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World’s First Commercial Deep-Sea Mining Project Advances in Norway

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Interest in deep sea mining increases during precious metals bull markets. With increased demand for precious metals and minerals for electronics manufacturing and other purposes, investments in deep sea mining projects has resumed.

Gold, silver and other precious metals exist in ore deposits within the earth’s surface. This includes the surface underneath the oceans, covering over 70% of the surface. Deep-sea mining is considered the next frontier in the quest for gold.

The focus is primarily on polymetallic nodules, polymetallic sulphides, and cobalt-rich ferromanganese crusts which contain metals like nickel, copper, cobalt, manganese, and rare earth elements.

The extreme conditions of the deep sea lead to increases in cost, which is a reason why interest in serious exploration of these resources has been limited. In the ocean, miners and mining equipment are subject to extreme pressure, freezing temperatures, and corrosive elements. pose significant technical and operational challenges.

The significant technical and operational challenges impact the bottom line. While new technologies including Remotely Operated Vehicles, seismic and sonar imaging technologies and innovations in drilling and extraction. These advancements come at a high cost of technology and uncertainty in recovering sufficient mineral quantities can make deep sea mining a risky financial venture.

Despite these risks, there are some Arctic countries leading the way. Last month, Norway’s parliament passed an agreement that allows for opening up the countries waters to deep sea mining exploration, despite pushback from environmentalists and the fishing industry.

Aerial view of a strip mine

Despite years of improvements, there are still environmental issues effecting the industry. Mining operations can lead to the destruction of habitats and loss of biodiversity.

Already the largest oil producer in Europe, Norway’s politicians see this as a promising emerging industry that will create jobs.

Many see the advancement as a potentially lucrative opportunity. However, it is an industry in its infancy, fraught with environmental, operational, and financial risks. The potential environmental impacts, particularly on the largely unexplored and fragile deep-sea ecosystems, are a major concern and subject to ongoing international debate and regulation.

The nascent stage of the industry, combined with environmental concerns and regulatory uncertainties, makes it difficult to accurately predict profit margins.

The profit margins for deep sea mining are uncertain and highly speculative. While the potential value of deep-sea minerals is significant, the costs of extraction and processing are also substantial.

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What is 3TG?

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If you’re not familiar with the term, 3TG refers to four minerals that are commonly used in various industries, including the electronics, jewelry, and automotive sectors. These minerals are often collectively referred to as “conflict minerals” because their mining and trading have been linked to human rights abuses and armed conflict in certain regions of the world.

  • Tantalum (T): Tantalum is used in electronic components such as capacitors and resistors. It is also used in the aerospace industry and for making high-temperature alloys.
  • Tin (Sn): Tin is used in various industries, including electronics for soldering, as well as in the production of automobiles, food packaging, construction materials, and more.
  • Tungsten (W): Tungsten is used in various applications, including manufacturing tools, electronics, and even some types of jewelry due to its hardness and durability.
  • Gold (Au): Gold is not only an investment or jewelry, but it is also used in electronics, dentistry, and certain industrial applications due to its excellent conductivity and resistance to corrosion.

The term “3TG” is derived from government regulatory agencies as a way for companies to develop responsible and ethical best practices related to sourcing and supply chain management.

Companies that use these minerals often engage in due diligence to ensure that the minerals are sourced from conflict-free areas and do not contribute to human rights abuses. This practice aims to promote ethical and sustainable sourcing of these minerals.

3TGs minerals are inside everything we use, including smartphones, both electric and combustion vehicles, medical devices and more. It’s difficult to find a modern electrical device that does not include 3TG minerals a component.

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Gold Smuggling on the Rise throughout Asia

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Border police in India have arrested a woman attempting to smuggle gold at a border crossing. Police seized over 2 kg of gold bars from the woman as she was entering from Bangladesh.

The 34 year old woman from the Chittagong district in Bangladesh had hidden 27 different types of gold bars in cloth and secured it around her waist.

