Seabed-mining firm faces legal questions over controversial Trump policy

Two months ago, President Donald Trump took an extraordinary step towards issuing permits to mine vast tracts of the ocean floor in international waters where valuable minerals are abundant.

It was a boon to The Metals Company (TMC), an ambitious start-up that had already spent more than half a billion dollars preparing to become the world’s first commercial seabed miner. Within days of Mr Trump’s executive order, the company submitted its application to the federal government.

As a result, some of the company’s international partners are now questioning their relationships with TMC, given that Mr Trump’s order conflicts with a longstanding treaty known as the Law of the Sea, potentially exposing them to legal risks.

The issue with TMC’s seabed-mining application is that nearly every country in the world, but not the US, has signed the Law of the Sea treaty. Its language is clear: Mining in areas outside a country’s territorial waters before nations agree on how to handle the practice is not just a breach of international law, but also an affront to “the common heritage of mankind”.

In May, a Japanese firm that TMC has partnered with in the past to process minerals from seabed-mining test runs said it was “carefully discussing the matter with TMC”, citing the importance of doing business with companies “via a route that has earned international credibility”.

In June, the Dutch Parliament, noting that TMC would be using a ship belonging to Allseas, a half-Dutch company, voted to request that the Dutch government “take and support any possible (legal) action against the US and The Metals Company” if they mine in international waters.

At July meetings of the International Seabed Authority, or ISA, which is a UN-affiliated body that administers the Law of the Sea, delegates hotly debated whether to strip TMC and its partners of exploration permits it had obtained through the ISA in recent years and would soon need to extend.

In an interview on July 18, Mr Gerard Barron, chief executive officer of TMC, dismissed the concerns. “I see those threats as nothing but wing-flapping,” he said.

Mr Barron said that because the US was the world’s most powerful economy, his company’s international partners would simply have to deal with the impending reality of commercial seabed mining and adapt their stances on international law.

He also said that his company’s US permit to start mining in international waters would be issued “sooner than people expect”.

TMC could process its minerals in Indonesia rather than Japan, Mr Barron said, noting that Indonesia and the US signed a hard-fought trade agreement last week.

And Allseas could relocate out of the Netherlands, a move the company’s CEO, Mr Pieter Heerema, alluded to in recent comments to the Dutch press. “We don’t have to, but must be able to consider it,” he said. “The Netherlands was attractive – now it isn’t.”

At a recent UN conference in France, Mr Nathan Nagy, a legal adviser to the US State Department, made a forceful speech defending his country’s stance on seabed mining in international waters, reiterating that the US has “never considered” the Law of the Sea to “reflect customary international law”.

Mr Barron said his company opted to apply for a US permit because the ISA had failed for many years to issue the regulations necessary to begin issuing its own extraction permits in international waters. The ISA had pledged to settle those regulations by 2025, but is widely expected to miss that deadline.

Delegates at the ongoing ISA talks in Kingston, Jamaica, described feverish, closed-door sessions filled with debate over how to address the Trump administration’s decision to start allowing seabed mining in international waters.

On July 21, the organisation’s council, made up of 36 elected member states, stopped short of punitive action but passed a resolution urging the body’s legal and technical committee to investigate “non-compliance” by its signatories. ISA member states are bound by the Law of the Sea to prevent public and private entities in their countries from doing business with anyone mining without an ISA permit, which is precisely what TMC is aiming to do.

“TMC has been testing the limits of what it can get away with, a bit like a child seeing how far it can go with bad behaviour,” said Mr Matthew Gianni, co-founder of the Deep Sea Conservation Coalition, who was present at the talks in Kingston.

“The member countries of the ISA have basically sent a shot across the bow, a warning to TMC that going rogue may well result in the loss of its ISA exploration claims,” he said. “It also sends a signal to other companies that if they go the same route as TMC has, they may also face the same consequences.”

The ISA’s draft regulations, which already stretch to nearly 200 pages, remained largely unsettled. The process has been stymied by disagreements over environmental regulations, including how much sediment seabed miners would be allowed to put back in the water, as well as how much in royalties miners would owe to countries sponsoring their permits.

The ISA’s Brazilian secretary-general, Ms Leticia Carvalho, told delegates in a speech that completing the regulations as soon as possible was “the best tool we have to prevent the chaos that unilateral action could bring”.

“What will prevent the Wild West are the rules,” she said.

TMC’s ISA-issued exploration permits were obtained through intermediaries in the small South Pacific island nations of Nauru and Tonga. They pertain to areas within a vast stretch of ocean floor about halfway between Mexico and Hawaii, called the Clarion-Clipperton Zone.

The seabed there is blanketed with potato-sized nodules containing large proportions of manganese and smaller amounts of nickel, cobalt and copper, all of which have growing uses in military equipment, electronics and large-scale industries such as steelmaking. The US considers those metals critical to national security and has sought new sources of them because China dominates current supply chains.

No commercial-scale seabed mining has ever taken place. The technological hurdles are high and there have been serious concerns about the environmental consequences in the deep sea, a region of the planet that is little understood to science.

Anticipating that mining would eventually be allowed, companies like Mr Barron’s have invested heavily in developing technologies to mine the ocean floors.

This includes ships with huge claws that would extend down to the seabed, as well as autonomous vehicles attached to gargantuan vacuums that would scour the ocean floor. NYTIMES