Norway is one of the first countries to formally authorize seabed mining activities in its waters after its parliament backed plans in January to prospect for minerals across 280,000 square kilometers (108,000 square miles) of its Arctic continental shelf.

“We will be attentive to the developments of deep sea mining in Norway and also around the world,” Maros Sefcovic, the bloc’s green deal chief, said at a press briefing. “Norway is one of the countries which is very careful when it comes to the protection of the environment.”

The nation meanwhile signed a memorandum of understanding with the EU on Thursday to develop land-based raw materials and Sefcovic didn’t rule out potential further collaboration in the future.

Sefcovic added that in May the EU would open a call for proposals for prospective mining projects for key raw materials from friendly countries as part of its plans to protect its supply chains during the transition to net zero by the middle of the century.

In trying to shift away from Russia for fossil fuels and China for key raw materials, the EU has boosted its reliance on Norway, which has an abundance of both.

But scientists have condemned sea bed mining and caused for a moratorium, citing a lack of data on its environmental and climate impacts. Jan Christian Vestre, Norway’s trade minister, defended the move.

“We need to extract more minerals for the green and digital transition,” he said. “We’re also talking about our resilience and strategic autonomy. We don’t want to be so dependent on countries from other parts of the world.”

(By John Ainger)

The Swiss company totalled 432.8 million tonnes of carbon dioxide equivalent last year, compared with in 2022, reversing the downward trend of recent years.

In its 2024-2026 Climate Action Transition Plan (CATP), Glencore noted it was still “on track” to meet its 15% reduction of carbon dioxide equivalent emissions for its industrial assets from 2019 levels by the end of 2026, and of 50% by the end of 2035.

The rest of Glencore’s revised climate plan is much like a previous plan it released — but this time includes the interim 2030 target.

“[The new plan] reflects a wide range of inputs, including analysis of the evolving market landscape, new regulatory requirements, mining and energy peer approaches, the IEA’s latest modelling, stakeholder inputs, and emerging insights from the most recent United Nations Framework Convention on Climate Change (UNFCCC) dialogue,” chief executive officer Gary Nagle said in a statement.

“We have also undertaken extensive engagement with our shareholders and appreciate their time and support as we have developed this CATP,” Nagle noted.

Glencore, like most of the world’s biggest listed companies, published its first climate action plans in 2020 in a bid to help with reaching the 2015 Paris Agreement goal of capping temperatures within 1.5 degrees Celsius.

The Baar, Switzerland-based firm, one of the top global thermal coal exporters, has faced backlash for being one of the few top miners still involved in the extraction of the fossil fuel used to generate electricity.

After facing pressure from major investors and shareholders, Glencore committed to run down its coal mines by the mid-2040s, closing at least 12 by 2035.

“We recognize the different roles of thermal coal and steelmaking coal – and the different transition pathways for both,” Nagle said while presenting the new strategy.

The executive noted the company “remains committed” to the responsible phase-down of its coal portfolio and is not progressing any greenfield thermal coal investments. 

The company continues to produce and recycle commodities considered key for today’s cleaner transition technologies. Nagle said the speed and direction of Glencore’s decarbonization efforts are significantly shaped by geopolitics, policy decisions, and technological advancements.

Tackling Scope 3 emissions

Glencore plans to cut “Scope 3” emissions — those produced when customers burn or process a company’s raw materials — by 30% by 2035 and achieving net zero Scope 3 emissions by 2050.

The company did not include its marketing activities in the these goals. It justified the decision by saying that, by trading in the third party volumes, its activities do not generate additional Scope 3 emissions, “which in the ordinary course are associated with the transformation or use of the product by third parties”.

Glencore recently acquired a 77% interest in Teck’s (TSX: TECK.A, TECK.B)(NYSE: TECK) steelmaking coal business, Elk Valley Resources (EVR). The transaction remains subject to mandatory regulatory approvals and is expected to close by no later than Q3 2024.  

Any increase in cobalt holdings would be aimed at reducing reliance on China, which dominates the processing of the material used to make missiles, aerospace parts, magnets for communication, and radar and guidance systems.

Cobalt is also used to make the batteries that power electric vehicles, a key plank of the energy transition.

The DLA’s stockpiling plans which run from October 2023 to September 2024 did not include, opens new tab cobalt, surprising the market, which had expected the 60% price drop to around $16 a lb since May 2022 to incentivise purchases.

DLA spokesperson Joe Yoswa said: “DLA … conducts critical material supply chain assessments biennially to determine NDS (National Defense Stockpiles) requirements. Cobalt is not currently presenting as a vulnerability requiring stockpiling.”

“Should that change in the future, DLA will reassess and make an appropriate recommendation on stockpiling to the Undersecretary of Defense for Acquisition and Sustainment.”

Yoswa added the NDS is “for defense purposes and is not an economic stockpile” and that “the current price of a commodity cannot be used as justification to acquire materials”.

The unfavourable price backdrop prompted cobalt and nickel supplier Jervois Global to suspend final construction of its Idaho cobalt operations in March last year, which would have been the only primary cobalt mine in the United States. It was expected to produce 2,000 metric tons a year.

Prices are likely to remain depressed due to slowing sales of electric vehicles which use cobalt-containing batteries, and new battery chemistries that don’t use it.

The sources said some of the impetus for the move to assess cobalt came from a letter sent by Congress in September 2022 to the Department of Defense (DoD) asking it “to direct” DLA “to prioritize the acquisition of domestically refined cobalt”.

The letter signed by lawmakers Byron Donalds, Don Bacon, Eric A. “Rick” Crawford, Kevin Hern and Markwayne Mullin cited “a heavy dependence on other countries’ refined cobalt, particularly China” as a reason to add to US stockpiles.

Spokespeople confirmed Mullin and Donalds signed the letter, while those for Crawford and Hern did not respond to requests for comment.

“As indicated in his 2022 letter to Under Secretary of Defense (William) La Plante, Congressman Bacon believes the Department should move aggressively to secure domestic sources of critical minerals including cobalt,” a spokesperson for Bacon said.

Most of the cobalt mined in Congo, amounting to 77% of global supplies or more than 170,000 tons last year, according to Darton Commodities, was exported to China for processing into metal or chemicals for batteries.

The NDS “lacks sufficient cobalt reserves, endangering America’s critical mineral supply chain”, the letter said, adding that: “From approximately 13,000 tons during the Cold War, cobalt in the Stockpile is now estimated at 333 tons”.

“In practical terms, the total cobalt stockpile is only 5 percent of annual US consumption.”

Yoswa declined to comment on how much cobalt DLA has in its stockpiles. “The National Defense Stockpile does hold 99.8% pure cobalt, but we won’t provide the amount that we hold for security purposes,” he said.

(By Pratima Desai and Ernest Scheyder; Editing by Veronica Brown and Mark Potter)

Greenpeace activists in late 2023 disrupted a research expedition when they boarded sea explorer The Metals Company’s vessel in the remote Pacific. Five Greenpeace activists boarded the MV Coco on November 25 and disabled its A-frame hoist/crane.

The vessel, engaged by TMC’s subsidiary, Nauru Ocean Resources (NORI) for environmental assessments, faced a week of disruptions from Nov. 23 by Greenpeace activities, which a Dutch court deemed unsafe and unlawful.

In December, a Dutch court ordered the activists to vacate the research vessel after the deep-sea mining company sued Greenpeace in the Netherlands, where the organization is headquartered.

The Metals Company says the research trip interrupted by Greenpeace was for scientific research aimed at improving knowledge of the effects of nodule collection.

It says the work had been requested by the ISA as part of an impact assessment, and that Greenpeace deliberately hampered those efforts when its activists boarded the company’s research vessel.

Greenpeace says the action was justified because The Metals Company has stated its plans to proceed with mining before regulations have been agreed upon.

Minerals and metals such as cobalt, nickel, copper, and manganese can be found in potato-sized nodules on the ocean floor. Reserves are estimated to be worth anywhere from $8 trillion to more than $16 trillion, and they are in areas where companies, including The Metals Company, plan to target.

Many NGOs and environmental groups, however, argue that mining the seafloor could have a devastating impact on the planet.

A recent report by the non-profit Planet Tracker says mining the seafloor for key minerals and metals could negatively impact the mining industry, resulting in $500 billion of lost value and causing damages to the world’s biodiversity estimated to be up to 25 times greater than land-based mining.

Read More: US bill supporting seafloor mining lifts The Metals Company

According to the study, confidence in the world’s ability to achieve net zero by 2050 seems to be eroding as it becomes more difficult to ensure adequate investment returns and progress diverges in a fragmenting world. This view is consistent across most regions and is most strongly held among people working in the oil and gas sector.

Bain & Company surveyed over 600 industry executives in mining, oil and gas, utilities, chemicals and agribusinesses across the globe to better understand their views on the energy transition, new technologies, and investment opportunities, and where they see the greatest challenges for decarbonization.

“This year’s survey found that energy and natural resource companies have not dampened ambitions for their transition-oriented growth businesses. However, customers’ willingness to pay is a growing issue, as is the ability to generate adequate return on investment (ROI) in energy transition-oriented projects. As a result, companies are focusing on projects with a viable ROI path,” said Joe Scalise, head of Bain & Company’s energy and natural resource practice. “The longer the executives are at the front lines of the energy transition, the more sober they are getting about the transition’s practical realities.”

The survey points out that executives in the Middle East (61%), Asia-Pacific (55%), and Latin America (51%) are feeling more optimistic about the prospects of their transition-oriented growth such as renewables, hydrogen, bio-based products, and lithium and other transition commodities that will contribute to their company’s valuation and profits by 2030. Hence, they are maintaining or increasing green investments. Only 4%, 12% and 10%, respectively, of executives from the three regions expressed less optimism, while the remainder showed no significant change.

The survey revealed a more balanced picture in Europe where 30% of executives revealed more optimism vs. 27% who were less optimistic about their new energy growth business areas contributing to the bottom line.

In North America, 29% of executives were more positive compared to 17% who were less positive on their transition-related growth areas.

Returns to scale-up

“Like last year, executives say the greatest obstacle to scaling up their transition-oriented businesses is finding enough customers willing to pay higher prices (or having equivalent policy support) to create sufficient return on investment,” the report states. “In fact, the share of executives identifying this as a very significant roadblock jumped 14 percentage points from 2023 to 2024, to 70% of executives.”

The experts behind the study note that the direct impact of higher interest rates on the cost of transition projects is likely shaping executives’ perspective on the challenges associated with customer willingness to pay. 

Bain has found that higher rates put upward pressure on the effective cost of low-carbon projects and a 500-basis-point increase in the cost of capital can increase the total annual revenue required to finance a project by as much as 50%.

Trendy North America

The survey presents North America as an emerging leader for green investments as 79% of all executives view it as an attractive region for energy transition investments. The next most attractive region is Europe at 65%. 

Australia and New Zealand come in as second runner-ups at 43%. 

Even as increasing government subsidies make some regions, such as North America, more attractive for investment, executives have growing concerns about policy stability.

The US Inflation Reduction Act is a major factor in North America’s investment attractiveness, but factors such as the availability of relatively low-cost natural gas feedstock also influenced the result. 

“However, while almost two-thirds of US executives surveyed agree that the IRA’s subsidies target the right areas, less than one-quarter believe that the policy regime will remain stable over the next five to 10 years,” the dossier states. “Furthermore, 42% of US executives think the IRA’s subsidies are unclear and that the rules are not easy to follow.”

About 70% of executives worldwide say that reducing policy uncertainty would very significantly improve their ability to scale up transition-oriented businesses.

A suspected arson attack caused production at the plant near Berlin to be halted for a week earlier this month, prompting Tesla chief executive Elon Musk to visit this week.

The elections for the new works council, to be held on March 18-20, are aimed at filling 39 seats, according to IG Metall, the top German trade union which has put forward 106 candidates in an attempt to get a majority.

That would enable it to elect the council’s chairperson and gain greater control over areas where the union has taken issue with the carmaker, which is known for its critical stance towards unions.

Among IG Metall demands is to hire new employees, better planning of working hours, at least 20 days of freely available vacation, better health protection, more security, higher pay and shorter working hours.

“Too often, savings are made on accident protection for ‘Tesla Speed’. That has to change,” IG Metall district manager Dirk Schulze said in a statement.

In order to end the understaffing of shifts, temporary workers should be hired, the union added.

Michaela Schmitz, the plant’s current works council head, told Reuters in e-mailed comments that much had been achieved over the last two years, including pay increases of up to 18%, improvements in occupational health and safety and benefits, including bike sharing and free bus rides.

“All of the aforementioned successes were achieved without the union or a collective bargaining agreement, quickly, easily and customised to Giga Berlin,” she said, adding that meant there was no need for “external influences in the future” – implying IG Metall.

In October, Tesla rejected IG Metall claims that health and safety provisions at its gigafactory near Berlin were inadequate, saying protecting workers was a top priority.

