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Item 1. Business

2024-03-25 compared with 2023-03-27 · 318 added, 236 removed, 454 unchanged (55% of the section changed)

We are a deep-sea minerals exploration company focused on the collection, processing and refining of polymetallic nodules found on the seafloor in international waters of the Clarion Clipperton Zone (“CCZ”), about 1,300 nautical miles (1,500 miles or 2,400 kilometers) south-west of San Diego, California.

The CCZ is a geological submarine fracture zone of abyssal plains and other formations in the Eastern Pacific Ocean, with a length of around 7,240 km (4,500 miles) that spans approximately 4,500,000 square kilometers (1,700,000 square miles).

The CCZ is a geological submarine fracture zone of abyssal plains and other formations in the Eastern Pacific Ocean, with a length of around 7,240 kilometers (4,500 miles) that spans approximately 4,500,000 square kilometers (1,700,000 square miles).

Polymetallic nodules are discrete rocks that sit unattached to the seafloor, occur in significant quantities in the CCZ and have high concentrations of nickel, manganese, cobalt and copper in a single rock.

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If we are able to collect polymetallic nodules from the seafloor on a commercial scale, we plan to use such nodules to produce three types of metal products:

(i) feedstock for battery cathode precursors (nickel and cobalt sulfates) for electric vehicles (“EV”) and renewable energy storage markets, (ii) copper cathode for EV wiring, clean energy transmission and other applications, and (iii) manganese silicate for manganese alloy production required for steel production.

(i) feedstock for battery cathode precursors (nickel and cobalt sulfates, or intermediary nickel-copper-cobalt matte, or nickel-copper-cobalt alloy) for electric vehicles (“EV”) and renewable energy storage markets, (ii) copper cathode for EV wiring, energy transmission and other applications, and (iii) manganese silicate for manganese alloy production required for steel production.

Our mission is to build a carefully managed, shared stock of metal (a “metal commons”) that can be used, recovered and reused for generations to come.

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The ISA grants contracts to sovereign states or to private contractors who are sponsored by a sovereign state.

The ISA requires that a contractor obtain and maintain sponsorship by a host nation that is a member of the ISA and signatory to UNCLOS, and such nation maintains effective supervision and regulatory control over such sponsored contractor.

The ISA has issued a total of 19 polymetallic nodule exploration contracts covering approximately 1.28 million km 2 , or 0.4% of the global seafloor, 17 of which are in the CCZ.

The ISA requires that a contractor obtain and maintain sponsorship by a host nation that is a member of the ISA and signatory to UNCLOS, and that such nation maintains effective supervision and regulatory control over such sponsored contractor.

The ISA has issued a total of 19 polymetallic nodule exploration contracts covering approximately 1.28 million square kilometers, or 0.4% of the global seafloor, 17 of which are in the CCZ.

We hold exclusive exploration and commercial rights to three of the 17 polymetallic nodule contract areas in the CCZ through our subsidiaries Nauru Ocean Resources Inc.

(“NORI”) and Tonga Offshore Mining Limited (“TOML”), sponsored by the Republic of Nauru (“Nauru”) and the Kingdom of Tonga (“Tonga”), respectively, and exclusive commercial rights through our subsidiary, DeepGreen Engineering Pte.

Ltd.’s (“DGE”), arrangement with Marawa Research and Exploration Limited (“Marawa”), a company owned and sponsored by the Republic of Kiribati (“Kiribati”).

We are still in the exploration phase and have not yet obtained any exploitation contracts from the ISA, which will only be available after exploitation regulations have been established, to commence commercial scale polymetallic nodule collection in the CCZ nor do we have the applicable environmental and other permits required to build and operate commercial-scale polymetallic nodule processing and refining plants on land.

We are still in the exploration phase and have not yet obtained any exploitation contracts from the ISA to commence commercial scale polymetallic nodule collection in the CCZ.

Additionally, we do not have the applicable environmental and/or other permits required to build and operate commercial-scale polymetallic nodule processing and refining plants on land.

