With land-based resources declining and prices rising, mineral miners are turning toward the ocean
Could the next gold rush be coming − under the sea?
Several mining companies around the world are exploring the ocean floor, at depths of up to 4,000 metres, looking for treasure − in the form of high-grade mineral manganese nodules and sea-floor massive sulphide systems (SMS) − in an effort to meet worldwide mineral demand.
Inside these baseball-sized nodules the metal grade of minerals like copper, cobalt and rare earths are expected to be up to 10 times greater than their terrestrial counterparts, offsetting concerns over high-extraction costs.
Rising metal prices, shrinking resources and ever-increasing demand has pushed miners into the ocean deep to find new reserves.
Demand for licences from the International Seabed Authority (ISA), the body that governs the ocean floor in international waters, has almost tripled in the past three years.
“There’s been more money around for investments, so people are more interested in new frontiers,” says Michael Lodge, deputy to the secretary-general and legal counsel for the ISA.
There are a host of challenges to mining the ocean floor − not least the unknown environmental impact − but more exploration licences are being granted every year and the demand shows signs of increasing as resources on land become more scarce. While Lodge says the term ‘gold rush’ might be extreme, there is definitely renewed interest from companies and governments.
“Land-based projects are becoming more and more difficult to finance because the grades are lower and operating conditions are more difficult,” explains Lodge. He notes that by the end of 2014 the ISA will most likely approve approximately 26 licenses, compared to the handful granted up until 2011. “It’s not going to be a complete displacement of land-based mining,” he adds. “It’s just an alternative place of supply.”
While the world waits to see what can be pulled from the sea floor, machines to advance this exploration are constantly being developed by miners, engineers and technology companies around the globe.
Canadian miner Nautilus Minerals is one of the world leaders in this deep-sea mining technology at its copper-gold project, Solwara 1, located in the Bismarck Sea 30 kilometres off the coast of Papua New Guinea. In line to be the first company in the world to commercially mine the seabed, Nautilus has been busy for the last few years adapting traditional mining equipment to work in this pressurized, electro-conductive and unfamiliar environment at water depths of 1,600 metres.
“They have different problems on land than we have on the sea floor using technology,” says Nautilus Minerals CEO Mike Johnston. “But we’re able to modify the technology, we just have to think through the problem and the solutions are usually pretty straightforward.”
The company was supposed to be into production of its SMS deposit by now, but a financial dispute with Papua New Guinea’s government caused an 18-month setback.
Back on track, Nautilus says it will be into production as early as two years and has been working on developing Seafloor Production Tools (SPTs), the first of which was finished in April by UK company Soil Machine Dynamics Ltd. (SMD). Known as the Bulk Cutter, this 300-tonne machine will help break up the top layer of the sea floor.
The boom in offshore oil and gas exploration has also proven beneficial, as advancements in the technologies in this sector have offered some convertible equipment for deep-sea miners.
“For instance, the pump and riser system that we’re using is straight out of the oil and gas industry,” says Mr. Johnston. “When it comes to this equipment all we’re doing, and where the innovation comes in, is that we’re applying this technology to a new energy application.”
“We’re sitting in a world between the deep sea oil and gas and the terrestrial mineral exploration, so what we do is marry those two technologies,” explains Matthew Kowalczyk, CEO at Vancouver-based Ocean Floor Geophysics Inc.
Kowalczyk’s company was created by PK Geophysics Inc., Frontier Geosciences Inc., and Cellula Robotics Ltd. in 2007 and specializes in designing sub-sea electromagnetic survey equipment to the ocean mining industry.
“We have no lack of work,” he says. “We’re seeing a renewed interest after the junior mining market crashed − which created a bit of a hiccup − and now it’s ramped up again.”
And while there is a certain race-like quality to current deep sea mining activities, there is collaboration going on as well, says Kowalczyk, adding that research facilities in Japan, Korea and Germany have already done significant tests and studies on deep sea mining.
“These institutions push the technology forward and this bolsters the commercial world,” he says.
Of course, there are concerns from scientists and conservationists all over the world regarding the environmental impact of mining the sea floor, but the ISA says it will continue to demand high levels of environmental studies and plans from its applicants.
But Mr. Lodge admits it’s going to be a wait-and-see affair.
“Of course you can’t really predict the impact until that technology is ready and tested. So it’s a bit of a learning curve for both sides.”
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This content was produced by The Globe and Mail's advertising department, in consultation with GE. The Globe's editorial department was not involved in its creation.
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