Updated: Nov 23, 2021
The world's largest sea bed mining site Canadian-based company, DeepGreen is set to merge with a large corporation sending its shares sky rocketing and a hike in value. Can it be stopped before commercial sea bed mining is set to start in 2023?
The opening up of the world’s largest ever mining site, located on the seabed of the deep dark depths of the Pacific ocean between Hawaii and Mexico, has just hit turbo, under scandalous circumstances.
In the next few weeks, a Canadian-based seabed mining company, DeepGreen, is likely to merge with a publicly listed corporation and catapult its shares to a combined value of close to US $ three billion.
To achieve this, the company needed to bolster investor confidence, so it managed to get a tiny Pacific Island country to stick its neck out and trigger a bizarre rule under international law that it hopes will deliver DeepGreen a 30+ year mining license in the deep Pacific seabed in 2023. DeepGreen says it intends to start commercial seabed mining in 2024.
The world was put on notice at the end of June by the Pacific Island nation of Nauru, which has invoked an obscure rule of the ‘UN law of the sea’ designed to force the regulator of the global seabed, the International Seabed Authority (ISA), to award a commercial mining contract to DeepGreen – (soon to be the Metals Company) – in two short years. And this in the middle of the covid pandemic when countries can’t meet to properly debate the issues.
International Seabed Authority map of 19 mining exploration license areas in the Pacific Ocean between Hawaii (top left) Kiribati (bottom left) and Mexico (to the right) covering a combined license area of around 1.5 million square kilometres.
Source – International Seabed Authority Website
DeepGreen owns three seabed mining subsidiaries, each of which have complex individual arrangements with the Pacific Island countries of Nauru, Kiribati and the Kingdom of Tonga. The arrangements give the ‘global north’ DeepGreen shareholders back-door access to areas of international waters reserved for developing states. The Tongan and Nauru subsidiaries were acquired from another speculative and dodgy Canadian seabed mining company, Nautilus Minerals, which went bankrupt in 2019 and has close ties to DeepGreen.
The minerals being targeted by DeepGreen and others are legally deemed the ‘common heritage of (hu)mankind’. The ISA, which is based in Jamaica and has jurisdiction over roughly half of our planet’s surface, is charged with managing these resources on behalf of every man, woman and child on earth, while also holding responsibility for protecting the integrity of deep sea ecosystems.
It’s also worth noting that science tells us quite clearly deep sea mining, as is planned, cannot be done without causing serious, widespread and long lasting impacts.
Concerned governments of the world can stop this whole thing before it starts. But they’ll need to urgently coordinate and take quick-smart action before it’s too late.
So far the ISA has dished out 31 exploration licenses in international waters to countries and companies. Of these 17 are located in the Pacific Ocean between Hawaii and Mexico, each at 75,000 sq kms, totalling just under 1.5 million sq kms. Three of these exploration license areas are held by DeepGreen’s subsidiaries, totalling 225,000 sq kms. To put it into perspective, New Zealand’s total land area is 268,000 sq kms.
Quite the land grab… but who’s behind this and what’s the rush?
In April, DeepGreen announced a planned merger with a US based so-called “SPAC” in order to go public: its shares are expected to add up to a combined value of US $2,900,000,000.
That’s a lot of zeros, especially given DeepGreen has no commercial licence to mine, and hasn’t even tested any mining equipment in the deep sea.
This whole thing is clearly about DeepGreen’s merger and its speculative hike in value.
We’re not clear that Nauru is aware of this, but the action the government has taken is enormously damaging and concerning, because it is designed to force a rushed attempt to develop deep-sea mining regulations at the ISA and likely to lead to a rush of mining applications from other operators.
On the 25th of June, whispers of Nauru’s plan to trigger the ‘two year rule’ were circulated in the same 24 hours as two exposes were released by Bloomberg and the Wall Street Journal pointing to the dubious modes of operation employed by DeepGreen and its Chief Executive, Gerard Barron, in particular the spin he has been putting on the promise of riches from seabed mining plus blatantly obscuring and downplaying environmental concerns.
A deep sea species of Glass Octopus. The vulnerability of deep sea creatures and ecosystems to planned mining activities cannot be overstated. Source: Schmidt Ocean Institute.
