Monday, November 07, 2011


Exploiting the Last Frontier: The World’s Oceans

By Henry Curtis

The world’s seabeds are ripe for exploitation and free trade agreements will maximize their use and minimize their regulation.

APEC’s Area of Influence

The idea that APEC refers to the Pacific Ocean is a misnomer. First, most Pacific Island Nations are excluded from APEC. Second, APEC wraps almost all of the way around the world, since it includes the United States, Canada and Russia and their Exclusive Economic Zones (EEZ).

APEC & Exclusive Economic Zones

Canada and the U.S. have Exclusive Economic Zones (EEZ) which extend into the Atlantic Ocean.

Australia and Chile have territorial claims to part of Antarctica while Russia, Peru and the US have reserved their rights to make claims.

The United States, Russia and Canada have economic zones that include part of the Arctic Ocean. No country currently owns the North Pole which sits over vast petroleum resources. In 2007 Russia planted a titanium Russian flag on the seabed beneath the North Pole. Russia also claims the 1800 km Lomonosov Ridge which cuts through the central part of the Arctic Ocean between the New Siberian Islands and Canada’s Ellesmere Island.

The Geographic Center of APEC

Hawai`i Governor Neil Abercrombie held a press conference at the Hawai`i Convention Center on November 7, 2011, the first day of the Asia Pacific Economic Cooperation (APEC) Meetings. He discussed geography and Hawai`i’s place in the Asia Pacific region.

Hawai`i is right at the center of the Asia Pacific region. That is the whole idea today. It’s to get the various delegations to have a clear understanding that were the eastern most part of the Asian Pacific region. This is were East meets East. That’s going to be the themes. Of course you have the old idea of East meets West, the crossroads. We’re trying to change that image and we’re going to be the anchor of the Asia Pacific area, and this is going to be where East meets East. And when that idea sinks in around the Pacific Rim, Hawai`i is going to take a big step forward.”

Ocean Exploration

The Ocean varies in depth, reaching its maximum depth of 10.91 kilometers (6.78 mi)  in the Marianas Trench, an area 1580 miles long and 43 miles wide. Most of the ocean (70%) have a depth less than five kilometers and virtually all of it (99%) have a depth less than seven kilometers.

The US bathyscape Trieste reached a depth of 10.9 kilometers in 1960. The manned Japanese sub, Shinkai, reached a depth of 6.5 kilometers in 1989, and the unmanned Japanese submarine reached a depth of 10.9 kilometers in 1995. Three submersibles that are capable of diving to 6 kilometers are the Russian Mir, the French Nautile and Japanese Shinkhai.  In 2011 the manned Chinese submarine Jiaolong  dived below 4 kilometers. China plans to dive to depths of 7 kilometers in 2012. This would be a significant feat for China, which in 2003 became  just the third nation in the world to conduct manned space flight.

Deep Sea Mining

Deep sea mining is a relatively new mineral retrieval process that takes place on the ocean floor. Ocean mining sites are usually around large areas of polymetallic nodules or active and extinct hydrothermal vents.

Over the past decade a new phase of deep-sea mining has begun. Rising demand for precious metals in Japan, China, Korea and India has pushed these countries in search of new sources.

The deepsea contains many different resources available for extraction and in many cases are found in higher concentrations than land-based mines. Cobalt, vanadium, molybdenum and platinum are located in manganese crusts at water depths of 0.8-2.4 kilometers. Copper, lead, zinc gold and silver are located in sulfide deposits at water depths of 1.4-3.7 kilometers.  Nickel, copper, cobalt, and manganese are located in polymetallic nodules at water depths of 4-6 kilometers. 

The International Seabed Authority (ISA) has jurisdiction over seabed mining.  In 2001 China obtained exclusive rights to prospect for polymetallic nodule ore deposit in a 75,000-square-km are of the East Pacific Ocean. In 2011 China obtained approval to to mine for polymetallic sulphide ore in the Indian Ocean. India raised concerns about Chinese warships moving into the area. 

