Sheryll Murray
My hon. Friend is absolutely correct. I am sure that they still pride themselves in taking their lunch in the form of a Cornish pasty: the pastry protects what is inside from dirty hands. Pasties are something else that we Cornish people are extremely proud of.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
I hope they withstand high pressure.
Sheryll Murray
Absolutely.
It gives me great pride as a Cornishwoman to take this Bill forward in Parliament today. The concept of deep-sea mining is not new, but as we make technological advances, this new industry is fast becoming a reality, and I am keen that Britain should be at the forefront. Everyone will know of my interest in the sea and the marine environment, and no one is more aware than me of the deep sea’s potential in contributing to the great expertise for which we are world-renowned. The United Kingdom is well placed to benefit strategically, economically and in employment terms, and to influence how deep-sea mining is taken forward.
Sheryll Murray
I was not around in the House during the passing of the 1981 Act.
Sheryll Murray
I have to confess that I was—a long time before, in fact.
All I can say to my hon. Friend the Member for Shipley (Philip Davies) is that we are always unsure how quickly we will see technological advancement. I really hope that Members will support the Bill today, because the UK should be a world leader in the field.
The UK prides itself on taking a close interest in environmental matters and having a good reputation on them—that may have been why the 1981 Act was passed. It follows that, being one of the first states to sponsor a commercial company to undertake exploration—and, I trust, being able to demonstrate the highest regard for international law by passing the Bill—the UK is well placed to ensure that discussions leading towards a regulatory framework for exploitation reflect both the desire for the highest environmental standards and what is practically possible from an industry and technological perspective. I am assured that during the preliminary discussions on a regulatory framework at the ISA this year, the UK delegation emphasised just that.
Now that commercial companies have become involved, deep-sea mining looks inevitable. As much as for the benefits, the UK needs to be involved so that it can shape regulations and standards. I hope that hon. Members show support for the scientists, the commercial companies with the expertise and the people who work in the associated companies, and that we can achieve and secure protection for the marine environment as the technology progresses. By passing the Bill, we can also make a big contribution to the UK economy over the next 30 years. I hope the House supports it.
Barry Gardiner
Let me give the hon. Lady the assurance that I am sure the Bill will pass on Second Reading. I have no desire to stuff it and am not foolish enough to attempt to do so. However, I would like to obtain from her and the Minister another assurance: that the environmental protection, which is currently only in the 1981 Act, will be strengthened when the Bill goes into Committee. The burden of proof in the precautionary principle is reversed in the Act, which states:
“In determining whether to grant an exploration or exploitation licence the Secretary of State shall have regard to the need to protect”.
I want to change the focus, so that instead of the Secretary of State having regard to the need to protect, no licence is granted unless full environmental impact assessments have been undertaken.
Alistair Burt
Does the hon. Gentleman intend to present evidence on any matters that would affect the issue of licences by the UK under the 1981 Act? Has any such evidence given him cause for concern that environmental protection measures are insufficient? I understand where he is going, but does he have, or is he aware of, any concerns about how successive Governments have applied the condition? I take his point and understand where he is coming from, but he can also present these concerns in Committee.
Barry Gardiner
As the Minister knows, few licences have been granted since the 1981 Act took effect, so I would not at this stage seek to adumbrate examples. However, I am aware of many concerns from the environmental community about deep-sea mining and about how the Bill does not reinforce the protections that I believe hon. Members on both sides of the House would want us to have.
The World Wide Fund for Nature position paper on deep-sea mining states:
“Distinct ecosystems are or can be associated with these minerals and will be affected in different ways by different types of mining. Dredging for nodules is likely to damage large areas of the seabed and disperse large clouds of sediment. Polymetallic sulphide mining may destroy active and inactive hydrothermal vents (black smokers) and their associated communities and disperse toxic materials. The extraction of cobalt rich crusts may destroy the benthic seamount communities and dependent fauna.”
I will not quote the paper at length—it is available online for hon. Members to read for themselves—but we need to take those concerns seriously. The global community has a principle on environmental legislation. It is the precautionary principle, which is that when we do not know, we do not do something that we have good reason to believe will cause damage.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Alistair Burt)
It is a great pleasure to be able to respond to the debate. I begin, of course, by congratulating my hon. Friend the Member for South East Cornwall (Sheryll Murray) on her success in the ballot and on introducing a Bill that is so appropriate to her interests and her constituency. She speaks with passion about fishing, Cornwall and the heritage of the sea, and she has been able to apply that passion to concerns about how we balance the opportunities presented by the resources of deep oceans with the environmental protection that we need if we are to ensure that we all have the type of world that we wish to live in.
I do not often get the chance to speak on a Friday in my current position, and I feel as though I were taking part in a pro-am tournament—I am speaking on a day when the professionals get to work. We have heard some exceptional speeches by colleagues who take a broad and deep interest in matters before the House, even if they are not subjects with which they have been familiar. They have an ability to turn their forensic minds to issues of importance to the House, so that they can quite properly ensure that private Members’ Bills and the Government response to them are under full scrutiny.
The hon. Member for Brent North (Barry Gardiner) is a regular here and always ensures that particular points of interest are raised, in this case concern about the environment, which he frequently expresses. I very much appreciate his comments and the way he went about making them.
My hon. Friend the Member for Shipley (Philip Davies) made some pertinent comments about the importance of business and enterprise to the United Kingdom and how that consideration should be balanced. I am old enough to remember his predecessor, the late Sir Marcus Fox, a great man. Many Members have fond memories of him, and it is a great pleasure to be reminded of him by my hon. Friend’s presence.
I am old enough actually to be the predecessor of my hon. Friend the Member for Bury North (Mr Nuttall). As you will be aware, Mr Deputy Speaker, I could spend the next hour reminiscing about Bury North.
