dig into the seabed, in a method more akin to land-based surface mining, said Beth Orcutt, vice president of research at the Bigelow Laboratory for Ocean Sciences.

Other risks include the loss of biodiversity at mining sites, changes to carbon sequestration, and the far-reaching damage from noise and sediment plumes, which could disrupt neighboring ecosystems.

"Many marine species are migratory ... disruptions in one area can therefore affect the breeding, feeding and migration patterns of these species," Daniela Fernandez, founder and CEO of the Sustainable Ocean Alliance, told Commodity Insights.

However, Loke's Sognnes warned that those saying "no" to deep-sea mining would push miners to controversial land-based sources of minerals where human rights or other environmental issues are at play.

Tapping into ocean's metals still a few years out

Mining in national waters will depend on countries moving from crafting legal frameworks and approving exploration expeditions to evaluating environmental and economic viability. Deep-sea mining opponents say such assessments will be the true test of whether the industry actually moves forward, despite confidence from industry participants.

Impossible Metals' Gunasekara expects mining in international water to start in 2026, "followed by Cook Islands and the Red Sea in 2027, then India and Sweden's EEZs, with Norway in 2030."

"Projects in national waters will require significant research to define resources and undertake rigorous multiyear environmental impact assessments," Gerard Barron, CEO of The Metals Co. Inc., said in an email response. The executive also expects mining in international waters to start first.

Loke Minerals plans to start mining in international waters before mining in Norway, where it said it would spend about eight years "exploring the resources, mapping the marine environment and close the knowledge gap" before submitting a development plan.