The company also last year raised salaries for the plant’s 12,500 workers, which regional IG Metall head Dirk Schulze welcomed at the time, while still calling for better working conditions at the plant.

(By Christoph Steitz; Editing by Barbara Lewis and Clelia Oziel)

President Felix Tshisekedi had sought to re-negotiate the terms of the joint venture to bring more benefits for Congo, the world’s biggest cobalt producer.

Under the revised deal, both parties have agreed that China will invest up to $7 billion in infrastructure projects in the central African country, up from $3 billion in the original agreement.

They have also agreed Chinese partners, including Sinohydro and China Railway group, will pay 1.2% of royalties annually to Congo while maintaining the same shareholding structure.

“Today, at the end of several months of negotiations, we reached this advent,” Minister Muvunyi said at the signing ceremony in the capital Kinshasa

Congo is also the world’s third-largest copper producer and holds significant deposits of lithium, tin, tungsten, tantalum and gold.

(By Benoit Nyemba and Sofia Christensen)

Coronavirus pandemic fallout and Moscow’s war in Ukraine have sent Western governments scrambling to reduce their reliance on Chinese supply chains and disentangle their economies from Russia.

But as Washington plots a course for its energy transition it is lagging behind China, which has spent the past decade securing access to minerals needed for the production of products like electric vehicle batteries and solar panels.

“We don’t want to be overly reliant on any one country or any one company for global supply chains for critical minerals,” Adeyemo told Reuters during a visit to a platinum mine in Marikana, South Africa, owned by Sibanye-Stillwater.

While the US government has launched a raft of measures to incentivize increased production of strategic and critical minerals at home, notably under the Inflation Reduction Act, Adeyemo acknowledged that overseas resources were also vital.

“Africa is going to play a huge role,” he said. “A lot of critical minerals are located here.”

Chinese assets in Africa already include massive copper and cobalt projects in Democratic Republic of Congo and Zambia as well as lithium in Zimbabwe, where companies are assisted by heavy Chinese state investment in accompanying infrastructure.

Adeyemo said the United States was working with G7 allies to close that infrastructure gap.

The US International Development Finance Corporation is, meanwhile, aiming to de-risk private investment in Africa. And the deputy secretary said Washington was incentivizing US manufacturing to boost demand for those minerals and create favourable market conditions for miners.

But he added that the White House also stood ready to ensure a level playing field.

“We are talking to our European allies … about some of the actions we can take using trade tools to make sure that a country like China can’t flood the market with things like electric vehicles and solar panels,” he said.

Hold accountable

Regarding Russia, Adeyemo said countries like South Africa also had a role to play.

In the wake of Moscow’s 2022 full-scale invasion of Ukraine, the US government slapped sanctions on a number of Russian miners and mineral exports. But it left Russian platinum group metals (PGM) largely untouched.

The United States is a major consumer of palladium, a PGM used in catalytic converters, with 32% of its imports of the metal coming from Russia between 2019 and 2022, according to the US Geological Survey.

“South Africa has a real opportunity to help supply the global economy,” Adeyemo said. “And it gives us the ability to take other actions to hold Russia accountable.”

South Africa is a major palladium producer, and Sibanye-Stillwater mines the metal both in Marikana and at a US project in Montana.

“Between what comes out of South Africa and what’s produced in the US, the US does not need to be dependent on sources from any other country,” CEO Neal Froneman told Reuters.

However, he said companies like his needed US government support.

“You can provide loans or introduce tariffs or whatever it might be,” he said. “That is a role that they need to think very differently about and help companies that are trying to source and provide these critical metals into those ecosystems.”

(By Joe Bavier; Editing by Mark Potter)

Ambassador Cong Peiwu said the Canadian government is “wrong” to prevent Chinese investors from buying majority stakes in domestic mining companies, like it did in 2022 when it forced three Chinese state-owned firms to divest from a trio of lithium companies.

“Politicizing normal commercial cooperation and using national security as a pretext for political interference is wrong. China has expressed firm opposition to this,” said Cong in an interview with Bloomberg News on Wednesday.

“We’ll continue to do business on the basis of mutual respect and mutual benefit.”

The comments follow remarks by Canada’s Natural Resources Minister Jonathan Wilkinson last week warning miners that Chinese stakes will face strict national security reviews.

Chinese investment has continued to flow through Canada’s mining sector more than a year after Trudeau moved to tighten its foreign ownership rules.

This year alone, Zijin Mining Group Co. initiated plans to buy a 15% stake in Canadian copper company Solaris Resources Inc., Ganfeng Lithium Group Co Ltd. moved to take a 15% stake in Vancouver-based Lithium Americas Argentina Corp. and Yintai Gold agreed to buy gold explorer Osino Resources Corp. for C$368 million ($271 million).

Canadian government officials, speaking on condition they weren’t named, have told Bloomberg they are tracking the issue closely and are considering whether further measures are needed beyond the current national security review regime.

While Wilkinson warned that recent transactions will be subject to rigorous reviews, Cong urged Canada’s government to “respect market laws, rather than shouting slogans against China and waging these wrong-placed accusations against China by over-stretching the concept of national security.”

China has found an ally in Canada’s cash-strapped junior mining firms, some of which have called on Ottawa to relax tougher rules on Chinese investment while the sector struggles to raise capital while commodity prices are low.

China’s investments provide capital to those firms at a time when metals have become an essential ingredient to the global transition away from fossil fuels. Minerals including lithium, copper, nickel and cobalt are key components of electric vehicles, solar panels and wind turbines, though countries like Canada and the US have pushed to build a domestic supply chain to reduce China’s dominance in the global mining industry.

“Critical mining is about those materials to be used in sectors like new-energy vehicles,” said Cong. “That’s good for the whole world. We’re talking about coping with climate change.”

(By Jacob Lorinc and Brian Platt)

CHART: China’s Belt and Road mining investment hits record

The Responsible Use of Seafloor Resources Act calls for federal resources to be allocated towards refining polymetallic nodule materials and advises several analyses across benefit sharing, technology development, trade, and environmental and human health.

The Act calls for the government to coordinate and expedite the development of infrastructure to process and refine seafloor nodules within the United States.

It also asks the Office of Science and Technology Policy to annually submit to the President and Congress a report including quantitative and qualitative analysis of the benefits to the US of importing seafloor nodules and processing and refining nodules domestically.

“The strength of US national security and energy independence will be determined by how we choose to respond amid increasing reliance on China. This legislation is common sense and encourages the needed strategic decoupling from China that is long overdue,” said Congresswoman Miller.

China controls roughly 60% of the global critical mineral production and over 85% of the world’s refining capacity.

“Over the last two decades, the Chinese Communist Party has strategically invested in putting a stranglehold on global critical mineral supply chains. It’s vital to our security and economic interests that the CCP controlled monopoly on these materials is broken,” said Congressman Joyce.

Following the introduction of the Bill, shares of the deep-sea mining pioneer rose as much as 15%. The Metals Company has a $588 million market capitalization.

“With commercial deep-sea nodule operations expected to begin soon, Congressional action to lay the foundation for processing and refining this remarkable resource is a game-changer,” CEO Gerard Barron said in a news release.

Minerals and metals such as cobalt, nickel, copper, and manganese can be found in potato-sized nodules on the ocean floor. Reserves are estimated to be worth anywhere from $8 trillion to more than $16 trillion, and they are in areas where companies, including The Metals Company, plan to target.

Many NGOs and environmental groups, however, argue that mining the seafloor could have a devastating impact on the planet.

A recent report by the non-profit Planet Tracker says mining the seafloor for key minerals and metals could negatively impact the mining industry, resulting in $500 billion of lost value and causing damages to the world’s biodiversity estimated to be up to 25 times greater than land-based mining.

In a paper published in the journal Chemical Science, Johannes Fessler explains that each of these three chemical elements has the potential to replace several noble metals that are commonly employed in organic chemistry to catalyze fine chemicals.

As an example, Fessler describes a complex active ingredient candidate based on pyrrole, a common drug precursor, which can be created from “simple starting materials” with the help of an acid-tolerant homogeneous iron catalyst and at room temperature.

“Homogeneous” catalysis means that the starting materials – catalyst, solvent and ultimately the product and by-product – are dissolved in a single reaction vessel. They must therefore be separated after each reaction step, purified and prepared for the next step.

“If you manage to save one of these steps in the chemical process, you greatly reduce the amount of time and material required and minimize waste,” Fessler said in a media statement.

This is precisely what he achieved with the reaction to pyrrole, using a reaction cascade.

Climate-neutral chemical industry

Replacing noble metals as catalysts with iron and the like has become an attractive research topic.

“The task of climate-neutral, sustainable management is facing the chemical industry as well as all other sectors,” the researcher said.

Iron is abundant, making up 5% of the earth’s crust. And after iron and titanium, manganese is the most common transition metal on the planet.

On the other hand, there is a reason why base metals have so far only played a marginal role in organic chemistry.

“They are often less stable in catalytic processes than catalysts made of noble metals,” Fessler explained. “In addition, they usually work at high temperatures and pressures in the area I am researching.”

However, such harsh conditions would destroy the complex molecules in drug production. The chemical structures that ensure the specific effect of a drug, the so-called functional groups in the molecule, are particularly at risk.

In this respect, it is a success to show how catalysts made of iron, manganese and cobalt can sometimes manage with significantly milder reaction conditions compared to previous practice. In the case of pyrrole, these are temperatures between 20 and 30 degrees Celsius.

Johannes Fessler’s experiments revealed another advantage of his approach: His non-noble metal catalysts very precisely converted only those molecules that the chemists needed in the actual synthesis. “We call this approach highly selective. It produces hardly any by-products or waste,” he said.

The scientist tested the reliable functioning of his reaction on various active ingredients and drug precursors.

“We wanted to make sure that the iron catalyst also activates the right place in the molecule for these substances and spares the sensitive functional groups,” he noted.

In this way, the chemist tested his method on widely used cholesterol-lowering drugs and blood pressure medications, among others.

The quest for substitutes for fossil fuels has increased the need for metals used in the batteries that power electric vehicles (EVs) and in green-energy applications. Minerals and metals such as cobalt, nickel, copper and manganese can be found in potato-sized nodules on the ocean floor. Reserves are estimated to be worth anywhere from $8 trillion to more than $16 trillion and they are in areas where companies, including deep-sea mining pioneer The Metals Company (NASDAQ: TMC), plan to target. 

According to the report, entitled “How to lose half a trillion” by non-profit Planet Tracker, extracting metals from the seafloor could cost the mining industry $30 to $132 billion in value destruction.

François Mosnier, head of Oceans and report lead author at Planet Tracker, told MINING.COM this estimate is the result of adding the combined value loss the activity would cause for both ocean floor and terrestrial miners.

“For the deep sea mining sector, focusing only on polymetallic nodules in international waters, the cost would reach $35 billion-$49 billion of value destruction,” Mosnier said. 

“This amount was computed based on the estimated invested capital in the sector in 2043 ($115 billion), the industry’s estimated return on invested capital (-2%) and the industry’s weighted average cost of capital (WACC) and long-term growth (3%).”

Put simply, the deep-sea mining industry would not beat the cost of the capital it requires to exist, he said.

“Before factoring in any environmental impacts, the economics already appear uncompelling,” Mosnier said. “High operating expenditures mean that returns will be negative for investors in deep sea mining, which will also destroy value in other sectors, such as terrestrial mining and fishing.”

On top of that, major global banks such Credit Suisse, Lloyds, NatWest, and Standard Chartered, Dutch bank ABN Amro, and Spanish group Banco Bilbao Vizcaya Argentaria, have all introduced policies that rule out funding deep-sea exploration and extraction.

The report highlights the positive financial impact of respecting nature as sectors dependent on preserving intact ecosystems have outperformed those exploiting resources threefold over the last three decades.

It also urges investors to focus on nature preservation rather than resource extraction a repeats its call for a moratorium on deep-sea mining.

Ready to start

While the International Seabed Authority (ISA) has yet to set rules for the extraction of minerals and metals from the ocean floor, there already is a country that doesn’t need to wait: Norway.

The nation secured in December parliamentary majority to go ahead with plans to open the Arctic Ocean to seabed mineral exploration, despite environmental groups and the fishing industry’s warnings that the move would risk the biodiversity of vulnerable ecosystems.

The European country, where vast oil and gas reserves have made it one of the world’s wealthiest nations, plans to search for minerals on its extended continental shelf.

China is another nation investing heavily in deep-sea mining technology, including remotely operated vehicles, vessels, and sonar scanning systems.

Chinese companies, according to the Pentagon, hold more International Seabed Authority contracts (five out of 31 for exploration and development) than any other country.

Opponents to seafloor mining have long-warned that consequences of both exploration and extraction of minerals from the seabed are unknown and that more research should be conducted before going ahead.

Those that support the expansion of activity believe deep-sea mining is central to meeting the increasing demand of mineral growth. The demand for copper and rare earth metals is predicted to grow by 40%, according to the International Energy Agency. 

