Catalyst with Shayle Kann: What to Make of Trump's Deep-Sea Minerals Push

Release Date: May 22, 2025
Host: Shayle Kann
Guest: Hans Schmidt, President and CEO of Ocean Minerals
Produced by: Latitude Media

Introduction: Trump's Executive Order on Deep-Sea Mining

In this episode of Catalyst, host Shayle Kann delves into the controversial topic of deep-sea mining (DSM) and the recent executive order (EO) issued by former President Donald Trump aimed at accelerating the United States' pursuit of underwater mineral resources.

Shayle Kann [03:04]:

"At the bottom of the ocean in certain places, there appears to be an enormous volume of these golf ball-sized rocks. They are polymetallic nodules and they contain battery minerals like nickel, cobalt, manganese, and copper, as well as rare earths."

Understanding the Executive Order

Shayle introduces Hans Schmidt, CEO of Ocean Minerals, to unpack the implications of Trump's EO on DSM.

Hans Schmidt [04:46]:

"The key important thing about the EO is the fact that the US has now publicly come out and said that it supports looking into deep sea mining and has directed the US Government to take positive and proactive action to help get this off the ground."

The EO emphasizes not only U.S. territorial waters but also extends to international waters, signaling a broader ambition to tap into global underwater resources.

Regulatory Framework: EEZs vs. International Waters

Shayle probes the complexities of operating within Exclusive Economic Zones (EEZs) versus international waters.

Hans Schmidt [05:59]:

"There are two areas: the exclusive economic zone, which is the territorial waters of any country, and beyond national boundaries, which is international waters regulated by the United Nations' International Seabed Authority (ISA)."

Despite the EO, the U.S. has not ratified the United Nations Convention on the Law of the Sea (UNCLOS), complicating its stance and operations in international waters.

Global Landscape of Deep-Sea Mining

The discussion shifts to the global players in DSM, with a focus on the Cook Islands and Japan.

Shayle Kann [19:47]:

"The Cook Islands is furthest along in terms of exploration and moving toward actual deep sea mining."

Hans Schmidt [19:55]:

"The Cook Islands have regulatory frameworks in place to transition from prospecting to exploitation with strong environmental safeguards. Japan is a close second, having announced significant nodule fields and advancing their programs under the University of Tokyo’s guidance."

Exploration and Licensing in the Cook Islands

Ocean Minerals is actively involved in the Cook Islands, holding one of three exploration licenses awarded in 2022.

Hans Schmidt [20:55]:

"Our company, Mohana Minerals, is two years away from applying for mining licenses. We are currently engaged in environmental data collection and developing our mining and processing systems."

The Cook Islands' structured approach allows companies to secure exploration licenses with a clear pathway to commercialization, setting a precedent for responsible DSM.

Addressing Environmental Concerns and Technological Solutions

Environmental impact remains a major concern for DSM. Hans explains how Ocean Minerals is addressing these challenges.

Hans Schmidt [22:57]:

"The technology for DSM extraction is known and proven since the 1970s. Our focus is on establishing baseline environmental data to ensure minimal impact through adaptive management."

Ocean Minerals is committed to continuous data collection and refining their processes to mitigate environmental footprints effectively.

Shayle Kann [22:44]:

"Is there a technological challenge in how we actually extract resources while minimizing environmental footprint?"

Hans Schmidt [22:57]:

"The separation and refining technologies already exist. We are merely sequencing existing technologies to optimize the extraction of multiple metals from polymetallic nodules."

Economic Viability and Capital Considerations

Shayle and Hans discuss the economic feasibility of DSM compared to terrestrial mining, addressing common misconceptions about costs and profitability.

Hans Schmidt [29:32]:

"Despite the high operational costs of seaworthy ships, DSM avoids the massive capital expenditures required for terrestrial infrastructure like power lines and roads. Additionally, DSM yields significantly more metal per ton of material, enhancing revenue potential."

Shayle Kann [31:26]:

"You're getting a higher value product per unit weight, which offsets higher operational expenses."

Hans Schmidt [31:33]:

"Our project, estimated at $3-4 billion, is projected to generate $500 million in free cash flow annually, presenting IRRs in the 30s and 40s—highly attractive compared to traditional land-based mining."

Handling Commodity Price Volatility

The discussion addresses the impact of fluctuating commodity prices on DSM profitability.

Shayle Kann [33:37]:

"With polymetallic nodules, you have multiple revenue streams that can offset the volatility of individual commodity prices."

Hans Schmidt [34:53]:

"Manganese, the largest component of our operations, offers market stability that buffers against price fluctuations in nickel and cobalt. Even with recent price dips, our project remains profitable."

Future Prospects and Conclusion

Shayle concludes the episode by highlighting the potential of DSM to meet global clean energy demands, provided that regulatory and technological challenges are effectively managed.

Shayle Kann [35:00]:

"Thank you, Hans. This is super interesting. I'll catch you in two to four years when you're pulling up commercial volumes."

Hans Schmidt [35:00]:

"Look forward to it. Thanks very much."

Key Takeaways

• Executive Order Impact: Trump's EO has spotlighted DSM, encouraging U.S. involvement in both EEZs and international waters despite regulatory challenges.
• Global Leadership: The Cook Islands lead DSM efforts with robust regulatory frameworks, followed by Japan’s advancing programs.
• Environmental Responsibility: Proven technologies and rigorous environmental data collection are crucial for sustainable DSM.
• Economic Feasibility: DSM offers high returns through efficient metal extraction, with polymetallic nodules providing economic resilience against commodity price volatility.
• Future Outlook: Effective management of regulatory, technological, and environmental aspects will determine DSM's role in the global energy transition.

Notable Quotes

• Hans Schmidt [07:37]:
  "There has been a lot of exploration work in the Clarion Clipperton zone, funded by governments, which has been invaluable for understanding and developing guidelines for underwater mining."

• Hans Schmidt [12:13]:
  "The EO has taken DSM and put it into the spotlight, bringing mainstream media and interest into DSM, which is a big step in the right direction."

• Hans Schmidt [27:24]:
  "We're using different technologies that exist and putting them together in a different sequence. It's just chemistry—big tanks, pumps, and circulatory circuits to separate metals."

• Hans Schmidt [34:53]:
  "Manganese is a great stabilizer and allows us to ride through the fluctuations we see in nickel and cobalt prices."

Conclusion

This episode of Catalyst offers an in-depth exploration of the burgeoning field of deep-sea mining, highlighting the intersection of policy, technology, environmental stewardship, and economic opportunity. With Ocean Minerals at the forefront, the discussion underscores the potential of DSM to contribute significantly to the global energy transition, provided that challenges are navigated thoughtfully and responsibly.

For more insights and episodes on climate tech and energy innovations, visit Latitude Media.