Currently, the best potential deep sea site for seabed mineral extraction has been found in the waters off APEC Member Papua New Guinea.  Nautilus Minerals Inc. is developing the Solwara 1 Project.  Starting in 2013, Nautilus Minerals Inc. plans to extract  high grade copper-gold resource from the world's first Seafloor Massive Sulphide. The mine is located at a water depth of 1600 meters in the Bismarck Sea off New Ireland Province.

Two forms of deep water mineral extraction are dominant.  The continuous-line bucket system (CLB) operates much like a conveyor-belt, running from the sea floor to the surface of the ocean where a ship or mining platform extracts the desired minerals, and returns the tailings to the ocean.  Hydraulic suction mining lowers a pipe to the seafloor which transfers nodules up to the mining ship. Another pipe from the ship to the seafloor returns the tailings to the area of the mining site. Recent technological advancements have given rise to the use remotely operated vehicles to collect mineral samples from prospective mine sites.

Moana Nui: “Does Papua/New Guinea, Tonga, Fiji, the Solomon Islands, New Zealand, the other islands negotiating deep-sea mining agreements, have the expertise and management in place to follow through with environmental and technological regulations? Can small island nations safeguard potential risks imposed by transnational industrial firms that have no stake in the region, other than its profit share? ...We just need to look at the handling of the Deepwater Horizon disaster to see that governments are ill prepared, and that these corporations do not have the capacity to prioritize the environment in its cleanup. Despite protests, Pacific Island governments are signing environmentally unfavorable lease agreements with transnational mining corporations.”

Free Trade Agreements re Seabed Mining

The United States-Oman Free Trade Agreement (OFTA) was adopted by the US in 2006. President Bush signed the Proclamation to implement the provisions of the OFTA in 2008. The U.S. Customs and Border Protection proposed implementing rules in 2011.

Federal Register (January 6, 2011): “Definitions ... “Territory” means ... With respect to the United States ...Any areas beyond the territorial seas of the United States within which, in accordance with international law and its domestic law, the United States may exercise rights with respect to the seabed and subsoil and their natural resources

The Association of Southeast Asian Nations (ASEAN) is a coalition of ten Asian nations: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam.

The ASEAN-China Free Trade Agreement took several years to formulate and its rules became effective in 2010.

In 2003 the Singapore Customs elaborated on various FTA provisions. "The following products may be considered as wholly produced or obtained entirely in Singapore ... products taken from the waters, seabed or beneath the seabed outside of the territorial waters of Singapore provided that Singapore has the rights to exploit such waters, seabed or beneath the seabed in accordance with international law."

"This compendium is the result of an initiative by the APEC Sub-Committee on Customs Procedures to develop a guide on Rules of Origin within APEC.  The emphasis has been on creating a compendium suitable for use within the business community, to better inform importers and exporters of current Rules of Origin trading arrangements.

This compendium has been jointly prepared by Australia and Japan, while APEC member economies themselves have contributed the content for their respective rules.  Their input is greatly appreciated in creating what is hoped will be a valuable tool for  businesses and other interested parties within the APEC community. ...

Rules of origin (ROO) are the basis on which the country of origin of goods is determined for international trade purposes.  They are used to determine the country in which goods have been produced or manufactured in cases where the production or manufacture took place in more than one country.  These rules are necessary to ensure that provisions applying selectively on the basis of origin are not avoided by minimal processing, trade diversion and similar circumvention method ...

Under the NAFTA there are a number of different categories that goods may originate under. They are: (a) Goods wholly obtained or produced entirely in the territory of one or more of the NAFTA countries ...Goods wholly obtained are defined as ... (h) Goods taken by a Party or a person of a Party from the seabed or beneath the seabed outside territorial waters, provided that a Party has rights to exploit such seabed (i)  Goods taken from outer space, provided they are obtained by a Party or a person of a Party and not processed in a non-Party."

The seabed and its riches are up for grabs as part of a new world order. It is too deep for monitoring and APEC rules lack enforcement. 

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