Deepsea Copper Mine Versus Terrestrial Mines

By Wendy Laursen 2015-06-01 19:22:26

Earth Economics has released an independent environmental and social benchmarking analysis of Nautilus Minerals’ proposed deep seabed mining project. The primary goal of the analysis was to measure the environmental and social impacts of the Solwara 1 project off Papua New Guinea in comparison with three terrestrial mines.

The report’s analysis is based on natural capital accounting and concludes that the Solwara 1 project has the potential to significantly reduce social and environmental impacts commonly associated with large surface terrestrial copper mines.

Specifically, the report compares Solwara 1 with three terrestrial mines: Bingham Canyon (Utah, U.S.), Prominent Hill (South Australia, Australia) and Intag (a proposed mine in Intag Province, Ecuador).

Solwara 1 is expected to be the world’s first commercial high-grade seafloor copper-gold mine project. The mine site is approximately 30km (18 miles) from shore in the Bismarck Sea in around 1,600m (5,000 feet) of water. The site has indicated resources of one million tons grading 7.2 percent copper, five grams (0.18 ounces) of gold per ton, 23 grams (0.81 ounces) of silver and 0.4 percent zinc. Inferred resources add 1.5 million tons of 8.1 percent copper, 6.4 grams of gold, 34 grams of silver and 0.9 percent zinc.

Global Demand

Regarding the market conditions for the project, the report findings include:

• World demand for copper continues to rise, with increasing global economic development, expanding renewable energy supplies (wind, hydro, wave geothermal, tidal power) and growing copper plumbing, electronics and communications sectors.

• Recycling is likely limited to around 35 percent of the supply of copper. Copper ore concentrations are declining. Environmental and social impacts of copper mining are rising.

• There is an urgent need to meet world copper demand while reducing fresh water use and contamination, damaging impacts to communities, mine footprints and CO2 emissions from copper mining.

• Seafloor mining has the potential to minimize the impact of copper mining by producing more copper with fewer natural capital inputs, fewer damaging outputs and a smaller area of impact.

Environmental Impacts

The proposed Solwara 1 project, when compared to the terrestrial mines, entails far less environmental and social impact and less short and long-term risks, says Nautilus.

The excavation and collection of mineralized material has been split into three individual tasks, which will each be carried out by a different seafloor production tool. The auxiliary cutter is designed as the pioneering tool which prepares the rugged sea bed for the more powerful bulk cutter. These two tools gather the excavated material; the third, the collecting machine, will collect the cut material by drawing it in as seawater slurry with internal pumps and pushing it through a flexible pipe to the subsea pump and on to the vessel via the riser and lifting system.

Terrestrial mines have significant impacts. Measured on the basis of impacts per ton of copper, the Solwara 1 project would outperform terrestrial mines:

• People will not be displaced by the proposed Solwara 1 project

• There will be no impact to food production

• There will be no impact to surface or groundwater fresh water supplies

• There will be no significant risk of disaster (e.g. mine tailing slide into communities)

• There will be no impact to pollination, soil formation, erosion, historic and cultural values

• The monetary damages (measured in terms of USD/year) resulting from terrestrial mines is estimated to be significantly more than that of the proposed Solwara 1 project (4 to 13 times per ton of copper produced for the three mines used in the comparison).

• The long-term mining liabilities for freshwater contamination, tailings and overburden failures that threaten downstream communities do not exist in Solwara 1.

Mike Johnston, CEO of Canadian-based Nautilus, said, “Growing copper demand requires our industry to look at more sustainable ways to meet this demand. As showcased in Earth Economics’ report, seafloor mining has the potential to not only provide economic benefits within the communities nearest to the operations while minimizing the impact of copper mining, it also has the potential to change the physical nature of the mining industry for the better.

“We believe that the proposed Solwara 1 project will launch a new frontier in the blue economy and resource sector. As the first publicly-listed company in the world to commercially explore seafloor mining opportunities, Nautilus is committed to leading the way and setting a high bar for developing an environmentally and socially responsible approach for the industry. Commissioning this report is part of our ongoing process to review, estimate and evaluate project impacts through objective third-party experts,” he added.

Purpose Built Vessel

It is anticipated that the proposed Solwara 1 project will commence operations in the first half of 2018 subject to project financing and completion of the company’s seafloor production equipment and vessel. The production support vessel is being built in China by Fujian Mawei Shipbuilding.

Marine Assets Corporation (MAC), a marine solutions company based in Dubai which specializes in the delivery of new build support vessels for the offshore industry, will own and provide the marine management of the vessel. The vessel will be chartered to Nautilus for a minimum period of five years at a rate of US$199,910 per day, with options to either extend the charter or purchase the vessel at the end of the five year period.

When completed, the vessel will measure 227m (750 feet) in length and 40m (130 feet) in width with accommodation for up to 180 people and generate approximately 31MW of power. All of the below deck mining equipment will be installed in the vessel during the build process to minimize the equipment integration to be completed following delivery of the vessel. The vessel is expected to be delivered by the end of 2017.

