Could Deep Sea Mining Break China's Grip on Critical Minerals?

President Trump has described seabed resources as “key to strengthening our economy [and] securing our energy future.” He has called for “immediate action” to explore and map the seafloor and to collect and process the minerals there.

One big challenge: Those nodules can’t just plug into an electric car and be ready to go. They need to be processed and refined into usable compounds. But the technology to extract all four critical minerals from nodules remains largely unproven. One country has come to dominate mineral processing worldwide and is well positioned to take over the processing of nodules, too. That would be China.

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“China has come to dominate mineral processing worldwide and is well positioned to take over the processing of nodules, too.”
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“China is ready to make it happen,” said Fabian Villalobos, a senior engineer at RAND. “People see seabed mining as something China has not yet dominated. They think it’s an opportunity to escape China’s control of the market. But if other countries don’t start to figure out how to enter this market and process these nodules, that’s just another resource that China will probably dominate in a few years after a regulatory framework is in place.”

The United States should consider developing that side of the industry with as much urgency as the mining itself, RAND found. Some efforts are underway to design and build processing plants in the United States. Federal grants, loans, and purchase agreements could help get those projects off the ground. “You can mine all you want,” LaTourrette said. “If you send it all to China for processing, you’re not helping one iota.”

China knows this, too. As part of their study, researchers interviewed representatives from half a dozen mining companies. Most said China is already pushing hard to sign processing deals, before their mining equipment even hits the water.

Weighing the impacts: Mining on land has often had catastrophic impacts: environmental damage; mineral conflicts; displaced communities; human-rights abuses. Seabed mining could provide an alternative, researchers noted. But the impact that mining could have on the deep ocean—or on related industries, like fishing—is not well understood.

Federally funded research could identify and mitigate environmental risks, RAND found—and help address some of the opposition to seabed mining. But the list of potential impacts that need more study is much longer than that. Seabed mining could trigger new territorial disputes and increase the need for maritime security forces. It could crash mineral prices, straining some developing countries that rely on mineral royalties.

For example: The Democratic Republic of Congo. Its budget rests on royalties it receives from its sprawling cobalt mines. In every scenario RAND studied, it stands to lose millions—maybe hundreds of millions—of dollars annually if seabed mining supplants those mines.

“The geopolitical implications of this are going to be huge,” LaTourrette said. “There’s a lot of money at stake. But beyond that, you need these minerals for technologies that are only becoming more important. If you can’t source these minerals, then you can’t compete in the global market.”

Millions of tons of critical minerals are thought to be sitting on the seabed, far more than miners could ever find on land. By most estimates, those seabed nodules could more than meet U.S. demand in the decades to come. The early explorers who first hauled them onto deck had no idea how valuable those dirty potatoes would become.

Doug Irving is a communications analyst at RAND. This article is published courtesy of RAND. This articleis published courtesy of RAND.