Weekly Nugget

Diving Deep for Critical Minerals

Dive into news and reports about deep-sea mining, including the benefits and drawbacks, plus an analysis from your Prospector team!



 




🗨 Diving Deep for Critical Minerals

Last week we chatted with you all about critical minerals, but this week we are “diving” in a bit more! It seems that second to lithium news, we are seeing almost continuous news about deep-sea mining. This continues to be one of the most hotly debated topics with our Prospector team and globally! While many argue that it is necessary to meet green energy transition needs, others are concerned about what little we know about the ocean and its diversity. Some studies show that “scooping” up these nodules would be cleaner than traditional land mining methods, but the report below suggests that it could be up to 25x worse in terms of biodiversity. One thing is for certain - the world is on the edge of its seat, waiting to see what the International Seabed Authority has to say and what the future of mining may look like.

Check out the recording of last week's mining roundup below:

 

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Jess Scanlan

Head of New Media

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📰 In The News

Deep-Sea Mining 25x Worse Than On Land?

A new report suggests that deep-sea mining could have a significantly greater negative impact on biodiversity than land-based mining. The extraction of minerals from the ocean floor, driven by the demand for materials used in batteries, could damage ecosystems on a scale up to 25 times greater than land-based mining. The mining would target cobalt, copper, nickel, and manganese nodules found on the seabed, which serves as essential habitats for many species. Restoring the deep-sea ecosystems affected by mining could cost twice as much as the extraction itself. The International Seabed Authority is expected to decide on regulations for seabed mining in international waters by July, while some countries and companies are calling for a moratorium on the practice due to its potential environmental impact.

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Argentina Mining Exploration Hits Decade High In 2022

Mining exploration investment in Argentina reached $370 million in 2022, marking the highest level in a decade, according to the country's mining secretariat. The exploratory budgets experienced a significant 68% growth from the previous year. Argentina's mining industry is described as being in full swing, with mining exports expected to more than double by 2025, reaching approximately $8.6 billion.

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Chinese Mining Company Opens Lithium Processing Plant In Zimbabwe

A Chinese mining company, Prospect Lithium Zimbabwe, a subsidiary of Zhejiang Huayou Cobalt, has inaugurated a $300 million lithium processing plant in Zimbabwe. With Zimbabwe possessing one of the largest lithium reserves in the world, the country has attracted investors in battery minerals from various countries, including Canada, the UK, and Australia. However, China remains the dominant player in the sector. The newly opened plant has the capacity to process 4.5 million metric tons of hard rock lithium annually, contributing to Zimbabwe's position as a competitive player in the global lithium value chain. 

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EVs Could See Copper Prices Return To Growth In 2024

Copper prices have been stagnant this year due to concerns about economic growth and supply constraints not being as severe as anticipated. Demand growth outside of China has stagnated, while China's growth rates have only reached pre-pandemic levels. However, there are positive signs for the metal, including rising backwardation and low stockpile levels, indicating a potential physical shortage. The expansion of the electric vehicle industry is also expected to drive copper demand, as EVs require a significant amount of copper compared to internal combustion engine cars. Copper prices are projected to find a floor around $8,500 per tonne by the end of this year and rise to $9,250 per tonne by the end of 2024.

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Critical Minerals Crunch To Hurt Green Transition, Warns McKinsey

A new report by McKinsey & Co warns of potential shortages of critical minerals that could slow down the energy transition. The consultancy firm forecasts shortages in high- and low-paced energy transition scenarios, particularly affecting wind turbines, solar panels, and electric vehicles. Dysprosium, a rare-earth element used in electric motors, faces a potential supply drop of up to 70%, while nickel, used in lithium-ion batteries, is expected to fall between 10% and 20% behind demand by 2030. The report suggests that such shortages could raise supply-chain costs, slow the transition to lower-carbon alternatives, and increase greenhouse gas emissions. McKinsey estimates that between $3 trillion and $4 trillion of mining, smelting, and refining investments are needed to meet the supply shortfall. The report highlights challenges such as permit delays, lack of skilled labor, financing, and infrastructure as barriers to building capacity. 

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❓Prospector Poll (Anonymous!)

What do you think will happen first?

Each week we want to get your opinion about the mining industry. We'll release the results with next week's Nugget! 

7.12 Poll

Last Weeks Results:

What are your thoughts on deep-sea mining?7-5-23 Poll Results-2


 

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