Canadian deep sea mining company to go public via merger with SPAC

Seabed minerals exploration outfit DeepGreen Metals has revealed plans to go public in a merger with a NYSE-listed special purpose acquisition company (SPAC).

The deal with Sustainable Opportunities Acquisition Corp (SOAC) will value the combined entity at US$2.9 billion and include a $330 million infusion from investors including Allseas Group SA, Maersk Supply Service and Glencore.

Vancouver-based DeepGreen aims to extract metals used in electric vehicle batteries from polymetallic nodules found deep in the Pacific Ocean. Deep sea mining has often been criticised for being a largely untested mining method with unknown environmental impacts.

In April last year, DeepGreen published a study which claimed that undersea mining poses fewer environmental and social challenges than land mining. However, scientists and governments remain sceptical of the practice, as demonstrated by Australia’s move last month to ban seabed mining off part of its Northern coast.

The merger with SOAC is expected to be completed in the second quarter of the year, with the combined entity to be called The Metals Company. DeepGreen chairman and CEO Gerard Barron will lead the company, with SOAC chief executive Scott Leonard joining the board.

“Sourcing battery metals is the biggest hurdle facing the clean energy transition, and the pipeline of new mining projects on land is insufficient to meet rising demand,” Leonard said.

“It [DeepGreen] offers a real, scalable solution to the raw materials problem, at a low production cost and with a significant reduction in the ESG footprint of metals. Assuming full-scale production, we expect The Metals Company to be among the lowest-cost nickel producers in the world.”