Polymetallic Nodules

Deep-sea polymetallic nodules form on or just below the sediment-covered seafloor of the abyssal plains.

These nodules contain significant amounts of metals, and their unique characteristic compared to terrestrial deposits is the presence of four critical metals in one deposit.

Deep-sea polymetallic nodules form on and just below the sediment-covered seafloor of the abyssal plains.

These nodules contain significant amounts of metals, and their unique characteristic compared to terrestrial deposits is the presence of the four critical metals, nickel, copper, cobalt and manganese, in one deposit.

TMC inaugural Impact Report 2021, filed May 2022

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Potentially easy to smelt

Very low concentrations of hazardous elements like arsenic, antimony and mercury

Potential to productize 100% of nodule mass and design a metallurgical flowsheet that generates no tailings and leaves almost no solid waste streams behind

Very low concentrations of certain hazardous elements like arsenic, antimony and mercury

Potential to productize almost 100% of nodule mass and design a metallurgical flowsheet that generates no tailings and leaves almost no solid waste streams behind

The above characteristics of polymetallic nodules may provide an opportunity to compress lifecycle environmental and social impacts of producing critical metals as compared to land ores.

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Given the wide range of environmental and social impacts associated with conventional land-based mining, we believe it is important to ensure that these large amounts of critical metals are sourced with the lowest environmental, social, and economic impacts possible.

As the global supply of high-grade ore remains limited and metal demand increases, we can expect a larger environmental and social footprint, potential supply shortages and sustained increases in metal prices should land-based ores remain the only viable source of critical metals.

Industries which represent an end-use segment that may require all four critical metals contained in nodules are of particular interest to us and represent potential market opportunities.

Most notably, nodules contain metals that can be employed as:

(i) feedstock for battery cathode precursors (nickel and cobalt sulfates) for EV and renewable energy storage markets, (ii) copper cathode for EV wiring, clean energy transmission and other applications, and (iii) manganese silicate for manganese alloy production required for steel production.

As the global supply of high-grade ore remains limited and metal demand increases, we can expect a larger environmental and social footprint, potential supply shortages and volatility in metal prices should land-based ores remain the only viable source of critical metals.

Industries which represent an end-use segment that may require all four critical metals contained in nodules (e.g.

EVs) are of particular interest to us and represent potential market opportunities.

Nodules contain metals that can be employed as:

(i) feedstock for battery cathode precursors (nickel, cobalt and manganese sulfates) for EV and renewable energy storage markets, (ii) copper cathode for EV wiring, energy transmission and other applications, and (iii) manganese silicate for manganese alloy production required for steel production.

See Section – Competitive Strengths .

While end-uses driven by the energy transition represent a small fraction of the total use of the four metals contained in polymetallic nodules today, we believe that the relative use of these four metals by EV’s and other energy transition is set to increase significantly over the next decades.

The below charts published by the International Energy Agency show increasing global demand by end-use application for nickel, cobalt, copper and manganese, under the scenario that net zero emissions is achieved by 2050.

The International Energy Agency provides global demand projections for 37 critical minerals needed for clean energy transitions across various target and technology scenarios.

IEA Critical Minerals Market Review 2023

Battery Metals and EV Market Opportunity Global

We believe there will be significant growth in EV demand, with many countries committing to phasing out cars that burn fossil fuels and many original equipment manufacturers (“OEMs”) devoting significant resources to the electrification of their vehicle offerings.

In 2022, the number of signatories to the Zero Emission Vehicle declaration announced at the UN Climate Change Conference (COP26) in October 2021 increased to 214;

We believe the world is at the very beginning of a multi-decade electrification of road transportation.

According to Bloomberg New Energy Finance (BNEF), at the end of 2023, the global fleet of four-wheeled vehicles including cars, vans, trucks, and buses numbered 1.57 billion (up 2.1% from 2022) and only 41 million passenger cars, or less than 3%, were electric.

