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Treasures from the deep : Frontier marine resources

Nazery Khalid Senior Fellow

Center for Maritime Economics and Industries, MIMA nazery@mima.gov.my

Margaret Ang Researcher

Center for Maritime Economics and Industries, MIMA margaretang@mima.gov.my

Abstract The oceans contain riches such as fisheries, oil and gas that benefit mankind. They also contain frontier marine resources (FMR) which include living and non-living frontier resources such as metallic sulphides, cobalt-rich crusts, gas clathrates, ocean thermal energy potential, wind power, valuable genes, fresh water, sites for marine ranching, marine biotechnology and many more. Some of these resources may contain commercial and bio-medicinal potential and may be converted to energy. Little research has been undertaken on this emerging and exciting field of study thus far to positively identify the whole spectrum of FMR, their features and their various potentials. This paper aims to modestly contribute to the literature by identifying the known FMR available in the maritime realm and assessing the developments of resources that have been commercially harnessed. The paper also discusses on the potential issues and challenges arising from discovering and developing FMR. It emphasizes the importance of addressing legal, security, environmental and economic issues that may hinder the exploration and development of FMR. It is hoped that the paper can inspire further research on the subject towards helping mankind to discover new FMR and unearth the manifold benefits and potentials that they can yield as sources of knowledge, food, chemicals and energy.

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1. Introduction The oceans and the ocean floors form an extensive and complex bio-geosphere system, acting as modulators of global climate. They also contain a treasure trove of resources – living and non-living – that have benefited mankind greatly. Exploratory studies and scientific research have identified that they contain a stunning range of marine resources yet to be fully explored and understood by us. These resources can be harnessed and utilized for socio-economic, scientific, industrial and medical uses and for the generation of energy. Thus far, only conventional marine resources such as fisheries, oil and gas have been harvested in a big way for commercial purposes. Not much is known about other marine resources that are available, and we have yet to ascertain the full range of resources available in the maritime realm and their potential contributions to mankind. As the world faces enormous challenges to meet rising demand for energy, food, minerals and medicine, and to harness natural resources in a responsible and environmentally friendly manner, the need to look for alternatives to those crucial resources have become pressing. Hence, it is crucial for us to develop substantial body of knowledge on natural resources in the maritime realm and exploit them sustainably. The oceans and their seabeds contain ‘non-traditional’ marine resources such as marine mineral resources, ocean energy resources, marine biotechnology, deep marine ranching and so forth. Some of these resources are believed to have enormous commercial potential and may be beneficial, but they have been largely underexplored due to the lack of understanding of their features and on account of the enormous technical and financial challenge to harness them. For purpose of discussion in this paper, frontier marine resources (FMR) is defined as marine resources that can be harnessed from the seas and ocean beds to generate social, economic, scientific and environmental benefits to mankind. The vast reservoir of FMR in the ocean can be classified as living and non-living resources, and this can further be categorized into renewable and non-renewable resources. Such resources have garnered growing interest in recent years. Beside the frequently used term ‘green resources’ which refer to natural resources and energy sources available on land, the term ‘blue resources’ is used to describe their offshore counterparts. There is greater awareness among researchers, marine scientists, consultants and industry players of the characteristics of these resources and their commercial prospects. There is a strong case of promoting FMR on several grounds beyond creating job opportunities, increasing marine resource production rates and boosting economic growth. Being non-hydrocarbon based, FMR such as wind and waves provide a cleaner option to conventional energy production which largely depends on hydrocarbon sources as the base material. The promotion of marine biotechnology and marine culture can help improve the productivity of the fishery industry and meet the growing need for protein sources by an expanding global population. Further development of FMR could enhance mankind’s understanding of the

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maritime environment, much of which still remains a mystery to us. New knowledge of the oceans and their contents may yield discoveries of FMR with medicinal properties that may help cure diseases and save lives. This knowledge can also enhance our understanding of the oceans and the Blue Planet in which we live. Certain types of FMR have enormous commercial potential and, if properly developed, can help to fuel the economic growth, development and social progress of a country. However, exploiting the economic potential of these FMR from the seas and marine seafloors poses huge technological, security, financial, legal, economical and environmental challenges to be overcome before their commercial potential can be successfully realized. 2. Types of frontier maritime resources FMR can be broadly classified into living and non-living resources. From literature review, several FMR have been identified, and they are presented in Table 1. There have been several projects worldwide to develop FMR, for example in the United States, Japan, India, China, Malaysia and several European countries, with varying degrees of capital outlay, development, intensity and success.

