Markets for nickel, cobalt, and copper are expected to grow for traditional uses as well as for energy transition uses, while manganese markets are considered relatively stable for long-term demand. Future growth in demand and supply from expected projects is uncertain, but the gap appears to be lowest for cobalt and manganese, the primary components of value in Cook Islands nodules.
Processing of nodules to recover nickel, cobalt, copper, and manganese is technically reasonable, and most of the steps have been demonstrated. However, no facilities exist today that could fully process nodules to finished products, and no significant excess capacity exists in facilities that could treat nodules to produce intermediates for refining elsewhere. New facilities, or sufficient economic incentives to deter purchase of competing feeds, is required. Establishing new processing technology for well-known terrestrial ores has been far from successful over the last several decades; there is no reason to believe that developing new processes for new resource types never previously treated would be more successful.
The existing market structure for ores with similar characteristics is to sell the material to a processor, who incurs processing costs and recovery losses, and sells the final product up the supply chain. The ore owner receives a fractional value of the contained metals, dependent on the overall composition and processing methodology. In-situ value is not a relevant metric for nodule projects unless the proponent includes all the capital costs, operating costs, and recovery losses for all the processing operations through to the final product. Cook Islands nodules have lower valuable metals contents than some other seabed nodule deposits and are estimated to have a market value of approximately US$100-140/dry metric tonne delivered to processing facility.
Nodule extraction by crawler harvesting of nodules and sediment has been demonstrated on a pilot scale, while nodule extraction by theoretically less-destructive pickers is considerably less technically advanced. Substantial development time is expected to determine if the latter technology is in fact viable. Working at depths 3 times greater than the Deepwater Horizon and >15 times deeper than North Sea oil recovery poses significant challenges to reliable operation.
Capital and operating costs suggested by project proponents show a high likelihood of economic losses for extraction and sale of Cook Island nodules. A sensitivity analysis for picking technology suggests the average outcome is negative. Estimated operating costs for a crawler project (PFS-level) are at or above nodule estimated market value, also indicating negative economics.
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