By Anthony Barich
Private company DeepGreen Metals Inc. is set to announce in April two major oil and gas offshore service companies as investors as part of a US$100 million equity raising to use their offshore expertise to extract polymetallic nodules from the Pacific Ocean floor.
The two oil and gas service companies will join Maersk Supply Service A/S and Glencore PLC as shareholders of DeepGreen as part of a process currently being run by Macquarie Bank and Fearnley Securities to raise US$100 million of fresh equity for the explorer which will close in June.
DeepGreen had previously raised US$77 million in equity, including US$25 million from Maersk, and is also talking to car makers —which need battery minerals for electric vehicles — for processing partnerships that could see them take equity at either a company or project level.
DeepGreen CEO Gerard Barron, previously an investor in another Canadian sea bed explorer, Nautilus Minerals Inc., told the International Mining and Resources Conference in Melbourne, Australia, in October 2018 that DeepGreen estimates a net present value, with a 10% discount, of US$4.09 billion for a single-plant project, with the potential to scale up to three to four plants.
Resources in the Clarion Clipperton Zone located between Hawaii and Mexico, where DeepGreen is planning to operate, are estimated at 34 billion tonnes of nodules including 6 billion tonnes of manganese, 270 million tonnes of nickel, 234 million tonnes of copper and 46 million tonnes of cobalt.
He told S&P Global Market Intelligence that while the involvement of oil and gas suppliers' expertise and technology could reduce capex, DeepGreen could not undertake such an enormous task on its own. It also gives the oil and gas suppliers a new future use for their assets, which are looking at less activity as the world steers away from fossil fuels.