A new report titled 'Case to prove: the economy of deep-sea mining,' prepared by the consultancy Koinon, was released at the request of several entities, including Oceans North, the Deep Sea Conservation Coalition, the Blue Ocean Foundation, the International Union for Conservation of Nature, and the Dona Bertarelli Philanthropy.
The document concluded that, in all realistically possible scenarios, mining activity tends to cause more damage to public value than the value it generates. This conclusion was presented during the 'Deep Sea Dialogues' event, held on the sidelines of the 31st session of the International Seabed Authority (ISA), based in Kingston, Jamaica.
The authors analyzed the possibility of exploiting polymetallic nodules in the Clarion-Clipperton Zone (CCZ), an area managed by the ISA, generating net financial value for both the international community and sponsoring states. The assessment focused on the NORI-D and TOML projects promoted by The Metals Company.
Considering various scenarios, including those less favorable than predicted by the promoter, analysts determined that the project would face losses in almost 83% of situations. Furthermore, the report points out that there is about a 60% chance that the investment will never recover the initial capital, with the increase in investment costs being the main factor reducing profitability.
Other risk factors include uncertainty about the actual quantity and concentration of minerals available in the Pacific Ocean, specifically between Mexico and Hawaii, along with the inherent difficulties of operating on the ocean floor. For the global community, the projected financial gains are also seen as limited and uncertain.
According to the United Nations Convention on the Law of the Sea (UNCLOS), mineral resources located outside national jurisdictions are considered the common heritage of mankind, and the ISA is responsible for managing their exploitation, ensuring an equitable division of economic benefits.
However, Koinon's analysis suggests that the revenue destined for the ISA through the benefit-sharing mechanism would be almost half of what the promoter had initially predicted. While the promoter estimated annual revenues of around $480 million for the ISA in a maximum production scenario, the report estimates a probable average value of approximately $260 million.
The economic benefits for sponsoring states are even smaller; in 48% of simulations, the projects would generate no revenue via corporate income tax. Without significant tax profits, these states would rely on other fiscal mechanisms, but the authors warn about the high administrative capacity required, which is difficult to ensure in a remote and unprecedented oceanic area in terms of oversight.
UNCLOS provides for a compensation system for developing nations that depend on terrestrial mining and may be affected by the exploitation of international marine resources. However, the report warns that the loss of revenue for these countries could exceed the gains obtained from deep-sea mining. In years of maximum production, losses for terrestrial producers could reach $1.9 billion, while ISA revenues would be close to $1.1 billion, particularly impacting countries such as South Africa, Indonesia, and the Democratic Republic of Congo.
Given this picture, the report concludes that it will be very difficult to compensate the affected countries while simultaneously ensuring sufficient revenue to be distributed as a global benefit, which calls into question the principle that international seabed resources should benefit all of humanity.
During the 'Deep Sea Dialogues,' researchers Diva Amon and Anna Metaxas, participating via video link from aboard the research vessel R/V Falkor from the Schmidt Ocean Institute, discussed the knowledge gaps in the deep sea necessary to assess the consequences of mineral extraction.
These debates took place during the 31st session of the International Seabed Authority (ISA) in Kingston. The event was organized by the Blue Ocean Fund, the International Union for Conservation of Nature, and the Donna Bertarelli Foundation. Scientists, financial analysts, and lawyers participated in the discussions to address the current state of knowledge and areas requiring study in the context of deep-sea mining.
Diva Amon, a researcher from the Benioff Oceanographic Laboratory at the University of California, shared her experience, noting that every dive carries the expectation of discovering unknown species. She is one of the scientists aboard the R/V Falkor, which has been conducting research on the biodiversity, habitats, and geological features of the deep waters of Trinidad and Tobago since June 29. During the expedition, Deep Wonders of Trinidad and Tobago and the High Seas, which lasted almost a month, the SuBastian vehicle reached the bottom of the Caribbean Sea dozens of times, and almost every trip resulted in discoveries, some made at depths exceeding 4000 meters.
Sharing some of the discovered species, Diva Amon emphasized that the expedition results prove that the seabed remains an unexplored territory with a vast area for further study. In her view, this situation makes it impossible to fully assess the environmental risks. The researcher asked: 'If we know so little, how can we assess the impact of deep-sea mining on species we do not yet know?'
The regulation of deep-sea mining is the subject of discussion in the second part of the 31st ISA session, which continues until Friday in Kingston, Jamaica. Following the first round of negotiations held in March during the first part of the session, the ISA continues to work towards achieving the so-called 'Mining Code.' This code will define the conditions, timelines, and possibility of commercial exploitation of minerals on the international seabed.
Diva Amon stated that countries are beginning to realize the economic value of the ocean, but they must be reminded that decisions regarding sustainable use must be based on scientific data. She highlighted the need to increase investment in studying the seabed. As an example, she cited small island developing states in the Caribbean, where about 80% of the marine territory is deep sea, but they lack the vessels to conduct such research. Therefore, according to her, these countries 'cannot make informed decisions about deep-sea governance because they lack knowledge.'
In response to questions about the impact of climate change on the deep sea, both researchers confirmed that seawater temperature is rising even in the deepest zones. Anna Metaxas noted that while it may not be a sharp increase, a rise of 1 or 2 degrees Celsius could have very significant consequences for these species. She added that much of the existing data is based on models, and there is a need to strengthen the collection of reference data on water temperature and currents.
In turn, Diva Amon insisted that changes caused by climate change in the oceans affect 'all parts of the planet' and cannot be underestimated. She also warned that pollution is already being observed in remote areas of the deep sea. 'Most dives take place in unexplored areas, and in almost all of them we find evidence of pollution,' she reported.