Table 1. Living and non-living frontier marine resources

Living resources Non-living resources Marine biotechnology: Pharmaceuticals Bioremediation of oil pollution Natural products Mariculture biotechnology

Marine mineral resources: Polymetallic nodules Cobalt-rich crusts Polymetallic massive sulphides

Deep sea marine culture/ranching Ocean energy resources: Wave energy Current energy Wind energy Solar energy

Gas hydrates

The next section describes several types of FMR and their features, based on the literature reviewed. The list is by no means exhaustive but the FMR listed are the most commonly known ones, and are believed to have significant commercial potential.

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2.1. Living resources 2.1.1 Marine biotechnology Marine biotechnology can generally be classified into four categories, namely pharmaceuticals, natural products, bioremediation of oil pollutions and mariculture biotechnology [1]. The potential for marine biotechnology include production of seafood and marine pharmaceuticals, development of value-added products of bycatch and ‘wastes’ of the fish industry, pollution control, and mariculture. R&D on marine biotechnology has revealed that these resources could lead the way toward sustainable and environmentally sound development of ocean resources. Several nations have put in place plans and institutional infrastructures to develop marine biotechnology in a systematic manner. In Malaysia for example, Malaysian Biotechnology Corporation, a high-level government agency under the purview of the Ministry of Science, Technology and Innovation Malaysia, was established in 2005 to identify value propositions in the biotech industry in the country and promote R&D efforts in biological and life sciences to improve the quality of human life. Among various types of marine biotechnology which are being explored are : i) Pharmaceutical from marine organisms

A large number of chemicals produced by marine organisms have pharmaceutical properties and values. Many marine organisms secrete compounds that help them survive and incidentally have properties which are beneficial to mankind. Screening of marine organisms has revealed that sponges, corals, tunicates, algae and some other organisms produce compounds showing antibiotic, anti-tumor, anti-viral or anti-inflammatory activities.

Marine algae or seaweeds have been identified as potential sources of bioactive natural products.1 Scientists from several countries - namely Germany, Iran and Malaysia - have found that marine sponge extracts generate antimicrobial activities. These sponges are a potential source of production of new antimicrobial drugs which can be useful for the treatment of human diseases [[1], [2], [3]]. Additional markets for sea cucumbers have emerged for biomedical research and can be used for ‘at home’ aquaria [4]. Studies on sea cucumbers conducted in Malaysia have found out that Atratoxin B1, extracted from a local sea cucumber,

1 For example, several of the 24 species of Malaysian seaweeds are found to produce activities against gram +ve

(Bacillus subtilis and Staphylococcus aureous) and gram –ve (Escherichia coli and Pseudomonas aeuroginosa) bacteria. Crude extracts of Turbinaria, Sargassum, Chaetomorpha and Amphiroa were found to produce inhibition in the growth of both types of bacteria. Such seaweeds and algae can be used to prevent bacteria and viruses from binding to human cells, hence avoiding infection [1].

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has Holothuria atra which may contain antifungal agent against dermatophytes [5]. The potent extract of atratoxin has antimicrobial agents, which have strong emphasis as antifungal agents. Seeing its potential, bio-prospectors have stepped up efforts to extract natural products from sea cucumbers. ArthiSea, SeaCuMax and Sea Jerky, popular arthritis medicine and nutritional supplements, are some sea cucumber extract products that have been actively marketed in recent years [6].

ii) Natural products

Chitin is a naturally occurring plastic component of the crab shell and is the second most abundant organic compound on earth. Its two major sources are the shells of arthropods – which include crabs, lobsters, shrimps and insects - and bodies of fungi [7]. Chitin is used most commonly in industrial applications in various fields such as coagulant for water treatment and latex waste, as absorbent for hydrocarbons and metals, in chromatography, as fruit coating, and in the production of new materials by blending it with natural rubber. It can be used for biodegradable sutures or ‘second skins’ for burn victims, or be woven into bandages to stop bacterial infection and bleeding. It is also used in the paper and textile industries to produce certain surface properties. Chitin also increases the shelf life of meat, fruits, vegetables and flowers. When processed in a chemical treatment to make it soluble in dilute acids, chitin becomes chitosan, one of the most versatile chemicals in wastewater treatment. Chitosan can remove organic molecules, heavy metals and polychlorinated biphenyls (PCBs), and has become increasingly popular of late as a health food product for reportedly being able to remove body fats.

Phycocolloids are extracted from seaweeds and have commercial value. The major commercial phycocolloids are agar-agar (jelly), carrageenan - a family of linear sulphated polysaccharides extracted from red seaweeds (for example, Gelidiella, Gracilaria, Chondrus, Hypnea) - and alginate from brown seaweeds (such as Ascophyllum, Laminaria, Turbinaria, Sargassum). Seaweed phycocolloids are mainly used as emulsifier in dairy, leather and textile products and in the pharmaceutical industry [8]. China and Japan are the top seaweed cultivators, producers and consumers in the world [9]. Japan, China and several Southeast Asian countries - namely Malaysia, Philippines, Indonesia and Thailand - have mastered seaweed cultivation techniques for commercial exploitation. Western Europe is also an important trading areas of seaweed products, with the United Kingdom, France and Norway leading the way [9].