However, the new sales of internal combustion cars have decreased since 2017 as sales of battery electric and plug-in hybrids vehicles have increased and accounted for over 15% of global passenger vehicle sales in 2023.

By 2030, automakers have collectively committed to sell 47 million EVs a year, a commitment that represents more than tripling of current sales levels.

The electrification of global road transportation is underpinned by the rapid expansion of the battery manufacturing capacity, which started accelerating since 2020 and is expected to reach 8TWh by 2040.

Battery chemistries that require metals contained in CCZ polymetallic nodules, nickel, cobalt and manganese, deliver high energy densities and are typically deployed in vehicles requiring long range (e.g., luxury and upmarket passenger cars) and power (trucks).

In 2023, these battery chemistries accounted for 58% of overall battery manufacturing, which represented only a small portion of the overall use of nickel (~12% of nickel demand) and manganese (<1% of manganese demand).

In addition, the use of batteries with different chemistries has changed over time, and we expect demand for the four metals found in polymetallic nodules to increase as the demand for batteries with certain chemistries increases.

We believe there will be continued growth in EV demand, with many countries committing to phasing out cars that burn fossil fuels and many original equipment manufacturers (“OEMs”) devoting significant resources to the electrification of their vehicle offerings.

In 2023, the number of signatories to the Zero Emission Vehicle declaration announced at the UN Climate Change Conference (COP28) increased to 228;

the declaration is aimed at accelerating the transition to zero emission vehicles with a goal to reach 100% new EV car and van sales by 2040, and by 2035 in leading markets.

Following the development of an energy crisis spurred by the Russian invasion of Ukraine, the European Parliament approved a law requiring that all new passenger cars and vans produce zero emissions by 2035, effectively banning the sale of new gas- and diesel-powered vehicles in the future (although a last-minute opposition from Germany in March 2023 has delayed the final vote on this law and may have put the laws’ future in doubt).

The law also increases carbon dioxide emission reduction targets for new cars to 55% for 2030 compared to 37.5% for 2021.

Similarly in the U.S., 22 states, plus the District of Columbia and Puerto Rico, have set 100% decarbonized energy goals by 2050 or sooner, with the Biden administration seeking to make half of all new vehicles sold in the U.S.

In the U.S., 23 states, plus the District of Columbia and Puerto Rico, have set 100% decarbonized energy goals by 2050 or sooner, with the Biden administration seeking to make half of all new vehicles sold in the U.S.

zero-emissions vehicles by 2030.

We believe this

transition to low carbon energy and EVs will test the limits of the current supply of certain metals, as EVs require several times more of these metals (such as nickel, cobalt and copper) than cars with internal combustion engines.

Raw material shortages could potentially delay the achievement of the world’s energy transition goals.

Battery Metals and EV Market Opportunity - USA

We believe the transition to low carbon energy and EVs will test the limits of the current supply of certain metals, as EVs require several times more of these metals (such as nickel, cobalt and copper) than cars with internal combustion engines.

Following price surges in 2022 in anticipation of a period of increased demand, an oversupply of nickel largely produced in

Indonesia has driven down prices of the metals.

These surpluses, however, could be temporary and we believe potential shortages in nickel and cobalt supply could return in the 2027/2028 timeframe, subject to developments in Indonesia and responses by the U.S.

and the European Union where regulators could impose measures to differentiate between sources of metal based on the environmental and social impacts of these sources.

Since prices of these metals have declined, investments by Western countries have declined and some of these interests have stopped mining/production of these metals altogether.

It should be noted that current metal prices as of the date of this report are similar to projections used in the initial assessment from March 2021 for the NORI Area D project.

Battery Metals and EV Market Opportunity in the U.S.

Although the total fleet of four-wheeled vehicles in the U.S.

(267 million or 17% of global) is roughly comparable in size to that of China (361 million or 23% of global), the U.S.

EV fleet is three times smaller in relative terms than that of China (5.1 million EVs or 2% of national fleet vs.

22 million EVs in China or 6% of national fleet).

