Cobalt Sea Mining (COBALT)

          CASE NUMBER:         103 
          CASE MNEMONIC:      COBALT  
          CASE NAME:          Cobalt Sea Mining

A.        IDENTIFICATION 
1.        The Issue
     The issue in the Pacific Ocean Manganese and Cobalt mining
case is the establishment of a precedent on how "the common
heritage of mankind" will be exploited, who has rights to the
economic benefits, and who will regulate resource depletion and
other potential environmental damage.  Since seabed mining is not
yet commercially viable in the depths beyond national
jurisdiction, the a priori approach taken in this case could act as a
framework for future trade and environmental issues in multilateral
forums, and will impact every state in the world.
2.        Description
     The discourse of the seabed provisions of the United Nations
Convention on the Law of the Sea (the "Convention") have been
contentious since "[i]n 1967, Arvid Pardo, the Ambassador of
Malta to the United Nations, delivered a speech to the First
Committee of the General Assembly, calling for an international
regime to govern the deep seabed, mine the manganese nodules and
distribute the profits from their sale to the neediest countries." 
This led to the establishment of UN Seabed Committees and laid the
groundwork for the third and present Convention which concluded in
1982. Even though Democratic and Republican administrations had been
working on the establishment of an international law of the sea
since 1958, the Reagan administration was so adamantly opposed to
the anti-market provisions in the proposed seabed regime, that it
refused to even sign the Convention, more less submit it for
ratification.  In the words of President Clinton's Deputy
Assistant Secretary of State (Oceans) David Colson:
     The basic flaws of that [1982] deep seabed mining regime
     are manifold.  But stated simply, it failed to provide
     the US and other states with major economic interests a
     voice commensurate with those interests in decision
     making relating to the management of deep seabed
     resources  and it was based on a highly interventionist,
     central economic planning model that was overly
     bureaucratic and would have preempted private investment
     in deep seabed mineral resource development, thus
     preventing the development of those resources when
     economic conditions warrant.
     In 1990, the Bush administration started to explore the
possibility of an amendment to the Convention which would make it
amenable to US interests.  The Clinton administration continued
the process, and in July of 1994 announced that he would sign a new
amendment, and in October sent it to the Senate for ratification.
Now the Convention and its Amendments will be considered by the
new Republican controlled Senate, and notably, overseen by Senate
Foreign Relations Committee Chairman Sen. Jesse Helms (R-NC).
     The ratification of the Convention would set a new standard
for activities on and under the high seas.  "The articles on the
protection and preservation of the marine environment that
finally emerged as part XII of the Convention represent the first
attempt to set out a general framework for a legal regime that
establishes on a global, conventional basis the obligations,
responsibilities and powers of states in all matters of marine
environmental protection."  The International Sea-Bed Authority will
have responsibility for controlling pollution from activities on the
deep seabed under Article 145, but the primary responsibility for
adopting and enforcing laws and regulations remains with the
states under Article 209.  This responsibility will have doubtful
effect when such activities do not damage the flag state's territory
and contributes important resources to the national economy.
    The geographic region covered by the Convention is called
the "Area" which means "the seabed and ocean floor and subsoil
thereof, beyond the limits of national jurisdiction."  This means any
part of the ocean floor, world wide, that is not covered by any
state's exclusive economic zone (EEZ).  The Habitat would include any
plant and animal life found at the respective mining sites which
average 12,000-20,000 feet in depth, and the plant and animal life
affected by the enormous amount of sediment that can be stirred-up
from the use of air lift mining vacuums and/or dredging equipment.
     The potential supply of manganese could be in the billions
of tons.  Manganese is used in the refining of steel and for
scrubbing sulphur from stack gas, usually from coal burning plants. 
Manganese can also be refined to extract copper and cobalt. 
Since the US is overwhelmingly the largest consumer of manganese (and
will be for the foreseeable future), this issue is of special
interest for the US, and to a certain degree Japan, Germany and
other highly industrialized countries who have developed deep-sea
mining technology and refine large quantities of steel.  The
economic viability and impact of this issue is unclear, but
potentially could be a multi-billion dollar industry which could
employ thousands of people.
     The environmental impact of seabed mining would include
biodiversity issues, ocean floor species and plant life loss, and
pollution from activities such as drilling, dredging, excavation,
waste disposal and related activities in the maintenance of
mining installations.  Scientists are just now learning more about
the type of habitat that surrounds sites with high levels of mineral
sulfides (which typically contain manganese, cobalt, copper,
zinc, lead and iron; and sometimes silver and gold).  As little as 15
years ago, many scientists thought the deep seabed was like a
desert, but recent deep sea exploration has found thriving
communities of many species, some unknown elsewhere.  "Such
communities form around hydrothermal ventswhich produce warm
water zones of tectonic activity such as the mid-ocean ridgesas well
as around cold jets of unusually salty water and places where
hydrocarbons seep from the sea floor.  The basis of life in these
ecosystems is not photosynthesis but the activity of bacteria
that use the substances coming out of the sea floorsulfides in the
hot water, for exampleto produce organic compounds and energy." 
These autotrophic bacteria are the first links in very long food
chains, in which 233 invertebrate species have already been
found.
     Some potential miners have proposed trying to collect
minerals as they precipitate out of active vents, which would almost
certainly cause great habitat and species loss.  But the
technology necessary to accomplish this feat is not available and may
