NORI Presentation SOPAC DSM June 2011

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Nauru Ocean Resources Inc.

World’s most experienced ultra 

eep sea m n ng  eam

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NORI is committed to operating in line with the 

following internationally accepted Environmental, 

Social and Governance principles and standards:

• United Nations Global Compact

• Millennium Development Goals

•  

Environmental Sustainability

  ,  , 

Safety Guidelines

• Precautionary 

Principle

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Developing 

Resources 

for a Developing State

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Environmental

80% Uninhabitable 

Rehabilitation> $200M

No land for 

a ricultureLimited 

Reliant on 

Foreign Aid Depleted by 

us,  r s  

Phosphate mining

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With limited terrestrial resources, Nauru must look 

development. NORI is 

with long term opportunities 

.

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• No commerciall   prospective mineral resources in EEZ

• ’ 

application in 2008.

 

distributed in Nauru to promote education, ra n ng,  ea   an   env ronmen a  

rehabilitation. 

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ar ne  c ence 

DSM Regulatory Framework 

Administration

NORI DSM Project

Pre‐Employment Traineeships

Staff  RecruitmentCareer Planning, Professional 

Development

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Pre‐Employment Traineeships 

Training for Nauruan National  job applicants not 

a rea y possessing t e requisite s i s  or t e Project.

Build capacity of  Nauruan Nationals to participate in 

.

Recruitment

Increase representation; 

Build

 

the 

skills 

base;xpan   career opt ons;

Increase economic participation,

’  .

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Career Planning, Professional Development and 

Development of  Sustainable EmploymentDeve opment o   career pat s  or a rea y experience  

Nauruan National employees to move beyond operator 

Provide sustainable employment and skills 

development to ensure opportunities exist to further 

advance their career. 

E.g.

 

study 

assistance 

and 

scholarships, 

development 

of  

tec n ca   capa t es,  u ng o   commerc a   s s, 

leadership development, technical training and 

.

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’  

Nauru = 1st State to sponsor ISA Reserved Area application; 

precedent 

for 

all 

PICs, 

particularly 

those 

with 

few 

mineral 

PICs leading the way in BOTH Nodule & SMS development. 

’   ,  . . 

Kiribati, as NORI will have developed the equipment, methods 

and  rocesses to demonstrate DSM feasibilit   and decrease 

cost of  capital. 

NORI’s EIA will provide valuable data for PICs to make 

environmental decisions within their own EEZ’s.

Nauru’s request for ITLOS AO has given potential PIC 

sponsoring States more certainty.

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States lacking mineral Resources are exposed to fluctuating metal 

markets. Future supply is not guaranteed. 

ome  esource r c   a es a rea y res r c ng supp y o   s ra eg c 

metals.  E.g. China slashed H2 2010 REE exports quotas by 72%, raised taxes, restricted 

production capacity and now further strengthening pricing power with  Baotou REE 

Exchange. 

Mn market: few producing nations ‐ Potential for OPEC like cartel

Q: How can States lacking in mineral Resources ensure access to 

an uninterrupted future supply of  metals at reasonable prices to 

A: By looking to the seafloor. Many States have recognised the 

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Nauru has entered the international race to the bottom of  

the ocean. Which PICs want to be next?

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Opportunity for PICs to be an international hub 

Norway has been for offshore Oil & Gas

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• Through offshore resource extraction Norway has 

become the 2nd richest country in the world.• Produced $1,500,000,000,000 from its continental 

• Whilst Norway’s offshore petroleum production has 

have ensured its long term economic future  –

’   , , ,

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Norway’s GDP Growth Driven by Offshore 

Resource Exploitation

Exploitation began on Norwegian 

continental shelf  in 1971  – causing 

rapid growth in GDP per capita to 

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PICs have an opportunity to play an important role in 

providing much‐needed supply of  metals to the world. 

metals such as copper (3rd most used metal in the 

world   man anese  4th and nickel  rovide and the role 

they play in advancing human livelihood. Because these 

services are not adequately quantified, they are often 

given too little weight in policy decisions. 

terrestrial mining industry, international metal markets, 

and the role metals  la   in societ .

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In all four 

the worldevery  uman  e ng  eserves goo   ea   an  

shelter, em lo ment o ortunities,  ualit  

education, and freedom 

poverty, 

hunger and 

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How can the world achieve the economic 

progress 

requ re 

ensure 

ese 

universal objectives are met? 

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A: B Unlockin the Value of New Sustainable Resources

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Economic Growth Demands Metals

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Water is essential to sustainable development.

<1% of  world's fresh water is accessible for direct human uses. 

Critical we do not waste what little water is available. 

