Friday, 14 August 2015

Deep Treasure

How we Plan to Extract Minerals from the Seafloor

As we move into an era of mining the deep-ocean floor, new and innovative technology developments are helping to drive forward this new industry.

The SMT vehicle will be driven by two pilots from a control rook on the surface ship above, attached via a giant power cable. (All maps/photos: Nautilus Minerals Inc.)

Balancing Humanity’s Need for Valuable Commodities

THERE is much concern over the commercial use of deep seabed mineral resources like base and precious metals, as well as rare earth elements. European scientists recently announced that they would be studying the ecological effects of deep sea mining on the environment and organisms living on the seafloor. At a recent international seabed authority meeting in Kingston, Jamaica, scientists were calling for temporary halt on new deep sea mining projects. One of them, the Solwara 1 project located in the Bismarck Sea of Papua New Guinea, is expected to commence operations in the first half of 2018.
The International Seabed Authority (ISA), the arm of the United Nations Convention on the Law of the Sea that governs mining in international waters, has already issued exploration permits to both national and private companies. “If we can take care of the environment, we have a brand new day ahead of us”, said Nii Odunton, Secretary General of ISA. In a policy paper published in Science on 9 July 2015, scientists want the ISA to hold off on issuing new permits until “a network of protected marine areas can be put in place”, potentially safeguarding an environment that we know very little about. Although the exact effects of long-term or extensive mining on the ocean floor remain unclear, the authors of the paper warn that “deep sea environments tend to recover very slowly when disturbed”, some so slowly that they likely “wouldn’t recover in a human’s lifetime, if ever.”
After Canadian-listed Nautilus Minerals Inc. released an Environmental and Social Benchmarking Report on its proposed Solwara 1 Project on 1 June 2015, Richard Steiner, Oasis Earth professor and conservation biologist, said: “Extremely little is known about the environmental goods and services of deep sea ecosystems in comparison to terrestrial ecosystems.” Civil society, non-government organisations, and scientists warn Nautilus shareholders not to pay the price of ignorance when it comes to investing in the Solwara 1 deep sea mining project. “Investors should be wary”, said Deep Sea Mining Campaign coordinator Dr. Helen Rosenbaum. She said that the benchmarking report demonstrates limited scientific understanding of the impacts of seabed mining and ignores the wide range of risks identified by comprehensive independent reviews of the project’s Environmental Impact Statement (EIS).
Deep sea mining of the ocean floor is still very much in an early stage. The advantage of undersea mining is that there is potentially a lot of resources that is in need for high-tech devices. Recent reports found that the worldwide demand for base metals like copper continues to rise, with increasing global economic development, expanding renewable energy supplies (wind, hydro, wave geothermal, tidal power), and growing electronics and communications sectors. Recycling is likely limited to around 35% of the supply of copper. There is an urgent need to meet the world’s copper demand while reducing fresh water use and contamination, damaging impacts to communities, mine footprints, and CO2 emissions from copper mining.
According to industry sources, seafloor mining has the potential to minimise the impact of mining by producing more commodities with fewer natural capital inputs, fewer damaging outputs, and a smaller area of impact. Finally, the long-term mining liabilities for freshwater contamination, tailings, and overburden failures that can threaten downstream communities do not exist in new undersea ventures.

A Clear Vision


Mike Johnston, CEO of Nautilus Minerals: “Growing copper demand requires our industry to look at more sustainable ways to meet this demand. […] Seafloor mining has the potential to not only provide economic benefits within the communities nearest to the operations while minimizing the impact of copper mining, it also has the potential to change the physical nature of the mining industry for the better.”
(Photo: Nautilus Minerals Inc.)

Interest in deep seabed mineral resources catapulted in the past five years. Peter Jantzen, Head of Wärtsilä’s Marine Lifecycle Solutions (MLS), noted at the 3rd Annual Deep Sea Mining Summit 2015 in Aberdeen, Scotland, UK: “Deep sea mining is, together with shale fuel, the most interesting and ground-breaking growth industry in the next 25 years...” Several developed countries do have a clear vision of how to extract minerals from the seafloor. Britain already has an exploration licence in partnership with UK Seabed Resources, a subsidiary of defence company Lockheed Martin. The two main companies looking to mine the seabed – UK Seabed Resources and Nautilus Minerals Inc. – are not traditional mining firms, although, as per 31 March 2015, South Africa-listed Anglo American plc does have a 5.99% stake in the latter, in addition to Mawarid Mining LLC (28.14%), Metalloinvest Holding (Cyprus) Ltd. (20.89%), and Canada’s Teck Cominco (7.2%).
Using existing technologies from the offshore oil and gas, dredging, and mining industries, Nautilus plans to extract high-grade Seafloor Massive Sulfide (SMS) systems in territorial waters of Papua New Guinea on a commercial scale. Pre-2008 plans originally called for three undersea mining vehicles – STMs (Seafloor Mining Tools) from Soil Machine Dynamics Ltd. (SMD) – that will be remotely-operated to extract and collect minerals from the seabed, and a complete Seafloor Production System. In a binding agreement with Norway’s North Sea Shipping Holding A/S, it was also envisioned to operate a 160m long, 14,200 specialist Mining Support Vessel (MSV), with the hull fabrication done at the Turkish shipyard RMK Marine at Tuzla. The STMs were to be fitted with cameras from Kongsberg Maritime’s Aberdeen-based underwater camera group, as well as 3D sonar sensors. The construction of the latter was terminated on 13 November 2012, however, as a result of a dispute with the Independent State of Papua New Guinea over costs that Nautilus says the government is obliged to meet for the project.