During her arrest the woman admitted to being paid to bring the gold across the border and had been instructed to deliver them to someone whom she did not know.

She told officials that this was her first attempt at smuggling gold across the border and that she was to be paid ₹ 2,000, around $25 for the task.

Reports of gold smuggling have rising sharply in recent years along the border between India and Bangladesh. A regional jewelry association from Bangladesh estimates that more than $700,000 worth of gold bullion is illegal smuggled into the country each year.

During the three year period between 2019 and 2022, India’s Border Security Force seized over 133 kg of gold that was being smuggled through West Bengal.

Authorities believe this is just a fraction of the amount of gold that is being smuggled through the region.

Much of the smuggled gold has been traced back to illegal mining operations throughout the Middle East, Singapore and many as far away as South Africa.

Officials believe that part of the problem stem from recent increases in taxes on the importation of gold imposed by the Ministry of Finance. The duty to import gold into India was raised from 7.5% to 12.5%. Plus an additional 2.5% tax is added to support the national mining infrastructure.

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Egypt Mints First Gold Ingot from Domestic Mines

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The tuts and kings that ruled Ancient Egyptian Civilizations were adorned with lavish jewelry, art and even clothing made from gold.

Gold is once again being actively mined in Egypt. In January, the government announced that the first standard gold bar had been released to the market made entirely from domestically mined gold ore.

The Igat mine in the Eastern Desert was discovered in June 2020 is estimated to contain roughly 1.3 million ounces, or about 36,000 gold kilos.

Other mines discovered in the same region include the El Sukari mine, which is estimated to contain 12 million troy ounces of gold.

Egyptian gold burial sandals and toe caps, circa 1479–1425 BCE. (Photo: The Metropolitan Museum of Art)

“Extracting gold from the Sukari mine contributes to raising the strategic gold reserves to 300 tons, and this contributes to raising the value of the local currency,” said Nagy Farag, Adviser to the Minister of Supply and Internal Trade for Gold Industry Affairs during an interview with Sada al-Balad TV channel. 

Faraq told Nile News Channel in February, that the Jebel Ikat mine has the capactity to produce about 200 kilos of gold per month. The gold is being used replenish the Central Bank’s gold reserves and is strengthening the Egyptian pound and the national economy.

The Central Bank of Egypt’s reserves now hold more than 125 tons of gold bullion.

The mines in Egypt’s Eastern Desert represent an incredible source of income for the country amidst growing interest in joining the BRICS treaty. The country has been actively expanding the exploration of mineral deposits in other regions.

The government is expected to invest roughly $1 billion into the country’s mining industry by 2030.

The country’s first certified gold refinery opened in December 2020 in the Marsa Alam area of the Eastern Desert, marking a significant achievement in maximizing the supply chain and providing more local jobs.

The earliest gold coin discovered in Egypt dates back to 360 B.C. The gold stater coin was introduced as a means of payment to Roman mercenaries. The coin’s specifications were modeled after the Persian daric standard, which contained 8.4 grams of gold.

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Climate Agenda and Consumer Spending Key Drivers of Silver Demand

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The pandemic lockdown of mines, factories and transportation caused a huge plunge in industrial demand in early 2021.

The lockdown also led investors to buy silver bullion coins in record amounts. The last two years have set new sales records for silver and gold bullion coins at both the Royal Mint and Perth Mint.

The use of silver in the manufacturing of consumer electronics, electric vehicles and solar panels has hit record highs.

The solar and electric vehicle industries are largely driven by billions of dollars of government funding and incentives. Even with the economy is a downward spiral it’s likely that subsidies and other funding for solar and green energy projects will continue. Green energy initiatives will continue to drive demand for silver for at least the next decade.

The President’s climate agenda has a goal that 50% of all new car sales by 2030 should electric vehicles.

Conservative estimates place 18 to 26 million new electric vehicles on the roads over the next seven years. With each having slightly more than one troy ounce of silver, that adds up to 20 to 30 million troy ounces or roughly 900 tons of silver needed.

