MINING OF THE DEEP SEABED TUESDAY, SEPTEMBER 20, 1977 U.S. SENATE, SUBCOMMITTEE ON PUBLIC LANDS AND The subcommittee and committee met, pursuant to notice, at 10 a.m., in room 5110, Dirksen Office Building, Hon. Lee Metcalf presiding. Present: Senators Metcalf, Hatfield, Stevens, and Schmitt. Also present: Steven P. Quarles, counsel, Norm Williams, professional staff member, Subcommittee on Public Lands and Resources; and James P. Walsh, general counsel, Deborah Stirling, and Christopher Koch, professional staff members, Gerald Kovach, minority staff counsel, Committee on Commerce, Science, and Transportation. OPENING STATEMENT OF HON. LEE METCALF, A U.S. SENATOR FROM THE STATE OF MONTANA Senator METCALF. The joint hearing will be in order. This is the second of 3 days of joint hearings on S. 2053, before the Subcommittee on Public Lands and Resources of the Committee on Energy and Natural Resources, and the Committee on Commerce, Science, and Transportation. Yesterday, we heard testimony on S. 2053, a bill relating to the Deep Seabed Mineral Resources Act, from John Murphy, chairman of the Merchant Marine and Fisheries Committee of the House of Representatives. Testimony was also received from representatives from the Departments of Commerce and Interior, and the U.S. Treasury. Today, we are going to hear from another distinguished Congressman who has played a very important part in the development of this legislation, Congressman John Breaux. We expect to hear later from representatives of the deep seabed industry and the banking and insurance interests. We will hear from Ambassador Richardson who has promised to give us the administration's views. Congressman Breaux, we are delighted to have you with us this morning. You have exercised such a position of leadership. We will listen to your testimony with a great deal of interest. STATEMENT OF HON. JOHN B. BREAUX, A U.S. REPRESENTATIVE FROM THE STATE OF LOUISIANA Mr. BREAUX. Thank you very much, Senator, and Senator Stevens. I appreciate the opportunity to be on this side of the Capitol. While I don't know anything about Bert Lance, I am interested in testifying over here too. Perhaps we can make it interesting and share some common interests. I would like to congratulate your Senate committees and staffs and your leadership for the work you have already done on the question of deep seabed mining. I have a prepared statement which I have submitted for your record. I would like to summarize and discuss with you some of the highlights and important points I think should be of interest to your committees. I think everybody can agree as Congressman Murphy indicated yesterday in his testimony, that we can no longer rely on the International Law of the Sea Conference which has been going on for a number of years to solve the committees' serious problems relating to deep seabed mining. Action on the part of Congress as a legislative body is absolutely essential at this time. One of the questions people have asked me, and I know will be asking you gentlemen, is: Why do we need a bill or a piece of legislation authorizing deep seabed mining? No. 1, I think international law at the present time allows U.S. companies, or anyone else for that matter, to go out on the high seas and to mine the high seas both for the purposes of commercial production and for the purposes of experimental mining or whatever, just as international law presently allows anyone to go out and fish international waters outside the U.S. 200-mile limit. That is a right to take the fish, to sell the fish, to take them into their possession and to use them as they see fit. I think any mining company, United States or otherwise, would have that same right today. I think the legislation is in keeping with that existing right that we have. I think it solidifies it and writes it in concrete. There are many who point out the United States voted for U.N. Resolution 2740. However, it is important to note in doing so that we as a Nation make many statements to qualify that vote in the United Nations. In addition to that, it is certainly clear we never at all agreed to some of the interpretations on that vote in the United Nations, that many of the so-called group of 77 are saying it was meant to intend. For instance, if the United States had not agreed to the moratorium in 1969, we did not agree that, pending the adoption of a comprehensive treaty, that we would not engage in our own high seas freedoms that already existed. In other words, we did not give up any of the existing rights of the high seas that we have as a result of the 1958 High Seas Convention in Geneva. By supporting the resolution adopted by the United Nations our policy very clearly pointed out: Pending the adoption of a comprehensive treaty agreed to by the United States, we shall continue to consider exploration and exploitation of the deep seabed as a high seas freedom pursuant to the 1958 High Seas Convention. So I think it is very important in this legislation the United States clearly and emphatically point out we have the right and continue to intend to exercise the right to exploit and explore the deep seabed pending the adoption of any international treaty. I am very pleased to see the bill you have before you very clearly and emphatically make that statement. Another point is: Why do we need legislation? It is because of the stability of the supply of the minerals. Your committee already knows we are importing something like 98 percent of all of the manganese in this country, 98 percent of all of the cobalt we use, something like 71 percent of all of the nickel, and a small percentage of the copper, about 15 percent. That indicates very clearly there is no question about those facts. We are tremendously dependent on