83 



Equally extensive on the ocean floor are nodules containing man- 

 ganese and iron oxide, cobalt, nickel, and copper. The floor of the 

 Pacific Ocean alone contains some 90 billion to 1,600 billion tons of 

 nodules. Although submarine manganese ore is lower in grade than 

 manganese mined on land, its mining may become attractive for its 

 combination of useful elements. Gross value of the constituent minerals 

 in these nodules approaches $115 per ton. Although under the proper 

 circumstances the potential of these nodules might be promising, pres- 

 ent factors of supply, demand, and pricing suggest that the economic 

 exploitation of phosphorite and manganese nodules is not imminent. 



Kecently discovered deposits in the Red Sea, indicate that volcanic 

 action in areas of rifts in the crust of the earth may have created eco- 

 nomically profitable opportunities. Sediments samipled in the Eed 

 Sea contain appreciable amounts of zinc, copper, lead, silver, and gold 

 which at current smelter prices would be worth about $2.5 billion. 



By far, the most important of all marine resources is petroleum. 

 More than 85 countries are engaged in offshore activities ; discoveries 

 have been reported from the shelves of North and South America, 

 Australia, Japan, the Mediterranean countries, the Red Sea, the 

 Arabian Gulf, the Union of Soviet Socialist Republics and, most 

 recently, in the North Sea and the South China Sea. Thirty-two of 

 these countries are already producing petroleum from their continental 

 shelves, which accounts for 16 percent of the world's oil and 6 per- 

 cent of the world's natural gas; by 1980 this percentage is expected 

 to double or quadruple. 



Proved petroleum reserves in the "free world" are estimated to 

 exceed 500 billion barrels of oil and nearly 1.5 million billion (quadril- 

 lion) cubic feet of gas. Ultimate world potential of all offshore 

 petroleum resources approaches 1,600 billion barrels. In comparison, 

 ultimate world potential of comparable resources on land is estimated 

 at 4,000 billion barrels. 



Given the abundant resources of the seabed and the challenges thej' 

 present, especially to the dynamic petroleum industry, what are their 

 implications for national policy and international diplomacy? In 

 mining operations, a foremost consideration is the necessity for main- 

 taining an approximate balance of supply against demand. A prime 

 economic characteristic of all minerals, except those that are scarce 

 and precious, is their price sensitivity. The risk, the high capital 

 investment, the unknowns, and the lack of experience in the marine 

 environment are major deterrents which will keep the small entre- 

 preneur from venturing into the deep-sea operations. Another deter- 

 rent, non-technical and non-economic, is the legal question of exclusive 

 right of exploitation, or security of tenure of operation. Undoubtedly, 

 deep-sea mineral deposits are siibstantial and represent a great poten- 

 tial resource. Once a substantially rich deposit is found, the technol- 

 ogy to exploit it will be readily developed. The outlook is one of 

 cautious optimism, but a legal regime needs to be established and inter- 

 national agreements effected b'^fore the mining industry will venture 

 into the ocean deeps. 



For offshore petroleum, the capabilities that are not available now 

 are certainly a short distance away. But does technology justif}- ex- 

 pansion ? As matters stand now, offshore operations seem likely to con- 

 tinue at an ever-increasing pace. While subject to some degree of tech- 