The agency also expects that the demand share for nickel, cobalt and lithium from clean energy technologies alone will grow by 60%, 70% and 90%, respectively. 

According to a study published in the Journal of Cleaner Production, producing battery metals from nodules could reduce emissions of CO² by 70-75%,  cut land use by 94% and eliminate 100% of solid waste.

The cobalt and nickel producer has axed or made part-time 30% of its senior corporate management roles, while fees for non-executive directors have been cut by the same amount, it said in a exchange filing. Some 5% of staff at its project in Finland have been let go, Jervois said.

Cobalt prices have plummeted by almost two-thirds over the past two years on rising supply — the Democratic Republic of Congo and Indonesia have been mining more of the metal — and a slowdown in demand growth. Chinese plants processed 80% of global cobalt supply last year, according to specialist trading house Darton Commodities.

Jervois mothballed a project in Idaho, which would have been the first new US cobalt mine in decades, about a year ago, highlighting the challenge facing the Biden administration as it attempts to chip away at China’s dominance in the supply chains of metals vital to the energy transition.

The recent cost-cutting is due to “adverse cobalt market conditions caused by Chinese overproduction and its impact on pricing,” Jervois said, adding that it remained “determined to deliver a responsibly sourced, Western supply chain of critical minerals.”

The company’s shares tumbled as much as 17% in Sydney. They have plunged from a peak of 96.29 Australian cents (63 cents) in April 2022, to less than 3 cents as of 11:35 a.m. local time on Thursday.

(By Jason Scott)

First Quantum Minerals (TSX: FM) inked a $500-million deal last month to supply Jiangxi Copper from the Kansanshi mine in Zambia as the Vancouver-based miner strives to shore up finances after authorities shut its Cobre Panama mine in the Central American country.

“There are active conversations going on about how best to approach some of those kinds of issues,” Natural Resources Minister Jonathan Wilkinson told reporters in Toronto. “What you’re going to find increasingly moving forward is democratic countries around the world coming together to try to find pathways through which we actually are ensured of access of the minerals we’re going to need.”

The largest shareholder in First Quantum is Jiangxi Copper, but Wilkinson said the government won’t pursue investments that pre-date its critical minerals divestment strategy. It began in November 2022 by targeting three TSX-listed lithium companies. Ottawa hasn’t changed its stance on reviewing Chinese investments in Canadian critical mineral companies, he said, even as recent deals highlight continued interest from the mining and processing behemoth.

“We’ve been pretty clear that we are not interested in investment generally from state-owned enterprises,” Wilkinson said in reply to a question from The Northern Miner at the Prospectors and Developers Association of Canada annual conference in Toronto. “Certainly the ones that are raising significant flags would be those that actually require some kind of offtake agreements, those that require control – effectively controlling shareholders – or provide for significant board representation.”

Competing interests

The federal reviews must walk a line between competing interests. On one side are mining companies, especially at the junior level, who are facing what they believe is an unprecedented funding crunch from lack of stock markets investing in the industry and who turn to industrial power China for backing. On the other side is the rising trend of resource nationalism for security as countries in the West try to diminish China’s dominance in critical mineral mining and processing.

China’s Yintai said last month it would buy Osino Resources (TSXV: OSI; US-OTC: OSIIF) for C$368 million, Zijin Mining invested $97 million for 15% of Solaris Resources (TSX: SLS; US-OTC: SLSSF) in January and Vital Metals (ASX: VML) said in December that Shenghe Resources was buying stockpiles of rare earth elements mined at its Nechalacho project in the Northwest Territories.

Each of those deals might have some wiggle room under a review. Osino’s primary asset is the Twin Hills gold project in Namibia. Gold is not one of Canada’s 31 critical minerals. Solaris is digging for copper, a critical mineral, but 15% isn’t regarded as a controlling stake. Vital is an Australian company, so Ottawa doesn’t have direct recourse under Canada’s Investment Act, though it does have a say in permits for the project.

On Tuesday, Montreal-based SRG Mining (TSXV: SRG) said it’s cancelling a $12.5 million deal with China’s Carbon ONE New Energy Group to take a 19.4% stake in the graphite miner. It had said last week it would incorporate in Abu Dhabi while maintaining its Toronto listing.

“That was a helpful decision that they would essentially not re-domicile in order to accept Chinese investment,” Wilkinson said. “But certainly we will be looking at all transactions that involve Chinese state owned enterprises and those companies related to them.”

In a 3-0 decision, the US Court of Appeals for the District of Columbia ruled in favor of Google parent Alphabet, Apple, Dell Technologies, Microsoft and Tesla, rejecting an appeal by former child miners and their representatives.

The plaintiffs accused the five companies of joining suppliers in a “forced labor” venture by purchasing cobalt, which is used to make lithium-ion batteries that are widely used in electronics. Nearly two-thirds of the world’s cobalt comes from the DRC.

According to the complaint, the companies “deliberately obscured” their dependence on child labor, including many children pressured into work by hunger and extreme poverty, to ensure their growing need for the metal would be met.

The 16 plaintiffs included representatives of five children who were killed in cobalt mining operations.

But the appeals court said buying cobalt in the global supply chain did not amount to “participation in a venture” under a federal law protecting children and other victims of human trafficking and forced labor.

Circuit Judge Neomi Rao said the plaintiffs had legal standing to seek damages, but did not show the five companies had anything more than a buyer-seller relationship with suppliers, or had power to stop the use of child labor.

She added that many other parties are responsible for labor trafficking, including labor brokers, other cobalt consumers and the DRC government.

“Without more specific allegations, the question is whether the tech companies’ purchasing an unspecified amount of cobalt from a supply chain originating in DRC mines plausibly demonstrates ‘participation in a venture’ with anyone engaged in forced labor in that supply chain,” Rao wrote. “We hold that it does not.”

Terry Collingsworth, a lawyer for the plaintiffs, in an email said his clients may appeal further, and could file new lawsuits if the companies’ conduct met the court’s test.

The decision provides “a strong incentive to avoid any transparency with their suppliers, even as they promise the public they have ‘zero tolerance’ policies against child labor,” he said. “We are far from finished seeking accountability.”

Dell said in a statement it was committed to upholding the human rights of workers throughout its supply chain, and has never knowingly sourced products made with child labor.

Google had no immediate comment. Apple, Microsoft, Tesla and their respective lawyers did not respond to requests for comment.

Tuesday’s decision upheld a November 2021 dismissal by US District Judge Carl Nichols in Washington.

The cobalt suppliers included Eurasian Resources Group, Glencore, Umicore and Zhejiang Huayou Cobalt, court papers show. None was named as a defendant.

The case is Doe 1 et al v Apple Inc et al, DC Circuit Court of Appeals, No. 21-7135.

(By Jonathan Stempel; Editing by Chizu Nomiyama, Jonathan Oatis, Aurora Ellis and David Gregorio)

Overinvestment led to “severe overcapacity” in the last year, said Chen Xuehua, who is a delegate to China’s National People’s Congress (NPC), which gathers in Beijing from Tuesday.

Chen cited “significant declines” in industry capacity utilisation.

“Some companies’ operations are facing great difficulties, there are suspended operations, falling prices, idled equipment and staff layoffs,” Chen said, according to a report by Shanghai Securities News.

China’s lithium iron phosphate capacity will reach 5.75 million metric tons in 2025, while global demand for the cathode material widely used in batteries is pegged at about 2.67 million tons that year, he added, citing industry data.

Chen, whose company is a major producer of battery materials nickel and cobalt, proposed that the government publish timely industry information, establish an alerting system to flag mismatch of resources, capacity and demand, and provide guidance on investment and development.

Regulations in Europe and the United States have made it harder to source waste batteries and recycled raw materials, posing challenges to China’s leading role in the lithium battery chain, said Chen, whose company recycles used batteries.

China should encourage more imports of used battery materials, especially hydroxide intermediate made from waste lithium batteries, including by lowering tariffs, he said.

China bans imports of used lithium batteries and black mass, the shredded material which comes from used batteries, which can include lithium, cobalt and nickel. These metals can then be extracted and used to make new batteries.

(By Siyi Liu and Emily Chow; Editing by Tony Munroe and Emelia Sithole-Matarise)

Read More: Chinese money still chasing Canadian critical mining deals despite Ottawa’s scrutiny

While experts continue to debate the potential implications of adopting AI at both a personal and business level, the mining industry has not stayed still waiting for the conclusions.

The sector has already embarked on a quest to transform operations from the traditional heavy-equipment and men-on-site operations, to mines that integrate connectivity, automation and AI.

On a visit to MWC Barcelona, an annual trade show dedicated to the mobile communications industry, MINING.COM was able to see how the world of telecommunications and mining are increasingly intertwined. 

Invited by telecommunications giant Huawei, MINING.com — the first mining media to ever attend MWC — saw sensors, smart cameras and 5G relay boxes ready to be deployed to mines around the world.

There was buzz around the new generation of mobile internet — “5.5G,” or “5G Advanced”. The new standard is expected to make the networks themselves more “intelligent” through the application of AI and machine learning, while also boosting performance and reducing overall power consumption.

When Huawei vice president of global marketing and solutions for mining and oil and gas, Jack Chan, was asked why the company began developing solutions for the industry, the answer was as quick as clear: safety.

“In China we have almost 3 million coal miners working in 4,400 coal mines, which are underground and often register deadly accidents,” Chan said. “When taking workers out of the tunnels and into a room full of screens displaying numbers, graphs and images, not only a company is saving lives, but is also more appealing to the new generations.”

Chan added that Information and Communications Technology (ICT) infrastructure is crucial to support intelligent mining. Without fast and reliable communication networks, robust computing power, rapid data storage, and vigilant network security, essential tasks, including real-time monitoring and instant data exchange would be impossible, he explained.

“Young people don’t want to spend hours underground, hot and breathing recycled air, but they are happy to sit in a room with air conditioner and monitor activities in real time,” he said.

Data on extraction, personnel location and danger detection is centralized on a system designed to eliminate problems caused by human error and miscommunication. Instead of people, robots patrol and inspect the dark and narrow underground corridors.

“AI service architects and AI algorithm engineers will become key roles in the era of intelligence,” Chan predicts.

Remote and digital solutions are common in other coal operations, such as those in Canada and Australia, but China has lagged and now the government has set the goal of achieving basic digitalization of all mines by 2035.

Huawei is a step ahead with is AI-based Pangu Mining, a suit of applications launched in July last year, which were developed based on the pilot verification of large AI models at industrial levels. 

The name Pangu comes from ancient Chinese mythology and folklore. The legendary figure is associated with the creation of the world.

There are altogether 21 application scenarios related to nine operating activities, namely, coal mining, tunneling, primary transportation, auxiliary transportation, lifting, safety monitoring, rock burst prevention, coal preparation, and coking.

Rock bursts are a particularly challenging issue in mining. The primary means of preventing rock bursts is drilling destress holes, whose quality matters. Shandong Energy has managed to address this challenge in its Lilou and Xinjulong coal mines by deploying Huawei’s AI model. 

Thanks to its visual recognition capabilities, Pangu can intelligently analyze the quality of stress relief drilling, and assist rock burst prevention personnel in quality verification, reducing their review workload by 82%. It used to take three days to complete such checks; now the time has been shortened to 10 minutes, with a 100% acceptance rate.

Chile’s Codelco, the world’s largest copper miner, has also adopted Huawei solutions with the goal of turning around under-performing mines and projects that have crimped both production and profit.

The state-owned company is looking to streamline structures and prioritize productive areas at a time when copper output is at the lowest level in a quarter of a century.

It’s all about connectivity

Being a telecommunications company at heart, Huawei has been able to deploy connectivity solutions, from networks to an operative system able to run a wide range of equipment and smart machines. Named Harmony, the OS enables different devices to speak the same language, facilitating better connection and collaboration, and bringing a simple, continuous, secure and reliable interaction experience in all scenarios.

“In the era of intelligence, digital intelligence transformation can be accelerated only by combining AI technology with industry cognition and valuable data accumulated by enterprises,” Jason Liu, President, Learning & Certification Services of Huawei told the audience during MWC Barcelona 2024.

Liu said AI solutions should be used as a tool, not as a replacement of human intelligence.

Pangu, for instance, can detect a problem, inform the location and characteristic of such problem and provide solutions suggestions. The application is predictive, in the sense it can fill in the blanks at a very deep level.

AI is enabling mining companies to become insight‐driven enterprises that utilize data to make faster, accurate decisions, improve health and safety, boost efficiency through error elimination and reduce operations footprint.

Digital thinking is not just a tool for mining companies, but a core value that shapes their business. One of Huawei’s key messages is that to succeed in the industry, miners need to foster an organizational culture that embraces innovation and adapts to changing technologies.

In a paper published in the journal ACS Applied Optical Materials, the scientists point out that many brilliant blue pigments—like those in antique Chinese porcelain or works by Claude Monet—make use of cobalt-based compounds, including the famous “cobalt blue.”