A recent study from Australia believes that new solar panel manufacturing will deplete the world’s current silver stockpile by 2050.

Typical cell phone only small amounts of precious metals, roughly 1/35 gram of gold and a 0.34 gram of silver. Sales of smartphones are projected to reach 1.49 billion units by 2026, which will consume 50.155 tons of pure gold and a whopping 500 tons of silver.

The majority of silver that is pulled from the ground results as a byproduct from mining other metals. As domestic mining of related metals has remained steady over the last decade, domestic silver production typically averages roughly 1,082 tons per year.

Major automakers including Tesla and General Motors have announced large cash investments in mining.

Industry analysts from both industries are speculating this to be a huge strategic advantage given the push to reduce dependence on fossil fuels.

Technology from the Boring Company already exists that could easily be applied to upend operations in the mining industry.

Their latest tunnel boring machine, named PrufRock, is capable of digging a one mile long, 12 foot diameter tunnel about a week.

Applying this to existing mining operations and adopting new methods of mining precious metals could lead to drastically improved operating margins and reduction in fuel consumption in addition to significantly reducing the environmental damage and long term effects caused by the stripping overburden to reach paydirt.

Producing rare earth metals and minerals to meet the needs for EV batteries would be an excellent application of Boring Machine technology to the mining industry. Adapting the machines to dig and sort through deposits is also a way to help eliminate the harsh conditions faced by workers in cobalt mines throughout the world.

Despite record high inflation spot prices have stayed relatively low but volatile.

Consumer Drivers of Silver Demand

Solar panels manufacturing consumes roughly 10 grams of silver per square meter that generate around 200 watts.

Estimates from the Silver Institute show that each hybrid vehicle has 18-34 grams, while a full-electric battery vehicle has 25-50 grams.

Each iPhone has 0.034g of gold (Au), 0.34g of silver (Ag) and 0.015 of palladium (Pl).

Apple sold 240 million units in 2021, consuming:

  • 8 tons of gold,
  • 81.6 tons of silver
  • and 3.6 tons of palladium

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South Africa Economy on Verge of Collapse, Brink of Civil War Resulting from Ongoing Blackouts

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An energy crisis has led to recurring power outages throughout South Africa as Eskom, the government owned electricity provider, continues to intentionally cut power to customers resulting from breakdowns of multiple power generating plants.

The ongoing rolling blackouts are some of the worst the country has experienced in many years causing factories, refineries, mines and other businesses to remain closed. The country’s president declared a state of disaster earlier this month.

The blackouts are effecting everything from traffic lights, water purification, internet connectivity and food availability.

Government officials are concerned that additional failures of the power grid could lead to widespread rioting and outbreaks of violence which could lead to a civil war.

Residents are concerned for their safety even at home as thieves and looters target homes without power.

The US Embassy in Pretoria has issued an advisory for Americans living in South Africa to “maintain 72 hours’ worth of supplies at home by stockpiling non-perishable food, three litres of drinking water per person per day, and medicines and first aid supplies”.

The ongoing blackouts have been ongoing for weeks and have created a SHTF scenario for many people even though the country is very rich in natural resources.

Roughly 77% of South Africas electricity is generated by coal generators.

The RAND refinery, the largest in the country, is reportedly operating at only 75% due to shutdowns of mines resulting from the power outages.

The largest exports are precious metals, particularly gold and platinum and other PGMs, which account for upwards of $25 billion. Reports from Reuters suggest that Platinum Group Metal exports, which includes rhodium and palladium, could be down as much as 15% or more this year.

South Africa is the largest producer of platinum group metals to the world, followed closely by Russia. The reduction in output will impact global supplies and markets as demand for these metals remains high.