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Fish oil is widely used for the treatment of Vitamins A and D deficiency. Sharks and certain bony saltwater fish are reportedly rich in Vitamins A and D. Medicinal oils may also be extracted from tropical fish species. Polyunsaturated fatty acids have medical significance for their ability to control blood cholesterol levels in humans.

iii) Bioremediation of oil pollutions

Marine bioremediation to fight oil spills and pollutions in the marine environment is another emerging area of marine biotechnology. It involves the use of marine micro-organisms to mineralize and degrade toxic chemicals spilling into the marine environment to render these harmless or to turn them into less toxic end-products. Although bacteria are mainly employed for this purpose, micro-algae and seagrasses are also considered for their role of bioremediation.

Management and bioremediation of heavy metal pollution can be done using algae. Marine algae or seaweeds are able to accumulate metals to high levels without damage. In the marine environment, seaweeds may provide a simple, effective system for the early detection of heavy metal pollution in the waters. Seaweeds may also be used to recover heavy metals from wastewater before discharge [10]. Besides being used to clean up oil pollution using seaweeds, plans are afoot to utilize micro-algae in controlling and converting rubber and oil sludge for commercial use.

iv) Mariculture biotechnology

Mariculture biotechnology development is an excellent means of stepping up the production of seafood. It involves low-technology applications for the procurement of stocking material (seeds), rearing larvae to marketable size and harvesting commercially important saltwater organisms including algae, shellfish and fin fish. Among the methods being planned and used in marine biotechnology include selective breeding, hybridization, and gene manipulation to create ‘super’ fish / shellfish and to produce transgenic fish.

The main objective of such efforts is to produce stocks of fish which can grow faster, attain large size, have high efficiency in converting food to flesh, and are more disease resistant. The enhancement of fisheries via aquaculture offers great commercial potential and economic value. In addition to coastal mariculture, fishery experts are exploring ways to conduct deep-sea marine farming.

There is growing effort in the academia to study marine biotechnology to enlarge fish catch and catalyze production in the fishery sector. For example in Malaysia, the Biotechnology Research Institute of Universiti Malaysia Sabah was

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established in 2002 to conduct research in the field of marine biotechnology, among others. Since its establishment, the institute has conducted research to develop marine natural products and aquaculture, in line with Malaysia’s ambition to become a regional biotechnology center.

2.1.2 Marine ranching

The decline of many of the fisheries worldwide has caused a major concern in the security and sustainability of seafood sources. Governments, resource managers and those who make their livelihood on fishing are searching for better ways to enhance fish stocks through improvement in seed quality and farming techniques such as ranching. Many marine ranching programs have been in place to generate income, reestablish fisheries and conserve aquatic biodiversity. These include the integrated development program for marine stocking in Norway; stock enhancement of barramundi in Australia for recreational fisheries; restocking sea cucumbers in Pacific Islands; sturgeon stocking programs in the Caspian Sea with an emphasis on Iran; and an assessment of stocking effectiveness of flounder in Miyako Bay, Japan; to name a few [41]. Researchers in Germany are even looking at possibility of offshore co-management of mariculture and wind farms [33]. Marine ranching has been considerably successful in increasing fish stocks. However, much investment and work are needed to further advance ranching technologies and strategies to enable marine ranching to be harnessed on a large scale [41].

2.2. Non-living resources 2.2.1 Marine mineral resources

With the increasing global demand of many of the world’s minerals and growing concern over the depletion of some of their reserves, the need to search for new sources have become pressing. As our quest for mineral resources expands to new and ‘non-traditional’ territories, the seas have emerged as a potential area for the discovery of new mineral sources. ‘Marine mining’, or the exploitation of mineral resources from the oceans, has emerged as a major issue as public awareness of the potential commercial opportunities from maritime mineral resources. Three such resources discovered in the past decades are polymetallic nodules, Cobalt-rich crusts and polymetallic massive sulphides.

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i) Polymetallic nodules

Polymetallic nodules (see Plate 1) are one of two metallic mineral resources of the deep seafloor that incorporate metals from both continental and deep ocean sources. The nodules contain valuable metals such as manganese (29.4%), iron (6%), nickel (1.34%), copper (1.25%), cobalt (0.25%), titanium (0.6%), aluminum (2.9%) and the remaining 32.16% are sodium, magnesium, silicium, zinc, oxygen and hydrogen [12]. These polymetallic nodules precipitate from seawater over millions of years on sediment that forms the surface of the vast abyssal plains underlying the deep ocean. They occur irregularly at depths greater than 4 km and are found in abundance in deep ocean basins of the Pacific Ocean [11].