Alistair Burt
As I think the House knows well, Bury North is not only a constituency that I was proud to represent for 14 years but my birthplace and home, and the place to which my fondest memories are attached. It remains a matter of great pride that I was able to represent my home town, and I only ask that my hon. Friend take my very best wishes to the metropolitan borough, all those in it and the diverse community of Bury.
Mr Deputy Speaker
Order. Before the Minister gives way, it may help if I say that we are not going to have a love-in about Bury, either North or South, or the north-west.
Mr Nuttall
I will take the Minister’s good wishes back to Bury, but to return to the Bill, does he agree that it has potential advantages for businesses based there? Opportunities will open up for them as a result of it, maybe not directly but through the supply chain.
Alistair Burt
My hon. Friend is absolutely right. I remember—he will know this from first-hand knowledge—how wide the industrial base is in Bury. For example, I recall being very impressed with how many were involved in the aerospace industry.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I am now intervening. It is a great temptation to listen to the Minister talk about the wonders of the north-west as I represent a north-west constituency, but I am sure he is itching to get on to the Bill. The problem is that the rest of the Chamber is also itching to hear him on the Bill rather than on the virtues of our great north-west.
Alistair Burt
With that admonition, Mr Deputy Speaker, I will leave the subject of Bury North when I have reminded my hon. Friend to take my best and fondest wishes to Bury football club, and to Gordon and Morris who do the commentary on Shakers Player every week. I am young enough to have played football regularly with the hon. Member for Dumfries and Galloway (Mr Brown)—
Mr Deputy Speaker
Order. I will help the Minister. I do not want to hear about football or about Bury, and certainly not about whether he plays football with the shadow Minister. I want to hear about the Bill. I know he will tell me about it. If not, we will move on.
Alistair Burt
I should like to set out responses to the Bill, which was introduced by my hon. Friend the Member for South East Cornwall, and, when I have made some progress, to deal with the series of questions colleagues have raised during the morning. This has been a wide-ranging debate, and I thank colleagues for their contributions. Deep-sea mining is in its infancy, but by being at the forefront of developments, we can ensure that the UK economy sees the benefits and that any environmental concerns are fully addressed.
The subject of the Bill is probably, in all fairness, unfamiliar to most colleagues. The hon. Member for Dumfries and Galloway was honest enough to say that it is a relatively new subject for him. I could pretend that my situation is different, but I will not. I am indebted to Mr Chris Whomersley and other Foreign and Commonwealth Office colleagues for their assistance in preparing me for the debate.
On the background, I want to fill out what colleagues have said about the origins of the Bill and the importance of correct definitions of, for example, the deep sea bed. Deep-sea mining does not come up every day, so it is important to alleviate concerns, particularly bearing in mind recent concerns about mineral extraction and the environment on land, by noting that any activity would take place a long way from any coastal area.
The term “deep sea bed” is defined in amendments in the Bill to the Deep Sea Mining (Temporary Provisions) Act 1981. The UN convention on the law of the sea calls it the “area” of the
“sea-bed and ocean floor, and the subsoil thereof, beyond the limits of national jurisdiction”.
That is commonly referred to as the common heritage of mankind, a phrase that has found its way into the UN convention in article 136. The concept, which goes back to the 1960s, expresses a profoundly important point, namely that the area and its resources do not belong to any one state. They should be developed for the benefit of everyone on the planet. They are controlled through the International Seabed Authority, an international organisation to which all states can become a party. I will say more about the ISA later.
To refer to a point made by my hon. Friend the Member for North East Somerset (Jacob Rees-Mogg), getting the balance right between what is controlled by regulation and legislation and what is allowed to run free, as it were, is difficult. My hon. Friend the Member for Shipley spoke about the freedom of the seas and the like. Access to the sea and freedom to roam on the seas is important, as is the enforcement of such rights to freedom. However, the world recognises that the resources of the sea and what lies on the sea bed and below are genuinely precious. Hon. Members are aware how resources can be badly exploited—I am sure my hon. Friend the Member for South East Cornwall knows that some countries have badly exploited resources through their fishing practices. That gives us pause to say, “Simply having a free-for-all will not work.” My hon. Friend the Member for North East Somerset can be assured, however, that the attitude of the United Kingdom is to ensure that, if international regulation does curtail freedoms, it must be because that is the right thing to do. We have to take our responsibilities seriously, and our responsibility to the environment and the need to ensure that the regulations cover that adequately are as important as ensuring that opportunities for prosperity are not lost through over-regulation or complicated bureaucracy.
The “area”, or the common heritage of mankind, is the area beyond the limits of any coastal state’s continental shelf. Under article 76 of the UN convention, a coastal state is entitled to a continental shelf of at least 200 nautical miles from coastal baselines, and more where the slope of the continental margin meets certain specified criteria. This entitlement is without prejudice to the question of delimitation of the continental shelf between states with opposite or adjacent coasts. The exception to the rule is for a small islet or rock that cannot support economic life. Under the UN convention, such rocks only generate a territorial area—a maritime zone up to 12 nautical miles from coastal baselines.
The UK has one such rock which is sometimes the subject of academic debate. That is Rockall, some 186 nautical miles west of St Kilda in the Outer Hebrides of Scotland. Anyone who has seen this rock, or seen pictures, will well understand why we could not claim that it could support economic life, being only a jagged spike of rock jutting up some 60 feet above sea level. Therefore, and contrary to some of the sometimes ill-informed comments about Rockall, the United Kingdom does not regard Rockall as capable of generating a continental shelf of its own. Does this mean that deep sea mining could take place in the vicinity of Rockall? No. While the UK uses a baseline on St Kilda—which, coincidentally, is uninhabited but has in the past supported a human population—the UK claims a continental shelf beyond 200 nautical miles in a westerly direction, way out into an area known as the Hatton Rockall plateau. Other states have overlapping continental shelf claims in the same area, but while the claims exist and their validity is yet to be considered by the appropriate international body, the area does not fall within the definition of one
“beyond the limits of national jurisdiction”.