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Mining Industry Risks Serious Labor Shortage in Meeting Industrial Demand

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A recent report issued by Deloitte titled “Tracking the Trends 2023, the Indispensable Role of Mining and Metals” is filled with ideas on how the mining industry can align with DEI ideology and embrace the cult of climate change.

The transition to a “green energy” future requires an abundance of minerals, rare earth metals and precious metals.

International Energy Agency estimates that demand for critical metals is expected to increase ten fold by 2040 as battery and electric vehicles manufacturing increases.

The mining industry will play a critical role as the supply chain ramps up to support domestic manufacturing of batteries, electric vehicles, solar panels and other advanced energy products.

The industry faces challenges with regulators, environmental protestors and the ESG and decarbonization movements continue to force companies to adopt policies to meet diversity and inclusion quotas.

Industry leaders report that companies across the mining industry already face serious labor shortages. Activist investors and companies continue to put an emphasis on the need for diversity and inclusiveness policies that are a hamper to business efforts and growth. Many of these policies are seen as nonsensical and impractical.

A bigger threat for the industry, particularly in North America, is that many of the existing workers in the mining industry are aging. Today, the average age for a worker in the mining industry is 46 years old. With nearly 50% of the skilled engineers expected to retire within the next 10 years. 

Mining directly employs more than 834,000 in the United States. With an additional 77,000 in Canada and 400,000 in Mexico.

The mining industry in Canada faces risks to keep up with industrial and consumer demand. The Deloitte report suggests that Canadian miners need to hire 80,000 to 120,000 people between now and 2030 in order to keep up with demand.

In the United States, employment in the mining sector has fallen over 20% in the last decade due mine shutdowns resulting from the decline in global demand for coal as the ESG movement lobbied for energy policy changes to support green energy solutions and less reliance on fossil fuels.

Last year, the United States produced 170 million tons of gold. Silver production topped 1,100 tons.

Industrial demand for silver is expected to continue to surge as as companies invest in the domestic manufacturing of EV batteries, solar panels and other components of the green energy movement.

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Silver Mining Dominated by Mexico, China and Peru in 2022

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Preliminary data from the US Geological Survey (USGS), global silver mine output increased by 4% last year.

Total mine output globally was roughly 26,000 tons in 2022, slight more than the 25,000 tons produced the previous year.

Most of the increase was due in part to the growth of mine output in Mexico, China and Chile.

Chile is an emerging leader in mining of both precious metals and critical minerals for industry and manufacturing. The country is one of the largest producers of copper, and silver is mined as a byproduct.

Top 11 Silver Producing Countries

  1. Mexico – 6,300 tons
  2. China – 3,600 tons
  3. Peru – 3,100 tons
  4. Chile – 1,600 tons
  5. Australia – 1,400 tons
  6. Poland – 1,300 tons
  7. Bolivia – 1,300 tons
  8. Russia – 1,200 tons
  9. USA – 1,100 tons
  10. Argentina – 840 tons
  11. India – 630 tons

The USGS is anticipating an increase in global silver production for 2023 as the industry continues recovering from the pandemic.

Demand is being driven the ramp-up of advanced manufacturing of components for electric vehicles, solar panels and other electronic devices that utilize silver (Ag).

The global supply chain for raw minerals and precious metals is continuing to recover from the pandemic.

Americans continue to consume more silver worldwide than any other country. Critical metals, such as silver and lithium are necessary for the production of EV cars, batteries, solar panels and other components of the green-energy economy.

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Astroid Mining Company Prepares to Launch Demo Refinery this Spring

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While SpaceX is currently the leading company in commoditizing space travel, a new startup is preparing to launch a prototype demonstration outer space refinery.

Space mining startup AstroForge raised $13 million in seed funding last year. The company is poised to launch their first of two launches aboard a Falcon 9 rocket.

Their goal is to test their orbital refinery and scout an asteroid for mineable resources.

The demonstration unit will be filled with an “astroid-like” material that will be incinerated into gases to separate the metals.