Plate 1. Polymetallic nodules [11]

The most promising of these deposits in terms of nodule and metal concentration – with combined nickel and copper content of at least 2 percent of weight - occurs in the Clarion-Clipperton Fracture Zone of the eastern equatorial Pacific Ocean between Hawaii and Central America, known as the Horn Zone [12] where mining companies are already working. In the Indian Ocean, nodules occur in different basins such as the Central Indian Ocean Basin, Wharton Basin, Crozet Basin, Madgascar Basin, Somali Basin, South Australian Basin and the Arabian Sea. Polymetallic nodules are a potentially valuable resource. However, the advent in mining technology and the prices for these commodities have not yet reached a stage where the commercial mining of these metals can be done on a large scale.

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ii) Cobalt-rich crusts

These ferromanganese crusts incorporate metals from both land and sea sources. The oxidized deposits of cobalt-rich crusts are found throughout the world’s oceans on the flanks and summits of seamounts, ridges and plateaus in water depths between 0.8 km and 2.5 km [13]. These crusts may reach 40 cm in thickness, but are more commonly 3-5 cm thick. They generally grow at the rate of 1-6 mm per million years. Cobalt-rich crusts have commercial potential due to their richness with metals, namely cobalt, manganese and nickel that are used in various industries. These metals are used to add specific properties such as hardness, strength and resistance to corrosion to steel. They are also employed in chemical and high-technology industries for products such as photovoltaic and solar cells, superconductors, advanced laser systems, catalysts, fuel cells and powerful magnets, and cutting tools. Additionally, cobalt is also used by the aerospace industry in superalloy structures. The central equatorial Pacific region offers the best potential for cobalt crusts mining, particularly the Exclusive Economic Zones around Johnston Island and Hawaii, the Marshall Islands, the Federated States of Micronesia and the international waters of the mid-Pacific. Democratic Republic of Congo, Zambia and Canada are amongst the largest producers of cobalt in the world [13].

iii) Polymetallic massive sulphides

Polymetallic massive sulphides are minerals deposited around seafloor hot springs during the upwelling of magma beneath a submerged volcanic mountain range. They are usually found in water depth up to 4 km. Massive sulphides have attracted interest of the international mining industry due to their high concentrations of base metals (such as copper, zinc and lead), and precious metals (such as gold and silver) [14]. Plate 2 shows the global distribution of polymetallic massive sulphides. Deposits are largely found in mid-ocean at the East Pacific Rise, the Southeast Pacific Rise and the Northeast Pacific Rise. Some sulphides deposits are located at the Mid-Atlantic Ridge and a site has been found at the ridge system of the Indian Ocean. Extensive sulphides deposits have also been discovered in the Lau Basin and North Fiji Basin (east of Australia), Okinawa Trough (southwest of Japan), Manus Basin (north of New Caledonia) and Woodlark Basin (east of Papua New Guinea) [14].

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Plate 2. Distribution of polymetallic massive sulphides [14]

2.2.2 Ocean energy resources

The ocean waters, the land beneath the seas and the air and sunlight above them contain massive energy resources. These resources can be classified as non-renewable energy sources which include oil and gas, and renewable energy sources such as wave, current, wind and solar. The potential to tap into these sources to generate energy is enormous as three-fourths of the earth’s surface is made up of the oceans. However, these resources can only be utilized in-situ and due consideration should be given on the technical feasibility and economic viability of harvesting these energies on a massive scale. Not surprisingly, developed countries are at the forefront of the development of ocean energy resources. Developing nations with less resources and more pressing socio-economic priorities cannot afford to develop or purchase technologies which are sophisticated, expensive and not yet proven to be as economically competitive and reliable as traditional energy sources such as oil and gas. However, with the increase in the prices of oil and gas and the voracious global demand for energy, there is greater impetus to harvest and commercialize some of these renewable ocean energy resources.

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i) Wave energy

Ocean wave energy is created by wind currents passing over open water with sufficient consistency and force that can be captured directly from surface waves or from pressure fluctuations below the surface [15]. Wave power varies in different parts of the world’s oceans. Areas such as northwestern coasts of the US, western coasts of Scotland, Australia, southern Africa and northern Canada have significant wave power. Advanced countries such as the US have demonstrated that harvesting wave energy in offshore locations is technically feasible and economically viable.