To be clear, deep sea mining as provided for by the Bill, would not take place anywhere near the coast of the UK, or the UK’s overseas territories, or any other coastal state for that matter. Indeed, most of the current applications relate to areas in the Pacific ocean, as my hon. Friend the Member for Worthing West (Sir Peter Bottomley) mentioned, and are a long way from any landmass.
I have described the “where”, now let me explain the “what”. As hon. Members appreciate, we are not talking about hydrocarbons, at least not at the moment. My notes suggest that it is safe to say that many hon. Members will be unfamiliar with the mineral types, but the debate suggests that they have made themselves very familiar with the mineral types we are discussing. Those minerals currently being explored for in the deep sea are composite mineral deposits, in formulations unique to the sea bed, which is why they are so special.
Presently there are international regulations in place for the exploration of three mineral types in the deep sea. The first, polymetallic nodules, have already been the subject of discussion today. Polymetallic or manganese nodules contain manganese, copper, cobalt and nickel, and are—as far as the FCO is concerned—potato-shaped balls generally found on the sea bed surface. I have no information about whether they may be tennis-ball sized, and it is the official view of the Foreign and Commonwealth Office that they are potato-shaped balls. They are generally found partially buried in sediment, and cover vast plains in the deepest areas of the sea bed.
Secondly, there are polymetallic sulphides. These, mainly sulphide deposits, are found in ocean ridges and seamounts, and often carry high concentrations of copper, zinc and lead, in addition to gold and silver, as my hon. Friend the Member for North East Somerset will be pleased to hear. Not for the first time, he is right on the ball—the tennis ball-sized ball. Such deposits are associated with previous volcanic activity, where the deposits have built up over time via plumes from vents. Where such vents are active, they tend to be places of unique fauna and flora. However, mining would take place only when such sites were extinct, not least because of the very high temperatures associated with live vents. That deals with one of the questions that my hon. Friend the Member for Shipley raised. There is no question of mining such areas when they are live, because frankly the temperatures would make it impossible.
The third group of mineral elements to which the current legislation applies are found in cobalt-rich crusts or ferromanganese crusts, which form at the flanks and summits of seamounts, ridges and plateaus. They contain amounts of iron and manganese, and are especially enriched in cobalt, manganese, lead, tellurium, bismuth and platinum. Such minerals are important. Mineral prices have increased noticeably since 2000, largely as a result of increases in demand, especially from emerging economies such as China and India, as colleagues have noted. According to the United States geological survey in 2013:
“China has advanced from consuming less than 10% of the global market for metals to over 25% of the market in the past few years and that trend is increasing; India is following on a similar path.”
As I will explain, changes in demand have created a need for legislation.
Alistair Burt
I will answer colleagues’ questions in due course, but I am happy to take an intervention now.
Barry Gardiner
I might have missed it in the Minister’s remarks about the various chemicals, but the briefings that I have read refer to deposits of submerged massive sulphides—the hon. Member for Bury North talked about the ISA, but this is SMS. Will the Minister say what category SMS falls into? My understanding is that a different treatment might apply in their mining.
Alistair Burt
The point I was making in going through the three mineral types is that they are the ones that are currently affected by regulation, but we are moving on. The hon. Gentleman is absolutely right: as he will be well aware, seafloor massive sulphide deposits are the modern equivalents of ancient volcanogenic massive sulphide ore deposits—or VMS deposits, as we call them in the Foreign and Commonwealth Office. The term has been coined by mineral explorers to differentiate modern from ancient deposits. SMS deposits are indeed relevant; I will come to the reason for changing the legislation.
There is also an issue of limited sources of supplies. For example, in 2010 it was estimated that the Congo produced 40% of global cobalt supplies, South Africa 79% of global platinum and China 97% of global rare earth elements. That factor can distort total global supplies and costs. Access to supplies makes these strategically important minerals. An increase in available stocks of such minerals should increase competition in the global market, reduce the price faced by consumers and help to ensure sufficient future supplies to satisfy rising global demand. For example, present estimates suggest that there is a 100-year supply of cobalt deposits on land, which might increase to 200 to 300 years if deep-sea supplies are included.
As the world, we hope, exits recession—helped in the United Kingdom, of course, by this Government’s economic policies—it is inevitable that demand for minerals will increase. It is certain that commercial companies will be looking for new sources of such minerals, and the deep sea bed is the new frontier for them. We in the United Kingdom must be at the forefront of such developments.
Barry Gardiner
The Minister has drawn a parallel that will have ramifications for the environmental agenda. He will know that the mentality of the Klondike and the frontier, and the rush for the extraction of minerals on land, resulted in some of the worst environmental degradation. Will he accept that the Opposition are simply trying to ensure that the Bill contains proper safeguards and environmental protections relating to the new frontier that he is describing, so that a similar laying waste of the environment that happened as a result of the extraction of natural resources on land does not happen on the sea bed?
Alistair Burt
That is the intention not only of the hon. Gentleman and his party; it is part of the Bill’s raison d’être and of the working environment on which the regulations are already based. There is already a double lock. The reason that UK legislation provides for licences is to ensure that those whom the UK sponsors for licence applications to the ISA have already passed the standards that this House, and this country, would expect from those involved in mineral extraction and exploration. Once the UK has been satisfied, the second lock comes into operation. That involves the environmental controls put forward by the ISA, and I will cover that subject in more detail in a moment.
There is no difference between us on the importance of this matter. In answer to some of the hon. Gentleman’s previous questions, there has not, to date, been any challenge to the existing arrangements. Only two licences have been granted under the 1981 legislation. The original reason for introducing those temporary provisions was that the possibility of Klondike-type activity was in the minds of companies in the early 1980s. That proved to be a false expectation, however, and the pace of exploration has been slow. The reason for introducing this legislation now is that we anticipate the pace picking up, given the increase in information and technological development.