The news articles and announcement from Nauru came just days after US merger disclosure rules forced an astonishing environmental admission from DeepGreen. Forced to file a statement with the US Securities and Exchange Commission, DeepGreen had to admit that it knows very little of what exists in deep sea environments and even less about how severe, far reaching or long-lasting the effects from mining would be. To quote from the filing:
“The potential impact of commercial scale polymetallic nodule collection on CCZ seabed habitats is currently difficult to measure and will require further studies. We cannot predict how long these studies will take, whether the environment and biodiversity is impacted by our activities, and if so, how long the environment and biodiversity will take to recover. In addition, it is unknown how effectively mitigation strategies can prevent potential biodiversity loss and species extinctions.”
“Given the significant volume of deep water and the difficulty of sampling or retrieving biological specimens without damage, a complete biological inventory might never be established. Accordingly, impacts on biodiversity and the ocean ecosystem cannot, and may never be, completely and definitively known.”
In other words, DeepGreen has no idea of the potential impact of seabed mining.
What DeepGreen said to the SEC is a complete contradiction to its oft-repeated spin around seabed mining. Spin it has propagated to garner public and investor support. Spin that unequivocally asserts minimal environmental impact and consistently peddles a baseless claim that mining the seabed is better than mining on land, despite saying the opposite in its filing.
This revelation raises serious questions of misrepresentation by DeepGreen, not only around its fitness as an operator, but the robustness of systems and processes of the ISA, which has awarded ten percent of all contracts to this single, questionable entity.
For observers who have long seen through DeepGreen’s antics, this trigger by Nauru and its temporal proximity to the high-profile exposés and DeepGreen’s SEC revelations are not surprising. Remember, the multi-billion dollar merger is pending through all of this and incoming shareholder confidence must be maintained for the merger attempt to succeed.
It has all coincided with a recent call from over 500 scientists from 44 countries outlining the cautionary need for a pause in the process of enabling mining in the deep sea.
This was hot on the heels of a June 9 European Parliament resolution calling for the same as well as reforms of the ISA, not to mention sustained and growing pressure from a wide range of international NGOs and Pacific civil society groups calling for moratorium or an outright ban on deep sea mining.
In Aotearoa New Zealand, we are calling on the Prime Minister to ban seabed mining (sign the petition here).
ISA Secretary General Michael Lodge, aboard a DeepGreen vessel. Lodge has appeared in a DeepGreen promotional video and argues strongly against criticisms and opponents of seabed mining. Source, Why the Rush report.
For those that might think, “well, at least this will help Nauru”, we now know that Nauru has agreed in its contract with DeepGreen’s subsidiary not to charge corporate tax. Nauru won’t even receive any royalties if DeepGreen doesn’t move to mining as it claims it will.
Papua New Guinea knows all too well the dangers of entanglement with well resourced mining companies: the country suffered a more than $100 million USD loss at the hands of DeepGreen’s seabed mining predecessor, Nautilus. And yes -DeepGreen’s CEO Gerard Barron was at the heart of that failed venture. Meanwhile, Mexico is being sued in an international tribunal for over $3 billion USD after turning down a proposed seabed mining venture which would have harmed sea turtles.
To put it simply, if unchallenged, DeepGreen, through its Nauruan subsidiary, will in 2023 be granted permission to strip-mine tens of thousands of square kilometres of the deep Pacific seabed continuously for multiple decades, with whatever regulations are in place – or none at all. What’s worse, it could very well trigger a virtual ‘race to the bottom’ by other countries and companies who could follow suit.
New Zealand is in a unique position globally on this issue. We have scrutinised seabed mining and its effects more so than any other country and each time we’ve had a good look, the planned activity has failed to meet the bar, with two having been denied and the third being overturned in court, with two successive courts ruling against it. . A Supreme Court ruling is expected sometime in the next few months.
The question is, will New Zealand or any government stand up and challenge this desperate move by Nauru, an economically challenged small island state, which is under pressure from a privately owned company from the global north? A move that, if left unchallenged, would open up vast tracts of the international deep seabed and drag the whole world into a decades-long commitment to a brand new, highly destructive activity of which the effects, even by admission of its greatest advocate, cannot be reliably predicted.
We call on New Zealand to BAN SEABED MINING in our waters. SIGN THE PETITION.
Learn more here.