Can US Seize China’s Mineral Throne With Deep-Sea Mining? Here’s What Experts Say

Deep-sea mining could be a $20 trillion industry, but the cost to get there is immense. One analyst said it’s really a power play to be the next “moon-shot.”

Clouds coming in from the Pacific Ocean during a rain storm in Bolsa Chica, near Huntington Beach, Calif., on Feb. 1, 2024. David Swanson/AFP

The United States is taking on China in the race to the bottom of the sea, hoping that new mining techniques will help break Beijing’s grip on global minerals.

Supporters say the deep-sea mining industry offers a “$20 trillion opportunity,” or that security gains outweigh the financial costs.

Skeptics say the upfront costs are enormous, and the minerals are already available on land in friendly countries.

In July, China got a green light from a little-known United Nations agency to begin testing its deep-sea mining vehicles in a specific designated section of the Pacific Ocean floor.

U.S. companies, backed by President Donald Trump’s executive orders, are now racing to secure their own footholds, eyeing billion-dollar investments.

Under the Chinese Communist Party, China has a near-monopoly on the global rare earths market, essential for the production of many new technologies such as electric vehicles, wind turbines, and smartphones.

It dominates both the mining and processing of these elements through state-controlled companies and strict export regulations.

Now the Chinese regime has the seafloor on its sonar.

In 2024, a report by the international consulting firm Arthur D. Little estimated that the deep-sea mining market could represent a “$20 trillion opportunity.”

It said that while traditional land-based mining is “increasingly constrained by diminishing ore grades, stricter environmental regulations, and rising production costs, seabed deposits are staggeringly abundant and generally of higher quality.”

Polymetallic manganese nodules, found 4 kilometers (km) to 6 km deep in the abyssal zone, offer dense concentrations of nickel, cobalt, copper, and manganese.

While seafloor massive sulfides—rich in copper, zinc, silver, and gold—are found 1.5 km to 3 km down, cobalt and manganese-rich crusts are found along underwater mountain ridges.

The explored areas are in the Clarion-Clipperton Zone, a geological submarine fracture zone located in the north of the Pacific Ocean between Mexico and Hawaii, as well as the Indian Ocean and the Mid-Atlantic Ridge.

Potential Costs

However, the United States’ ambition won’t come cheap.

The two main collection methods—mechanical rakes and high-pressure water jets—must still prove that they can operate reliably at such depths.

Furthermore, the costs of running the ships and extracting the materials may run into the 10-figure mark, and that’s even before any material has been taken to land to be processed.

Arthur D. Little analysts said in the report that financing will only become available when miners can demonstrate their ability to deliver at an industrial scale, which is in excess of 500,000 tons per year.

Jack Lifton, co-founder of Technology Metals Research, told The Epoch Times that Beijing’s ambition in deep-sea mining is part of a long-term play from the regime.

“China has organized its mining industry globally for 25 years,” he said. “They’ve been doing this for generations, and the West has ignored this.”

China may be preserving its domestic rare earths and shifting pollution-intensive processing offshore, according to Lifton.

“They’re concerned about the massive pollution they’ve had processing rare earths for 25 years,” he said.

Lifton said he’s skeptical about the U.S. deep-sea mining industry.

“It’s too expensive, and there’s plenty of raw materials,” he said, adding that most of the minerals sought on the seafloor already exist in large quantities on land in places such as Panama, Brazil, and South Africa.

“In the meantime, Alaska, New Mexico, and Arizona are sitting there saying, ‘We’ve been telling you we’ve got copper for 45 years.’”

In April, Trump issued an executive order calling for the acceleration of deep-sea mining.

The move was followed by the first permit application to the U.S. government by The Metals Company, which said it is developing the world’s largest source of battery metals on the Pacific seabed.

“Together, the resource is estimated to contain approximately 15.5 million tonnes of nickel, 12.8 million tonnes of copper, 2.0 million tonnes of cobalt, and 345 million tonnes of manganese,” it said in a statement at the time.

On July 2, the deep-sea mining startup Impossible Metals told Axios that it plans to start raising more than $1 billion from investors this year.