In mineral form, the metal has high chemical and thermal stability, and those properties make cobalt aluminate one of the only pigments suitable for high-temperature applications, including pottery glazes.

Today, cobalt is used in lithium-ion batteries, and demand for the metal ore will likely increase as the need for battery power grows. As a result, scientists, including Peng Jiang and colleagues, are searching for alternative pigments that require fewer cobalt ions and still maintain a bright blue hue.

The team based their new pigment on a barium feldspar mineral (BaAl2Si2O8), which also features high temperature and chemical stability. Compounds containing barium, aluminum, silicon and cobalt were ground together, pressed into a sheet, then heated to above 2550 degrees Fahrenheit to form the pigment.

Then, the researchers mixed the powder into a ceramic glaze, sprayed it onto tiles, and fired them to produce glazed pieces of pottery.

The pigment was stable at temperatures up to 3200 degrees—well above the typical firing temperature of a pottery kiln—and only experienced slight colour changes when exposed to either acidic or alkaline solutions, demonstrating the compound’s stability.

Tiles sprayed with the pigmented glaze maintained a smooth, bright surface that deepened in colour as the cobalt concentration in the pigment increased.

The researchers say this new powder substantially reduces the amount of cobalt needed, resulting in a cheaper, easier-to-produce blue ceramic pigment.

A total of 18 critical mineral blocks, including tungsten, vanadium, cobalt and nickel, will be auctioned in eight states across the country, including Chhattisgarh, Madhya Pradesh, Karnataka, Maharashtra and Rajasthan, a government statement said.

Seventeen mineral blocks have been put up for a composite licence, while one block is for a mining lease, it added. A composite licence includes a licence to examine a block and mine it afterwards.

Joshi added that five states – Maharashtra, Madhya Pradesh, Haryana, Chhattisgarh and Rajasthan – will auction blocks for exploration licence of critical minerals, separately.

Further, he said that in the first round of the first part of auctions launched in November last year, the government received 56 bids from entities, including Vedanta Ltd, Coal India, Shree Cement, Ola Electric, Dalmia group and Jindal Power.

The second round of bidding for the first tranche of auctions will be held in mid-March and the bid winner will be announced in mid-April.

Separately, Joshi said there will be no shortage of coal in the country this year.

His comments come after the Coal India, the world’s largest miner, lowered its annual production target for the financial year 2025 on adequate stockpiles, last week.

($1 = 82.8859 Indian rupees)

(By Neha Arora and Hritam Mukherjee; Editing by Tasim Zahid and Sohini Goswami)

Read More: India’s Ola Electric considers bid for lithium mining rights

“BatMan builds on NREL’s expertise using laser ablation, advanced computational models, and materials characterization to address key challenges in battery manufacturing,” said Bertrand Tremolet de Villers, project co-lead and senior scientist in NREL’s Thin Film and Manufacturing Sciences group.

“This new, high-throughput laser patterning process—demonstrated at scale with state-of-the-art roll-to-roll manufacturing techniques—uses laser pulses to quickly and precisely modify and optimize electrode structures, offering a massive leap in battery capabilities with minimal added manufacturing cost.”

According to Tremolet de Villers and his team, the material makeup, thickness, and structural design of electrodes can impact battery capacity, voltage, and charging speed. For example, doubling the thickness of electrodes from 50 μm to 100 μm increases the energy density of a battery cell by about 16%. However, this increased thickness makes it more difficult to charge the battery quickly without causing long-term damage from lithium plating, which reduces the battery’s lifetime.

Given this state of affairs, the EV industry needs a breakthrough battery design that combines the benefits of thicker electrodes and fast charging without increasing manufacturing costs. The BatMan research team is answering the call with a process that optimizes electrode structures and streamlines battery production.

The pore network

Prior NREL research illuminated how intricate patterns of tiny holes in an electrode—known as the pore network—can unlock battery improvements. These microscopic pores create access points to increase ionic diffusion, allowing the ions to move more quickly during charge and discharge without damaging the battery. As a manufacturing bonus, these pores also speed up electrolyte saturation during the wetting process, which consists of injecting a liquid electrolyte into the cell to facilitate the flow of ions between electrodes.

“Early conversations between NREL’s battery researchers and material scientists uncovered an opportunity to utilize laser ablation to configure these pore networks,” said Donal Finegan, project co-lead and senior scientist in NREL’s Energy Storage group. “With support from our industry partners, BatMan established a new process to incorporate this technique into battery manufacturing. But first, we needed to know which pore patterns would yield the greatest battery benefits.”

Genetic algorithms

To evaluate different pore channel shapes, depth, and distribution, the researchers turned to NREL’s Lithium-Ion Battery Secondary Pore Network Design Optimization Analytical Diffusion Model. The genetic algorithm also considered the specific hardware limitations of the laser used to create the pores. These advanced models helped identify the optimal pore arrangement: a hexagonal pattern of laser-ablated pores with a depth of 50% of the electrode coating thickness. The study also found that adding straight channels across the width of the electrode dramatically improved electrode wetting when compared to unstructured electrodes.

With a target pore network identified, the BatMan team began working toward small-scale prototyping and characterization of the laser-patterned electrode. The scientists used an Amplitude Laser Group femtosecond laser system with high-speed galvanometer-controlled scanning optics for the laser ablation, working closely with the Amplitude team to achieve precise control of the laser based on position, power, frequency, and number of pulses. 

“Our collaboration with NREL helped integrate the laser into their existing research capabilities to support the BatMan project goals,” said Quentin Mocaer, line manager at Amplitude. “We also received valuable insights into how future system designs and new technologies could further improve this process at an industrial scale.”

NREL researchers applied advanced characterization tools to evaluate the performance of the laser-ablated electrodes. First, researchers applied X-ray nano-computed tomography and scanning electron microscopy to analyze the morphological features of the electrode structure and validate battery enhancements. Next, NREL’s multiphysics models illustrated how improved uniformity in the structures reduced the risk of lithium plating during fast charging. Finally, the BatMan team assembled small battery cells to assess the optimized electrode architectures in action. Electrochemical analysis of the laser-ablated cells demonstrated superior fast-charge performance, with nearly 100% more capacity after 800 cycles. 

Roll-to-roll

After numerous cycles of laser ablation, characterization, and adjustment, it was time to scale up the process for high-throughput demonstration. Most battery manufacturing facilities use a continuous roller-based processing line, known as a roll-to-roll line, that bonds the active material mixture onto a foil surface. Researchers used NREL’s roll-to-roll line to demonstrate and de-risk the compatibility of this new process to encourage adoption by battery manufacturers.

“After nearly three years of research, our team successfully processed 700 meters of double-sided electrode material, proving that laser ablation is a scalable and economically feasible technique for roll-to-roll production of lithium-ion batteries,” Finegan said. “The magnitude of this demonstration was unique to NREL and showcases how strategic laboratory support can advance industry processes.”

NREL returned the optimized electrode material to BatMan’s manufacturing partner Clarios, where experts assembled commercially relevant 27-Ah batteries for further evaluation. Early inspection using Liminal Insights’ EchoStat acoustic imaging indicates that the laser-ablated electrodes wet faster and more uniformly than baseline cells. Additional non-destructive diagnostics will validate the expected performance improvements and ensure battery safety and quality before this technology enters the marketplace.

Time will tell how long it will take before laser-ablated cells find their way into electric vehicles, but the NREL team is optimistic. Techno-economic analysis of the laser patterning process estimates a minimal added cost to battery manufacturing of under $1.50/kWh—that is less than 2%—and the performance advantages are undeniable. NREL researchers also found that the graphite debris collected during the laser ablation process can be directly reused to make new battery cells without any significant impact on the cells’ performance, which presents an opportunity to further reduce the cost of laser ablating electrodes.

“Our lab-scale experimentation shows that laser-ablated electrodes could double the rate of charge of electric vehicles,” Finegan said. “This is a technology evolution that could alter conventional manufacturing, not only for lithium-ion batteries but also next-generation battery chemistries.”

Gecamines is also leveraging existing shareholding in mines to negotiate off-take contracts for the purpose of trading copper and cobalt on its own.

The miner wants more local executives on boards governing joint ventures to have a greater say in how assets are managed, Guy Robert Lukama, the Gecamines chairman, told Reuters.

The plans may mean overhauling some terms of agreements that Gecamines deems unfavourable to capitalize on the world’s scramble for supplies of minerals critical to global green energy transition.

“We want to repair a certain stage of mistakes that were made when they asked us to give most of our best assets to third parties just to attract foreign direct investment,” said the chairman of the state miner, which at its peak in 1986 produced more than 490,000 tons of copper and cobalt – but is now a shadow of its former self.

Chinese mining companies have been key to driving output in the world’s biggest supplier of cobalt, a key component in batteries for electric vehicles and mobile phones. Congo is also the world’s third-largest copper producer.

President Felix Tshisekedi’s government had previously said some deals were heavily skewed in favour of China, forcing some state-backed firms to find an additional $1 billion in a renegotiated infrastructure for minerals pact.

Prolonged debts

Board representation on the mines could ensure accountability, transparency, community development and compliance with rules on local procurement and training of Congolese staff, Lukama said.

He added that some mines aren’t investing in expanding output, citing prolonged levels of indebtedness. A lack of oversight could be behind the huge debts, which he said is depriving the state miner of returns.

Lukama questioned why some of its partners are reporting losses and scaling down production because of a slump in cobalt’s value while copper prices have remained elevated. In Congo, cobalt output is a by-product of copper.

“We can no longer accept this level of debt while people don’t put capital into the assets,” he said.

“We are not sleeping partners in our own country. We should be part of the governance.”

CMOC deal

Last year’s deal with China’s CMOC Group secured Gecamines a right to acquire copper and cobalt produced from Tenke Fungurume Mining equal to its 20% stake, on market terms. Gecamines also scored an $800 million settlement to end a dispute over mineral royalties and $1.2 billion in dividends over the life of the Tenke mine.

The deals has prompted Gecamines’ push to trade copper and cobalt at projects with partners including Glencore and Zijin Mining.

Gecamines’ partners had retained full off-take rights because they used debt to build the projects, Lukama said.

“The off-take was there to secure the flows of repayment of debt, now the debt is repaid, why should they keep it 100%.”

Lukama said some terms need to be reviewed as investors aren’t meeting expectations, with communities not better off despite the mining boom.

He declined to say which companies are not meeting expectations.

Changes to the mining code in 2018 bolstered Gecamines’ powers to seek reviews of terms in mining contracts and boosted the minimum state participation threshold, said Andrew Smith, a senior Africa analyst at risk intelligence company Verisk Maplecroft.

“DR Congo does have a history of pressurising mining companies into ceding shares,” Smith said.

“Measures such as asserting that firms have not paid adequate royalties or taxes by underreporting revenues and production have been used in the past.”

(By Felix Njini and Veronica Brown; Editing by David Evans)

So when China surprised the markets by restricting exports of two niche industrial metals last year, top-level officials in the Pentagon-controlled agency—and the White House—faced an uncomfortable reality: Its panic button no longer worked. The realization triggered a different kind of alarm in Washington.

A senior official in the administration of President Joe Biden, who spoke on condition of anonymity to discuss internal deliberations, admits that Beijing’s decision to limit exports of gallium and germanium sent a jolt through the White House, adding to already urgent calls for Washington to confront China’s dominance of the global metals supply chain. A lack of gallium and germanium—which are mined in tiny volumes alongside aluminum and zinc—would potentially affect production of everything from military satellites to missiles and night-vision goggles.

On this occasion the crisis was averted as Chinese exports resumed, but years of budget cuts have shrunk the agency’s strategic reserves to record lows. Former officials at the Pentagon’s Defense Logistics Agency, which manages the stockpile, say the US faces serious shortages of the raw materials needed to execute the energy transition at the scale envisioned by Biden and his team.

“This is literally the worst time to discover the ‘oh shit’ button doesn’t work,” says one former Defense Department stockpiling veteran, who asked to remain anonymous while discussing issues of national security.

In the first of a three-part series based on more than 40 interviews with industry executives, officials and politicians, Bloomberg has looked at Western efforts to create an alternative, China-free, global metals supply chain. The US in particular has been a hive of activity. Officials have rushed around the globe to negotiate deals with key allies, while behind the scenes US diplomats are cajoling Western miners to expand investment in the copper and cobalt-rich Democratic Republic of Congo, where China dominates production. The Biden administration also intends to team-up with the European Union to bolster efforts to gain some control over global supplies, while it funnels billions of dollars into projects to create a domestic mining and refining raw material supply chain.

Yet Beijing’s dominance remains unshaken. Tangible results from US efforts have so far been limited, and executives at some of the world’s biggest mining companies have reported frustration at what they view as a lack of a coherent strategy on critical minerals supply. Other industry executives have urged Washington to take a cue from Beijing and develop a more nimble stockpiling program to both protect manufacturers from scarcity and insulate producers against price falls.

