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  PlanetArk 21 Aug 06
Is Marine Mining the Wave of the Future?
Story by Anna Stablum

LONDON - Record high metals prices have sent two firms scurrying into the ocean for copper and gold, but costs and environmental challenges may yet sink their plans.

Big miners have failed to keep up with buoyant metals demand from Asia so two small companies, Nautilus Minerals and Neptune Minerals, are betting on marine mining to fill the gap.

"Underwater mining is the future with the great demand from China and Asia making it possible, despite the higher costs," said Professor Anton Eisenhauer of the GEOMAR Research Center for Marine Geosciences at Germany's University of Kiel. GEOMAR has developed mining submarines used in diamond operations outside Namibia by giant diamond house De Beers.

While offshore oil wells have been around for decades, sea mining for minerals is in its infancy. Copper prices doubling in less than a year and gold prices near record highs are helping it grows up quickly.

"Not many people realise that there is potentially another 200,000 tonnes of copper reaching the market in the next three and a half years," said David Heydon, president and CEO of Canada's Nautilus Minerals.

World number one gold miner Barrick holds a 9.5 percent stake in Nautilus Minerals, which is exploring off the coast of Papua New Guinea and aims to start producing in 2009. "We are looking to produce between 300,000-500,000 ounces of gold and 100,000-200,000 tonnes of copper," Heydon said, adding there are also very high grades of silver and zinc in the ore.

One of the main attractions is the high metal grades. "There is potential to find grades that haven't been seen for ages, the surface sampling from 2005 reached 12.5 percent on copper, 15 grams per tonne on gold per year," Heydon said.

The common grade for copper is 1-2 percent, according to Magnus Ericsson, director of consultancy Raw Materials Group. "For gold, 1-3 gram per ounce is very high in open pits, and under the surface one might find 5 grams," Ericsson said.

By using mobile equipment it is possible to mine smaller deposits while a conventional mine must be larger to be viable.

"I can mine one out, pull the pipes up and move the ship to another area 200 miles away," Heydon said.

Neptune Minerals, listed on London's junior stock market is carrying out similar exploration activity in New Zealand waters.

BIG CHALLENGES

Nii Allotey Odunton, deputy secretary-general of the International Seabed Authority (ISA), controlling all mining activities beyond national jurisdiction, predicts high costs.

"The operating cost is the big problem, you bring the minerals up and then you move them into the shore to a refinery... all these costs have to be less than the aggregate you get from these metals," Odunton said.

In the 1970s, manganese nodules were mined in the seabed but in the end it proved too costly. On the other hand, diamond house De Beers' Namibian marine mining operations produced just over 900,000 carats last year. But offshore diamond mining is not as deep (120-130 metres) as Nautilus's operations of 1,600-1,800 metres depth. Neptune is exploring at levels between 120-1,800 metres.

Nautilus is in Holland and Belgium this week to talk to dredging companies which it hopes will do the mining for them. ICH Holland Merwede, a market leader in the dredging industry, said that theoretically it should be possible to go down to 1,500 m but no one has the technology.

"We are seriously looking at it, but up until now we are always confronted with the fact that if there are ore deposits in the world that are cheaper to mine, we don't go to 1,600 meters deep," said Jan Dewit, responsible for sales of mining equipment below water at ICH Holland Merwede.

The oil and gas industry went offshore in the mid-1940s and today about a third of the world's oil comes from the sea. A remote-operated vehicle (ROV), used in the offshore industry, goes beyond 3,000 m and could be deployed to the seabed in order to scoop and recover the raw material to the surface, John Mair, global technology manager at Subsea 7 one of the world's leading subsea construction contractors, said.

"The technology is not that challenging," Mair said. But it all comes down to how viable it would be, he added.

Kristina Gjerde, high seas policy adviser to the Global Marine Program of The World Conservation Union (IUCN), said the biggest environmental challenge would be disturbing sediments.

"You would have to clearcut the area, you are not only breaking the bottom, but you are also stirring up the sediments which will destroy the flow and create stress on other organisms nearby," Gjerde said.
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