AstroForge also intends to explore asteroids for platinum-group metals. In addition to platinum itself, the metals in the group include palladium, rhodium, iridium, ruthenium and osmium. All of these metals have many industrial uses.

Backers of the industry are enthusiastic that extra-terrestrial and asteroid mining will grow to become a trillion industry.

Gold Prices continue a bull run for the sixth consecutive week.

Gold continues week-over-week gains. The market is keeping a close eye on this week’s Fed meeting and anticipating remarks from Chairman Powell at the end.

Inflation, interest rates, the looming debt crisis and the NATO activation of tanks and other artillery support in Ukraine weighing on traders.

Other key economic data points are likely to impact markets.

Though recent data shows that inflation bay be easing, analysts from the Wall Street Journal and others share concerns from Fed regulators that tightening of the labor market in recent years may cause prices to spike.

Uprisings in Peru Impacting Copper and Silver Output

Peru is one of largest producers of copper and silver. Ongoing protests, uprisings and riots against the current government has led to the shut down of at least one mine.

Industry analysts at mining.com report the shutdown may impact up to 30% of the countries copper (Cu) production. Silver is typically found along with copper in large deposits and is mined as a byproduct.

The largest importers of Peruvian silver are Brazil and the United States. The disruptions in Peru are likely to impact copper and silver futures as global inventories have reached record low levels.

Mining Company Issues Apology for Lost Radioactive Capsule

Mining giant Rio Tinto is on the hook for accidentally losing a capsule containing radioactive element caesium 137.

The global mining company operates an Iron Ore mine in Western Australia.

The truck arrived in Perth with the capsule missing. Authorities believe that the capsule fell off the truck during the 870 mile journey through the desert to Perth.

Cesium-137 is a radioactive isotope that is used in medical and industrial equipment.

SD Bullion Launches New 5 oz Silver at Spot Price Deal

Before the pandemic, several online bullion offered regular deals to buy silver at spot price. The silver supply chain has begun to recover.

Online bullion dealer SD Bullion has launched a special promotion to buy a 5 oz silver bar at spot price for new customers.

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US Mint Struggles while Perth & the Royal Mint Shine

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Both the Perth Mint and the Royal Mint have announced huge increases in year over year sales of precious metals.

According to the Royal Mint, gold sales increased 25% above 2021, silver demand was up by 29%.

Earlier this month, the Perth Mint reported that gold sales were up 10% for the year, noting that there was a drop in demand during December.

The Perth Mint is owned by the government of Western Australia and it is reported to be the largest refiner of newly mined gold in the world.

Meanwhile, the US Mint has been struggling to keep up with demand from domestic silver investors.

Sales of Silver Eagles slumped in 2022 as demand continues to soar. This led investors to buy silver coins from Australia and England.

Why is the US Mint struggling to keep up with the demand from investors?

The US Mint outsources the production of blank silver planchets to private mints.

The Mint cancelled the commemorative 2022 Morgan & Peace silver $1 coin series due to issues with acquisition of raw materials.

The planchet manufacturers need to adhere to all legal definitions. The main one being that coins be minted from domestically mined sources.

The pandemic exposed a lot of problems with America’s supply chain. Many in the mining industry continue to worsen with inflation and looming recession.

Many of the top silver and gold mining operations in the United States all reported encountering various production delays throughout the last year.

Many of the top miners have reported delays and higher fuel costs associated with the transport of slurry concentrates from remote mine locations to refiners for further upstream processing and smelting.

The US Mint began outsourcing the production of planchets that are used to produce coins.

While the current list of suppliers is not readily available, Sunshine Minting and LeachGarner are two of the private mints that have had previous contracts with the Mint.

Most of the world’s largest and most capable precious metals processing companies are located outside the US, making it more difficult for the Mint supply chain.

Some of the ore extracted from domestic mines is handled by multinational corporations.

Many of the world’s leading refineries such as PAMP Suisse, Metalor, and Valcambi are based in Switzerland.