Overhauling the DLA to speed up procurement, at a time when battery metal prices have been falling, could deliver an easy win, they argue. The price drops have led some Western miners to cut back production, a trend that’s raised concerns about long-term resource security even as demand for electric vehicles cools.

The US government appears to have listened. In December, Congress passed a new National Defense Authorization Act, which gives the logistics agency greater freedom to make long-term purchases without the congressional approval it had previously needed. It also guarantees $1 billion a year in future funding.

“This is the next chapter in the discussion about how the US can create its own security of supply,” says Todd Malan, chief external affairs officer at Talon Metals Corp., which is developing a nickel, copper and cobalt mine in Minnesota with help from the US Energy and Defense departments. “In these markets you could see the US government making a really big impact if it emerges as a strategic buyer.”

A love-hate relationship with cobalt

A 60% slump in cobalt prices over the last two years has exposed the fragility in Washington’s efforts to bolster supplies of critical minerals. Beijing used the price drops to buy record volumes of the metal in two quick-fire deals executed in days last year. To have made a similar purchase, the DLA would have had to submit a buying request to Congress and wait, often for as long as a year, for approval. The NDAA reforms should streamline that process.

The act also allows the DLA to strike long-term supply deals with domestic refineries, without which the US will struggle to process raw materials coming from countries such as Congo. Several companies are working to build refining plants for critical minerals in North America, but extreme market volatility has made fundraising difficult.

“The obstacle right now is that there’s relatively little investment in this field,” US Under Secretary of State for Economic Growth, Energy, and the Environment, Jose Fernandez, told Bloomberg in November, referring to efforts to secure raw materials. “We have supply chains that are dominated by one or two countries. We need to be able to galvanize the private sector in our efforts.”

But domestic producers are still reeling from the price falls. The only major cobalt mine in the US has been mothballed for almost a year. Owned by Australian miner Jervois Global Ltd., the Idaho-based facility could begin production within weeks, but it would need cobalt prices to almost double to $25 per pound, or receive additional government support, to justify finishing construction, says Bryce Crocker, the company’s chief executive officer.

“If somebody wants to purchase the cobalt from us—if the government wants to support the price, or if a customer like an automaker wants to provide some kind of pricing floor—that could also work,” says Crocker, who adds that in Washington, stockpiling is “certainly being spoken about much more seriously than it has been in the past.”

A 2021 Heritage Foundation report calculated the value of NDS reserves at an inflation-adjusted peak of more than $42 billion at the start of the Cold War in the 1950s. As of March 2023, however, the amount of stockpiled material was valued at just $912 million, according to the Congressional Research Service.

Cobalt—as critical to jet engines as EV batteries—has been a source of anxiety for the US defense industry for decades. In the mid-1990s, the DLA had more than 20,000 tons of the metal in stock, enough to meet the entire domestic needs of the US for three years, according to Defense Department records. But when its budget was cut, cobalt was one of the first metals the DLA sold to balance its books—to the bemusement of traders who bought its reserves and sold them to a booming aerospace sector. And despite a weakening in demand for EVs, even the most pessimistic forecasters predict that cobalt demand will outstrip supply by the end of the decade.

“Twenty years ago, I told the director of the DLA: ‘We’re buying all this cobalt from you; at some point we’ll be selling it back to you,’” says Mark Kristoff, CEO of specialist metals trading house Traxys SA. “Now governments are waking up.”

Sanctions, fines and doing business in Congo

The DLA received a $1 billion cash injection from Congress in 2021 to help avert a major funding crisis, after the Department of Defense warned that without fresh investment, the entire stockpiling program would reach breaking point by 2025.

Officials from the DLA soon began turning up at niche mining conferences and making discreet enquiries about buying large volumes of cobalt. It sparked speculation among traders that the Pentagon was set to become a major strategic buyer once more. Simultaneously, State Department officials have traveled across South America, Africa and Southeast Asia trying to build diplomatic relations with nations rich in critical minerals, say industry executives familiar with the trips. They approached commodity traders and private mining companies, asking them what it would take for big Western miners to return to difficult — but mineral-rich countries — like Congo.

This flurry of activity was driven by a fear that inaction would leave the US defense industry exposed to periodic supply shocks and allow Beijing to further tighten its grip over key metals, say the people familiar with the process.

US efforts to boost cobalt supplies have so far been largely focused on high-wire statecraft in Congo, which accounts for about 70% of global output. The country supplied the DLA with huge volumes of cobalt throughout the Cold War and most of the uranium for the Manhattan Project’s nuclear weapons in 1945. But over the past two decades many Western companies have left the country after a slew of problems—from asset seizures to billion-dollar corruption cases—cemented Congo’s reputation as one of the world’s most risky mining jurisdictions.

The US now wants Western companies to invest in projects in the country, but progress has been hindered by Washington’s sanctions on Dan Gertler, the mining magnate who until recently had sprawling interests in the African country. He receives royalties from the three biggest non-Chinese cobalt producers in Congo.

Any agreement to buy or sell the projects or the materials they produce may require the US to allow some kind of workaround, so companies aren’t engaging with a sanctioned individual, according to people with knowledge of the talks. The possibility that Gertler, who’s denied any wrongdoing, might profit from the very deals that led to him being sanctioned has already been condemned by Congolese and international anti-corruption groups.

“We understand that mining has a checkered history,” the US State Department’s Fernandez says. “Our aim is to improve on that.”

Freeport-McMoRan Inc. sold its majority stake in the Tenke Fungurume cobalt and copper mine—one of the world’s richest—to a Chinese rival, CMOC Group, in 2016 after commodity prices began to fall in 2015. In 2020 it sold its last Congolese asset to CMOC, which has since developed it into the world’s largest cobalt mine.

“It broke my heart,” says Richard Adkerson, Freeport’s CEO, of the Tenke Fungurume deal. “Now, there are people in the US government saying, ‘Why did you sell to the Chinese?’”

“We offered it to the market for sale, and only Chinese companies showed up,” Adkerson adds. “There was no possibility of the US government stepping up.”

US officials have been deployed to convince people that times have changed. Helaina Matza, who oversees Biden’s global infrastructure investment program, visited several mining projects in Congo in October 2023 and has been working with White House senior advisor for energy and investment Amos Hochstein to court mining companies and encourage financing for copper and cobalt assets in the region. Potential partners include sovereign wealth funds and TechMet Ltd., the critical minerals investment company whose shareholders include the US government’s International Development Finance Corp. Washington also agreed to help finance parts of the $2.3 billion project to rebuild and expand the Lobito railway corridor, which links the copper belt in Zambia and Congo to Angola’s Atlantic coast.

Executives have welcomed the renewed US interest in countries like Congo, but some see Washington as being too cavalier, saying that the government’s approach has appeared confused and at times ad hoc.

Reworking global supply chains was always going to be a complex negotiation between companies, financiers and governments, says Hochstein.
Yet “companies that told me 12, 18 months ago ‘Zero chance I will invest in Africa’ or ‘Zero chance I go to this specific country in Central, South America’ are now saying, ‘Wait a minute—let’s have a conversation. We’re interested,’” he says.

To stockpile, or not to stockpile

The DLA’s Strategic Materials division employs about 80 people and manages three of the six nationwide Defense Department depots — which store some of the 66 materials—from aluminum to zirconium—the US deems critical to national security. Procurement is handled by a small team which travels across the US and Europe to attend minor metals conferences tucked away in the back rooms of hotels from Florida to Eastern Europe.

And while the NDAA reforms mean that it no longer needs congressional approval to buy and sell materials, legislative guardrails remain. The stockpile must receive annual approval for appropriations and the renewal of the DLA’s funding—which is not guaranteed in the ultra-divided politics of Congress and a possible second presidential term for Donald Trump. The Defense Department, which didn’t respond to requests for comment, still needs to implement the new measures.

Some in the industry believe the stockpiling model should echo China’s National Food and Strategic Reserves Administration, more commonly known as the State Reserve Bureau.

“The SRB has always had the patience to step into the market when prices are low,” says Tony Southgate, a cobalt trader at Stratton Metal Resources Ltd. in London, “and they very rarely get their timing wrong.”

Its buying strategy is an official state secret. But before its most recent cobalt purchase, the SRB summoned producers to a meeting in Beijing, where the price and size of the deal were agreed in an afternoon, according to people familiar with the matter. The total cost of last year’s purchases—about $270 million based on spot prices—is little more than a rounding error in China’s $270 billion annual defense budget or that of the US, which stands at $850 billion.

And so with the Biden administration committing billions of dollars to mines, refineries and other projects to support the energy transition, supporters of stockpiling say comparatively small sums—around $600 million would buy two years worth of gallium, germanium and cobalt—are needed to bolster US strategic reserves.

“We need to use national defense stockpiling like we do the petroleum reserve,” says Gregory Wischer, principal at Dei Gratia Minerals, a Washington DC-based consulting firm, referring to the emergency stash of oil operated by the US. “It’s easier to increase the stockpiling than it is to get projects online that can take years or even decades.”

“Stockpiling,” he adds, “will be a very powerful tool to support an energy transition in the United States.”

(By Mark Burton, Joe Deaux, Michael J Kavanagh, Jennifer A Dlouhy and Annie Lee)

“Clearly now, we are reaching a very high level of interest so I would say that yes it seems to be inevitable,” said Michael Lodge, the secretary-general of the ISA, in an interview with CNBC.

“One of the main drivers of industrial interest is the potential to produce larger quantities of minerals at equivalent or lower cost to what can be produced on land,” Lodge added.

His comments come as the ISA prepares to recommence talks on deep-sea mining in Kingston, Jamaica, next month.

Recently, Norway’s parliament greenlit seabed mining exploration in the country’s territorial waters. The determination on January 9 made Norway the first country to formally authorize seabed mining activities in its waters.

Minerals and metals such as cobalt, nickel, copper and manganese can be found in potato-sized nodules on the ocean floor. Reserves are estimated to be worth anywhere from $8 trillion to more than $16 trillion.

According to a study published in the Journal of Cleaner Production, producing battery metals from nodules could reduce emissions of CO² by 70-75%,  cut land use by 94% and eliminate 100% of solid waste.

Meanwhile, scientists have warned that the full environmental impacts of deep-sea mining are hard to predict, and environmental campaign groups say the practice can lead to ecosystem destruction and species extinction.

“It hasn’t been done yet, so it is very hard to say conclusively that it would be as destructive as some people claim that it would be,” said Lodge.

If a screenwriter were writing a new film with an anti-environment villain, one of the easiest ways to establish the moral bankruptcy of the antagonist would be to make the character a corporate industrialist hell-bent on mining the deep ocean.

The average audience, after all, does not require even a single frame of film to imagine that deep sea mining might involve any number of ecological horrors. Most opponents of deep sea mining lean into such favorable preconceptions, vividly characterizing deep sea mining as a catastrophic act of ocean ecosystem vandalism, which any responsible citizen ought to categorically oppose with do-or-die fervor.

Thus it may come as a surprise that none other than James Cameron, passionate deep ocean explorer and director of the ocean-themed “Avatar: The Way of Water,” recently expressed feeling open-minded toward deep-sea mining as a “less wrong” alternative to conventional land-based mining.

A challenge is that seafloor mining immediately starts off at a reputational disadvantage, a product of what Cameron calls society’s “weird habit of blowing the wrong thing out of proportion.” This instinctive reaction leads many to overlook the potential for deep sea mining to offer a more just, lower-impact, and lower-carbon way to mine metals than conventional terrestrial mining – a proposition that evidence so far seems to suggest has real promise.

As an oceanographer by training, I endorse Cameron’s suggestion, as heretical as that may seem. Collecting metals from the seabed may well be a “more right” way for humanity to source some of its needs for new metals.

This opportunity to pioneer a new dramatically lower-impact form of mining highlights how important it is for environmentalists and ocean scientists to critically reexamine the automatic instinct to oppose any further alteration of our seas. In the face of forces like climate change and far more extensive human activities that have and will continue to keep changing the oceans, such aspirations are already futile.

Equally futile are superficial attempts to reject new mining both on land and at sea with impossible recycling math, thereby avoiding having to wrestle with the energy transition’s implacable trade-offs. With these factors in mind, it is well worth asking whether we ought to continue concentrating the impact of our metals production on land in service of a shining ideal of ocean conservation that is already unattainable.

What is deep sea mining, really?

While some have speculated about mining other potential ocean-based resources for many decades, collecting seafloor nodules is closest to commercial operations and at the focus of most of the ongoing debate. Other marine resources remain far more speculative, and would be subject to their own unique environmental assessments and regulatory restrictions. Indeed, no commercial-scale harvesting of seafloor metals has occurred yet, as governments and industry await the finalization of international regulations and environmental standards.

In certain regions of the abyssal seafloor between 3.5 and 6 kilometers in depth, natural chemical processes have formed vast fields of potato-sized concretions rich in manganese, nickel, copper, and cobalt. As coincidence would have it, manganese, nickel, and cobalt are the exact metals used to manufacture the nickel-manganese-cobalt lithium-ion battery packs found in many electric vehicle batteries and other electronic devices.