In the interim, however, the environmental protections in section 5 of the 1981 legislation have proved entirely sufficient, as have the inspections. If the hon. Gentleman does not believe that and wishes to raise a challenge to what we have done, he is entitled to do so. He is right to be concerned about this, but I am genuinely not aware of any challenges to those who have taken licences through the United Kingdom. We must protect for the future, however, and I will go on to explain how that is being covered by the ISA, how we are dealing with negotiations as we look forward four or five years to mineral exploitation—which is not anticipated yet—and how we are involved with the ISA in relation to that. He need not fear that we are not considering these matters. Nor need he fear that this matter has caused any concern to date.
Barry Gardiner
I am grateful to the Minister for trying to respond fully to my concerns. I appreciate that. However, it is not sufficient to say that there is no cause for concern simply because only two licences have been issued to date and because there have been no problems with the way in which section 5 of that 32-year-old Act of Parliament is being implemented. He knows very well that section 5 states that
“the Secretary of State shall have regard to the need to protect”
the marine environment. The words “have regard to” do not provide for a strong protection. All we are asking is that that wording should be upgraded in the Bill.
Alistair Burt
I am sure that my hon. Friend the Member for South East Cornwall will give that matter her consideration. I was not seeking to link the fact that only two licences had been issued to the issue of environmental protection. There have been only two applications because only two consortia have felt it necessary to do that kind of work. Others have not been prepared to do it. There is no linkage between the two points. My point was that we have no evidence that environmental issues have ever been a matter of concern in relation to those applying for a licence under our legislation and going on to be sponsored for permission from the ISA. The protections that are in place have in no way been considered inadequate. Had they been, that would have been an important point of evidence, but we do not have any such evidence to date.
Mr Nuttall
Does the Minister have any evidence to suggest that any companies have been put off from applying for a licence as a result of this country’s regulatory regime over the past 32 years, and that they have gone elsewhere?
Alistair Burt
No. The sort of work we are talking about is immensely expensive. If a company is to get down and explore the resources in deep sea, that will mean a very expensive financial commitment. Companies have not come forward because it has not been worth their while to do so, but the world is moving on. There is no evidence to suggest that anything in UK regulation has been in any way off-putting; indeed, quite the contrary. The most recent company to go through the process made reference to the helpfulness of the British Government as it pursued its licence. I hope I can set my hon. Friend’s mind at rest: regulation does not seem to be an issue.
Let me make a little more progress. When one thinks of the offshore, what inevitably springs to mind first is the search for oil and gas. However, industry has yet to express an interest in possible supplies of hydrocarbons in the deep sea, which is why no international regulations have been developed for their exploration. That is not to say that it will not happen. It may sound odd to suggest that international regulations for the exploration of hydrocarbons would be needed when exploration for hydrocarbons is not new. Multinational corporations are exploiting hydrocarbons all around the world, often in very deep water, but the point is that when we talk of the deep sea and “the area”, we talk of the role of the International Seabed Authority in managing the resources. So any exploration or exploitation would need to be under those ISA regulations, not national ones.
Let me deal now with some of the questions raised about the Bill, as it would be pertinent to do so now that I have set out the background, before providing some comment on the history of the Bill and why we are where we are with it. If I may, I shall discuss the issues in relation to the hon. Members who raised them.
I thank the hon. Member for Dumfries and Galloway for setting out the position of the Opposition and for indicating that the Opposition will support the Bill for the reasons that he set out. He rightly emphasised that policing needed to be done in respect of those who had applied for, and been successful in gaining, licences. The need to get on with the job has to be balanced with concern for the environment. Our intention is closely to scrutinise the activities of contractors. The current contractor is a highly reputable company, and we are satisfied that it will act appropriately.
The ISA has responsibilities, too, in respect of those who apply for licences from it. Reports have to be made to the ISA, whose legal and technical commission scrutinises them. We are pressing for improvements in the quality of the licences, which will become part of the negotiation; we anticipate greater exploitation of these resources. I shall say a little more about that in a few moments.
My hon. Friend the Member for Bury North raised a series of points. He mentioned the involvement of the European Union, but I am conscious that this is a track down which it would probably be inadvisable to go or spend any time; there might be some differences between him and me on certain elements of the EU. I would like to give him an absolute assurance, however, that there is no question of the UK ceding any powers to the EU, which is represented on the ISA for two reasons. First, a number of states without maritime interests want the EU to represent them, and secondly, a number of areas in the convention on the law of the sea fall within Community competence. They are listed in a declaration and include issues such as the marine environment, trade in minerals and fishing, and there is no intention to go any further.
Questions were raised about a company from a country outside the parties that had committed to the convention—and the United States came up as an obvious example. How would it go about things if it was prevented from participating? As my hon. Friend the Member for South East Cornwall suggested, it would need to seek a sponsorship from a party in a participating state. Such a sponsorship is not lightly handled; the regulations are covered by the ISA, which has set out in regulation 11 details of a certificate of sponsorship and the exact connection between a state and company wishing to apply for registration by using either its own state or another.
As for the position of the United Kingdom, we have a contractor that is largely based in the United States but has a subsidiary in the UK which allows it to apply through the UK to the ISA. Companies are not prevented from being sponsored by the fact that their nation states have not signed the convention, but they will be sponsored in a way that is properly controlled.
Members have asked what penalty would be imposed on a company that operated outside that sphere, and just went rogue and mined. I understand that there would then be a question mark over the title to the minerals, as a result of which the company would be at risk in selling on those minerals or anything else. As far as we are aware, however, the issue does not arise at present. The legislation has encouraged companies to operate in accordance with the rules because it is in their interests to do so. The costs of exploitation of resources in the deep sea are such that a company would not wish to be involved unless it was absolutely sure that it would be able to sell on what it had, and that it was protected. The legal ramifications of not going through international regulation would be enormous.
