A careful reading would show that the Japanese researchers were quite modest about their findings. The most promising result came from samples of Site 1222 which showed that the potential area could contain enough rare elements to ‘possibly’ meet the current global demand for these commodities. The figure of 100 billion tons was not mentioned in the published paper. And even though the seabed might contain rich deposits many significant obstacles to extraction remain.
When discussing the extraction of any commodity, the concepts of geographical and geopolitical distance need to be considered. In terms of geographical distance, these deposits are located in the seabed 4–5 kilometres below the sea. They are also located in international waters, hundreds of kilometres from land. And even though the seabed might contain these resources, it may not be economically viable to undertake any large-scale extraction, keeping these deposits tantalisingly out of reach.
But with the development of new equipment and technology, it might be possible in the near future to develop economically-viable methods to extract these resources from the seabed. Although in this case geopolitical distance may well prove to be a major obstacle. Situated in international waters, outside the exclusive economic zones (EEZ) of any countries, it would be difficult and very time-consuming, if at all possible, to come up with an equitable formula to divide up the extracted resources. Even though Japanese scientists discovered this potential mother lode of rare earths, this does not mean Japan is able to call dibs on them. To put the matter into perspective, recent Japanese efforts to extract minerals from the seabed in their EEZ have already drawn the ire of their Chinese counterparts, disputing Japanese claims of legal jurisdiction over the area.
Given the heightened global demand for rare earth elements, as well as the increasingly-unstable Chinese supply, many states are seeking access to alternative sources, and this recent discovery is going to draw attention. Any move to extract these resources are bound to draw protests from other interested actors and open up a new front in the competition for resources, thereby increasing international tension. It is also not uncommon for disputes over natural resources or EEZs to draw a very strong nationalistic response. For instance, in August 2007 Russia planted their flag on the Arctic seabed so as to cement its claim over the area. Expectedly, this provocative action was not well-received by the other claimant states, who naturally wanted to retain the freedom of being able to extract such resources in the future.
As it is, current evidence does not indicate that any concerted action would be taken by states to extract rare earth from the seabed. Apart from the issues of geographical and geopolitical distance, the interest in and prices of rare earths are high because supply is limited. Any major increase in supply will depress global interest as well as prices. Given that major consumers of rare earths such as Japan and South Korea have already embarked on ambitious projects to extract and refine rare earths in various countries prior to this recent discovery, it is highly unlikely that they want to see the rapid depreciation of their new investments by pushing for seabed extraction.
Lastly, the WTO has also recently released its ruling that China’s restrictions on the exports of certain forms of bauxite, coke, fluorspar, magnesium, manganese, silicon metal and zinc contravened the WTO’s Accession Protocol, which establishes a precedent for other states to challenge China’s restrictions on rare earths exports. A successful challenge would result in more Chinese exports, thereby removing any incentives to extract resources from the seabed, at least for now. Thus, for the time being, it seems that any dreams of extracting rare earths from the Pacific can be put to bed.
Ming Hwa Ting, PhD., teaches at the University of Adelaide. He was most recently interviewed by ABC National Radio on the reasons behind China’s unexpected relaxation of its rare earth exports in H2-2011. The interview and transcript is available here.