Based on 2023 data, the U.S.

is the second largest consumer of battery nickel based on EV end-use.

We expect this use to grow significantly in the coming years.

In August 2021, the U.S.

government announced a target of 50% EV sales by 2030.

The announcement was followed by a ramp-up of industry commitments to build battery cell manufacturing gigafactories, which when aggregated across North America would represent approximately 1,047GWh of capacity, according to Benchmark Minerals Intelligence (“Benchmark”).

government announced a target of 50% EV sales by 2030 and in August of 2022, the U.S.

Congress enacted the Inflation Reduction Act of 2022 (“IRA”) which included incentivizing EV adoption and domestic production of clean vehicle

critical mineral and battery components.

These announcements resulted in industry commitments to build battery cell manufacturing gigafactories, which would represent approximately 1.3TWh of aggregate capacity across North America, according to Benchmark Minerals Intelligence (“Benchmark”).

While the IRA has helped attract over US$100 billion in EV value chain investments, less than 1.3% of the total is being invested in the sourcing of raw materials.

In June 2021, the Biden administration’s 100-Day Review of Critical Minerals Supply Chains estimated that fully electrifying U.S.

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primary production of 18ktpa of nickel, 0.6ktpa of cobalt, and zero primary production of manganese.

Across our NORI and TOML contract areas, we have identified 15.9Mt of nickel, 2.3Mt of cobalt and 355Mt of manganese plus 13.5Mt of copper, with the potential to take the U.S.

from zero or de minimis production of the three namesake elements in the most prominent battery cathode (NMC) to near self-sufficiency or potentially a net export position in each.

Senator Lisa Murkowski wrote a letter to the U.S.

Secretary of Energy, Jennifer Granholm, which noted “new and abundant sources of supply, such as polymetallic nodules, offer a pathway to mineral security for the United States.” The U.S.

Secretary of Energy’s reply in July 2022 included, “In light of global demand for critical minerals, it is reasonable to expect that exploitation of marine resources will at some point occur.

Department of Energy is continuing to work with interagency partners to consider all potential sources of critical minerals for the supply chain including the role that seabed nodules could play in the future.”

Across our NORI and TOML contract areas, we have estimated resources of 15.9Mt of nickel, 2.2Mt of cobalt and 355Mt of manganese plus 13.3Mt of copper, with the potential to take the U.S.

from zero or de minimis production of those metals, which comprise the metals used in the most prominent battery cathode (NMC) in 2023 to near self-sufficiency or potentially a net export position in each.

In September 2023, nine U.S.

House of Representatives members wrote to the Secretary of Defense, Lloyd Austin, noting that the United States has “an opportunity to evaluate domestic processing and refining of seafloor resources from contracts held by allied parties in international waters,” and urging the Department of Defense to “assess polymetallic nodules as a viable resource to secure critical minerals and close national security vulnerabilities.” In December 2023, 31 U.S.

House of Representatives members wrote to the Secretary of Defense, Lloyd Austin, emphasizing “the importance of evaluating and planning for seabed mining as a new vector of competition with China for resource superiority and security.” Additional letters from five members of the Texas House delegation as well as Senator Cornyn were written to the Department of Defense in support of our U.S.

subsidiary DeepGreen Resources’ application to the Defense Production Act Title III program for support with a site-specific feasibility study for its planned full-scale processing plant.

Also in December of 2023, the U.S.

National Defense Authorization Act (NDAA) was signed into law for fiscal year 2024 including a provision on ‘Critical and Strategic Minerals and Materials Sourcing from Seafloor Resources.’ In this provision, the House Armed Services Committee (HASC) directed the Assistant Secretary of Defense for Industrial Base Policy to, by March 2024, submit a report to the HASC assessing the processing of seabed resources of polymetallic nodules domestically.

Although not yet submitted, the report shall include, at a minimum, the following:

(1) a review of current resources and controlling parties in securing seabed resources of polymetallic nodules;

(2) an assessment of current domestic deep-sea mining and material processing capabilities;

and (3) a roadmap recommending how the U.S.

can have the ability to source and/or process critical minerals in innovative arenas, such as deep-sea mining, to decrease reliance on sources from foreign adversaries and bolster domestic competencies.