Nickel and manganese are also used extensively in many standard steel and aluminum alloys as well as in other clean energy technologies like hydrogen electrolysis cells, while copper is a crucial component for countless power grid infrastructure elements. Finally, supply chains for these metals exhibit a concerning degree of overconcentration, with around 70% of cobalt and nickel processing and 44% of copper refining currently based in China. Consequently, deep-sea nodules pose implications for the metal requirements of not just electric car batteries, but for the clean energy transition as a whole.

Prospectors propose using remotely-operated robots to simply vacuum up these nodules and pump them to motherships at the ocean’s surface. In contrast, mining these same metals on land would typically require clear-cutting forest and vegetation, then blasting and digging surface excavations or deep mine shafts to extract buried ore, exhuming the soil layer and many layers of rock in the process.

No form of mining is without environmental impacts, and the same is certainly true for seafloor nodule collection. Most of the robotic collector vehicles currently in testing use hydraulic jets to dislodge the nodules, sucking up the metal-rich rocks along with the top 5-10 centimeters of sediment. This will likely kill the majority of bottom-dwelling organisms caught in the collector’s path. The sediment ingested by the collector vehicle is subsequently ejected, creating a plume near the seafloor in the vehicle’s wake that could harm or bury seafloor life.

While being transported to the mothership at the ocean’s surface via pipe, the nodules may rattle within the pipe, generating loud underwater noise. Finally, return water and sediment carried to the mothership through these pipes must be brought back to the ocean floor which may affect local carbon and nutrient cycling and generate a relatively dilute, light sediment plume.

Let there be no doubt that harvesting deep-sea nodules would deteriorate local seafloor ecosystems to some extent. But the direct and more long-lasting seabed disturbance is limited to the path of the collector vehicles. The effects of the sediment plume near the seafloor depend on how much the sediment cloud rises and travels horizontally, and how much plumes affect bottom-dwelling organisms. The impact of noise from piping nodules to the surface depends on the equipment used and the sensitivity of nearby animals to that noise. Furthermore, impacts like noise and ejected sediment could cease immediately should mining companies pause or end operations.

Meanwhile, the one-third of Earth’s surface covered by land contains all of our paved concrete cities, all of our land-based mines, and all of our vast expanses of cropland and livestock pasture. To date, the burden of nearly the entirety of society’s current and historic demand for metals has fallen upon this minority of the planet’s surface area that we happen to live in closest proximity to. Nor should we forget that society also already carries out numerous ocean-based economic activities—fishing and whaling, marine shipping, the dredging of shipping channels, sand harvesting, offshore oil and gas drilling, and the construction of offshore wind turbines, undersea pipelines, and cable networks. Many of these operations produce similar impacts in terms of noise and local seafloor disturbance.

Sourcing metals from nodules could be preferable to conventional mining on land from a human perspective as well. Extracting metals from remote locations at sea that are literally uninhabitable may avoid many of the risks to human communities and sociopolitical conflicts that terrestrial mining can pose. The production of metals from nodules would also rely primarily on skilled labor in sectors with traditionally strong union representation like shorefront workers and metalworkers, avoiding risks like mine worker exploitation and poor safety standards that confront many global mineral supply chains today.

Humanity may also share the benefits of deep sea metals more broadly than has historically been the case in mining. The United Nations Convention on the Law of the Sea (UNCLOS) tasks the International Seabed Authority (ISA) with not only regulating seabed economic activities, but with collecting royalties on mining and redistributing them as benefits to countries globally, prioritizing developing countries in particular. The claims-based nature of seabed exploration under the ISA has also encouraged companies to partner with sponsor nations including small island developing states with few other economic opportunities that could themselves benefit from revenue and administrative fees associated with such agreements. As such, one wonders whether seafloor nodules might offer not just technical and environmental advantages relative to traditional mining, but also produce better social outcomes as well.

An incoherent debate

Ultimately, it is critical to distinguish between accurate claims about deep sea nodule collection and misleading assertions without basis.

Seafloor mining opponents claim nodule collection will pose an existential threat to marine life, driving rare seafloor species to extinction, or threatening fisheries at the scale of entire ocean basins. Activists have lobbied governments and potential industry customers like automakers to support moratoria on deep-sea mining, arguing that nodule collection is too dangerous to allow or consider—at least until scientists learn more about the risks.

But opponents of nodule collection are engaging in exaggeration, cherry-picking, and misleading messaging that clearly call into question their rhetorical commitments to let the science speak. Cases abound where activists have cited scientific research to claim catastrophic impacts of nodule harvesting that far exceed the actual findings in question.

For example, recent Greenpeace campaigns have widely smeared polymetallic nodules as “radioactive” and potentially harmful to workers, a claim that some reporting has uncritically repeated. Yet the actual scientific study that activists are citing concludes that nodules emit low amounts of relatively harmless alpha radiation, which cannot even penetrate human skin, and proposes that simply requiring workers to wear an N95 mask would provide effective protection.

Or there’s the case of exaggerated claims about the future of tuna. A recent study examining the overlap between Pacific tuna population patterns and the nodule-rich seafloor areas has motivated activists, journalists, and fishing industry representatives to label nodule collection as a threat to Pacific tuna on an ocean-wide scale. But it once again appears that nobody has read the underlying paper. The study only investigated the potential for tuna populations to migrate into one nodule-containing seafloor region in response to future climate change, and did not directly study the influence of nodule harvesting operations on tuna. This is a clear case of activists and reporters spawning scientific conclusions from their imagination to fit a desired narrative.

A broader look at activist campaigns against seafloor nodule collection suggests that opponents simply aren’t interested in scientific impact assessments to begin with. Anti-mining advocates represent environmental risks from nodule harvesting as though they are inherent and fundamental, ignoring the potential for regulations or technology to reduce impacts.

Scientific findings with any industry connection are dismissed on principle rather than refuted on their research methods or merits. Direct action activists call for decade-long bans on nodule exploration until scientific understanding improves, while obstructing small-scale expeditions intended to conduct some of that very science. And empty lip service in more formal proceedings notwithstanding, opponents’ public messaging remains noticeably disinterested in advancing any solutions to the risks they loudly emphasize.

On the other hand, it is true that deep sea nodules are not, strictly speaking, absolutely necessary for the energy transition. The quantities of metals required to manufacture electric vehicles at global scale over the next few decades would not come close to exhausting either land-based or seafloor nodule deposits.

As Table 1 shows, humanity could—without so much as touching deep-sea metals—produce nickel-manganese-cobalt (NMC) batteries for between 1.5 to 5 billion electric vehicles before encountering cobalt supply limitations. More importantly, with a rapidly-growing share of electric vehicles utilizing lithium-iron-phosphate (LFP) batteries that do not consume cobalt, nickel, or manganese, it appears increasingly likely that the future global electric vehicle fleet may not require as much of these three metals.

In pure quantitative resource terms, deep-sea metals are thus optional for net-zero pathways. But given how society is presently grappling with how to best expand and diversify battery metal production today, the insistence that ocean resources are off-limits risks ruling out a promising approach for accomplishing this more efficiently and sustainably.

In response, activists challenge the very idea that society requires any significant new mining at all, often by calling instead for improved recycling and a crusade against private automobile ownership. This car-hating recycling-based circular economy platform rather elegantly upholds traditional conservationist principles while dodging most acknowledgement that the global shift towards more sustainable societies might involve ecological tradeoffs. However, it is both incoherent and incorrect. Specific proposals for reducing car ownership are often unrealistically overoptimistic, while cold, hard math suggests that even a vastly smaller global car fleet would still require electric vehicle replacements on the order of at least several hundred million electric cars, relative to the 30 million or so that exist today. The quantitative case for new battery metal mining is unshakeable.

As such, climate hawks would do well to consider the environmental case for deep-sea metals. One particular advantage is adaptive management. Unlike a surface mine on land, where many significant ecological impacts occur all at once during the mine’s initial construction, the fingerprint of nodule collection on the seafloor is incremental with every unit of rocks collected.

If scientists conclude that it is important for collector vehicles to leave more nodules behind, operators can adjust accordingly even midway through harvesting an area. If regulators determine that underwater noise from nodule collection is more harmful than anticipated, they can require technology improvements that reduce impacts from that point forward. If collector vehicle technology improves in ways that further minimize environmental risks, regulators can compel all operators to adopt that technology.

At the most basic level, we can imagine forms of seafloor nodule collection that tread extremely lightly upon the seafloor. Regulators are working with scientists and aspiring operators to define initial precautionary thresholds for dissolved metals, noise, light, and turbidity that nodule collectors will in turn commit to meet. Across the conceivable spectrum of approaches one can envision robots that only disturb sediment to half the depth, that use dimmer onboard lights, or that eject sediment in a controlled manner to greatly reduce the size of the plume in their wake.

Advocacy by many opponents for seafloor mining bans that would foreclose any of these possibilities hints at a narrow-minded aversion that fixates more on the idea of collecting seabed metals than it does on the actual impacts.

Gatekeepers of the ocean

That ocean conservation activists and ocean researchers opposed to seafloor nodule collection should not be surprising. The average oceanographer chooses the field more out of a genuine love of the ocean and belief in the intrinsic value of oceanic knowledge, than out of any desire to invent world-changing technology or win a Nobel Prize. The same is true for many ocean advocates.

In such loving eyes, the ocean is at once pristine and untouchable, but also fragile and increasingly tainted. Yet such a worldview winds up paradoxically invoking humanity’s longstanding, deep interactions with the ocean to declare the oceans off-limits to new activities.

The idea that the ocean is better off the less humans interact with it too often neglects to consider how treating the seas as sacrosanct can itself come at societal and environmental costs. Fishing well in excess of fish population replenishment serves neither food security nor ocean life, but the seas can support even extensive fishing that spares large areas of land from farming.

Cargo ships and the concrete wharfs and dredged channels to support them impose harms on ecosystems, but enable global trade and link continents that would otherwise have to sustain themselves in isolation. Similarly, arguments opposing deep sea nodule harvesting cannot weigh only the costs or benefits to the ocean alone.

A common line of argument declares that humans clearly have not shown any ability to steward the environment on land, and therefore cannot by any means be trusted to extract resources from the ocean. But with nearly all human activities leaving some mark upon the land environment, would environmentalists ever really concede, at any point present or future, that humans have achieved sufficient redemption in their eyes to collect nodules at sea? Indeed environmentalists too often express similar fatalism towards seemingly any kind of human activity. Utopias do not exist, and demanding that humankind achieve utopia before attempting anything new is to effectively insist that society remain in an eternal purgatory of stasis.

The alternative, ecomodernist view is that sourcing metals from the ocean represents a part of the process itself of demonstrating better stewardship of our land ecosystems. The ocean certainly faces its share of problems, and turning to seabed nodules in order to reduce the known problem of mining impacts on land may create new problems—which humans can and will solve in turn. But humanity is already asking enough of the one-third of Earth’s land surface that it is well worth seeking an optimal balance by leveraging the watery two-thirds of the globe a little more. Arguments over the ecological diversity of seafloor nodule regions notwithstanding, it is patently obvious that the richness of biomass per unit area of land cleared for conventional mining is many orders of magnitude greater.

In the end, the better question to ask is not whether humanity should collect deep-sea metals, but rather how. Before claiming that the cost of collecting nodules from the ocean floor is too high, researchers, activists, regulators, and companies should explore the degree to which operators can reduce impacts and define what obligations to hold industry accountable to. As such, calling for immediate moratoriums on deep-sea mining is not only premature, but a circumvention of constructive dialogue and negotiation.

Much will depend on the final form of international seabed regulations, not to mention the formulation of promised mechanisms for collecting and distributing benefits globally from deep-sea activities in international territory. And given the precariousness of global supply chains for key metals, dragging such discussions out for many years would impose its own risks and costs.

But fundamentally, the debate over seabed mining would benefit from more open-minded curiosity and willingness to imagine the policy frameworks and technologies that could produce a new and better form of mining—one rooted from the very start in a more progressive vision of shared management of a global commons, for the collective benefit of all humanity.

(This article first appeared on the Breakthrough Institute)

The company’s production leapt by 174% year-on-year to 55,526 metric tons, accounting for over a quarter of global demand of 213,000 tons.

Kisanfu, in which Chinese battery giant CATL owns a minority stake, has flooded the cobalt market. The Cobalt Institute estimates global production exceeded demand by 12,500 tons in 2023, making it one of the “biggest surpluses in recent years”.

CMOC is unconcerned. It plans to lift output further this year despite a slump in the cobalt price from $40 per lb in May 2022 to a current $13.

Others can’t afford to be so sanguine. The price implosion has upturned project economics and undermined Western hopes of reducing dependency on China for a metal that is critical both to clean energy technology and military hardware.

But the West is now challenging China’s tight grip on the mineral riches lying beneath the soil of the Congo and its neighbour Zambia.