foreign sources for these strategic minerals our country needs. Some would say, well, the evidence is such it shows we are not in any danger of having a cartel formed like the OPEC cartel; we do not need to go forward with legislation because the people we get the supplies from are really friendly countries and evidence has indicated there is no danger, really, of a cartel being formed. Some of these same people were saying back in the early 1970's and late 1960's, there wasn't any danger of an OPEC type of oil cartel formed, yet we were less dependent on that amount of oil imported in those days than we are these strategic minerals we are talking about today. Everyone can agree the OPEC cartel practically brought this country to our knees in 1973. Yet, I think, we are in a much more vulnerable situation today with regard to these strategic materials. There is some evidence before our committee, that we saw, that says yes, there is a potential for a cartel being formed and doing a great deal of damage to the United States. But given the testimony, and I am the first to admit there is some disagreement on this point. I think there should be no disagreement on the fact the present situation allows for a short-term supply interruption or what I call economic dislocation, a potential which I think is a very serious problem. While they might not have a complete cartel, I think the suppliers of these minerals had the ability to really seriously cause a tremendous economic dislocation as far as the price of these minerals are concerned. You have to look at the figures to show the price increases we have seen in these minerals we are talking about. For instance, cobalt prices increased from $2.20 a pound in 1970 to $5.20 a pound in 1977, that is an increase of 136 percent. Manganese prices have exhibited an even greater price increase since 1970, 169 percent, while the overall U.S. economy in that same period experienced a 46-percent inflationary increase. What we are saying is, I believe, a very serious potential for some tremendous economic problems that could be caused our country unless we do something about the tremendous inbalance we have as far as our supplies of these metals are concerned. Another reason why I think it is important for us to enact legislation of this kind, I think it would be an extra incentive to stimulate the negotiations of the Law of the Sea and heaven knows they need stimulation. I think there is no doubt there is an atti tude on the part of many of the other nations of the world the United States is not very serious about passing legislation. Quite frankly, if I was a pragmatic delegate from one of the developing nations of the world and I was trying to see a treaty being negotiated in the best interests of my country, I would take the same position as many of the group of 77 are taking today. What is that position? It is simply my country does not have the technology or capability at this time to go out and mine the deep seabed minerals and no one else is doing it. The United States is not doing it; they are not really moving in that direction, so why not sit back and try to negotiate the best deal possible for my particular parochial interests as a nation. I would take the position, quite frankly, I will sit back and wait for a better offer than I got yesterday. That is the history of what we have seen happen in the law of the sea negotiations. They don't think we have any real motivation to move forward and protect our own economic and national interests. As long as we take that position, I think they are going to sit back and wait for a better offer than they got the day before. I think it is time to quit crying wolf. I visited the Geneva Conference in the meetings in Geneva. We are not kidding anymore. We are moving forward with legislation and the Senate is going to take action. I think that has had an impact. Although, as a result of what happened in New York, they really did not take it very seriously again, but with your actions in the Senate, together with the House's action, I think other nations of the world are starting to get the message. Unless we negotiate in good faith and make some realistic compromises and meaningful compromises, the United States and other developed nations of the world are going to go forward and protect their own interests. It is high time we get on the ball and try to come to a conclusive decision on a realistic treaty. I think the administration's position is one, in the past, that has hampered efforts of coming up with any legislation. They have always said: Let's wait one more time; let's see how the negotiating session is going to go. We are very close to coming up with a treaty. For that reason as much as any, I think Congress has tried to hold back and let the delegates negotiate a treaty which I agree is the best way to handle this situation. But I would still like to be in Congress when we come up with the treaty. I think if we continue the way we are going now, none of us are going to be here. I think legislation is going to help the administration. It will help our negotiating team, Ambassador Richardson, and others of the administration who said before our committee, they will support domestic legislation: "If no substantial progress was made at the recent session in New York." I don't think anyone can come away from that session thinking anyone made any substantial progress as far as the interests of the United States are concerned. Maybe in the interests of other nations, but not in our national interest. I think if they follow through with that pledge, if they would support legislation, if no substantial progress is made we will see the administration hopefully coming out with the final decision to support some legislation. |