TMC TMC the Metals Company Inc

By Yusuf Khan

Deep-sea mining just took a step closer to becoming a reality, as Canadian miner, The Metals Company, said it would look to submit an application as soon as next July to mine the seabed for battery metals.

In a Nasdaq filing, TMC said that it intends to apply to the International Seabed Authority for an exploitation contract in roughly eleven months time, after the July 2024 ISA meeting and assuming a one-year application review process, expects its subsidiary NORI to be in production by the fourth quarter of 2025.

Deep-sea mining has received more attention in recent months, with governments including France and Germany coming out in opposition to the practice. Companies involved say it offers a chance to exploit the seafloor for commodities like cobalt and nickel which are used in electric-vehicle batteries and therefore key to the energy transition, all the while avoiding human rights issues and land-based destruction. Environmental groups however say it would be destroying an untouched environment while land-based mining continues.

Last week, members of the ISA--a UN-affiliated organization tasked with policing the seafloor--wrapped up meeting in Jamaica to formalize a mining code.

A mining code would outline what can and can't be done when mining the seafloor, as well as establishing rules and regulations around royalties and taxation. However, no agreement was reached during the July meeting, which ran for roughly three weeks. Members are due to meet again in October.

TMC has been one of the most fervent actors in the space and in July 2021, triggered the 'two-year rule', through state sponsor the Republic of Nauru, forcing the ISA to create a mining code within two years. If no code was established by the end of that, a prospective miner could in theory submit an application to mine based on whatever mining code had been agreed upon so far. At present no miner has submitted an application even though the deadline has now passed.

The Canadian miner said that it will require between $60 million and $70 million in additional cash to submit an application to mine following the July 2024 meeting of the ISA. It added that as of June 30 it had $20 million in cash on hand and an undrawn $25 million unsecured credit facility.

"While we were pleased to see the high level of motivation and collaboration among the ISA members who made significant progress in Kingston last month, it is clear the parties need more time to fulfill their legal obligation of delivering the mining code," said Gerard Barron, chief executive of TMC. "After carefully listening during the last three weeks of ISA meetings, NORI now intends to submit an application following the July 2024 ISA session, which gives us more time to strengthen our environmental dataset while providing time for three more council sessions and intersessional work."

Over the past year, TMC has been delisted from Nasdaq twice after its share price dropped below $1 for more than 30 consecutive trading days.

"The Metals Company's announcement flies in the face of international opposition to deep sea mining, and it's a big kick in the teeth for governments that spent three long weeks debating the future of the oceans and concluded this industry should not get a greenlight," Greenpeace campaigner Louisa Casson said.

"It's clear that trying to mine the oceans is becoming politically toxic-even more so with zero rules in place. This is bullish talk to try and force governments into rushed decisions, but it will come back to bite them," she added.

Write to Yusuf Khan at yusuf.khan@wsj.com

(END) Dow Jones Newswires

August 02, 2023 12:26 ET (16:26 GMT)

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