This new scramble for Africa comes with a post-colonial twist since both countries have ambitions to be major actors in the critical minerals race.

Back to Africa

The clue is in the name. The Copperbelt straddling northern Zambia and the southern part of the Congo still contains some of the richest copper and cobalt deposits in the world.

KoBold Metals, a California-based metals exploration company backed by billionaires Bill Gates and Jeff Bezoz, claims its Mingomba project in Zambia boasts copper grades of around 5%, compared with under 1% for most big mines in Chile, the world’s top producer.

Few Western mining companies have until now ventured into the renascent Copperbelt, wary of the daunting mix of political risk, poor infrastructure and, in the case of Congolese cobalt, the ethical issues around artisanal mining.

Fewer still have lasted.

US producer Freeport McMoRan brought the Tenke Fungurume copper-cobalt mine into production in 2009. It sold its holding to CMOC in 2016, giving the Chinese company its first foothold in the Congo.

Freeport went on to sell CMOC the Kisanfu deposit in 2020 saying it was “no longer strategic” to its long-term growth.

CMOC quite evidently views the deposit very differently.

And Western governments also seem to be coming to the view that if you’re strategically short of energy transition metals such as copper and cobalt, there’s only one place to head.

Back to Africa.

De-risking African metals

The US International Development Finance Corporation (DFC) is planning to near double its financial commitments to try to de-risk mining in the Copperbelt.

The flagship investment so far is the Lobito Corridor project, which will upgrade the existing rail line from the Angolan port of Lobito to the Congo and then extend it into Zambia.

The aim is to link Copperbelt mines directly with the Atlantic Ocean, reducing both the cost and the carbon foot-print of the current trucking corridor to South African ports.

US and European government backing, it is hoped, will de-risk logistics for the private sector, a policy that has already borne fruit in the form of a six-year commitment from Ivanhoe Mines to use the upgraded rail line for copper exports from its giant Kamoa-Kakula mine in the Congo.

The United States Trade and Development Agency (USTDA), meanwhile, is funding a feasibility study into a new 200-megawatt solar power plant in Solwezi.

This will not only supply Zambian industry but has the potential to provide power for two critical mineral mines in the Congo, addressing another persistent problem for Copperbelt operators.

Infrastructure is just the start of the West’s re-engagement with the Congo and Zambia.

The DFC has “a very healthy” pipeline of critical minerals projects in the region, according to deputy CEO Nisha Biswal.

Japan’s Organization for Metals and Energy Security has just signed a memorandum of understanding with Congo’s state-owned mining company Gecamines for technical cooperation at every stage of the mineral supply chain.

The deal falls under the aegis of the Minerals Security Partnership, a US-led alliance of Western countries looking to reduce critical metals dependency on China and other problem suppliers such as Russia.

Taking back control

Gecamines has in recent years been a largely passive minority stake-holder in the country’s mines.

That is changing as the Congolese government looks to grab a greater revenue share of its mineral resources.

President Felix Tshisekedi’s government, which won a second term in December elections, is taking a harder line with some of the Chinese investment deals struck under his predecessor Joseph Kabila.

The amorphous mega deal with China’s Sicomines joint venture has been revisited with the Chinese partners committing to $7 billion in infrastructure spending and annual payment of 1.2% royalties.

CMOC itself was locked in a protracted dispute with the government over royalties, leading to a year-long suspension of exports.

CMOC ended up paying $800 million and, perhaps more significantly, agreed to translate Gecamines’ minority holding into commensurate physical metal offtake deals.

Gecamines sees this as a template for all its minority holdings and the Zambian government seems to be taking a close interest.

Gecamines has also just offered to buy three copper-cobalt assets from Eurasian Resources Group, which is part owned by the government of Kazakhstan.

The real game-changer, however, could be the Congo’s second attempt at formalizing its artisanal mining force, which collectively produces over 10% of the world’s supply of cobalt.

Entreprise Generale du Cobalt (EGC) was created in 2021 and given exclusive rights over artisanal production but failed to secure a suitable deposit to trial the scheme.

Gecamines will now transfer five mining areas to EGC in what is hoped to be the start of a transformational process of assimilating artisanal workers.

De-risking artisanal mining would be also be transformational for the Minerals Security Partnership, which desperately needs to find cobalt that’s not committed to Chinese buyers.

(The opinions expressed here are those of the author, Andy Home, a columnist for Reuters.)

(Editing by David Evans)

Nigeria-based Africa Finance Corp. last week signed an expression of interest to provide $100 million in financing to Kobaloni Energy, backed by mining veteran Mick Davis’ Vision Blue, for the planned facility in Zambia.

AFC should reach an investment decision within 3-4 months, chief executive officer Samaila Zubairu said in an interview Feb. 9. Once the financing is finalized, production could start within 18 months, Johnny Velloza, Kobaloni’s co-founder, said by text message Wednesday.

The project would help diversify a crucial part of the global battery making supply chain away from China, which currently accounts for about 75% of global cobalt refining capacity. Zambia isn’t a major cobalt producer, but its northern neighbor Democratic Republic of Congo mines about two-thirds of the world’s supplies of the metal.

Still, prices have plunged from highs above $80,000 a ton two years ago to about $28,000 on the London Metal Exchange due to oversupply, making investments in the metal more difficult.

(By Matthew Hill)

The plant is located in Temiskaming Shores, Ontario. It will have the capacity to produced 5% of the global supply of battery grade cobalt needed for electric vehicles (EV).

“Canada has surpassed China as the top jurisdiction in the global battery supply chain, given its strength in raw materials mining and processing,” Electra CEO Trent Mell said in a news release. “[Last week’s] announcement from the Government of Canada demonstrates its continued commitment to building a strong, domestic EV supply chain.

“We are grateful for this additional investment as it represents added validation of our progress and will allow Electra to continue to work toward our goal of producing secure, clean and ethically sourced materials that are a crucial part of a sustainable future for electric vehicles in Canada.” 

Electra’s refinery recycles spent batteries, creating black mass from which critical minerals can be recovered. The plant made its first shipment of nickel-cobalt mixed hydroxide precipitate to a customer in July 2023.

Once fully commissioned, the refinery could produce sufficient cobalt for over 1.5 million EVs annually. Last year about 40 tonnes of black mass material was processed to recover critical minerals.

The company has an agreement with LG Energy Solution to supply 19,000 tonnes of cobalt in sulphate beginning in 2025. The total will represent up to 80% of Electra’s expected annual production.

Ottawa is focused on six critical minerals key to making electric vehicles and wind turbines: lithium, graphite, nickel, cobalt, copper, and so-called rare earth elements.

Wilkinson said the mining and processing of critical minerals was currently too dominated by China.

“(We’re) looking at how do we optimize the regulatory and permanent processes so you can take what is a 12 to 15-year process and bring it down to maybe five,” he said.

“There are ways you can just do things smarter … There’s no reason that you can’t do permitting of different things between federal and provincial governments at the same time, instead of doing them sequentially.”

Canada plans to reduce the time to approve mining permits by better funding the regulatory agency to get rid of paperwork backlogs and running permitting and environmental assessment processes at the same time.

The country will have to continue importing cobalt, Wilkinson said, due to its limited resources of the metal. China controls most of the world’s refined cobalt and rare earths supplies.

To cover costs, Canada is putting in place investment tax credits to pay for a “significant chunk” of the capital associated with new mining and mineral processing projects, Wilkinson said.

Funds are also ready to be made available for infrastructure like transmission lines and roads that will help accelerate the development of new minerals, he added.

The government is also investing billions of dollars in several companies’ battery factory projects in Canada, including Swedish battery producer Northvolt and German car manufacturer Volkswagen.

A loan guarantee programme is being put in place as well to provide access for indigenous communities to low-cost debt for investing as equity participants in existing and future projects, Wilkinson said.

In July, a group of five First Nation communities protested against mining plans in the so-called “Ring of Fire”, a region in the remote James Bay Lowlands of northern Ontario that is seen as the next frontier for mining metals such as copper, cobalt and nickel.

Wilkinson said streamlining permitting and environmental assessments would not lead to corner-cutting.

“I think the environmental community also recognizes that there is no energy transition without significantly enhanced volumes of critical minerals,” he said.

(By Forrest Crellin and Julia Payne; Editing by Mark Potter)

Fatih Birol said the production of electric cars, solar panels and other energy equipment requires a steady supply of minerals such as lithium, cobalt and copper.

The IEA continues to keep an eye on oil and gas markets, Birol said, but the supply chain of energy technologies is an important emerging security challenge.

“It is the reason we are embarking on a critical minerals security program,” he said in a speech.

“Currently, we are A, not able to keep up with the demand, and B, the ability of manufacturing these critical minerals is concentrated in one single country or two,” he said.

He did not give further details, but said the program was “inspired by our oil security mechanism”, which requires member countries to hold 90 days’ worth of oil stocks that can be released in the event of global supply disruptions.

China is the main producer for 30 out of 50 critical materials, according to a US Aerospace Industries Association paper last year, and is the world’s top miner and processor of rare earths.

The country last year imposed curbs on exports of gallium and germanium and types of graphite in an effort to protect its dominance in strategic metals.

The IEA’s move comes as countries escalate efforts to cut emissions, requiring ready supplies of critical minerals such as lithium, copper, nickel, cobalt, manganese and graphite used in batteries, and rare earth elements used in wind turbines and electric vehicles.

That new demand has stirred concerns about price volatility and security of supply, and the IEA has warned that even in an electrified, renewables-rich energy system, geopolitics remains a key consideration.

Last July, the agency published its inaugural Critical Minerals Market Review and hosted in September the first-ever international summit on critical minerals and their role in clean energy transitions.

(By America Hernandez and Geert De Clercq; Editing by Jan Harvey)

The Democratic Republic of Congo’s mining unit wants to buy three of the Khazakh miner’s assets in the country and has funds to finance the purchase, Robert Lukama, the chairman of Gecamines told Reuters.

Lukama declined to name the projects or mines Gecamines wants to buy but said the company is targeting three of ERG’s several assets in the world’s top cobalt supplier.

ERG didn’t immediately respond to emailed questions.

“We have a firm proposal and we can confirm our proposal,” Lukama said in an interview. “We showed our seriousness and we showed that we have the means to buy the assets.”

Luxembourg-based ERG is 40% owned by the Kazakhstan government and its assets in Congo include Frontier mine, Comide, Metalkol, Boss Mining and some development and near-production assets.

Gecamines, which ranked among the world’s top copper producers in the 1980s, is pushing for a bigger role in production and supply of critical minerals. Last year the state miner said it was leveraging its shareholding in joint ventures to secure rights to buy and trade in copper and cobalt.

Gecamines’ offer is not conditional on the level of development or state assets are in and the miner is working hard to find common ground with ERG, Lukama said.

“We made an offer to buy some assets of ERG in good shape or not, it doesn’t matter for us,” he said. “We are still confident that we can convince them where the best interests are for us, for them and for the country.”

He added that Gecamines is focused on creating value and is “entitled” to claim back undeveloped assets.

ERG has been negotiating with DRC authorities to lift the suspension of its Boss Mining operations. The government halted the operations in June last year after accusing ERG of polluting the environment.

Lukama said the loss of production at Boss Mining is depriving both shareholders of revenue. Gecamines owns a 49% stake in Boss Mining, which targets producing about 25,000 tons of copper and more than 3,000 tons of cobalt annually.

(By Felix Njini; Editing by Susan Fenton)

The new MRE includes 813 million tonnes of indicated material grading 0.22% nickel, plus 0.07% copper, 0.02% cobalt, 0.048 g/t platinum, 0.094 g/t palladium and 0.012 g/t gold, for a nickel-equivalent (NiEq) grade of 0.29%. The contained nickel metal is nearly 3.9 billion lb.

There are also 896 million tonnes of inferred material grading 0.27% NiEq (0.21% nickel, 0.05% copper, 0.02% cobalt, 0.039 g/t platinum, 0.068 g/t palladium and 0.009 g/t gold), containing 4.2 billion lb. of nickel. The inferred resource grew 180% in tonnage compared to the deposit’s initial resource published in November 2023.

The 2024 resource estimate incorporated 35 historical drill holes, the data for which Alaska Energy purchased in August 2023, and eight diamond drill holes (totaling 4,138 metres) drilled by the company in 2023. The resource area covers three zones (EZ1, EZ2, EZ3) of sulphide mineralization spanning 4.5 kilometres of the Eureka deposit.

The highlight of recent drilling was the identification of a higher-grade core zone within EZ2 that displayed continuity along much of the strike of the deposit. This core zone alone contains an indicated resource of 211 million tonnes at 0.34% NiEq and an inferred resource of 154 million tonnes at 0.33% NiEq.

“In less than a year, we have taken an exploration concept to a substantial deposit of nickel and other critical metals,” Alaska Energy Metals CEO Gregory Beischer commented in a news release. “The update increases the nickel metal content of the deposit to over 8 billion lb. (more than 3.7 million tonnes) with only a 0.01% grade decrease and a notably lower strip ratio.”

