China could kick off deep-sea mining before others: UN body

October 24, 2019 10:10
China is eyeing opportunities to extract mineral resources that lie deep within the seabeds. Photo: Bloomberg

China is likely to become the first country in the world to start mining seabed minerals if the international rules for exploitation are approved next year, according to the International Seabed Authority (ISA).

“I do believe that China could easily be among the first (to start exploitation),” Reuters quoted Michael Lodge, ISA general-secretary, as saying.

“The demand for minerals is enormous and increasing, there is no doubt about the market,” said Lodge, who visited China last week.

The quest for exploiting seabed minerals, such as polymetallic nodules containing nickel, copper, cobalt and manganese is driven by demand for smart phones and electric car batteries, and the need to diversify supply.

The ISA has already signed 30 contracts with governments, research institutions and commercial entities for exploration phase, with China holding the most -- five contracts.

The body, which was established to manage the seabed resources by the United Nations Convention on the Law of the Sea (UNCLOS), is aiming to adopt seabed mineral exploitation rules by July 2020.

Apart from China, there is also interest from European countries including Belgium, Britain, Germany and Poland, as well as from the Middle East.

However, no one has yet demonstrated that deep-sea mining can be cost effective, and some non-governmental organizations have questioned whether it would be possible to reach a deal on exploitation rules next year, Reuters noted.

“I think, it’s pretty good. I think the current draft is largely complete,” Lodge said, when asked about prospects of adopting the rules by next July.

One of the issues yet to be agreed is proportionate financial payments to the Jamaica-based ISA for subsea mineral exploitation outside national waters.

“We are looking at ad valorem royalty that would be based on the value of the ore at a point of extraction ... The middle range is 4-6 percent ad valorem royalty, potentially increasing over time,” Lodge said.

If the rules are approved, it could take about two to three years to obtain permits to start deep-sea mining under the current draft, according to the official.

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