The estimated costs for the conversion of the wave energy into electrical or any other usable energy are dependent on many physical and economic factors. They include system design, wave energy power, assumptions on discount rate, cost reductions from a maturing technology and tax incentives. Leading the way in this field, the US has conducted a detailed evaluation of potential wave energy development in its coastal areas [16]. According to the US Department of the Interior, the resulting cost estimate of electricity generated from commercial-scale energy facilities offshore California, Hawaii, Oregon and Massachusetts – where the wave energy power is relatively high - was in the range of US$0.09 to US$0.11/kWh, after tax incentives [15]. However, there are some environmental impacts that should be considered when developing wave energy. These include impacts on the marine habitat, leakage or accidental spills of harmful liquids from devices used, and conflict with other sea space use in the area such as fishing, recreational boating and commercial shipping.

ii) Current energy

Ocean currents carry an enormous amount of energy due to the density of the ocean water. Such energy can be captured and converted to a usable form of energy such as electricity. Ocean currents flow in complex patterns, driven by wind and solar heating of the waters near the equator. Their flow is relatively constant and moves only in one direction. Some of the well-known ocean currents are the Gulf Stream, Florida Straits Current and California Current in the US. To underline the massive potential of ocean currents as an energy source, it has been estimated that 1/1,000th of the available energy from the Gulf Stream would supply the US state of Florida with 35% of its electrical needs [17]. Although ocean current energy is at an early stage of development, there are countries which are actively pursuing it, namely the US, Japan, China and some European Union countries.

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According to the US Department of the Interior, for the ocean current energy extraction to be economically viable and competitive, velocities of at least 2 m/s (4 knots) would be required, 2 although it is possible to generate energy from velocities as low as 1 m/s [17]. It is an expensive undertaking requiring huge investments and capital outlay. A huge portion of the cost of installing the technology would come from the cables to transport the electricity to the onshore grid. There are significant technical and environmental challenges for ocean current energy to be successfully commercialized. Since maintenance costs are potentially high, ensuring the reliability of the system and technology used is critical. To ensure efficient performance of the system to generate energy from ocean currents, prevention of marine growth build up, corrosion resistance and avoidance of cavitations3 must be put in place. Considerations should also be given to protecting marine species at the project sites from injury caused by turning turbine blades. Other challenges such as the effect on the location of the turbines to navigation safety of ships, changes in estuary mixing and impacts from slowing the current flow for energy extraction must also be addressed.

iii) Wind energy

Another alternative to renewable energy is wind energy. The utilization of wind energy for power generation is not a new concept as onshore wind farms have been in operation since the time of ancient civilizations [19]. Over the centuries, wind energy has emerged as a popular source of energy worldwide, with wind facilities extending to offshore locations. The first offshore wind facilities, the Vindeby Facility, were installed in offshore Denmark [20]. The Scandinavian nation is a strong proponent of renewable energy and has set a target of generating half of its electricity by such means by the year 2030.4 Wind energy currently supplies approximately 12 per cent of electricity in Denmark which hopes to derive a larger part of wind energy from offshore wind farms (see Plate 3). Thereafter, many more offshore wind facilities were installed in the US, Canada and Europe, mainly in shallow water depths of less than 30 m. In Asia, wind energy growth is on the rise, especially in India and China [21]. Further technological development is underway to explore ways in harnessing wind energy in deeper waters than currently available technologies permit.

2 The kinetic energy of a 5-knot current is equivalent to wind at more than 100 mph. 3 Cavitations refer to air bubble formation that creates turbulence and substantially decreases the efficiency of current-energy harvest. 4 ‘Wind turbine specialists in extreme conditions’. Danish Trade Council. Available at http://www.um.dk/Publikationer/Eksportraadgivning/FocusDenmark/0202/0202/html/chapter03.htm (accessed on 8/4/2009).

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Plate 3: Middelgrunden Windmill Farm, an offshore farm located in the Oeresund near Copenhagen harbor, Denmark [18]

Energy produced from the wind is directly proportional to the cube of the wind speed [19]. As offshore winds tend to flow at higher speeds than onshore winds, offshore wind facilities tend to be favored over onshore facilities. Offshore wind facilities are basically similar to wind facilities on land, except that the former are larger and feature certain modifications to prevent corrosion and to protect against wave and wind interactions [19]. However, the availability of wind resource varies with location. It is crucial to understand the nature of offshore wind in order to design a wind energy facility that maximizes power generation. Wind energy is a very clean way to harness energy as it does not require fuel to operate, hence produces no emissions. The only impediment is the high cost and the technical challenge associated with developing the wind facility.

2.2.3 Gas hydrates Of the non-solid minerals available beneath the seas, gas and petroleum are the most commonly known and extensively exploited. Deposits of these precious resources are usually available in shallow and deepwaters off the coasts of Africa, the Americas, Asia

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and Europe. Among the most promising of new fuel sources are gas hydrates, also known as clathrates. Gas hydrates are a mixture of natural gas and water compressed into a solid by the cold and high pressures of the deep ocean floor in undersea basins of the continental margins [22]. Because of the pressure and temperature requirements, and the requirement of relatively large amount of organic matter for bacterial methanogenesis, gas hydrates are usually found at high latitudes regions and along the continental margins in the oceans [23]. The realization that huge reservoirs of methane hydrates occur on the ocean floor and in permafrost regions has led to the exploration of these resources in mainly oil-poor countries such as Japan and India. Several countries - including the US, Canada, Russia, India and Japan – are keen to explore the possibilities of methane hydrates as fossil fuels [22]. This can be attributed to the fact that the ice-like crystals of methane are said to contain the energy potential which is equal to more than twice of all fossil fuels combined [22]. However, an economic extraction method for methane has so far proven elusive. It has been projected that if recovery techniques can be perfected, estimated reserves could satisfy the energy needs of the world for centuries [23].