We believe the continued focus by the U.S.

government may increase our opportunities to develop operations in the U.S.

Environmental Market Opportunity

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Even with high end-of-life product recycling rates, most of the new demand over the coming decades will have to be met by new mining.

We believe the land mining sector is fundamentally challenged — ore grades are falling, production is moving to some of the more biodiverse and conflict-laden regions in the world (such as the Democratic Republic of the Congo, Indonesia, Philippines and South Africa), accessing ore bodies often requires a complete removal of ecosystems situated on and above such orebodies, and removing, breaking or tunneling through significant tonnage of waste rock.

Toxic levels of heavy elements often found in land orebodies typically need to be removed, stored, and maintained indefinitely — a real challenge on seismically active and wet tropical islands in countries like Indonesia that accounts for most of the growth in nickel supply.

We believe the land mining sector is fundamentally challenged:

ore grades are falling, production is moving to some of the more biodiverse and conflict-laden regions in the world (such as the Democratic Republic of the Congo, Indonesia, Philippines and South Africa), accessing ore bodies often requires a complete removal of ecosystems situated on and above such orebodies, and removing, breaking or tunneling through significant tonnage of waste rock.

Toxic levels of heavy elements often found in land orebodies typically need to be removed, stored, and maintained indefinitely;

a real challenge on seismically active and wet tropical islands in countries like Indonesia that accounts for most of the growth in nickel supply.

As a result of a vigorous campaign by several non-governmental organizations, some participants in the EV supply chain have called for a general moratorium on all forms of deep seabed mining until there is more knowledge about marine impacts of nodule collection operations.

While our Environmental & Social Impact Assessment (ESIA) for offshore nodule collection segment of the NORI Area D Nodule Project is still ongoing, based on already completed research into lifecycle impacts of battery metal production specifically from deep-sea polymetallic nodules, we believe that nodules provide an opportunity to significantly compress most lifecycle environmental, social and governance (ESG) impacts associated with conventional metal production from land-based ores.

To quantify comparative ESG footprints of metal production from nodules as compared to conventional land ores, we commissioned several lifecycle assessments (“LCAs”) looking at the cradle-to-gate impacts of producing nickel, copper, cobalt and manganese products from polymetallic nodules and how it compares to land-based routes.

While our Environmental & Social Impact Assessment (ESIA) for offshore nodule collection segment of the NORI Area D Nodule Project is still ongoing, based on already completed research into lifecycle impacts of battery metal production specifically from deep-sea polymetallic nodules, we identified how nodules can potentially provide an opportunity to significantly compress most lifecycle environmental, social and governance (ESG) impacts associated with conventional metal production from land-based ores.

To quantify environmental footprints of metal production from nodules as compared to conventional land ores, we commissioned several lifecycle assessments (“LCAs”) looking at the cradle-to-gate impacts of producing nickel, copper, cobalt and manganese products from polymetallic nodules and how it compares to land-based routes.

An LCA white paper examining a comprehensive set of impacts was commissioned by us and co-authored by certain of our executive officers in 2018 and reviewed by subject matter specialists and published on our website in April 2020;

an LCA research paper focusing on climate change impacts was peer-reviewed and published in the Elsevier Journal of Cleaner Production in December 2020, an LCA research paper focusing on solid waste streams was peer-reviewed and published in the Yale Journal of Industrial Ecology in January 2022 and an LCA compliant with the International Organization for Standardization Standard 14040 on our NORI Area D project was conducted by Benchmark and released in March 2023.

Based on these LCA assessments that we commissioned and certain of our executive officers co-authored, we believe that we are positioned to become one of the lowest ESG footprint metal companies in the industry.

