Race to dominate seabed mining
How far will countries go to secure access to critical minerals?
The world can’t get enough of critical minerals. From 2017 to 2022, green energy projects alone boosted demand for lithium by roughly 200%, cobalt by 70% and nickel by 40%.
Given the time and resources that go into locating and extracting these and other critical minerals – marked by their indispensability for national security and their vulnerability to supply disruption – producers can’t possibly keep pace with demand. But in geopolitics (and business), the race never stops.
Desperate to source these undersupplied minerals to hasten the energy transition and development of advanced computing and weapons, many countries are eyeing the world’s seabeds as the next frontier. The intensity of this race means the ocean floor could soon become a focus of competition and even conflict.
Some of the most valuable deposits of critical minerals on Earth lie deep beneath the oceans’ surface. Most come in one of three forms: Cobalt-rich ferromanganese crusts are found near submarine volcanoes and contain lead, tellurium, cerium, europium and more; polymetallic sulphides occur near deep-sea hypothermal vents and contain copper, lead, zinc and some precious metals; and polymetallic nodules form from sediment buildup and mineral accumulation from seawater over millions of years and thus are widely distributed, and contain nickel, copper, lithium, cobalt, molybdenum, zirconium and rare earth elements.
Though all these deposit formations contain valuable minerals, polymetallic nodules (PMNs) are the most commercially attractive for seabed mining because of their high mineral concentrations and relatively easy extraction. Lying loose on the ocean floor, PMNs essentially can be vacuumed up.#
Though PMNs are relatively abundant, four zones have attracted the most commercial interest: the ClarionClipperton
Zone in the equatorial Pacific, the Central Indian Ocean Basin, the Prime Crust Zone in the northwestern Pacific and the Mid-Atlantic Ridge. The crown jewel is the Clarion-Clipperton Zone, which is believed to hold about 20% as much copper as all land-based reserves.
The United Nations’ International Seabed Authority is tasked with regulating seabed mining and issuing licenses for exploration. The ISA has issued more than 30 such contracts
(mostly for PMNs), each lasting an initial period of 15 years.
Most of the contracts cover geological studies, mineral resource assessments and environmental surveys, though a handful include developing and testing mining technology and mineral processing techniques. Regulation is ambiguous, however, because the ISA is still finalizing its first major set of rules for seabed mining in international waters. Additionally, ongoing research could affect environmental and mining standards.
For example, the U.S.-led Deep Ocean Observing Strategy aims to observe, map, explore and model the deep ocean, while the United Kingdom is funding a project (confusingly named the Seabed Mining And Resilience To EXperimental impact project) to study how deep-sea ecosystems respond to and recover from large-scale disturbances such as mining.
Not everyone is enthused about the potential of seabed mining. Several countries, including Brazil and Canada, have called for a freeze on commercial seabed mining until the environmental impact is better understood.
Environmentalists warn of the potential dangers of disrupting the seabed. Advocates contend that seabed mining is less disruptive than land mining, and at any rate is necessary for the green transition.
There also has been no agreement on how to handle royalties in international waters once commercial production gets underway.
And the ISA has been criticized for a lack of transparency in the issuance of licenses and for allowing some companies operating under exploratory contracts to engage in exploitation in the name of equipment testing. Critics allege that governments or private interests, not the ISA, are driving the licensing process.
Ownership is another critical question with the potential to spark conflict. As mining of the seabed becomes a reality, countries will want to extend their territory to ensure that they hold the rights to the minerals.
Demarcation of territorial waters is regulated by the U.N. Convention on the Law of the Sea. It defines a country’s territorial sea, contiguous zone, exclusive economic zone and continental shelf. Everything else is international waters and regulated by the United Nations.
Under international law, countries are limited in how far they can extend their territorial waters. However, a government can petition the U.N. for an extension of as much as 150 nautical miles if it can prove that its continental shelf goes beyond 200 nautical miles.
The process is long and laborious but not impossible. In 2004, after nearly 17 years of study, Brazil petitioned for the extension of its maritime territory in three areas. It argued that the area off its continental shelf was a natural prolongation of its territorial land and noted its lack of maritime territorial disputes.
In 2019, the U.N. accepted most of Brazil’s claims and added 170,00 square kilometers (66,000 square miles) to its maritime boundary. A decision on the final piece of Brazil’s claim – likely to be approved – is expected by 2025.
The chance to secure the legal rights to exploit more distant offshore natural resources makes it worth the wait.
Brazil has pre-salt oil deposits along its coast, most notably in the Santos Basin, and may have PMNs off its southern coast.
But the extension process also creates risks of conflict with neighbors, especially in areas like the South China Sea where maritime disputes abound. While it evaluates their claims, the U.N.’s Commission on the Limits of the Continental Shelf can permit countries to begin exploration in the area being studied, as it did in recent years with Canada and its claims off the coasts of Newfoundland and Labrador.
The Canadian case concerned oil and gas exploration, but offshore mining will likely observe the same precedent. This incentivizes countries near contested waters to move swiftly in filing claims for territorial extensions.
Though many questions remain about the future of seabed mining, its importance for national power is clear. Competition for critical minerals will only intensify, and countries with ownership rights have an advantage, as do those with the technology and capital to develop seabed projects.
Countries will also compete to influence international bodies like the ISA, or they may attempt to circumvent the organization entirely. The race to dominate oceanic mineral deposits is just getting started.