Jacob Rees-Mogg
Is that also the view of the United States Government, or might they be willing to protect an American company that had mined and was not party to the convention?
Alistair Burt
Obviously I cannot speak for the United States Government. I am not sure whether they would be able to protect a company based in the United States under their laws if that company was in breach of the international regulation and convention that apply here. However, as I have said, that does not arise at present, and there are ways of handling the accession of companies whose nation states are not party to the convention.
My hon. Friend the Member for Bury North asked why the 1981 Act was being changed now, and why it was passed at the time. I dealt with that question a moment ago. The atmosphere surrounding the exploration of deep-sea minerals was very different in 1981. Things have moved on since then, and we need to upgrade the legislation. The Act was passed at a time when early and rapid exploration was anticipated, but it did not happen, so there has been no need to replace that temporary provisions legislation during the intervening years. However, market and technological developments now suggest that the time is right to amend it, and the Government will therefore support the Bill.
My hon. Friend the Member for Shipley raised questions about the prosperity agenda. He asked how we could ensure that our determination to enforce environmental controls and licensing did not get in the way of those wishing to become involved in business. Fees are prescribed with the consent of the Treasury. I must admit that I do not have the fees in front of me, but I can assure my hon. Friend that I will have them in time for the Committee stage. I can tell him that only two licences have been applied for over the years, and I have no reason to believe that the fees have posed any difficulty. Indeed, as I said earlier, the company that was most recently involved in the process thanked the Government and congratulated them on their help and support. What I do know is that the fee for application to the ISA for a licence is some US$500,000. We are not talking about applications by companies operating on a small scale. We are talking about big business and serious sums, which is understandable if the authority is to be allowed to do its work and ensure that no one makes a frivolous application.
As I said, only two licences have been issued in the United Kingdom under the 1981 Act. We monitor carefully the compliance by the contractor with the terms of the licence, and we are not aware that any company has applied for a licence and been refused, or had its licence revoked. I can reassure Members who are worried that there is no evidence that the regime is in any way putting anyone off.
Mr Nuttall
I mentioned in an intervention that I had been interested to hear that an application had been granted under the existing legislation. That prompts this question: if that licence is valid under the existing legislation, why is there a need to change it? Also, will that company have to reapply under the new legislation?
Alistair Burt
I doubt it very much. Speaking off the top of my head, I imagine there would be a passing-on provision that would assume that those who had complied with the terms of the 1981 Act will be, as it were, automatically passported under new legislation. The new legislation will expand the scope of the minerals being sought and cover associated issues. I am sure I can assure my hon. Friend that nothing in relation to the practical operation of the new legislation would require what he asks about.
My hon. Friend the Member for Shipley asked how the licensing regime in the UK compares with those in other countries. Because of the scale of the issues involved here, very few states have any legislation on deep-sea mining. We are confident that UK legislation balances the need to ensure proper control over contractors with the need to avoid having an over-burdensome regulatory regime.
My hon. Friend also asked how long it takes to issue licences. We act very quickly. We have worked with contractors to ensure that licenses are issued promptly. The most recent licensee expresses happiness with its relationship with the Government.
On the ISA, my hon. Friend asked how overlaps are avoided. That question reminds me of the situation in the Klondike, as represented in the 1950s black-and-white B-movies we remember so fondly, when people would go out and stake the land. Occasionally, I believe, fisticuffs might have been involved if there were disputes. We have moved on from that, although it is still a first-come, first-served business as the licenses are processed. The ISA is the stakeholder and once it has granted a licence for a particular piece of the sea bed, that is it. That prevents any overlap. The system ensures there is no problem in terms of competing claims.
The hon. Member for Brent North raised some environmental concerns. We have made it clear that the ISA should consult relevant NGOs in developing mining regulations. That goes to the heart of the issue of where we go from here. As has been made clear, the expectation is that the licences being sought will be for exploration. There is a distinction between exploration and exploitation. Exploitation under the wider scope of the legislation is not expected in the next four or five years. At present the ISA is consulting member states about what their regulations should be for that mining and exploitation. The UK has a crucial role to play in that, given our history of, and engagement in, environmental protection. We are engaged with the ISA in working through the new regulations that will govern mining.
As far as UK-based NGOs are concerned, there is an understanding that this is going to happen and it will not be stopped. Accordingly, it is a good thing for the UK to be involved and NGOs are very supportive of our engagement. There has been a meeting between officials and the WWF in relation to this Bill. I understand it is content with the way we are going about things. A further meeting is promised and we will keep in close touch. Bearing in mind the record of some other states, the fact that a British Government—of any party—should be involved in dealing with these issues should be of comfort to international NGOs. We will be fully engaged.
Let me again deal with the point about section 5 of the 1981 Act to which we may return in Committee. My note from my colleague says that nobody has suggested before that section 5 is inadequate, and that although the Act can change the duties imposed on the Secretary of State, it is for the ISA to establish environmental standards for applications from other countries. We have our own standards, but a double lock and a double check are in place. I am happy to go into that in further detail in Committee, making sure that I have got absolutely up-to-date information on how this has been handled. I am very content with the general reassurance I can give that it is not complacency but experience to date that leads me to believe that there has not been a challenge. However, we will double check and then see whether there is any need for any increased provision. If there is, I am sure that my hon. Friend the Member for South East Cornwall will be the first person to introduce it.