The Perth Mint and Royal Canadian Mint operate the largest and most advanced refineries in the world.

Why is the US Mint continuing to outsource mining and smelting operations to foreign companies?

The five largest mines in the US:

Greens Creek Mine, Alaska

The Greens Creek Mine is owned by Hecla Mining Company. The mine is located on Admiralty Island in the Alexander Archipelagos Islands, roughly 40 miles south of Juneau.

In 2021, Greens Creek produced 9.2 million ounces of silver and 48,088 ounces of gold.

Projected production outlook for 2022 is expected to be slightly higher, between 9.3 and 9.6 million ounces of silver and from 44,000 to 48,000 ounces of gold.

However, issues with the quality of the base metals, primarily zinc and lead, Hecla had postponed shipments of silver concentrates to upstream refineries.

Red Dog Mine, Alaska

Located 105 miles north of the Arctic Circle near Kotzebue, Alaska. It is one of the largest zinc mines in the world and is operated by Teck Resources (TECK).

The Red Dog Mine is believed to be the largest deposit of zinc in the world. Roughly 4% of all of the zinc is produced from this mine.

Ore concentrates of the mine are trucked over 50 miles where they are stored in port.

Due to the extreme location, the silver slurry can only be transported by ship from the arctic during the months from June through October.

The mine has been operating since 1989. With current production levels, the mine is expected to continue operating only until 2031.

The Red Dog Mine is one of the largest domestic sources of critical minerals.

Zinc has a variety of industrial uses. It is also an essential part of the green economy, component manufacturing for electric vehicle, windmills and solar panels.

Silver, germanium and lead and other minerals are byproducts of the primary operations.

Over 7.7 million ounces of silver was dug out of Red Dog mine in 2017.

Continental Mine, Montana

The Continental Mine is located near Butte, Montana. Also where the World Museum of Mining is located.

The main commodities of the Continental Mine are copper and molybdenum. Molybdenum and copper are also critical metals and minerals needed in the domestic manufacturing of electrical devices, motors for EVs and other electrical components.

Silver and gold are extracted from the copper-molybdenite ore. Recent mine output data is not  publicly available.

Marigold Mine, Nevada

The Marigold Mine is located in northern Nevada. The primary deposit is mineralized gold. The gold is extracted from sedimentary rocks including limestone, siltstone, breccias, meta-basalts and quartzite.

The mine is owned and operated by SSR Mining. The Marigold Mine began operation in 1989. The mine is expected to continue to sustain current production levels through 2032. Exploration and development of other nearby properties is expected to extend operations beyond.

Marigold is an open pit operations where blasted rocks is dumped onto heap leaching pages. A chemical process extracts precious metals and minerals from the ore and stored in carbon columns for later extraction through electrowinning.

Reports from SSR earlier in the year showed signs of delays in production with expectations of producing between 215,000 and 245,000 ounces of gold in 2022.

Rochester Mine, Nevada

The Rochester mine is an open pit, heap leach silver-gold operation in northwestern Nevada.

The silver-gold ore is extracted from sulfide deposits layered during Permian-Triassic period volcanic lava flows.

In 2021, the mining operations produced 3.2 million ounces of silver, while gold output was roughly 27,000 ounces.

Saudi Arabia experimenting with CBDC and alternative currencies to the PetroDollar

During the last year there has been a lot of media speculation regarding trade relations between Saudi Arabia and BRICS countries.

The Chinese central bank has been identified as buying roughly 300 tons of gold bullion in 2022. With Central Banks of other countries doing the same.

China has been wooing Saudi Arabia and making significant investments throughout the Middle East as part of the Belt & Road Initiative.

Saudi Arabia becoming part of BRICS and selling oil in a new basket currency would compete with both the Euro and the Dollar.

It seems pretty logical that China would intend for BRICS launch a CBDC digital currency that is backed by gold resources of the basket currency. Given that many central banks are experimenting with CBDC there will need to be interoperability between local currencies.