The Metals Company thwarted in its rush to mine the deep sea
After three weeks of negotiations at the International Seabed Authority (ISA) no regulations on deep sea mining were adopted despite wannabe-miner The Metals Company (TMC) and its sponsoring state Nauru attempting to rush the process.
This session was billed as crucial due to Nauru and TMC announcing their intention to mine under a legal loophole called the “two-year rule,” which could allow them to submit a plan of work for exploitation even if regulations are not in place.[i] That two-year deadline expired on 9th July 2023.
Andy Whitmore, Deep Sea Mining Campaign’s (DSMC) Finance Advocacy Officer stated:
“There has been clear push back from ISA members in response to TMC’s brazen attempt to rush regulations. There is no likelihood of a mining code being adopted anytime soon. ISA members agreed to continue negotiations, assess in 2024 the feasibility of adopting exploitation regulations in 2025, but to develop yet another road map if they are not ready by then.”[ii]
“The fact that Nauru spoke out against the decision,[iii] and there was a 20% drop in TMC’s share price after the ISA Council meeting, demonstrates that this is bad news for TMC.”
Despite the clear concerns of ISA member states, TMC announced yesterday that they intend to submit an application for commercial mining to the ISA following the July 2024 meeting regardless of progress on regulations.[iv]
Mr Whitmore responded:
“By not applying this year as threatened, TMC has acknowledged the opposition of ISA members to commercial mining being carried out in the absence of the mining code.[v] This stance was repeatedly emphasised by ISA members throughout the meeting with an ISA participant noting that it ‘now seems deeply rooted’ in delegates’ minds.”[vi]
TMC is again downplaying the likelihood that regulations will not be completed by their self-proclaimed deadline of next July. They are also downplaying the chances an application will fail due to: the lack of clarity surrounding the process for making a decision; problems in how certain provisions would work if the mining code is not completed;[vii] and if a licence is approved it will most likely face a legal challenge.[viii]
“They are also rapidly running out of cash. TMC notes their new deadline requires an additional US$60 to 70 million to submit an application in a year’s time. They have only US$20 million in the bank, and even with a credit facility from partner Allseas of US$25 million they will be short of cash without issuing shares and diluting their stock.”
“The situation is likely worse, given rising inflation and interest rates, as recently pointed out by entrepreneur Victor Vescoe.”[ix]
Concluded Mr, Whitmore.
_______________________________
For more information
Andy Whitmore, +44 7754 395597, andy[at]dsm-campaign.org
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