3. Issues arising from FMR development There are several issues – real or potential - that can emerge in the drive towards exploring, discovering and developing FMR. They include legal, economic, environmental and security issues which are discussed below : 3.1. Legal issues

Nations at loggerheads over maritime boundaries and territories could not be realistically expected to work together to jointly develop resources-rich areas located in disp uted maritime areas. Even the very discovery of resources at sea can all too easily trigger a scramble among nations to claim them and to mark their boundaries, and can lead to tense stand-offs.

The exploration of FMR may raise several legal questions such as the delimitation of maritime boundaries among nations. The straddling, borderless expanse and trans-boundary nature of the oceans may give rise to disputes that can frustrate efforts to explore and develop FMR for scientific purposes or economic benefits.

To enable nations to jointly conduct exploration in areas located along maritime borders would require significant extension in the jurisdiction of coastal states. As it stands, there exist overlapping maritime claims and a lack of maritime boundary delimitation in several maritime areas worldwide. This has resulted in nations defining their maritime zones in a manner that may create opposition by other nations and put

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them at odds with one another.5 Such a situation is not desirable for the exploration of FMR which requires close cooperation among nations and joint management of resources. In the case of waters located adjacent to the coasts of countries claiming the areas in question, the extent of the territorial sea and contiguous zone of those countries may overlap and hinder efforts to conserve, develop and utilize those resources which the said countries are entitled to.

Developing FMR could be particularly problematic for littoral nations whose maritime borders are located in waters rich with such resources. Such nations may adopt rigid postures and non-negotiable policies that proclaim, as a matter of principle, possession of sole sovereignty and jurisdiction over maritime areas adjacent to their coasts and extending not less than 200 nautical miles from the coasts. This proclamation also gives them sole sovereignty and jurisdiction over the sea floor and subsoil thereof of the said areas. Ill-defined baselines and boundaries may result in overlapping claims and disputes over maritime borders in the FMR-rich areas, and create an adversarial situation which is not conducive to the joint development of FMR in such areas.

To avoid conflicts arising from conflicting claims over such areas, nations must forge and foster good ties among them as a basis to cooperate in matters pertaining to exploration of the oceans. International law propagates such cooperation, as stated in Article 123 of UNCLOS : States bordering an enclosed or semi-enclosed sea should cooperate with each other in the exercise of their rights and in the performance of their duties under this Convention. To this end they shall endeavor, directly or through an appropriate regional organization:

a) to coordinate the management, conservation, exploration and exploitation of the

living resources of the sea;

b) to coordinate the implementation of their rights and duties with respect to the protection and preservation of the marine environment;

c) to coordinate their scientific research policies and undertake where appropriate

joint programs of scientific research in the area; d) to invite, as appropriate, other interested States or international organizations to

cooperate with them in furtherance of the provisions of this article. 5 For example, Timor Leste and Australia were embroiled in a dispute over the maritime borders of an area in Timor Sea which contains significant gas deposit. The seas separating Indonesia and Australia, the Timor Sea and Arafura Sea, contain reefs, islands and a continental shelf rich in oil and gas resources, provided the stage for a maritime boundary dispute between them. With the signing of the Australia-Indonesia Maritime Delimitation Treaty in 1997, the dispute between them concerning their common maritime boundaries is deemed to have been resolved. Their dispute over sovereignty of the seabed of an area known as the Timor Gap – a seabed boundary negotiated between them in 1972 - ended when Timor Leste seceded from Indonesia and gained independence.

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To underline the potential divisiveness of boundary wrangling that can put a spanner in the works of cooperation among nations to exploit FMR, consider the long-standing political and legal obstacles that have hampered bilateral cooperation between the US and Mexico in matters pertaining to maritime cooperation. Analysts have suggested bridging the impasse between the two by establishing one or more Transboundary Energy Security and Environmental Cooperation Areas (TESECA) in the maritime boundary region between US and Mexico in the Gulf of Mexico.6 Creating a TESECA in these areas will provide a valuable institutional forum for bilateral discussion and development of cooperative management opportunities for transboundary hydrocarbons as well as the protection of the marine environment.