Copper and Stainless Steel are needed to distribute and store water 

without 

waste, 

corrosion, 

leaks 

or 

bacterial 

contamination. 

Potassium permanganate  – 2nd only to chlorine

884M people still rely on drinking water from unimproved sources 

such as ponds, streams, irrigation canals and unprotected dug 

we s.

Almost one‐tenth of  the global disease burden could be prevented 

.

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Stainless Steel 

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(requiring Ni and 

Raw water handling, India 

Mn) is relied upon 

throughout the 

world to 

distribute clean 

water. 

Office Building Plumbing, China

Water distribution Pi in   USA

Water Distribution Pipe, Canada

Stainless Steel Tap Italy

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Stainless Steel Tap, Italy

Water Tank, ChinaWater Storage Tank, Japan

Reverse Osmosis Plant, Singapore

De Salination Plant, Saudi Arabia

A G E i t ibl

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A Green Economy is not possible 

without metals at affordable prices

1 Wi d T bi 500 k 12 C

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1 Wind Turbine: 500 kg  12x more Cu to create 

of  Ni + 1000 kg of  Cu 1kw than conventional ower  eneration

l h l h h

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An electric vehicle has over TWICE the Cu content 

of  the average car ‐ 2km of  copper wiring

Ni and Cu

 

batteries in 

.

Mn is needed for high strength 

stee   s eet to rep ace  eav er m  

carbon thus making vehicles lighter 

reducing 

vehicle 

emissions. 

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Whilst metals are critical to development we are 

running out of  mineral Resources on land at a 

time when demand is increasing. If  demand 

increases without a commensurate increase in 

supply the price of  minerals will become 

unaffordable 

to 

the 

world’s 

poor. 

DSM offers a new supply which will be critical in 

meeting 

increasing 

demand, 

and 

PICs 

have 

unique opportunity to lead this new industry. 

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World co er consum tion 1900  – 2008  K TONNES

World production  –1900: 495 kt; 2008: over 15 Mt

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Mining lower grade material is environmentally 

damaging as it requires moving more rock per tonne of  metal recovered with attendant greater 

surface area disturbance, higher fuel emissions 

per 

tonne 

and 

larger 

waste 

rock 

dumps.

Mining Industry is being forced to produce from far

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Mining Industry is being forced to produce from far 

more  angerous, remote, an   pr st ne env ronments 

on land

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Unique opportunity here for PICs to lead the way in protecting the 

planets overall environment by taking pressure off  the land, which, 

w s   on y accoun ng  or  o   e p ane s sur ace area,  as  een 

subject to 100% of   Ni and Cu mining.

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DSM = No Deforestation

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• Diversity on a 40m rainforest tree can exceed 1 million living species;

• Rainforests among the most biodiverse places on Earth ‐ exceptional 

biological richness on both landscape and local scales, across 

axonom c groups.  amma s, amp ans, rep es,  r s,  s , 

insects, vascular plant species etc.

•   . 

• Rainforests provide essential services such as clean air, water, rainfall and stable climate, and are a source of  food and medicine.

• Increasing pressures on rainforests from hydrocarbon and terrestrial 

mining projects, illegal logging, oil palm plantations, transportation 

,  ,  u   u   w   .

• Forests are home to 80% of  our terrestrial biodiversity.

  .   .

Nickel laterites occur in equatorial tropical rainforest regions

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q p g

Unlike nickel laterites, access to and mining of  underwater mineral 

decrease 

in 

the 

Earth’s 

carbon 

absorption 

capacity

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By avoiding deforestation DSM helps keep our planet green

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DSM = 

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Minimal Overburden 

and 

Stripping

Underwater mineral deposits 

enerall 

occur 

directl 

on 

the 

seafloor and do not demand large 

pre‐strips or overburden removal 

of  waste for every tonne of  ore.

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average mine strip ratio of  4.2:1 over a mine life of  37 years.

Construction of  Escondida included stripping 180 MT of  

was e us o ge o ore o y

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was e  us   o ge   o ore o y

Irreplaceable Andes Environment

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‐ 

moved 

in 

pre‐

stripping 

during 

2001 

alone!

Terrestrial mines  0.55% Cu

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Wh   di   u   180 tonnes of  the 

Earth  just to get 1 tonne of  

Co er? 

Is this the wisest

use 

of  

the 

planet’s 

environment?

DSM = Minimal Waste Rock & 

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Minimal Tailings 

• Modern terrestrial open‐pit mining has very high 

waste‐to‐product ratio.

• E.g. Porphyry copper deposits (the largest source of  

copper ore) are averaging 0.55% Cu which means 

99.45% is produced as tailings. 

