Rare Earths: Is offshore mining a reality?
Rare Earths: Is offshore mining a reality?
Posted on 4th October 2018 in General News.
Last month, Chatham Rock Phosphate formed a 100% owned enterprise, Pacific Rare Earths, to evaluate the recoverability of rare earths from phosphate nodules on the Chatham Rise, which extends due east from New Zealand into the Pacific Ocean. Earlier this year, rare earth news was flooded several times with headlines of offshore rare earths in Japan’s exclusive economic zone with “centuries worth of resources that could cut the country’s reliance on supply from China”.
Roskill view: Before considering offshore rare earth deposits, it is important to remember that there are several large rare earth resources classified across the globe outside of China, adding up to over 45Mt of contained rare earth oxides (REO), although less than 2Mt are proven reserves. Despite this, Roskill estimates that 80% of supply will be sourced from China in 2018 and most advanced projects in the pipeline are supported by Chinese downstream processors through off-take agreements.
Offshore mining is a relatively new concept compared to conventional land mining and targets polymetallic nodules and rocks between 1km to 6km seawater depth. One of the only well-established offshore mining operations is diamond mining off the coast of Namibia, which began in the 1960s, however, this is in shallower 100m to 200m deep waters on the coastal shelf. Papua New Guinea was the first country to approve a permit for the exploration of minerals in the deep seabed, but seabed mining is not expected to take off elsewhere anytime soon. Despite the high cost of deep-sea dredging to recover raw materials, the main hurdle for offshore mining is environmental protection of highly sensitive marine life ecosystems. New Zealand authorities have already rejected several marine mining licences. It remains to be seen if critical materials such as rare earths used in new energy and high-tech applications will swing the possibility of offshore mining into reality. It is unlikely that offshore mining will provide a solution to oncoming growth in demand from electric vehicles over the next 10 years.
To discuss the rare earths market with Roskill, contact David Merriman: merriman@roskill.com, or Nils Backeberg: nils@roskill.com
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