be unnecessarily complex.  Research on the Escanaba Trough along the
Gorda Ridge off California suggests that deposits which are
formed within sediments efficiently trap and concentrate minerals as
they leave volcanic domes.  Scientists assume that hydrothermal vents
have life spans of less than fifty years, and once vents are no
longer active, their fauna disappear leaving only the valuable
crusts.  Therefore, future legislation could restrict mining to
deposits on inactive vents to minimize the destruction of species
and habitat.
3.        Related Cases
4.        Draft Author: David Bew
B.        LEGAL Clusters
5.        Discourse and Status: AGReement and INProgress
     The Convention on the Law of the Sea entered into force on
November 16, 1994 with the 60 parties necessary for the
Convention to enter into force, but no major sea power or
industrialized country, save for Iceland, has ratified the
Convention.  As of January 27, 1995, 72 countries were party to
the amendment to the Convention addressing the "non-market"
mining provisions.
6.        Forum and Scope: UN and MULTIlateral
7.        Decision Breadth: 72
     The Law of the Sea Treaty received the necessary 60
ratifications and entered into force November 16, 1994.  Since
Iceland was the only industrialized country to ratify the treaty,
UN members have been amenable to the new amendment which
addresses the reservations of the US and is expected to be
ratified by virtually all countries.  Even the countries not
ratifying the treaty will be effected by its provisions since
much of its contents are considered customary international law.
     Number of parties affected: All states
8.        Legal Standing:     TREATY
C.        GEOGRAPHIC Clusters
9.        Geographic Locations
     a.   Geographic Domain:       OCEAN
     b.   Geographic Site:         OCEAN
     c.   Geographic Impact:       MANY
10.       Sub-National Factors: NO 
11.       Type of Habitat: OCEANS
     The habitat in this case is the area at or near the ocean
floor in depths ranging from 12,000-20,000 feet.
12.       Type of Measure:    LICENsing
13.       Direct vs. Indirect Impacts: DIRect
14.       Relation of Measure to Environmental Impact
     Licensing and regulation is direct as they cover the process
of mining, and not the use of the manganese, cobalt, etc.
     A.   Directly Related:        YES MINeral
     b.   Indirectly Related:      NO
     c.   Not Related:             NO
     d.   Process Related:         YES Pollution Sea [POLS]
     The environmental and trade impacts are directly related to
the process of mining.  Any mining conducted in the Area will be
licensed and regulated by the Authority, which has responsibility
for controlling the activities on the seabed.
15.       Trade Product Identification: RAW, HARD MINERAL
16.       Economic Data
     The industry is only in its infancy; there are not yet any
commercially viable mine sites.
17.       Impact of Measure on Trade Competitiveness: HIGH
18.       Industry Sector:  MINeral
19.       Exporters and Importers: MANY and MANY
     Exporters:  The leading preliminary US consortium is led by
Lockheed (plus two possible others may have site claims
"grandfathered" into the Amendment); other site claims so far
have come from Japan, France, Russia, India and China.
     Importers: Leading consumer of subject minerals is the US.
20.       Environmental Problem Type:  Species Loss Sea [SPLS]
     Species and habitat loss could extend to the 223
invertebrate species that have been identified near hydrothermal
vents, most of which are endemic, differing considerably in
separate geographical zones.  The potential loss from the
destruction of these seabed habitats could also have a direct
human impact.  "Some of the hot vent organisms can tolerate
temperatures up to 250øC, a property unusual enough to make these
bacteria valuable...in biotechnology to produce heat-resistant
enzymes."
21.       Name, Type, and Diversity of Species 
     Name:          MANY 
     Type:          MANY
     Diversity:     NA
     As a beginning, 223 invertebrate species have been described
living around hydrothermal vents in the deep seabed around
Escanaba Trough.  Most of these species are "molluscs, annelids,
arthropods or members of Vestimentifera, the tube worms.  The
peracarides and echinoderms that dominate 'normal' seabed
communities are only weakly represented.  Most of the
hydrothermal species are endemic, differing considerably between
vents in separate geographical zones."
22.       Resource Impact and Effect:   HIGH and REGULatory
23.       Urgency and Lifetime: LOW and 100s of years
24.       Substitutes:   SYNTHetics
F.        OTHER Factors
25.       Culture:  YES
     Much of the controversy surrounding the Law of the Sea
Treaty is related to the expected profits generated by seabed
mining.  Many participants in the debate want land locked and
poor countries to benefit from the development of the "common
heritage of mankind" since the Area falls outside the
jurisdiction of any country's EEZ. 
27.       Human Rights:  NO
26.       Trans-Border:  NO
27.       Rights:        YES
     The basic question is who owns these resources.  The law
does recognize the common heritage but assumes a first-come,
first-serve attitude to exploitation.
28.       Relevant Literature
     The body of literature on this issue is extremely large and
spans more than thirty years.  The most important document is the
UN Convention on the Law of the Sea, especially Part XI and Part
XII.  The applicable articles include the following.
     art. 145 Protection of the Marine Environment
     art. 186 Sea-Bed Disputes Chamber of the International
     Tribunal for the Law of the Sea
     art. 187 Jurisdiction of the Sea-Bed Disputes Chamber
     art. 208 Pollution from sea-bed activities
     art. 209 Pollution from activities in the Area
     art. 214 Enforcement with respect to pollution from
     sea-bed activities
     ANNEX VI. art. 14 Sea-Bed Disputes Chamber
Carter, Barry and Phillip Trimble, International Law, Little,
     Brown and Company, Boston, 1991.
Dispatch, "UN Convention on the Law of the Sea," 5/22 (May, 1994)
     359.

Dispatch, "US to sign Seabed Mining Agreement of the Law of the
     Sea Convention," 5/29 (December 1994) p.485.
Janis, Mark, An Introduction to International Law, Little, Brown
     and Company, Boston, 1993. 
New Scientist, "A Strategy for the Sea Floor," October 12, 1991,
     34.
Oceans, "Looking Toward Seabed Mining," 21/1 (January, 1988), 69.
Oceans, "ProspectingTwo Miles Down," 21/2 (February, 1988), 16.

                           References



[ENDNOTES WILL BE ADDED]