• Even more waste for  old where recover   rates can 

be as little as 5‐10 grams of  gold per tonne of  rock 

and 

ore 

mined.• Disposal of  this waste (large volumes and toxic) 

threat 

posed 

by 

mining.

Tailings

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DSM = Less Ore, Less Waste & Less Tailings

S fl b

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Seafloor 

Polymetallic

Lumwana 

Copper 

Ambatovy 

Nickel 

Eramet

Manganese 

No u es M ne M ne M ne

Grade 43% MnO2, 

1.3% Ni

0.74% Cu 1.04% Ni 43.10 % Mn

 

1.1% Cu

Overburden  N/A Yes Yes Yes

Strip Ratio N/A 4.2:1 1.33:1 1:1

Ore Mined (Mtpa) 4.6 6.76 5.77 3.01 54  . . .

Tailings /Ore ratio 54% 99% 99% 57%

Tailings (Mtpa) 2.48 6.69 5.7 1.71 14

Ni Product (ktpa) 60 60

 

Mn Product (ktpa) 1,100 1,100

To obtain 

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equiv. metal from 

Land Minin

1,092 Mt mined 

+ 271 Mt tailin s 

Nodule Mine 

49.7 Mt tailings

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Copper 5% 1%

rade

Ore per 4 mill tonnes 20 mill tonnes

annum

 

per annum

 

waste:ore)

Total tonnes 4mtpa 80mtpa

 

Terrestrial Copper Porphyry  = 20x more tonnage

Irreplaceable Andes Environment  – tens of  millions of  years to form. 

After copper is mined the environment will NEVER return to previous 

condition Yet 45% of world Cu comes from this fragile Andes

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condition. Yet 45% of  world Cu comes from this fragile Andes 

environment!

The Peruvian Andes is famous 

or ts un que an pr st ne

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or  ts un que  an   pr st ne 

cloud forests 

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Rio Blanco porphyry copper deposit  – pristine region of  the Andes 

mountains  on the border of  Peru and Ecuador. This is merely an 

exploration camp, the mountain won’t exist after mining!

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Levelling a 500Mt mountain  just to get 3.15Mt of  

u

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Is this the wisest way to source our copper when 

hundreds of  millions of  tonnes of  Cu sits on the 

seafloor 

and 

does 

not 

re uire 

pre 

strippin 

or 

deforestation?

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Mountain levelled and replaced with huge waste pile and tailings 

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previous condition. 

Peruvian Andes 

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Los Bronces open pit copper mine in Chilean Andes 

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Unique mountains 

continue to be levelled 

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on land 24/7. This 

summ t van s e   n a 

day. Is this sustainable?

DSM = Minimal Production Infrastructure

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 Ambatovy  Nickel, Madagascar ‐

220km ore pipeline from mine to 

processing plant through rainforestDSM = no rail/road/pipelines

DSM process plants can be constructed and operated in efficient 

‘ 

it ’ 

ft 

i t l 

d t ti 

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mines ‘on site’ – often causing massive environmental devastation.

One of the greatest sources of pollution caused by global mining

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One of  the greatest sources of  pollution caused by global mining 

atmosphere. 

“  

ecological security threats in the world” (US EPA).

In contrast acids cannot be roduced in the ocean because 

seawater is alkaline.

AMD at a sulphide‐rich nickel and copper ore deposit

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Terrestrial mining often requires

miners to work in hazardous 

and unsafe conditions with

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and unsafe conditions with 

significant chemical exposure

DSM: The New & SAFE ‘Mine Face’ 

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• Increased GDP

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• Increased GDP

• Employment 

•  

• Capacity Building

• ec no ogy  rans er 

• Foreign Investment 

• Tax Revenue/Royalties  –  Health & education services etc.

…without  the negative impacts generally  associated  with the extractive industry  such as community  dislocation and  degradation of  the national  environment. 

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Cook  Islands/

Kiribati

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encourage 

DSM 

investment 

and 

achieve 

these 

positive 

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How much does it cost to build and 

opera e a  eep  ea  ne

 

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Commercial terms of  Regulatory Regimes must 

reco nise:

• Unique challenges of  starting a new industry  –

“ ” ‐

technological risks are VERY HIGH 

• DSM is not bankable

• 

• Exploration costs are higher than on land

• Industry must develop new technologies

Prelude floatin   LNG  latform

488m long

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488m long  on

Semi‐Submersibles$600M buy or $450k per day hire

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800

400

600

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200

‐200

0

1 2 3 4 5 6 7 8 9 10 11 12 13

‐400

‐800

‐600

Very High

‐1000 Up‐Front 

‐1400

‐1200

 

CAPEX

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Dredging industry moves 2 billion tonnes per annum off  seafloor

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