Developing marine natural resources

The world is facing a severe shortage of natural resources. In particular, oil prices, which started to surge in 2000, have remained high despite the global economic turbulence. This is not a case of rapid supply disruption caused by war in the Middle East, as seen in oil shocks in the past. When the fighting ceases, oil prices normalized. Rather, the price situation today reflects fundamental supply-demand dynamics. Without increasing absolute supply, prices will be on a sustained upward trajectory.

Over the next two decades, emerging economies will have a combined middle class of three billion people. These will form a new-consumer juggernaut in the global economy. Accordingly, demand for primary energy resources such as oil, coal and natural gases will grow by 40 percent by 2035 and further strain other vital natural resources.

The long-term outlook has not been missed by suppliers. A recent rise in resource nationalism in resource-rich countries such as China reflects the supply constraints and concerns surrounding available natural resources.

To resolve the shortage of natural resources, attention should be paid to the development of marine resources. The ocean, covering 71 percent of the earth’s surface, still remains as an unknown world; less than 10 percent has been explored and it contains an estimated one-third of the world’s oil reserves, or 1.6 trillion barrels, and 15 percent of the world’s natural gas reserves.

In addition, there is much more copper, manganese, nickel and cobalt buried in hydrothermal deposits or manganese nodules in the ocean bed than on land - enough to last for more than 200 years.

Of all minerals, methane hydrate, also known as “fire ice,” is attracting particular attention. Methane hydrate is methane gas trapped or dissolved in ice embedded in deep-sea sediment. The amount of worldwide reserves is estimated at 10 trillion tons, 100 times more than natural gas reserves and equivalent to 5,000 years’ use of fossil fuels. As marine technology advances, the potential for growth in this area will just get bigger, which will enable more deep water operations.

Given the economic stakes involved, countries started to announce exclusive economic zones (EEZs) in the 1970s and claimed special rights for the exploration and use of marine resources within 200 nautical miles (370 kilometers) from their coasts.

EEZs are the source of many territorial disputes. Japan, for example, turned its eyes to the ocean to secure marine resources and often had maritime boundary disputes with its neighbors such as Korea, China and Taiwan. Japan’s claim over Dokdo Island, for example, is mainly linked with the vast marine reserves that are adjacent to the tiny rocky islets. And in the East China Sea, Japan has a long-running territorial dispute with China over the oil- and mineral-rich area around the Diaoyudao islands.

Thanks to advancement in marine exploration and drilling technologies, oil fields in far deeper and more difficult ocean environments are being explored and developed. It is increasingly possible to extract mineral deposits far below the sea surface.

At present, Korea’s marine resource development is still in an embryonic stage, but it is growing at a rapid rate of more than 8 percent each year.

If Korea combines its strength in construction engineering with its shipbuilding expertise, it can become a powerhouse in this area within a short period of time.

For Korea to become a key player in marine resources development, industries, government and academia should collaborate on a mid- to long-term plan, secure marine capabilities and nurture experts in marine resources development. Marine experts should be well versed in not only basic marine science, such as ocean physics, chemistry, biology and geology, but also applied sciences like machinery, electronics, civil engineering, shipbuilding and submarine medical care.

*The writer is a research fellow at the technology and industry department at the Samsung Economic Research Institute. For more SERI reports, please visit www.seriworld.org.

By Bae Young-Il