My hon. Friend the Member for Dover (Charlie Elphicke) raised the issue of fracking. As I said at the beginning of my remarks, we are hundreds of miles away from that; it is not an issue in relation to this Bill and there is no connection with this activity. My hon. Friend the Member for North East Somerset raised issues relating to our companies being disadvantaged compared with US companies, and I believed we have covered that. I do not think there is any evidence of that happening, and I hope that we have the balance right between that problem of international regulation and the prosperity agenda and the like.
I have answered a number of specific questions, but I have not dealt with some key parts of the Bill that I would like to address. Of course, if hon. Members have further questions, I am happy to take interventions. The 1981 Act was passed at a time when the prospects for a United Nations agreement on deep-sea mining were uncertain. The United Kingdom, along with a number of other countries, therefore decided to enact its own legislation to enable the Government to license British companies to undertake deep-sea mining. That was coupled with a system under which the various other countries that had enacted legislation would reciprocally recognise each other’s licences.
The 1981 Act provides for the Secretary of State to issue exploration and exploitation licences, and for licences issued by reciprocating countries to be recognised. It also made provision for the revocation of licences where, for example, there was a threat to safety or the welfare of persons, or there was a need to protect the fauna and flora of the deep-sea bed—even then, such issues were a matter of concern to this House. As we have discussed, the Act also included provision in section 5 to place a strong obligation on the Secretary of State, in exercising his or her powers, to have regard to the protection of the marine environment. That is likely to be unchanged by the new Bill, but I have given a commitment to the House that we will take a hard look at whether there is genuinely any need to consider that further, and we will do so. The Government expect any company that we sponsor, as well as those sponsored by other states, to comply with the highest environmental standards.
Although certain UK companies were interested in deep-sea mining, in fact no mining was conducted in accordance with the licences issued under the 1981 Act. The UN convention on the law of the sea was adopted in 1982, with part XI dealing with deep-sea mining. However, the United Kingdom, again in the company of a number of our allies, did not find those provisions acceptable. We did not believe that they were conducive to encouraging commercial companies to engage in deep-sea mining. We therefore did not become a party to the convention at that time, even though most of the other provisions were acceptable and, indeed, welcome, to us.
I should add that I very much endorse what my hon. Friend the Member for South East Cornwall said about the importance of the convention; it has rightly been called the “constitution of the oceans”. The United Kingdom is a strong supporter of the convention, which we believe, overall, provides an appropriate balance between the rights of the various users of the seas. As a maritime nation, it is especially important to the United Kingdom that the international rules on the law of the sea should be clear and fair. A number of colleagues have mentioned that our good friend—and our closest or oldest ally, whichever is the current term—the United States has not yet ratified the convention. I know that the Administration in Washington have expressed an eager desire to do so, and we wish them well with the endeavour. We look forward to their participation in the convention and, in particular, to their playing a full role in the ISA.
Jacob Rees-Mogg
I am grateful to the Minister for giving way. Under the treaty of Windsor of 1386, our oldest ally is Portugal.
Alistair Burt
This is a fact never lost on the Foreign and Commonwealth Office. I also have in my room at the FCO a copy of a treaty with Algeria that dates back many centuries; we have such treaties scattered around the place. There are many claims to be our oldest ally and we can be quite sure that the facts would prevent the United States from claiming that. For the avoidance of any doubt, however, let me make it clear how close and warm our relationship is with the United States across the board. Environmental protection and the law of the sea is another area where the House can expect the warmest and closest engagement between us and the US. We look forward to the US’s playing a full role in the International Seabed Authority.
As I have said, the UK, in common with other industrialised countries, did not feel able to participate in the original convention because of the terms of part XI. There was a general recognition that it was unsatisfactory for the industrialised countries to remain outside the convention. So in 1990 the then Secretary-General of the United Nations, Mr Perez de Cuellar, convened informal consultations, which continued for several years. The UK played a key role and the result was the adoption by the United Nations General Assembly of an agreement on the implementation of part XI of the convention in July 1994. Such agreements assisted the UK’s joining the convention.
The part XI agreement is particularly pertinent to the Bill. It remedied the major defects of the original convention and, in particular, it addressed the costs to states parties and ensured that they were kept to a reasonable level. It clarified and streamlined the procedures for the approval of applications to explore for or exploit the mineral resources of the deep-sea bed. The agreement reduced the possibility for the so-called Enterprise, an international organisation composed of states parties, to participate in exploitation or exploration. It emphasised that decision making in the authority should normally be by consensus. It resolved satisfactorily the problem of how to ensure equitable representation of all states in the council, including the industrialised and developing states, as well as the consumers of metals and land-based producers.
The agreement ensured that any transfer of technology to developing countries should be by agreement. It also stated that the development of the resources of the area should take place in accordance with sound commercial principles. It emphasised that the system of payments to the authority should be fair to both the contractors and to the authority and established a finance committee, on which the United Kingdom has a member, which has a key role in scrutinising the finances of the authority.
The adoption of the part XI agreement paved the way for the United Kingdom to become a party to the convention in July 1997. When the UK became a party to the convention, we considered whether the 1981 Act was sufficient to enable us to comply with our obligations under the convention. At the time it was concluded that it did—although, as I think it is fair to say, only just. Obviously the intention behind the 1981 Act was not to implement the convention, which had not even been adopted when the Act was enacted, but the essential elements were thought to be sufficient. In particular, as we have seen, the Act provided for the issue of licences to prospective contractors and we are satisfied that that gives the United Kingdom sufficient powers in relation to such contractors to comply with the requirements of the convention, particularly that the sponsoring state should have effective control over its contractors.