3.2. Economic issues

Amid the financial crisis and global recession beleaguering the world currently, funds are hard to come by to finance exploratory projects. Governments and financial institutions alike are tightening their budgets and adopting a prudent stand in allocating financing, concentrating only needy projects to encourage consumer spending, create jobs and generating economic growth. Naturally, activities such as developing FMR will have to take a backseat as governments and businesses work at staving off inflation and preventing their economies from plunging into deeper crisis. The acute need to put the financial markets and world economy back on track will halt the progress of studies, analysis, discovery and development of FMR.

More than ever, careful assessment needs to be conducted to ascertain the economic potential and financial viability of certain FMR related projects. To lure the private sector to invest and pour in huge amount of capital expenditure to undertake certain types of FMR related activities such as marine ranching and harnessing energy from ocean waves, detailed studies must be carried out to determine the financial viability of such projects. It would be asking too much of financiers, at a time of financial crisis like what we are experiencing now, to back FMR related projects based on their potential alone. The decision to pursue the development of a particular FMR may come at the expense of the exploration and development of other types of marine resources. For example, the drilling of oil in offshore locations rich in both hydrocarbon deposits and fisheries resources may result in the halting of fishing activities in the said waters. It would be impracitcal, if not altogether impossible, to conduct both activities concurrently without giving rise to some sort of conflict and even risks. The presence of platforms and rigs, and support vessels in offshore project sites where FMR are found, may pose a danger to merchant and fishing vessels colliding with them. In addition, the presence of sub-

6 Mc Laughlin (2008) stated that two maritime areas straddling the boundary of the US and Mexico are especially suitable for this purpose [24]. The areas are the Perdido Foldbelt Region which contain large quantities of hydrocarbons, and an area beyond national jurisdictions of the two countries called the Western Gap which is governed by an international treaty between them.

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sea components such as pipelines and risers may ensnare the nets of fishing vessels. This could make it difficult to conduct fishing activities and could result in the affected fishermen incurring considerable costs to replace or repair damaged equipment.

3.3. Environmental issues

The oceans are priceless, irreplaceable gifts containing precious sources of energy, food and features that benefit mankind and can generate huge economic returns. In the excitement of exploiting FMR, nations and private enterprises may overlook the importance of harnessing them in an environmentally friendly and sustainable manner. Already, new frontiers and far-flung maritime areas are being ruthlessly exploited for resources to meet rapacious global demand, at times without supervision. Extensive drilling of fields in such areas not only will result in the rapid depletion of their resources.7 In addition, exploitation of such areas may cause incidents leading to pollution of the maritime environment and beyond.

Governments of nations which are littoral to waters containing FMR should be legally and morally obliged to take full responsibility and measures to ensure that those resources are conserved and protected. In addition, they must also to regulate the use of the resources to meet their national objectives with zero damage, or at the very least with the most minimal disruption, to the integrity of the project sites and the vicinity. FMR may be located particularly in sensitive sea areas which are rich in biodiversity and vulnerable to external disturbances. The richness and fragility of such areas – which may feature geological and biological characteristics that could not afford to be tampered with in a major way – may cause adverse effects to the integrity of host areas and to the preservation and existence of the said resources. Rising sea temperatures and dramatic changes in global climactic patterns may also pose a threat to FMR exploration and development. These can cause changes to the sea environments- such as the rise in sea levels, thawing of polar caps and increase in carbon dioxide content in the maritime atmosphere - that may affect the integrity, rejuvenation and even existence of certain living FMR. No efforts should be spared in ensuring that changes in sea conditions are carefully monitored and FMR related activities are closely supervised to ensure the integrity of the marine environment and the fragile FMR therein.

7 Byron and Waugh (1988) propagated the concept of Ricardian limits – developed in the context of increasing economic and social costs – which stated that exploitation of resources would result in their depletion in a gradual manner instead of in a dramatic fashion ala Malthusian exhaustion.

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3.4 Security issues

Since the 11 September 2001 attacks, concerns have been raised over the possibility of terrorist attacks on maritime targets. Although at times such concerns border on the paranoia and hyperbole, the potential threats should not be dismissed. Despite the fact that there is no compelling evidence that terrorists have the operational capability and even the resources to mount attack on maritime assets, one should be mindful of the fact that terrorist threats are asymmetrical and non-conventional in nature, and that they thrive on the element of surprise. In the case of ‘big ticket’ and expensive maritime targets such as merchant vessels and oil rigs, one attack is one attack too many.

Assets and infrastructures deployed in remote offshore locations for the exploration and development of FMR such as windmills, tank storages, pipes, offshore platforms and vessels at anchor are particularly vulnerable to attacks. Far out at sea, they do not enjoy the kind of close monitoring and security protection that can be accorded to assets closer to or along the shores. They can be attacked not only by means of maritime transport modes but also via air, missiles launched onshore or even bombs smuggled onboard vessels to the project sites.