The March 2023 LCA by Benchmark shows that the NORI Area D project performed better in each impact category analyzed than all the land-based processing routes chosen for comparison, except for the global warming potential (“GWP”) and water consumption of producing cobalt sulfate, in which one land-based route performed better.

While most of these reductions are attributable to the unique characteristics of the polymetallic nodule resource as described above, the elimination of solid processing waste streams onshore is due to our investment in a near-zero-waste flowsheet design and low carbon emissions are due to our commitment to locate onshore processing facilities in places with access to renewable power.

an LCA research paper focusing on climate change impacts was peer-reviewed and published in the Elsevier Journal of Cleaner Production in December 2020, an LCA research paper focusing on solid waste streams was peer-reviewed and published in the Yale Journal of Industrial Ecology in January 2022 and an independent LCA compliant with the International Organization for Standardization Standard 14040 on our NORI Area D project was conducted by Benchmark and released in March 2023.

Based on these LCA assessments that we commissioned, we believe that we are positioned to become one of the lowest ESG footprint metal companies in the industry.

The March 2023 LCA by Benchmark shows that the NORI Area D project model performed better in each impact category analyzed than all the land-based processing routes chosen for comparison, except for the global warming potential (“GWP”) and water consumption of producing cobalt sulfate, in which one land-based route performed better.

While most of these reductions are attributable to the unique characteristics of the polymetallic nodule resource as described above, the elimination of solid processing waste streams onshore is due to our investment in a near-zero-waste flowsheet design and part of the low carbon emissions are due to our commitment to locate onshore processing facilities in places with access to low carbon power.

Benchmark modeled the land-based processing routes with background ecoinvent data and foreground data from two expert chemical engineers in the nickel and cobalt industry.

The NORI Area D Project data is based on the NORI Technical Report Summary, dated March 2021, which included an initial assessment and an economic analysis of NORI Area D prepared in accordance with the SEC’s Modernization of Property Disclosures for Mining Registrants set forth in subpart 1300 of Regulation S-K (the “SEC Mining Rules”).

The NORI Technical Report Summary is filed as Exhibit 96.1 to this Annual Report on Form 10-K.

The Benchmark LCA is currently assessing the impacts of the NORI Area D Project on marine biodiversity and ecosystem function as part of the ESIA conducted by NORI in partnership with world leading deep sea research institutions and contractors.

The CCZ abyssal plains are one of the most common and least populated habitats on the planet, akin to barren deserts on land.

The NORI Technical Report Summary is filed as Exhibit 96.1 to this Annual Report.

As part of the ESIA conducted by NORI in partnership with world leading deep-sea research institutions and contractors, we are currently assessing the impacts of the NORI Area D Project on marine biodiversity and ecosystem function.

The CCZ abyssal plains are one of the most common and least populated habitats on the planet, akin to deserts on land.

The CCZ abyssal seafloor is plant-free, food-poor and dominated by bacterial life forms.

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Metal production from nodules will reduce biomass at risk by over 90% compared to producing the same amount of metals from conventional land ores.

As a precautionary environmental management and protection measure, the ISA has already set aside 43% of the CCZ as protected areas or 1.97 million km 2 , or Areas of Particular Environmental Interest (APEIs) aiming to ensure that all types of habitats that could be impacted by exploitation are represented within APEIs.

In contrast, land-based mining for nickel and cobalt occurs in diverse countries as identified by Benchmark in a study commissioned by us and published in November 2023.

In both Indonesia and the Democratic Republic of the Congo (the “DRC”), which are the world’s largest producers of nickel and cobalt respectively, the extraction of metal ores through open pit mines requires the complete removal of overlying ecosystems and contained carbon sinks, in turn eliminating the carbon sequestration.

The study found that 1 kilogram of nickel mined from saprolite and limonite ore in Sulawesi, Indonesia removes forests containing carbon stock equivalent to 7.0 and 9.4 kilograms of CO 2 e, and 3.6 kilograms of CO 2 e in the case of cobalt mined in Katanga, DRC.