In a testimony in April to a hearing of the House Committee on Natural Resources’ Subcommittee on Oversight and Investigations, Oliver Gunasekara, CEO and co-founder of Impossible Metals, said that seabed minerals offer the “best opportunity to break [U.S.] reliance on foreign nations for critical minerals without sacrificing [U.S.] values or ... prosperity.”

“We have the opportunity to displace minerals from foreign mines that do not meet American environmental and human rights standards,” he said.

Gunasekara noted that 75 percent of nickel comes from Indonesia, where the majority is controlled by China, and that there are “appalling” levels of child labor in the Democratic Republic of the Congo, where about 70 percent of cobalt comes from. Cobalt mining is also controlled by China.

Some key seabed minerals are currently relatively inexpensive.

When asked if there is a risk that China could undercut global markets by dumping these minerals, especially given its nonmarket economy, Gunasekara told The Epoch Times by email that he estimates the company’s costs to be about “10 times less than the average nickel mine in 2024.”

“This protects us against China dumping,” he said.

But Gunasekara said he agreed that this is about competition more than price, and a matter of long-term strategic security, especially for Western countries trying to decouple from Chinese-controlled supply chains.

In a major 2024 report on European Union competitiveness requested by the European Commission, Mario Draghi, former European Central Bank chief and Italian prime minister, said that the bloc “should also carefully explore the potential of environmentally-sustainable deep-sea mining.”

However, in Europe, deep-sea mining remains a contentious issue with growing calls for a moratorium or precautionary pause because of environmental concerns.

In January 2024, the Norwegian parliament endorsed the government’s proposal to allow exploration for the possible extraction of seabed minerals on the Arctic seabed, partly to reduce the country’s dependence on China.

Plans were later put—and still are—on ice after a small left-wing environmentalist political party succeeded in blocking the plans.

International Seabed Authority

China holds five active exploration contracts under the United Nations’ Jamaica-based International Seabed Authority (ISA), more than any other country. It is also ISA’s main funder.

Countries such as Japan, Germany, and Britain also have licenses.

The United States is not a signatory of the U.N. Convention on the Law of the Sea (UNCLOS), which established the ISA in 1982 and says that international waters and their resources are “the common heritage of humankind.”

Trump’s executive order prompted a warning from ISA Secretary-General Leticia Carvalho, who said in April, “No state has the right to unilaterally exploit the mineral resources of the area outside the legal framework established by UNCLOS.”

‘It’s the New Great Game’

Michael Ashley Schulman, chief investment officer at Running Point Capital Advisors, told The Epoch Times by email that he believed that deep-sea mining is the next “moon-shot.”

“President Trump’s interest is no surprise; these minerals are either strategic now or could be strategic when new technology comes along,” he said.

“Trump’s order explicitly marshals Commerce, Interior, Defense, State, and the [Development Finance Corporation] to create permitting pipelines, stockpile strategies, and alliance finance mechanisms.”

“[China’s] deep dive, despite their rare earth stranglehold, smacks of a classic double-dip strategy,” Schulman said.

“Sure, cobalt’s cheap now, making the economics questionable for the West if we’re purely bean-counting, but this isn’t just about the bottom line; it’s more Game of Thrones under the sea, a power play for future tech and territory dominance.”

He said that these underwater mining zones function as exclusive territories that could serve dual purposes for mining as well as deep-sea surveillance or military operations.

“They also enable Beijing to create cooperative agreements and alliances with countries lacking independent mining capabilities. And possibly most important for China, which faces severe pollution from highly polluting land-mining operations, they relocate environmental damage offshore where it won’t affect mainland air quality,” Schulman said.

“Geopolitically, [the race is] the new Great Game.

“Except the playing field is the abyssal plain, and instead of oil, the prize is the treasure chest of tomorrow’s technology.

“Investors who felt they missed the lithium train now see a James Cameron-scale sequel with higher [capital expenditure], longer lead times, but potential margins that make today’s mineral values look like a teaser trailer.

“Possibly expect [special-purpose acquisition companies], sovereign-wealth funds, and Big Oil’s ‘blue-ocean’ divisions to form some unlikely team-ups.”