China Looks to Ocean Mining for Metals Used in Batteries

China is undergoing a nationwide pivot to electric-powered transportation, encouraging electric vehicle adoption and creating massive public transport hubs. In an effort to adopt this renewable approach and reduce its dependence on fossil fuels, China will turn its focus to another crucial resource in tomorrow’s energy economy: batteries. Cobalt, lithium, copper and nickel are just some of the precious metals inside batteries, and all will skyrocket in demand as countries continue the long journey away from fossil fuels and towards electrification. By some estimates, on a planet with 1 billion cars, the transition to electric vehicles would require several times more metal than all existing land-based supplies. Is this new scarce mineral dependency really a new-era of sustainability? Perhaps not, but in the meantime mining corporations are looking to new, bluer pastures for crucial ores. Similar to the way hydraulic fracturing led to the dawn of a new era for energy independence for countries like China’s rival, the United States, undersea mining is set to be the next frontier of competition for resources.

The ocean is home to a vast array of available resources just waiting to be mined by those with technology sophisticated enough to access them. For example, diamond mining titan De Beers extracted 1.4 million carats from the coastal waters of Namibia in 2018, and their capacity is only increasing. To establish a regulatory framework for undersea mining, the United Nations created the International Seabed Authority (ISA), based in Kingston, Jamaica. The potential risks from deep sea mining are not very well understood, but one mining technique releases large amounts of sediment in the water, interfering with and damaging ecosystems.

Due to these potentially negative consequences of deep sea mining, the ISA has only begun to grant exploratory permits to governments, research institutions and commercial entities. So far, the ISA has issued a total 30 permits, five of which were to Chinese entities, more than any other nation. The most recent contract, awarded in July 2019, grants China access to a 148,250 square kilometer swathe of the Western Pacific Ocean. Michael Lodge, ISA general-secretary, recently commented, “I do believe that China could easily be among the first (to start exploitation). The demand for minerals is enormous and increasing, there is no doubt about the market.” Lodge believes that the ISA will adopt a draft of seabed mining rules in July 2020. He is confident that the draft will pass. “I think, it’s pretty good. I think the current draft is largely complete,” he said.

What could be mined and where (source: chinadialogue ocean)

Meanwhile GreenPeace has called for an immediate moratorium on deep sea mining to investigate the potential impact on deep sea ecosystems, but the ISA has rejected such a proposal. However, according to University of Hawaii oceanographer Jeff Drazen, undersea mining could have untold consequences for scientific discovery. He points to the many undiscovered microbes in the deep sea, and their potential to facilitate medical breakthroughs. Matt McCarthy, an infectious-disease specialist at Weill Cornell Medical College, told The Atlantic, “The next great drug may be hidden somewhere deep in the water,” he said. “We need to get to the deep-sea organisms, because they’re making compounds that we’ve never seen before. We may find drugs that could be used to treat gout, or rheumatoid arthritis, or all kinds of other conditions.”

Despite these credible concerns, the potential to harvest vast quantities of underwater minerals is simply too enticing to the private sector. China’s status as an energy importer positions the nation as a key beneficiary of deep sea mining. China’s interest in deep sea mining is underscored by its support for the ISA as its biggest benefactor, while also jointly establishing an ocean mining research center in the Chinese coastal city of Qingdao. The research center opening coincided with the signing of a memorandum of understanding between China’s State Oceanic Administration and the ISA.

Some observers of the ISA events believe that China is willing to be patient when it comes to ratification of the mining code, as the current 2020 deadline for the ocean mining code primarily benefits companies with the most advanced technological methods that allow them to conform to guidelines. China’s capabilities for undersea mining still lag behind some of the industry leaders, which would explain the lack of urgency from the Chinese ISA delegation to go forward with the mining code. Another potential reason for China’s patience with the ISA is due to China’s dominance in terrestrial mining, especially for battery components like cobalt. Chinese companies own eight of the 14 cobalt producers in the Democratic Republic of Congo, home to 68% of the world’s cobalt supply.

Kristina Gjerde, a senior high seas adviser at the International Union for the Conservation of Nature, who has attended ISA events for five years, commented, “They may want to wait until they have access to technology in compliance with the best environmental standards. The pace that’s been kept up for the 2020 deadline seems to be purely for the convenience of a couple of companies that are most advanced in their technology.”

Beijing Pioneer Hi-Tech Development Corporation, a Chinese company, was awarded a recent contract from the ISA to explore polymetallic nodules. This is the third entity sponsored by the Chinese government, along with COMRA and China Minmetals. A director of the company said that mining of the mineral-rich ridge in the Western Pacific Ocean is projected to begin between 2030 and 2035.

Liu Feng, secretary general of COMRA (China Ocean Mineral Resources R&D Association), spoke in October 2019 to NewsChina, and outlined the current state of China’s ocean mining technology. “In my view, China’s deep-sea research is getting closer to the most advanced sphere in world deep-sea exploration. We have five contracts, the most of any country, and these cover the largest geographical area. From the technological perspective, we have developed almost all the state-of-the-art technology needed, from resource exploration to processing,” said Liu.