The International Seabed Authority is the body that under the convention is responsible for regulating deep-sea mining. It has its seat in Kingston, Jamaica. The House will be aware of the extent of my portfolio in the FCO—Iraq, Iran and various countries throughout the middle east—so I hope it will not mind if I apply to the Foreign Secretary to suggest that it might be necessary for me to visit the ISA in Kingston, Jamaica at some point, with, of course, an appropriate delegation including Members of the Opposition, to ascertain that the proposals made by my hon. Friend the Member for South East Cornwall in her Bill will be accepted by the authority. With the permission of the House, I will make that request to the Foreign Secretary. However, that is a digression.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I think the hon. Gentleman is testing the patience of the Chamber a little bit, and I will be quite honest with him. We have had a lot of long interventions, and the last thing I want to get into is a history lesson from either side of the House, because other Bills want to get a hearing, and I am sure he has an interest in those as well.
Alistair Burt
Thank you, Mr Deputy Speaker.
The procedures for handling applications to explore for minerals on the deep sea bed are set out in the regulations adopted by the authority—one set for each type of minerals, polymetallic nodules, polymetallic sulphides and cobalt-rich crusts. The applicant makes an application to the authority, and pays the fee of $500,000. But as we have indicated, there is a certificate of sponsorship from the state party concerned; it is stipulated in the convention that all applications must be sponsored by a state party.
Because of the concerns voiced about environmental protection, I have taken the liberty of obtaining a copy of the two applications for licences that we have made under that sponsorship. The House will be pleased to know that in both, the issue of environmental standards is put forward by a representative of the United Kingdom, who makes the application on behalf of the company being sponsored. So environmental protection is at the heart of the application that is made by the United Kingdom when sponsorship applications are made.
Mr Russell Brown
For clarity, would the Minister be prepared to put copies of those documents in the Library for other Members to inspect, should they wish?
Alistair Burt
I do not know yet, because these are applications relating to commercial companies. I will check. My understanding is that when the application is made to the ISA, there is a nomination process which is led by a speech or a recommendation by the representative of the sponsoring state, to explain that it backs the application. So the document relates to a specific company. I genuinely do not know whether these are public documents. If they are, I do not think there would be any problem, but I must check.
However, I do not think there would be any problem in my reading out the appropriate section in one of the applications. It states:
“As was made plain last year—and indeed the United Kingdom has said on a number of occasions in the Assembly and the Council—the United Kingdom is committed to ensuring the highest environmental standards for companies which it sponsors under Part XI.”
Again, our experts have looked at the application by this particular company and are entirely satisfied that the company will be applying the highest environmental standards. I know from my personal contacts with the company that they feel equally strongly about the need to do so.
So not only is there a pledge on behalf of the United Kingdom Government, and accordingly we can be held to that, but there is a recognition, because it is a narrow field and people know one another, of the importance of it personally to those involved. I say that simply to give a sense of how seriously environmental protection is taken; the House need not be worried that it is glossed over in any way.
The standard clauses for exploration contracts granted by the ISA are also covered by published documents, which set out what environmental monitoring is necessary. Those documents are available. We might talk to the Library about making any of these documents available before the Committee, so that Members will see what the ISA says, what we say, and so on. I hope that that will help.
Having made the sponsored application, the applicant makes a presentation to the legal and technical commission of the authority. As I have said, in the case of applications sponsored by the United Kingdom, the Government send representatives to speak during the presentations in the legal and technical commission, to demonstrate not only our support for the applications but the responsibility that we take as a Government for them. I hope that is reassuring. After approval by the legal and technical commission, the applications are forwarded to the council.
We were very pleased that the first application sponsored by the UK was successfully approved by the International Seabed Authority in 2012, and that the contract between the British company and the authority was signed earlier this year. The second application was put to the legal and technical commission this year, although, disappointingly, it was not approved by the commission because of lack of time. We hope, however, that the application will be approved by the commission next year. We are convinced that it is a first-class application.
I would like to pay tribute to the staff of the International Seabed Authority, particularly its Secretary General, Mr Odunton of Ghana, and his deputy, Michael Lodge, who is British. We have found them knowledgeable and helpful, and we have enjoyed a fruitful working relationship with them over many years.
My hon. Friend the Member for South East Cornwall rightly referred to an event in March this year to mark the signing of an exploration contract granted by the International Seabed Authority to a UK-registered company. That licence, for the exploration of polymetallic nodules, is in an area of the mid-Pacific ocean at depths of around 4 km below sea level. The Minister for Universities and Science, my right hon. Friend the Member for Havant (Mr Willetts), who spoke at the event, called the new venture a
“huge vote of confidence in the UK”,
and declared that we have the skills and technology to make it a success. As a number of colleagues have said, we want the United Kingdom to be a world leader in this regard. He talked of how the decision to grant a licence reflected British technological strengths in areas such as marine engineering and marine science, and how it would give British companies and British scientists the opportunity to undertake groundbreaking work in fields such as deep sea biology.
The 1981 Act was sufficient to do the job—to ensure the UK Government had sufficient jurisdiction and control over the UK company in order for it to sponsor its first application in 2012. Now we want to ensure that British companies are able to take up the opportunities available to explore for different mineral types—the point made by the hon. Member for Brent North—namely polymetallic sulphides and cobalt-rich crusts, and we want to ensure that we are fully compliant with UNCLOS.
The Bill is really about the balance between commercial companies’ need to find the resources that the world seeks and environmental protection. It is also about saying, “The United Kingdom is open for business in this sphere.” We can say to any company that seeks the United Kingdom’s sponsorship of an application for polymetallic sulphides or cobalt-rich crusts, “Yes, we can sponsor your application.” But at present, without this Bill, because of the changes in technology, if they were applying for minerals outside the scope of the legislation, we would have to turn such companies away. That is why the change is necessary. The Government simply do not believe that that would be the correct position for our country to be in. At its heart, the Bill is designed to enable the United Kingdom to take advantage of the opportunities that this new, emerging and very exciting technology offers us.