The Eureka deposit of the Nikolai project now represents a globally significant accumulation of nickel and has now become one of the larger known nickel deposits in the country, Beischer noted. The project is located 40 km northwest of the village of Paxson, on the southern flank of the Alaska Range.

“Nikolai could potentially become an important source of nickel for the US, catering to the needs of various manufacturing sectors including stainless steel, electric vehicles, defense components, long-term, grid-scale renewable energy storage batteries and a myriad of other uses,” he said.

Regarding the high-grade core zone at EZ2, Beischer said the company will continue to evaluate this area as it could positively affect project economics.

The Nikolai project is a possible host to disseminated nickel-copper-cobalt-PGE mineralization analogous to the Crawford deposit in Canada and the Norilsk mine in Russia, the company said.

Shares in Alaska Energy Metals jumped over 5% to C$0.29 apiece by 12:20 p.m. in Toronto, for a market capitalization of C$20 million. The stock traded between C$0.03 and C$0.50 over the past 52 weeks.

China consumes more than half the world’s metals and an even greater proportion of iron ore and battery raw materials – and gloom about the country’s economic prospects amid a property and stock market crisis have only added to bearish mining sentiment. 

In a new trading desk note Marcus Garvey, head of Macquarie commodities strategy based in Singapore, and a team of analysts have identified the first green shoots for the sector (and 34 charts to back it up):   

“January’s full set of PMIs (World manufacturing new orders up 1.2pp to 49.8) looks like a potential turning point for the global industrial cycle, with bullish implications for industrial commodities demand.”

Expectations of a smaller reduction in US interest rates this year than previously anticipated have supported the dollar and put metal prices under pressure which usually move in the opposite direction. 

Nevertheless, says Macquarie: “Commodity prices have a far more consistent relationship with global growth than with FX.”

The investment bank also points to US goods demand which it says “increasingly looks to be reaccelerating,” and from a higher base. Macquarie also sees the potential of a developed market manufacturing recovery and a restocking cycle in Europe.”

And while China has so far held off on broad based economic stimulus, fixed asset investment in infrastructure, led by renewables, and certain sectors including autos (particularly electric cars) have shown notable strength.

“Ultimately, if commodity prices are lifted by a pick-up in global industrial production, the implications for goods inflation may become self-inhibiting, by reducing the scope for further central bank easing. 

“But that is an ex-post problem, not an ex-ante one, suggesting to us that dips should now be bought. 

“Selectively at least, in those markets where fundamentals are already relatively tight or have the potential to tighten quickly. Especially if positioning gets short.”

Entreprise Generale du Cobalt will soon launch pilot sites around the town of Kolwezi on parts of five mining permits belonging to its main shareholder, state-miner Gecamines, Eric Kalala said.

“The problem before was that we didn’t have any land, but that problem has been solved,” Kalala told Bloomberg News on the sidelines of the Mining Indaba conference in Cape Town on Wednesday. The company doesn’t yet have an offtake agreement for the electric-vehicle battery metal, which will be dug by small-scale, artisanal miners working with EGC-approved cooperatives.

Congo founded EGC in 2019 to formalize artisanal cobalt mining, which employs hundreds of thousands of people but is infamous for dangerous working conditions and child labor. The company has struggled to get off the ground amid disagreements about its structure and weak cobalt prices due to oversupply.

The low prices offer an “opportunity” to set up the company with less competition on the ground from other buyers, with the aim of being ready to capitalize when the market turns, Kalala said.

In theory, EGC could be a major player in global cobalt, 70% of which comes from Congo. The country’s artisanal miners can account for as much as 20% of national output, according to the company.

Congo exported 139,800 tons of cobalt last year, a 21% increase from 2022. Total world production was about 190,000 tons in 2022, according to US Geological Survey estimates.

Commodity trader Trafigura Group is still EGC’s “main partner” in the project, but “bilateral discussions” continue with other parties, Kalala said.

“Trafigura remains committed to its commercial agreement with EGC and delivering on the pressing need to kick-start the large-scale formalization” of the artisanal and small-scale cobalt sector, Trafigura said by email.

“At present Trafigura is the only company permitted to buy from EGC – we encourage others to follow our approach and contribute towards meaningful change,” the Singapore-based company said.

Incursions by artisanal miners pose risks for private miners across Congo, and EGC is “designing a legal solution” that could allow it to operate on parts of permits owned by companies like Glencore and Eurasian Resources Group, Kalala said.

ERG didn’t immediately respond to a request for comment. Glencore declined to comment.

(By William Clowes and Michael J. Kavanagh)

Read More: Congo’s Gecamines and Entreprise Generale du Cobalt sign mining deal

According to a recent study led by scientists at the University of São Paulo (USP), sediments from this formation – which is about the size of Spain – have been dated between 45 million and 40 million years ago.

In a paper published in the journal Scientific Reports, the experts explain that over 10 years, they travelled around the area in research ships and analyzed samples of seafloor sediment dredged at a depth of about 650 metres in the western RGR. They were able to characterize its mineralogical, geochemical and magnetic properties.

The samples contained mainly red clay with several minerals typical of tropical volcanic rock alterations, such as kaolinite, magnetite, oxidized magnetite, hematite and goethite.

“Our research and analysis enabled us to determine that it was indeed an island, and what’s now under discussion is whether the area can be included in Brazil’s legally recognized continental shelf,” Luigi Jovane, senior author of the article, said in a media statement.

“Geologically speaking, we discovered that the clay was formed after the last volcanic activity occurred 45 million years ago. The formation therefore dates from between 30 million and 40 million years ago. And it must have been formed as a result of these tropical conditions.”

For Jovane, the fact that a multidisciplinary team participated in the research contributed to the results.

“We have a group of the highest quality including specialists in geology, geochemistry, biology, hydrodynamics, environmental impact assessment, new energies, psychology, and law. All this accumulated science can be used to deepen our understanding of the RGR and prospect the region without affecting the local system’s synergies,” he said.

“To know whether resources can be viably extracted from the seafloor, we need to analyze the sustainability and impacts of this extraction. The ecosystem services provided by the ocean there haven’t been studied in detail, for example. When you interfere with an area, you have to know how this will affect animals, fungi and corals, and understand the impact you’ll have on the cumulative processes involved.”

Seafloor discoveries

Jovane and his team reconstructed the western portion of the RGR using high-resolution bathymetric mapping that showed plateaus covered with sediment and separated by a rift with a depth of more than 600 metres.

They used an autonomous underwater vehicle and a remotely operated vehicle to produce maps, videos and sonar surveys.

The AUV was capable of diving down to the seafloor and covering a pre-established area for a maximum of 12 hours. The ROV was connected to a ship by a cable as it moved while producing high-resolution images, and collecting samples of rocks and organisms with a robotic arm.

Red earth

The existence of tropical soil between the volcanic lava flows detected by the researchers shows that the rocks must have been exposed to open-air weathering in a warm-wet climate in a region with active volcanoes less than 40 million years ago. The soil is similar to the “red earth” found in many parts of São Paulo state.

The RGR has been intensely studied in recent years because of its economic potential. It is in international waters and hence governed by the International Seabed Authority. In December 2018, the Brazilian government applied for an extension of its continental shelf to include the RGR, which is well beyond the limit of 200 nautical miles established for all nations by the UN Convention on the Law of the Sea.

Areas rich in cobalt, nickel and lithium, as well as tellurium and other rare earths critical to the transition from fossil fuels, one of the main drivers of global warming, to renewable energy, have been detected in the RGR. 

“It’s important to understand the ecosystem services and other natural processes at work in the RGR,” Jovane said. “Only this knowledge can enable us to carry out the environmental impact assessments and calculate the mitigation measures and offsets required to protect it if economic development is permitted.”

Created by government decree in December 2019, EGC was granted a monopoly on artisanal cobalt produced in the central African country, the world’s top producer of a critical metal key to the global energy transition.

“The provision of these 5 mining areas from Gécamines to EGC will mark the beginning of the standardization of artisanal cobalt mining and the structuring of local entrepreneurship,” Gino Buhendwa Ntale, EGC chairman, said in a statement.

Artisanal miners, who dig cobalt using rudimentary means, are the second largest source of cobalt worldwide after the Congo’s industrial mines.

Late on Tuesday, the Mineral Security Partnership (MSP), a multinational collaboration of more than a dozen countries and the European Union to invest in a global supply chain, also announced a deal with Gecamines and Japan’s JOGMEC.

“This is a MOU (memorandum of understanding) that will expedite European and Japanese investment in the mining sector in the DRC (Democratic Republic of Congo), and it’s also a powerful demonstration of the MSP’s efforts to secure and diversify critical mineral supply chains,” US Under Secretary of State for Energy Jose W. Fernandez told a media briefing.

(By Anait Miridzhanian and Wendell Roelf; Editing by Eileen Soreng and Mark Potter)

Musk premiered the Cybertruck smashed-window and all in November 2019. The Cybertruck – only the sixth production vehicle in the Tesla stable – sports the company’s proprietary 4680 cells first revealed at its now infamous Battery Day event in 2020.  

The 4680 is a soda can sized cell with a nickel-cobalt-manganese (NCM) cathode and is already powering the 84.6 kWh performance version of its Model Y assembled in Texas. 

The Cybertruck AWD and top of the range Cyberbeast model up that capacity to 122.4 kWh, according to Tesla filings with the US EPA.

Buyers can add a separately installed range extender to get the truck close to the 800km (500mi) driving range initially promised and qualify it for Biden administration’s $7,500 subsidy scheme until the base model becomes available.

Pre-orderly conduct

There is no firm number on the pre-orders Tesla has received. A crowdsourced tally put it as high as two million – a figure that is now widely quoted in the press – while Musk confirmed it is over one million. 

Given the hype surrounding the Cybertruck, two million fans who only had to put down $100 (now $250) for the privilege does not sound outlandish. 

How many Cybertrucks Tesla can produce is also far from being bolted down. 

Tesla told investors last year the company can produce anywhere between 250,000 and 500,000 units per year, but installed capacity at Giga Texas for this year is reportedly only 125,000. 

Elon Musk did admit in December that the Texas plant was in “production hell” and Tesla has a well-earned reputation for overpromising and underdelivering, but in 2023, Tesla did manage to up production 35% to 1.85 million vehicles. 

Mutatis Mutandas

Irrespective of model-version, Tesla’s triangle truck is a battery metals beast. 

If Tesla produces 125,000 Cybertrucks this year, the company would have had to procure around 14,000 tonnes of graphite, 11,000 tonnes of nickel, 10,000 tonnes of lithium carbonate equivalent, 1,400 tonnes of cobalt and 1,300 tonnes of manganese, according to data from Adamas Intelligence, Toronto-based EV supply chain research consultants.

Easily doable and at current prices for these battery metals a bargain, even if you take into account yields all the way up and down the supply chain. Cell manufacture is notoriously tricky and as much as 30% of the raw material entering through the factory ends up as black mass.

At the low end of Tesla’s Cybertruck production target – 250,000 – mining quickly becomes a weightier matter for the company now worth just $582 billion in New York after a horrendous start to 2024. 

Add in those Cybertruck owners who opt for an extra pack in the back and there are tonnes of reasons why Tesla could consider upping its mining investments. 

Under this scenario – still highly conservative given the immense interest in the Cybertruck – Tesla needs the entire nickel output of Glencore’s Murrin Murrin mine in Western Australia and over half its cobalt. 

Fulfill the million preorders and Tesla needs to offtake 100% of Glencore’s annual nickel production, which the Swiss miner said will be between 80,000 and 90,000 tonnes in 2024 and everything Mutanda produced last year. 

Two million? Hope that no-one orders the range extender and Cybertruck assembly lines would need to add half a Norilsk for the nickel (presuming it’s allowed into Texas then) and two-thirds of Glencore’s entire cobalt production. 

Finished stainless steel is about 8%-10% nickel – so there’s that too.

Battery day and night

Natural graphite has been on its own wild ride – down some $300 from this time last year to the early $500s a tonne now. 

To power 1 million Cybertrucks, Tesla needs the natural graphite of the world’s number two producing country, Madagascar, according to the USGS. 

If most drivers want to go the extra mile add half the output of world number three Mozambique or most of fourth-ranked Brazil.    

Much like those that mine the devil’s copper and the goblin’s ore, lithium mining companies – and their investors  – have gone through seven heavens and nine circles of hell since the Cybertruck’s 2019 debut. 

Lithium carbonate equivalent was exchanging hands for $8,500 a tonne at the time on a global weighted average basis, according to Benchmark Mineral Intelligence, a London-based price reporting agency and satellite battery factory tracker. 

November 2022 LCE topped $80,000 a tonne. Today it is around $14,400 a tonne. 

When it comes to LCE, one million Cybertrucks with no big black box in the back, need one Greenbushes, the world’s largest hard rock lithium mine. 

That is, provided the Sino-Australian venture does not cut back further on production to ride out the downturn.