The Impact of Seabed Nodule Mining: A Qualitative Analysis

Tilton, J.E. (1983). The Impact of Seabed Nodule Mining: A Qualitative Analysis. IIASA Research Report. IIASA, Laxenburg, Austria: RR-83-033

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Abstract

This paper considers the future effects of seabed mining on the cobalt, copper, manganese, and nickel industries, and the implications for producing and consuming states. Two general conclusions emerge.

First, estimating the future impacts of seabed mining is an extremely complicated and difficult endeavor. There is much disagreement about the relative costs of seabed and land-based production. How scientific breakthroughs and other technological developments will alter future costs is simply unknown, and to some extent unknowable. Moreover, relative costs alone will not be the only determinant of the future level of seabed mining. Some countries may support such production to lessen their dependence on foreign producers. Thus production may be influenced as much by political decision as by economic considerations. Even if the future level of seabed mining could be ascertained, its impact would be difficult to assess ex ante. Such assessments require knowledge of long-term supply and demand curves, and it is not clear how these curves will shift over time in response to resource depletion, technological progress, the introduction of new materials, changes in mineral policies, and other factors.

Second, the potential impacts of seabed mining appear to vary more and to be less bounded than is often presumed. The necessary technology, particularly on the scale required, has not yet been proven, and, it is not clear whether the requisite policies to protect investments are in place. These uncertainties raise the possibility that seabed mining could face a fate similar to that of oil shale, where for many years commercial production appeared imminent, but the goal remains elusive. Moreover, the impacts of seabed mining are not fully appreciated as is evident by the argument that seabed mining could not force existing land-based mines to close. The rationale for this position overlooks the potential influence of new technology on relative costs of both seabed and land-based mining and ignores the coproduct nature of seabed operations and the substantial effect of even limited production on the cobalt market and perhaps the manganese market.

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