As we have discussed this morning, the Bill is quite a technical measure, with all the substantive amendments to the 1981 Act being set out in a schedule to the Bill. I could say a good deal about each of the amendments, but that might stretch the patience of the House, so I will not go through them in any great detail. We have covered a lot in the interventions and discussions that we have had. The point to make is that the Act is being brought up to date in relation to the sort of minerals that are now available for exploitation and in relation to changes in the law. It deals with some of the technical aspects relating to Scotland and other jurisdictions, but it keeps at its heart the need to balance commercial opportunity with environmental protection, which has already proved to be successful. But none of us is naive, and none of us can forget that there are states that operate differently. Without being absolutely certain that international regulation will follow the sort of intentions that we in this House would have, the Government will not be happy. In our dealings with the ISA, we will look to ensure that that works its way through.
The amendments in the schedule refer to changing definitions of the minerals to be exploited, appropriate dates for corresponding contracts with the ISA, the tightening up of the licences, and ensuring that reciprocal recognition is brought up to date. They provide for important work to be done to arbitrate disputes and deal with the international tribunal for the law of the sea and to ensure that it is relevant in relation to this work. They remove redundant terms and bodies and ensure that the terms used in the Act are up to date.
As we have heard, despite the Bill’s title and the 1981 Act, no mining or exploitation has been conducted in the deep sea by a UK company or any other company. Even with the most optimistic outlook, this is probably five years off for polymetallic nodules and longer for other mineral types.
The International Seabed Authority developed regulations for the exploration of polymetallic nodules some 10 years ago. To date it has issued 13 contracts and is in the process of issuing more. They are all for areas in the Clarion-Clipperton fracture zone in the equatorial north Pacific ocean, except for one in the central Indian basin of the Indian ocean. Exploration regulations for polymetallic sulphides were agreed in the past few years, with the authority issuing contracts to China, Russia, Korea and France, and cobalt-rich crust regulations were only agreed in 2012, since when there have been only a couple of applications.
Of the total of 23 contracts awarded or pending, over half were submitted in the past few years. That gives an indication of how the pace of interest and demand has changed, which is another reason why my hon. Friend the Member for South East Cornwall has proposed this Bill at this stage and why it is important to support it and make progress.
At this year’s annual meeting, the ISA’s council discussed a paper on the process towards development of a regulatory framework for the exploitation of polymetallic nodules. As I have said, so far the activity in relation to deep-sea mining has been confined to exploration, but the time for exploitation—that is, mining—is coming. I know that the secretariat to the authority is acutely aware of the challenges that will be posed by the development of regulations for the exploitation of polymetallic nodules. It has, therefore, sensibly engaged a well-respected team of consultants to look at the issues. I have here a copy of the consultants’ report, which is on the authority’s website. It sets out clearly and carefully the issues with which the authority will have to grapple. It is entitled, “Towards the Development of a Regulatory Framework for Polymetallic Nodule Exploitation in the Area”, and I commend it to the House and to colleagues who have expressed their interest in the affair today.
It is worth reiterating two points that the UK made clear in our statement. First, we emphasised that polymetallic nodule exploitation must be conducted in accordance with the highest environmental standards. Secondly—I believe we were alone in the states that spoke to make this point—we called for full engagement with all stakeholders, including contractors, technology providers and non-governmental organisations, in the development of a regulatory regime. I hope that that is of interest to the House and its needs.
I repeat those points because they are essential and lie at the heart of our approach. It is only by working together to develop a regime that we will be able to strike the right balance between protecting the environment and encouraging commercial enterprises. Stakeholders need to pool their knowledge and expertise, including that in the economics of deep-sea mining, the technology available and the biology of the environment involved, in order to begin to understand the full picture and reach the best solutions. We see environmental NGOs as important contributors in that process. Officials already engage with NGOs at authority meetings. I had a meeting with officials in advance of this Second Reading debate and have promised more consultations in advance of future meetings. We see this as an ongoing collaboration.
The Government believe that, given the advances in technology, a likely increase in future demand for mineral resources and a steady if not increasing cost for those resources, deep sea-bed mining is inevitable. It is a question of when, not if. In other words, deep-sea mining is going to happen and we could not stop it even if we wanted to. The fact that companies have started to take up exploration licences from the ISA when previously they were the domain of research institutes is a sign of a new phase in development. A UK-registered company is one of those that have taken up a licence and it is our clear intention to be at the forefront of this emerging industry. It is important that the UK should be in that position. This is an opportunity for us to ensure that our values, particularly in the protection of the environment, should be taken into account.
We believe that this Bill, modest though it is in some ways, is a crucial stepping stone in ensuring that the United Kingdom can be in the right place to influence developments. We believe that, as a responsible sponsoring and licensing state, we will be able to fulfil our obligations to ensure that the highest environmental standards are adopted and applied by our licensees in the work that they carry out. I can also assure the House that we will make use of our leadership role as a sponsoring state to try to ensure that the best possible practices are adopted when the ISA develops a regulatory regime for mining.
In conclusion, the Government believe that the Bill will signal our support for and readiness to uphold UNCLOS, provide leadership in calling for and upholding the highest possible environmental standards, and ensure that the UK aims to make the most of the opportunities offered by this increasingly important industry. I cannot commend the House enough for the attention it has paid to my hon. Friend the Member for South East Cornwall’s Bill and I cannot commend her enough for proposing it. I look forward to taking it further with the consent of the House, with the intention of maintaining the balance we have all strived to achieve in the past few years.
Jacob Rees-Mogg
On a point of order, Mr Deputy Speaker. The Minister referred to placing papers that contain confidential information in the Library. You will be aware that Mr Speaker ruled in 2006 that any confidential papers that are referred to ought to be placed in the Library with the confidential information removed. Will that practice be followed today?
Mr Deputy Speaker (Mr Lindsay Hoyle)
That is obviously a matter for the Minister, but as the hon. Gentleman is going off a previous ruling, I am sure the Minister will take it on board.