SINGAPORE - BY ASIA INSIDER - Oct 23,2023

The International Seabed Authority (ISA), a UN-affiliated organization, has sparked renewed interest in deep-sea mining following its decision to accept applications in July. Although concerns remain over potential environmental impact and lack of scientific research, the growing demand for "battery metals" for Electric Vehicles (EVs) and clean energy infrastructure is driving momentum for deep-sea mining. Deep-sea mining involves extracting minerals from the ocean floor, specifically from poly-metallic nodules that have formed over millions of years.

 

These nodules contain lucrative deposits of cobalt, nickel, manganese, and Rare Earth Elements (REEs). However, the process requires specialized equipment and significant capital expenditure due to the depths at which the nodules are found. China, Russia, and Norway are among the most eager participants in this nascent and controversial industry.

Currently, there is limited research available on the potential long-term effects of deep-sea mining. This has prompted several governments, including France, Germany, and Chile, as well as NGOs like Greenpeace, to call for a global moratorium on the practice. The International Seabed Authority (ISA) has taken a cautious approach to the development of regulations for deep-sea mining, given the lack of scientific research.

 

However, the ISA is required to use existing regulations to vet mining applications, and prospective contractors must obtain sponsorship from an ISA member. With only three months remaining to develop regulations, it is unlikely that concerns from pro-moratorium members of the ISA will be adequately addressed.

 

In addition to environmental concerns, there are also potential geopolitical implications of deep-sea mining. The industry is currently dominated by a small number of states with the necessary capital, equipment, and technical expertise for seabed mining.

This concentration of power could worsen existing geopolitical tensions, particularly in areas where there are competing claims over maritime boundaries and resource rights. Canada, China, Japan, South Korea, and Russia are currently the dominant players in the industry, with Norway emerging as a key investor.

 

The concentration of power in the deep-sea mining industry could exacerbate geopolitical tensions in areas with competing claims over maritime boundaries and resource rights. For example, China's presence in the South China Sea has caused tensions with neighboring countries like Vietnam and the Philippines. Similarly, Russia's involvement in the industry and interest in the Arctic Ocean has raised concerns about Moscow asserting control over the region's resources.

 

The Clarion-Clipperton Zone (CCZ) in the Pacific Ocean, estimated to hold 21 billion tonnes of nodules, is a particularly competitive area for deep-sea mining, with Russia, China, and the US vying for control.

 

The expansion of deep-sea mining will likely influence the decision-making and strategies of naval forces from these countries. The US sees deep-sea mining as an opportunity to reduce dependence on foreign sources of critical minerals and increase domestic supply chain resilience.

 

For China, deep-sea mining aligns with its "Made in China 2025" strategy, which emphasizes indigenous innovation in highly specialized and technical fields to guide economic decision-making by Chinese companies.

The emerging deep-sea mining industry is increasing geopolitical competition as countries vie for access to critical minerals, including battery metals like cobalt, nickel, manganese, and rare earth elements. The lack of available scientific research on the potential long-term environmental impact has prompted concerns from NGOs and some governments, leading to calls for a moratorium on deep-sea mining.

 

Meanwhile, the dominant players in the industry are countries with the capital, equipment, and technical knowledge required for seabed mining, including China, Russia, Canada, Japan, South Korea, and Norway. This could exacerbate existing geopolitical tensions, particularly in areas with competing claims over maritime boundaries and resource rights, such as the South China Sea and the Clarion-Clipperton Zone.

 

The expansion of deep-sea mining also has national security implications, as supply chain needs have encouraged state-owned enterprises and private defense contractors to evaluate investment opportunities. However, the prohibitive level of overhead required for operations and the ambivalent regulatory framework have already prompted early exits from the industry.

 

Deep-sea mining is also likely to increase the geopolitical relevance of island nations, some of whom lack consensus on the subject and could be vulnerable to external pressures and influence from more powerful nation-states and global mining corporations committed to starting operations in the next few years.

 

As the industry grows, geopolitical conflicts are likely to arise over issues like territorial boundaries, resource rights, and environmental regulation. The International Seabed Authority (ISA), a UN affiliate organization, must contend with an accelerated timeline to develop a deep-sea mining code, coupled with the need to overcome staunch internal opposition and dissension to the practice both internally from its member-states and internationally.

 

Whether the ISA can strike a compromise before the July deadline will be the organization’s most consequential test to date, with significant geopolitical implications at stake.