The Solwara 1 Project is located in the Bismarck Sea of Papua New Guinea, approximately 30km from the coast of the New Ireland Province and 50km north of the international port of Rabaul. Nautilus’ mineral tenement holdings also include 12 additional resources at a depth of around 1,700m declared as Solwara 2-13, one of which, Solwara 2, is located some 25km northeast of Solwara 1.

Seafloor Production System projected for the Solwara 1 Project.

In April 2015, Nautilus reached an agreement with the Papua New Guinea government that will allow the company’s Solwara 1 Project to proceed. The company has also been granted an environmental permit for this site. Under this agreement, the Papua New Guinea government took a 15% stake of the Solwara 1 Project, with the option for a further 15% stake. Papua New Guinea made an initial non-refundable payment of US$7M to Nautilus with the remainder of its share – US$113M – paid more recently into escrow.
“We believe that the proposed Solwara 1 Project will launch a new frontier in the ‘blue economy and resource sector’. As the first publicly-listed company in the world to commercially explore seafloor mining opportunities, Nautilus is committed to leading the way and setting a high bar for developing an environmentally and socially responsible approach for the industry”, said Nautilus’ CEO Mike Johnston. 
Nautilus’ vision is to be the world’s first company to explore the ocean floor for polymetallic SMS deposits. The company presently holds more than 500,000sq.km of exploration territory in Papua New Guinea, Fiji, Tonga, Vanuatu, the Solomon Islands, New Zealand, and the eastern Pacific. In the Bismarck Sea to the north of Papua New Guinea, the Solwara 1 resource boasts a copper grade of approximately 7%. Looking at the ocean, there are very large deposits of SMS, copper, nickel, cobalt, and polymetallic nodules that are very high-grade compared with land-based deposits, according to Nautilus. Land-based copper mining operations typically feature copper grades of 0.6%. The resource delineated by Nautilus’ exploration team in 2007 and drilled in 2010/11, using ROV (Remotely Operated Vehicle) technology, contains a high-grade copper-gold resource averaging 7.2% copper, 5g/ton gold, 23g/ton silver, and 0.4% zinc, all of which contained in “a simple ore” that should produce a commercial grade copper concentrate with “low impurity levels and good recovery.” Preliminary metallurgical testing of a representative 1.2 tons drill core sample yielded chalcopyrite (an economically important copper ore) as the dominant ore constituent, in addition to minor bornite, chalcocite, covellite, tetrahedrite/tennantite, galena, sphalerite, pyrite, arsenopyrite, barite, anhydrite, and silicate minerals; all of which can be separated from chalcopyrite using standard flotation techniques. In November 2011, Nautilus also announced an inferred mineral resource of 1.540 million metric tons of material grading 8.1% copper, 6.4g/ton gold, 34g/ton silver, and 0.9% zinc. Gold grades of well over 20g/ton have also been reported in some of Solwara 1’s intercepts.

Sampling campaign undertaken at a depth of 1,600m in the Solwara 1 Project area.


The specialist MSV “Nautilus” used during the 2010-2011 exploration campaign.




Testimonials

According to Nautilus’ CEO Mike Johnston, most of the world’s best deposits lie even deeper than Solwara 1, at around 6,000m in an area known as the Clarion Clipperton Zone. Large numbers of manganese nodules, rich in copper, cobalt, and nickel, lie across this 4.5 million sq.km abyssal plain between Hawaii and Mexico. Also, Ocean Mineral Singapore Pte Ltd. (OMS) has entered into a 15-year exploration contract for polymetallic nodules at a site within the Clarion-Clipperton Fracture Zone with ISA. The project will be sponsored by the Singapore government.
At the 3rd Annual Deep Sea Mining Summit 2015, industry representatives from Bosch Rexroth, Fugro, Kongsberg Maritime A/S (delivering underwater camera packages to major subsea service clients), Liquid Robotics, and Lockheed Martin claimed that the number of governments in the Asia-Pacific region interested in supporting international deep sea resource ventures is about to grow. With regard to the Solwara 1 Project, Nautilus entered into a Port Upgrade and Operations Deed with PNG Ports Corporation Ltd. (PNGPC) in October 2009 to provide the company with a secure right to port handling capacity at the Rabaul port for 1.5 million metric tons of ore per year for three years. Johnston noted: “We are talking to a lot of governments in the western Pacific – smaller nations which are interested in it because they do not have any other opportunities.”

Conclusion

It is not a secret that marine resources – hydrocarbons, minerals, wildlife – are in need of a certain level of protection. This is normally provided by Coast Guard organisations, but also the military is continuing to increase its presence in regions with high potential of critical commodities. Specific regions like the Arctic or the Western Pacific are coming into wider focus by many developed countries seeking those critical commodities. As to the Arctic, Russia is “taking certain political and military steps” to defend against activities undertaken by “some developed countries that don’t have direct access to the Polar regions”, said Russia’s Defence Minister Sergei Shoigu. “Military use of the seas also covers these [regions], with Russia considering protecting its national interests in the Arctic with military means if necessary”, he pointed out at a recent Ministry of Defence meeting. According to Shoigu, there is an increasing interest in the region’s resources by nations that have no direct access to the Arctic, so “the constant military presence in the Arctic and a possibility to protect the state’s interests by military means are regarded as an integral part of the general policy to guarantee national security.”
Moscow is deploying submarines to Polar regions, and is continuing to create modern military infrastructure on some of the New Siberian Islands – Novaya Zemlya, Frantz Josef Land Archipelago and Wrangel Island – all of which are located in the Arctic Ocean.

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