Nautilus Minerals is on track to become the first publicly-listed company to commercially mine high-grade copper on the seafloor.

It is on schedule to kick off the deep water mining industry in early 2018. 

Listed on the Toronto Stock Exchange and trading on New York’s OTCQX, the OTC Market’s top tier marketplace, Nautilus has mining and environmental approvals for its flagship Solwara 1 project.

Solwara 1 is in joint venture with Papua New Guinea’s Eda Kopa (Solwara) Ltd and is a copper-gold seafloor massive sulphide discovery in PNG’s Bismark Sea. 

Nautilus is determined to set a high bar for an environmentally and socially responsible approach to this new method of mining.

“The eyes of the world are waiting to see the dawn of this new industry,” CEO Mike Johnston told ResourceStocks from Nautilus’ Brisbane office.

“We’re looking to open up the potential on the sea floor for the extraction of high-grade mineral resources.

“When you think that 70% of the planet is covered by water and our existing resources come from just 30% of planet, the seafloor potential is huge.”

Despite the different logistics of entering a new frontier, Johnston said the company was ahead of schedule and in September held a steel cutting ceremony to mark the start of its production support vessel in China.

“Everything is on track and we’re looking to be in production in the first quarter of 2018,” he said.

Seafloor mining was almost the opposite of conventional land-based resources extraction, Johnston noted.

“It’s a complete paradigm shift in terms of environmental impact and capital expenditure requirements,” he said.

“On land, capital expenditure is front-end loaded and copper projects typically have a high capital intensity and you have to squeeze benefits through low-cost expansion.

“But on the seafloor, there are enormous resources and you can bolt on more capacity as you go.”

An independent environmental and social benchmarking analysis found Solwara 1 could have less environmental and social impacts than traditional, large land-based copper mines.

The Earth Economics report, based on natural capital accounting, found seafloor mining had the potential to minimise the impact of copper mining by producing more copper with fewer natural capital inputs, fewer damaging outputs and a smaller area of impact.

“The company that did this report approached us first and said ‘this is a game-changer’,” Johnston explained.

“They liked the fact it ticked so many environmental boxes.

“Natural capital accounting takes the emotion out of the argument and strips everything to monetary values.

“The report’s conclusion was that seafloor mining was a better way to provide key resources like copper to mankind and it’s got a mind-blowingly small environmental and carbon dioxide footprint when you compare it to massive copper porphyry mines.

“Unlike terrestrial mines, we won’t impact on surface or fresh groundwater supplies and we won’t produce any waste.”

Nautilus will send the high-grade material to China’s Tongling Non-Ferrous Metals Group copper smelter, which has agreed to purchase Solwara 1’s product.

“Tongling is one of the most efficient copper smelters in the world and it will process 100% of our material,” Johnston said.

“What would be tailings in the West will produce sulphuric acid for fertiliser, and the iron ore and gold, and then there’ll be nothing left – zippo.” 

The mining procedure for Solwara 1 sounds like science fiction compared with the process at a typical land-based copper operation.

Two large robotic machines will cut rock on the seafloor and a third will collect it as a seawater slurry.

The collecting machine will push the slurry through a pipe to the riser and lifting system to deliver it to the production support vessel, which is now under construction.

On board the vessel, the slurry will be dewatered then the solid, high-grade material will be put on a transport vessel moored alongside.

The filtered seawater will be pumped back to the seafloor to avoid mixing the water column and to minimise the environmental impact of the operation.

Johnston said Nautilus was at the forefront thanks to advances in technology, information being declassified by the military and its cohesive in-house team with diverse experience.

“There’s a real buzz at Nautilus,” Johnston said.

“People are doing something new and we have a mix of petroleum, mining and processing guys solving common problems.

“If we can approach our project from different angles we can all learn something – we’re quite fortunate to be at the front of that.”

He said the technology at their fingertips was incredible compared with what was available just a few decades ago.

“Technology rules the day,” he said.

“You have more computing power in your mobile phone than they had in the 1970s.

“There are massive step-changes all the time in technology and that’s going to continue.

“When I first started this, people said we won’t be able to see what we’re doing but now we have 3D sonar and digital imagery, which is pretty staggering.”

The company had $US84.6 million in cash and equivalents mid-year but will need to raise more capital as the development progresses.

“We have a number of sources of funding and we have supportive shareholders, who we’re grateful for – and we’re very different to the average mining company in Australia,” Johnston said.

“People are quite interested and as we get closer to production, the level of engagement and excitement increases every three months.

“Investors can see that we’re ticking off milestones and before you know it, we’ll be mining, so now is a good time to come on board.”

For Nautilus, Solwara 1 is just the beginning of its seafloor focus.

The company holds exploration tenements and applications in the Southwest Pacific and international waters in the Central Pacific.

“When we move outside national jurisdictions, we go to the International Seabed Authority,” Johnston explained.

“They administer about 70% of the ocean and its seabed, which is about 50% of the entire planet.

“There is potential all over the world and our objective remains to develop the first commercial high-grade seafloor copper-gold project and launch the deep water seafloor resource production industry.”