Due to the resulting vegetation change, mining activities cause carbon sequestration services loss of 4.8 grams and 6.5 grams of CO 2 e respectively for nickel, and 9.3 grams of CO 2 e for cobalt per year.

As a precautionary environmental management and protection measure, the ISA has already set aside 43% of the CCZ as protected areas or 1.97 million square kilometers, or Areas of Particular Environmental Interest (APEIs) aiming to ensure that all types of habitats that could be impacted by exploitation are represented within APEIs.

For comparison, only approximately 8.2% of global oceans are protected today and the global target agreed in the High Seas Treaty in March 2023 is to protect 30% of the oceans by 2030.

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We are collaborating with some of the world’s leading researchers to conduct environmental baseline and collection impact studies to design plans that could mitigate marine impacts of nodule collection through collection system design and adaptive management systems.

If the entire CCZ area currently under exploration (1.28 million km 2 ) were to be exploited over a 30-year period, these nodule collection operations would impact 42,500 km 2 of the abyssal seafloor per year in one of the least productive areas of the ocean (with respect to the abundance of marine life).

This is less than 1% of the estimated 4,900,000 km 2 of the seafloor currently impacted every year by trawling operations that take place primarily in highly productive coastal waters.

If the entire CCZ area currently under exploration (1.28 million square kilometers) were to be exploited over a 30-year period, these nodule collection operations would impact 42,500 square kilometers of the abyssal seafloor per year in one of the least productive areas of the ocean (with respect to the abundance of marine life).

This is less than 1% of the estimated 4,900,000 square kilometers of the seafloor currently impacted every year by trawling operations that take place primarily in highly productive coastal waters.

Potential future commercial-scale nodule collection operations in the CCZ are likely to disturb marine wildlife in the operating area.

The nature and severity of these impacts on CCZ wildlife are expected to vary by species and are currently subject to uncertainty.

We have completed studies baselining wildlife and ecosystem function, piloting the nodule collection system and assessing impacts arising from the use of this system, and collected data processing and assessment are currently in progress.

We have completed studies baselining wildlife and ecosystem function, piloting the nodule collection system and assessing impacts arising from the use of this system immediately following the collector test and 12 months after the collector test, processing and assessment of collected data are currently in progress.

Given the significant volume of deep water and the difficulty of sampling or retrieving biological specimens in the CCZ, a complete biological inventory might never be established.

Accordingly, impacts on CCZ biodiversity may never be completely and definitively known.

For the same reasons, it may also not be possible to definitively establish whether the impact of nodule collection on global biodiversity will be less significant than those estimated for land-based mining for a similar amount of produced metal.

Given that similar challenges remain on land, with an estimated 70-80% of species still undescribed, it may also not be possible to definitively establish whether the impact of nodule collection on global biodiversity will be less significant than those estimated for land-based mining for a similar amount of produced metal.

It is also currently not definitively known how effectively the risk of biodiversity loss in the CCZ could be eliminated or reduced through mitigation strategies or how long it will take for disturbed seabed areas to recover naturally.

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Nodule collection is no exception and will impact the deep-sea marine environment through nodule removal, disturbance of seafloor sediment (“seafloor plumes”) and return of seawater used for nodule transport that is expected to contain residual sediment and nodule fines back in the water column (“midwater plumes”).

Baselining the impacted marine environment by characterizing the ecosystem and then developing measures to avoid and mitigate these impacts is the central focus of our ESIA program currently being undertaken in partnership with some of the world’s leading deep-sea research institutions.

Baselining the impacted marine environment by characterizing the ecosystem and then developing measures to avoid and mitigate these impacts is the central focus of our offshore ESIA program currently being undertaken in partnership with some of the world’s leading deep-sea research institutions.

Nodule removal will impact species that depend on the hard nodule substrate for attachment.

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Disturbance of the seafloor by nodule collector vehicles is expected to disturb (mostly microbial) organisms living in and on the sediments.

