Selected Decisions and Documents - International Seabed Authority

65. Nautilus Minerals Inc., which in 2008 had indicated that it hoped to commence commercial
production from its Solwara 1 site in the territorial waters of Papua New Guinea by 2010, announced in
December 2008 that, because of the unprecedented speed and severity of the global economic downturn and
the uncertainty in the financial and commodity markets, it has decided to delay or cancel existing contracts
for the construction of the equipment for the Solwara 1 mining system and to reduce its workforce by
approximately 30 per cent. Nautilus has nevertheless stated that it remains committed to its objective of
developing the world’s first seafloor massive sulphide recovery operation and will continue to move forward
with the process of gaining government approval for its mining licence application and for its environmental
permit. In addition, the company intends to continue its focused exploration programme to increase its
resource base. In this regard, it was announced in February 2009 that Nautilus had identified and
characterized a total of 10 new sea floor massive sulphide systems in waters under the jurisdiction of Tonga
(source: www.nautilusminerals.com). Another exploration company, Bluewater Metals Pty. Ltd., an Australian
private company incorporated in the state of New South Wales, announced in February 2009 that it proposed
to conduct an exploration campaign for high‐grade sea floor massive sulphides in waters under the
jurisdiction of Tonga. According to Matangi Tonga, an online news service, the company was granted a
mineral prospecting licence in 2008 and conducted initial research involving a comprehensive review and
reassessment of previous investigations in over 300 published papers and reports. It now intends to conduct
a detailed survey of a number of selected areas, which will entail mapping of targeted areas and a shipborne
survey using high definition sonar multibeam mapping, high resolution side scan sonar, two remotely
operated vehicles and a submersible drill rig.
66. On the other hand, the pessimistic outlook for the mining sector does not appear to be shared by the
offshore oil and gas industry. Leading energy business analyst Douglas‐Westwood forecasts that the
deepwater oil and gas sector will continue its recent aggressive growth trend and will spend $162 billion over
the period 2009‐2013, with particularly strong growth in Latin America and Asia. 3 This reflects the fact that
the bulk of deepwater developments are being led by major oil companies that are less dependent on
external project finance than smaller exploration companies and are thus able to take a long‐term view of
demand and prices for oil. World deepwater production is expected to grow from 6 million barrels of oil
equivalent per day in 2007 to 11 million barrels of oil equivalent in 2011. Key drivers of expenditure forecast
over the next five years include the opening up of reserves further from the coast and the drilling and
completion of subsea development wells, together accounting for nearly 70 per cent of all expenditure. It is
evident that a substantial amount of research and development funding is being directed towards technology
that will make production at greater water depths possible. Petrobras, for example, in its 2009‐2013 business
plan announced in January 2009 that it plans to increase its investment in exploration and production by up
to 71 per cent, with $28 billion allocated to evaluation, development and production of discoveries in the socalled
pre‐salt layer of the Santos and Espírito Santos basins. 4 In Western Europe, it was announced recently
that StatoilHydro of Norway had made a major discovery of gas in the Asterix prospect, which lies in 1,360
metres of water 345 kilometres west of Sandnessjøen in the Norwegian Sea. Preliminary estimates put the
proven recoverable volume at about 16 billion cubic metres (100 million barrels of oil equivalent). 5
67. Also on a more positive note, recent scientific work, particularly in relation to submarine
hydrothermal systems, has helped to extend and improve current knowledge of the hydrothermal mineral
potential of the world’s oceans. For example, two new major hydrothermal fields were recently discovered
and analysed by Russian scientists in the rift valley of the Mid‐Atlantic Ridge. The Ashadze hydrothermal field,
located on the western slope of the Mid‐Atlantic Ridge rift valley consists of three closely related active
hydrothermal sites located at the greatest depth in the ocean (4,200 metres) at which a hydrothermal field
has been found. The Krasnov field, in contrast, is an inactive hydrothermal site, originally identified in 2004,
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3
Douglas‐Westwood, The World Deepwater Market 2009‐2013 (February 2009), available from http://www.dw‐1.com.
4
See http://www.oilvoice.com.
5
Ibid., 16 March 2009.
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