Given this, it is imperative for the stakeholders involved in exploration and development of FMR to take precaution to prevent attacks on the personnel and assets such as research vessels, windmills and offshore platforms. In doing so, huge amount of resources and close cooperation among the stakeholders of FMR projects and security agencies are required to ensure the risks emanating from the threats of terror attacks. Sharing of intelligence is key to thwart attacks, and is as important as the ability to response to crisis situations involving terror attacks. This is vital to ensure that lives are not lost, properties are not damaged and the integrity of the maritime environment is protected. Not to be taken lightly as well are the potential security threats on FMR projects that can be posed by other asymmetrical, non-conventional threats besides terrorism. These include attacks by pirates, natural disasters such as tsunami and hurricanes, mechanical failure of equipment and vessels, careless handling of flammable and dangerous resources such as oil, and even elements of sabotage from personnel working on FMR projects.

4. Prospects of FMR and conclusion

The seas play a crucial role in ensuring the integrity and of this fragile planet and the continuity of life therein. They provide untold riches to mankind and a wealth of resources that bring various benefits to nations and mankind. There is still much knowledge to be gained from the seas whose mysteries, contents, features and potentials are yet to be known to the full extent by mankind. To identify, extract and harness the resources at sea and those lying therein require much exploration, analysis and resources, a high dose of cooperation amongst nations.

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To overcome the issues of overlapping claims of offshore areas and unclear maritime boundaries, nations bordering waters containing FMR may consider establishing maritime joint development zones and work together to harness their potential. To this end, it is encouraging to note that since the conclusion of the Geneva Conventions on the Law of the Sea in 1958, there is growing use and acceptance by states of joint development or cooperative management agreements. Of note is the joint development agreements related to the exploration, management and exploitation of common maritime natural resources have proven to be an effective mechanism for achieving peaceful resolution of maritime boundary disputes among nations.8 It is recommended that nations exhaustively explore this route to explore and develop FMR and to harness their economic potential for mutual benefit. To encourage more research on FMR, funding, grants and strong institutional support must be made available for scientists and analysts to explore new frontiers. At the same time, efforts must also be focused on developing new technologies, geo-engineering methods and environmental modification techniques to explore more hostile maritime territories and discover new resources, and to develop better understanding of the impact of climate change on the oceans and their resources. To ensure that FMR are sustainably developed and the marine environment surrounding them is well protected, there has to be solid legal, regulatory and institutional infrastructures. National and international organizations – whether governmental, semi-governmental or non-governmental – laws and regulations must be at the foundation of all efforts to develop FMR-rich areas. Good laws and regulations by themselves are worthless without strong, strict and sustained enforcement by agencies. There must also be close cooperation between the public and private sector to support the drive in the development of FMR and to manage and conserve FMR in a responsible fashion. It would also help that nations develop national, regional and even international bluperints and long-term strategies to develop FMR rather than doing so on an ad hoc basis and in a patchy manner. There must be an overarching strategy to develop FMR to take into account resources available, the need to exploit those resources, national priorities, the socio-economic benefits, the need to preserve the resources and protect the environment, and the importance of regulating the actions of the parties involved in exploring, studying and developing FMR. To this end, it would perhaps be helpful to be guided by the principles of Modern Ocean Governance that would help lay the foundations to propagate activities in the development of FMR in a responsible, sustainable manner [26]. The principles are :

• Conditional freedom of activity in the high seas • Protection and preservation of the marine environment • Conservation of high seas, living marine resources and biodiversity

8 In this respect, Caribbean and Latin American countries have successfully adopted this approach and are at the forefront of working together and cooperating to explore marine resources within the framework of joint development agreements or cooperative management strategies. For example, Chile, Ecuador and Peru proclaimed the Declaration of Maritime Zone in 1952 among them that commit them to ensure the conservation and protection of their natural resources at sea.

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• Sustainable and equitable use of the seas • Cooperation among organizations, institutions and nations • Precautionary approach (including prior Environmental Impact Assessment) • Ecosystem approach • Use of best available science • Transparency in decision making and carrying out of activities in the oceans • Responsibility of states to control the actions of their nationals and consequences for

breach of international obligations Approaching FMR development using the abovementioned principles could help ensure that activities related to FMR are conducted in a systematic, orderly and environmentally friendly fashion. The set of principles is helpful in helping to establish the foundation for mankind to enhance its understanding of FMR and at the same time protect and preserve the sensitive maritime areas where the resources are found. Much more information and knowledge about FMR need to be attained and an extensive tapestry of dimensions need to be uncovered before we can develop a truly comprehensive understanding of the various FMR available. It is essential that we have a full grasp of the features of FMR, their economic potential and benefits, and their place in the rich and complex web of the maritime ecosystem before investing in efforts to commercialize them. It is hoped that the quick cantering through this fascinating and promising field of maritime studies in this paper would inspire other researchers to conduct further and more detailed studies on the prospects of FMR to improve our understanding and appreciation of these priceless resources.

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