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SPC-EU Deep Sea MiningProject Workshop,

6-8 June, 2011COOK ISLANDS PRESENTATION

by Paul Lynch Ll.b/BA. MBALegal Adviser,

Office of the Minister of Minerals & Natural Resources

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The Cook Islands

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Cook Islands- Country reportDeveloping nation, low natural resources, small

land area, infrastructure constraints, large public service.

Tourism #1 earner Large EEZ 2 million km2 of deep ocean, 4-5,000mNo army or armed Police force or gangs.Good education levels, involved and public opinion

and debate, Low level corruption and criminal offending.Environmental concerns re. SBM are great given

our reliance on tourism (clean beaches image).

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Rarotonga- our capital

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SBM History in Cook IslandsExploratory Surveys found High Grade Nodules1970’s-Nodules reported by Russian/US

researchers 1972 RV Tangaroa - Rarotonga 1976 RV Ravakai – Penrhyn 1980 Hakurei Maru – south Penrhyn Basin 1983 Hakurei Maru 2 – south Penrhyn Basin 1985 – 1990 Hakurei Maru 2 – north Penrhyn

Basin 1990-1995 - 1 mill km2 south EEZ

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Cook Islands NodulesHigh abundance (42-47 kg/m2)

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Towards 2012….Cook Islands have been awaiting

advances in Technology to mine at depthLittle progress for years.

BUT NOW….With recent technological advances and

interest in SBMThe Cook Islands government has

become active again in the area of SBM

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SBM Policy of the Cook IslandsA comprehensive national SBM Policy has been

drafted and taken through consultationsThe SBM Policy has been adopted by both the former

and new governmentsThe SBM Policy provides –

a written declaration of the principles that will guide the Government of the Cook Islands in the management of SBM.

the foundation for the comprehensive regulatory framework to be established to ensure wise management of the SBM for the benefit of present and future generations of Cook Islanders

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SBM Act 2009 of the Cook IslandsThe centerpiece of the regulatory framework is a new

and comprehensive law to govern SBM activity in the Cook Islands;

Contains provisions to govern all rights, obligations and interests in SBM in the Cook Islands;

Reflects international best practices concerning in the extractive industries (mining and petroleum);

Contains provisions that reflect the unique elements of SBM activity;

Carefully tailored to complement existing laws in Cook Islands.

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SBM Institutional arrangementsThe Minister will be responsible for the implementation of

the new lawA ‘National Seabed Minerals Authority’ will be created,

with day-to-day responsibility for administering the new law, including licensing, monitoring, compliance and enforcement;

A ‘Seabed Minerals Commissioner’ appointed by the Minister will be the Head of the National Seabed Minerals Authority;

A ‘Seabed Minerals Advisory Board’ will be established to provide a formal avenue for community and stakeholder consultation and participation concerning management of the seabed minerals sector.

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SBM Model Agreement The SBM Act provides a ‘Seabed Mineral Agreement” in

accordance with accepted international practice;

A SBM Agreement would be concluded as a legally-binding agreement between the Government and a mining company;

A SBM Agreement would provide an avenue for the Government and a mining company to agree to specific undertakings to facilitate the conduct and financing of SBMctivities;

A SBM Agreement would be negotiated according to a Model Contract Agreement prescribed under the Act, so as to enhance and strengthen the negotiating position of Government with foreign SBM mining companies

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Recent Cook Islands dealings with foreign contractors…

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Avatiu Harbour redevelopment

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PROJECT SUMMARY

$NZ25 million ProjectBiggest Infrastructure Project in years

Start May 2011Finish June 2012McConnell Dowell successful Tenderer

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McConnell Dowell now in the Cook Islands

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Business Trade and Investment Board BTIB ROLE•BTIB refused McC.D. approval due to low local participation- less than $1 million

•Negotiations and compromise reached to increase local participation to $5 million

•BTIB approval given

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LOCAL PARTICIPATION now

Local contractors now usedLocal weldersLocal materials and supplies

(concrete and fill)Local engineersLocal administration staff

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Avatiu Harbour Project, RarotongaCOOK ISLANDS

StartedMay 2011 with BTIB approval

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Foreign Investment controlsBTIB role and MFEM Act controlsGoverned by the SBM Act 2009The Minister approves SBM

investment Minister enters SBM AgreementIn a process managed by the SBM

AuthoritySBM Authority conducts the

negotiations

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COOK ISLANDS FUTURE BENEFITTo ensure that the Cook Islands benefits from any entry into the SBM sector

The Cook Islands must set and apply a regime of controls for operations in the SBM sector

We are ready and willing

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Our SBM Division currently

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Our SBM future awaits….

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Capacity Building requiredThe SBM Act 2009 is not in force yet

It requires significant Budgetary support from the Cook Islands government and overseas donors

Capacity building and training is required of Cook Islanders to manage and benefit from this exciting resource

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SPC-EU Deep Sea MiningProject Workshop,

6-8 June, 2011Meitaki

AndThank you