Dispute Resolved

In 2013, an arbitrator ruled in favor of the Canadian company in a dispute with Papua New Guinea over the ownership of the Solwara project after a nearly two-year battle.

Nautilus had accused the government of not coming through on its share of financing for the project, while the government had accused Nautilus of not fulfilling some of its obligations.

The report is available here.

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Impact Study Delivered for Nicaraguan Canal

By Reuters 2015-06-01 18:16:03

A long-awaited study on the impact of the proposed $50 billion Nicaraguan waterway by a British consultancy has been delivered, a canal official said on Monday, the first major milestone since a symbolic groundbreaking six months ago.

The social and environmental impact study by the consultancy, Environmental Resources Management Ltd, will be discussed by an inter-institutional commission in June, before being voted on by the canal commission in July, Telemaco Talavera, spokesman of the government canal commission, said.

The 172-mile (278 km), Chinese-backed project, which the Nicaraguan government says will be operational by 2020, is one of the world’s most ambitious infrastructure schemes, but has been met with widespread incredulity.

Hong Kong-based HK Nicaragua Canal Development Investment Co Ltd (HKND Group), which is controlled by Wang Jing, a Chinese telecom mogul well connected to China’s political elite, owns the concession to build and operate the canal.

“In summary, ERM says that the project offers potential benefits for the environment and the people of Nicaragua,” Talavera told state media, without giving more details.

ERM spokesman Manuel Roman said on state media that the company was not for or against the project, adding that the study had highlighted the potential challenges of the scheme for the government and HKND to decide how to proceed.

After a chiefly symbolic groundbreaking ceremony in Managua last year, from which members of the international media were barred, Wang Jing said the environmental study would be finished by the first quarter of 2015, with excavation work beginning by the end of September.

Nicaraguan presidential spokesman Paul Oquist said in December that feasibility studies, including a McKinsey report that experts say will define interest in financing the canal, would also be ready by April.

In January, the U.S. embassy in Managua said it was concerned by a lack of information surrounding the canal, calling for all relevant documents pertaining to the project to be made public.

If completed, the canal could give China a major foothold in Central America, a region long dominated by the United States, which completed the Panama Canal a century ago.

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Stranded Tanker Arrives in Port

By Kathryn Stone 2015-06-01 12:44:22

The disabled Afromax tanker Lady M finally arrived at the Port of Las Palmas Sunday after being stranded two weeks following an onboard fire.

The 115,418 DWT fuel tanker, owned and operated by Atlas Maritime, was carrying around 90,000 tons of fuel when a May 14 fire struck the vessel, disabling its engines. The incident occurred about 500 nautical miles off the Azores Islands.

Following the fire, the Lady M was denied entry into port until inspectors could determine the condition of the vessel and that it matched descriptions from the owner. According to European Union law, petroleum tankers are forbidden from docking in foreign ports without receiving prior permission. While ascertaining the exact situation onboard, the Coast Guard ordered the vessel to stay at a location about 60 miles off the Coast of Gran Canaria.

Greenpeace Spain expressed concern over this action last Friday citing that the Lady M was carrying 13,000 tons of oil more than the Prestige vessel, which in 2002 resulted in the largest oil spill for both Spain and Portugal. The organization urged Spanish authorities to permit the vessel entry in a nearby port to avoid any potential spill of the ‘dangerous cargo’.

Four tugs assisted in bring the vessel into the Port of Las Palmas Sunday and the port authority has reported that the hull is in very good condition and not at risk of spilling oil. On Monday the Lady M was subsequently transported to the Reina Sofia dock for repairs, which are expected to take between 10 and 15 days.

The vessel was traveling from the Perisan Gulf to Texas when the fire was reported and is set to resume course once repairs are completed.

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Chevron Moves Big Foot Platform After Damage

By MarEx 2015-06-01 20:24:19

Chevron Corporation has advised that the Big Foot tension-leg platform (TLP) will be moved to sheltered waters from its location in the deepwater U.S. Gulf of Mexico following damage to subsea installation tendons.

The tendons were pre-installed in preparation for connection to the Big Foot TLP. Between Friday, May 29 and Sunday, May 31, 2015, several tendons lost buoyancy.

The Big Foot TLP was not connected to any subsea wells or tendons at the time of the incident and was not damaged. There are no producing wells at Big Foot at this time. There were no injuries and there has been no release of any fluids to the environment.

Damage to the tendons, which are not connected to subsea wells and are used to attach the TLP to the seafloor, is being assessed.

The $5 billion platform has a production capacity of 75,000 barrels of oil and 25 million cubic feet of natural gas per day, with living quarters for as many as 200 crewmen.

First production will not commence in late 2015 as planned, said Chevron in a statement.

The Big Foot field was discovered in 2006 and has an estimated total recoverable resources limit of over 200 million barrels of oil equivalent which Chevron plans to extract over the course of 35 years. The water depth at the field is around 5,200 feet (1,500m).

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