India on November 28, 2024 initiated a first-of-its-kind e-auction of offshore mineral blocks, located off the coast of Kerala and Gujarat and the Great Nicobar Island area. Originally, a total of 13 mineral blocks were put up for auction, the center of attraction lay on the introduction of 7 blocks of Polymetallic nodules and crusts in the West Sewell Ridge Seamounts, situated to the east of Nicobar Island, into the process.
The auction followed the offshore areas mineral (development and regulation) amendment bill of 2023, aiming to amend the earlier 2002 offshore areas mineral (development and regulation) act. The objectives of this proposed bill, 2023 are to enhance self-reliance and security in the sector by encouraging exploration in India’s offshore areas by including key policy reforms such as streamlining exploration and operating rights, competitive bidding for production leases and licenses for PSUs and private companies.
Unlike Crusts, which are cobalt-rich ferromanganese deposits found at shallower depths, polymetallic nodules are mineral concentrations located much deeper in the sea, between 4,000-6,000m. Both these nodules-crusts have garnered global attention for being repositories of critical minerals like manganese, iron, cobalt, nickel, copper, rare earth elements, which are pivotal in solar panels, wind turbines, permanent magnets, electric batteries, modern communications, semiconductors, and defense technologies.
Over the years, the Geological Survey of India has conducted numerous surveys, collected geo-scientific data, assessed mineral resources, and performed high-resolution sea-bed mapping within its vast exclusive economic zones and territorial waters in order to explore the marine minerals. Of these, the Andaman sea region is identified as the potential source of these resources which hold significant economic and strategic value for the country.
In 2023, it was reported by the Marine and Coastal Survey division of GSI that the presence of these vital resources were found in the West Sewell Ridge (WSR) Seamounts, and Sewell Rise Seamounts (SR)- north of the Andaman Back Arc Spreading Centre at depths of 600 to 1300 meters. Additionally, traces of crusts and nodules were also found at 1200-1500m water depth along the flanks of reefs and small seamounts of the northern region of the Lakshadweep Ridge System.
According to a 2020 study, reconnaissance surveys by the GSI found significant levels of rare earth elements (REE) like neodymium, cerium in the samples of the crusts and nodules in WSR and SR. The total rare earth elements varied significantly between 158 ppm and 1899 ppm in SR, cerium being the highest concentration amongst other REE. Both ridges showed high cobalt enrichments, with levels ranging 899-2580 ppm in the WSR and 1444-2168 ppm in the SR. Moreover, extremely high nickel concentrations were also detected, varying 2072-4870 ppm in the WSR and 3370-7860 ppm in the SR.
The discovery of these ‘treasure troves’ in the Andaman Sea is significant for India, as its energy transition gains momentum, its economy continues to advance and its aspirations to become a key global semiconductor and defense manufacturing hub, create a dire-need for such minerals. The Centre for Social and Economic Progress, in its groundbreaking study, predicted that, by 2047 the total cobalt demand of India will rise to approximately 5,914 tonnes, nickel to 26,203 tonnes, and copper to 368,143 tonnes.
However, India currently facing mounting challenges, due to its limited domestic availability, and many of such minerals are deep-seated, low in technological know-how and high in mining-costs, which have rendered India on full reliance, mainly for nickel and cobalt, 93.3% for copper-ores and most rare earth elements, on foreign sources, with China accounting for 56.3% of total imports. Furthermore, the Investment Information and Credit Rating Agency report suggests that India’s extraction of critical minerals from its terrestrial reserves may not yield full commercial benefits until 2031, further solidifying the nation’s continued dependence on China as a critical mineral supplier. China currently controls around 68%, 40%, 73% of nickel, copper and cobalt refining respectively, 85% of rare earths processing and 60% of global production capacity. Given China’s history of weaponizing the supplies of these materials for geopolitical gains, India’s high dependency on China further exacerbates the risk by exposing it to external shocks like supply chain disruptions, price fluctuations, and trade embargoes.
Several projects are underway globally to diversify the supply chain of these minerals, with offshore exploration gaining traction as a potential solution. Advocates for offshore mineral exploration argue that it can circumvent the risks associated with land-based mining, such as widespread deforestation, water contamination that jeopardizes neighbouring communities’ health, and labor-related human rights violations. These issues often lead to local resistance, complicating the resource extraction process and diminishing the overall efficiency of mining and processing operations.
Although India has made notable progress over the years in this sector, such as acquiring exclusive rights to 75,000 sq km in the Central Indian Ocean Basin from International Sea-bed Authority to explore polymetallic nodules in 2002, launching deep sea mission in 2021, partnering with Japan to develop ocean minerals extraction technologies, and drafting blue economic policy to utilize the ocean resources fully and effectively, the inaugural offshore mineral auction marks yet another step in India’s ambition to scale up commercial exploration and extraction while drawing global attention and investment to its untapped marine wealth. While the long-term benefits of this initiative remain to be seen, it clearly underscores India’s intent to address its critical mineral needs, secure reliable reserves, and reduce its dependence on foreign imports.
But with all these, there come significant environmental concerns surrounding the exploration of these resources, which may result in a situation where the benefits of resource extraction for India’s energy transition and economic growth plans are offset by the negative impact on its marine diversity, creating a zero-sum game scenario.
Experts have suggested that the amendment of the 2023 bill, by allowing private players to participate in this sensitive domain, raises concerns that it will potentially lead to unchecked exploitation, and with a lack of transparency, it would make it less accountable towards the protection of the benthic ecosystem of the Andaman Sea.
The Andaman Sea is home to several critically endangered and vulnerable species. Recently, scientists discovered Brittle Stars, a type of Echinodermata (Ophiuroidea), for the first time in the seamounts of the Andaman back arc basin. As many of such species in the Andaman Sea are yet to be discovered, not knowing and understanding their roles in the ecosystem and their potential benefits to local communities, environmentalists argue that exploiting ocean mineral resources from this region can irreversibly or permanently destroy marine habitats by releasing toxic compounds, stirring up sediment plumes, and generating noise and light pollution. Recently, scientists and marine experts from more than 70 countries issued a moratorium, emphasizing the urgent need for additional research and assessment of the environmental impacts of these activities.
With respect to India’s scientific community, little research has been conducted to comprehend the potential consequences of mineral exploitation in its waters. Therefore, it is crucial for India to establish a strong framework to support environmental conservation and sustainable use of its marine resources. While the recent introduction of the offshore areas mineral trust rules, 2024 is a positive step in the right direction, the effectiveness of these measures in mitigating grave risks associated with seabed mineral exploitation in the fragile Andaman-Nicobar sea remains uncertain.