Impact severity will depend on the depth of sediment disturbance (expected to be approximately 5 cm based on modelling, lab tests, and recent collector tests completed in the CCZ by our subsidiary NORI and two other nodule contract-holders, Belgium’s Global Sea Mineral Resources NV (GSR) and the German’s BGR) and the impact this disturbance has on benthic ecosystem function.

Impact severity will depend on the depth of sediment disturbance (expected to be approximately 5 centimeters based on modelling, laboratory tests, and recent collector tests completed in the CCZ by our subsidiary NORI and two other nodule contract-holders, Belgium’s Global Sea Mineral Resources NV (GSR) and the German’s BGR) and the impact this disturbance has on benthic ecosystem function.

Over 90% of the entrained sediment is expected to be separated from nodules inside the collector vehicle and discharged behind the collector vehicle, most settling back to the seafloor within a few hundred meters.

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We believe we are well positioned to meet the growing demand for critical battery metals:

● Increasing demand:

The response to the climate change crisis is accelerating demand for EVs, renewable energy storage and infrastructure.

● Supply for increasing demand :

The response to climate change is driving robust demand for EVs, renewable energy storage and infrastructure.

To manufacture battery cells, gigafactories will need critical battery metals like nickel, cobalt, manganese, and copper to meet rising battery demand.

government maintained its target of 50% EV sales by 2030, spurring a ramp-up of battery gigafactory commitments, as well as the launch of Strategic Priorities for Ocean Exploration and Characterization of the US Exclusive Economic Zone, outlining Federal priorities for ocean exploration and characterization of critical minerals in the Western and Central Pacific Ocean.

Globally, the number of signatories to the Zero Emission Vehicle declaration announced at COP26 in October 2021 increased to 214, which is aimed at accelerating the transition to 100% new car sales being zero emission globally by 2040, and by 2035 in leading markets.

● Supporting energy security:

In March 2022, the invasion of Ukraine by Russia and doubling of nickel pricing to all-time highs in 2022 and 2023 resulted in closing of the LME nickel market.

These events illustrated the volatility and vulnerability of international commodity markets, particularly for Class 1 nickel for which Russia is the world’s largest single producer.

These events underscore a national security rationale for reducing the dependence on fossil fuels that is complicated by the stronghold position that Russia and China have as major miners and refiners of key clean energy metals.

Our NORI and TOML contract areas contain amounts of these metals that rival today’s largest producers, ranked as the world’s #1 and #2 largest undeveloped nickel projects, respectively, by Mining.com in March 2022.

● Supporting climate justice:

At the UN Climate Change Conference (COP27) in November 2022, a “loss and damage” fund was initiated, which aims to establish a long-overdue avenue to deliver vital support to vulnerable, developing countries disproportionately impacted by the accelerating climate crisis.

This aligns with the direction of the ISA’s Capacity Development Strategy designed to ensure the effective participation of developing countries.

● Rising battery metal and battery cell prices:

Commodity prices for metals like nickel and copper have recently reached multi-year highs and battery cell production costs are rising for the first time since the introduction of gigafactories in 2014.

Since then, only Chinese battery manufacturers appear to have succeeded at returning to the previous trend of reducing battery costs.

We believe that bringing new, strategically located metal sources online may help alleviate the cost pressures on battery cell production.

Globally, the number of signatories to the Zero Emission Vehicle declaration announced at COP28 in November 2023 increased to 228, which is aimed at accelerating the transition to 100% new car sales being zero emission globally by 2040, and by 2035 in leading markets.

government enacted the IRA, spurring a ramp-up of investments in battery and battery component production.

Additionally, the U.S.

government entered into new critical mineral trade agreement with Japan, which we believe improves our business prospects related to our plans to commercially process nodules at the Pacific Metals Co.

(“PAMCO”) facility in Hachinohe, Japan.

● Path to energy security :

Throughout 2023, China limited exports of gallium and germanium, which are needed to produce semiconductor chips and graphite, a key ingredient in battery anodes.

China also banned the export of rare earth metal extraction and separation technologies used in production of hybrid and battery electric vehicle motors.

These events underscore a national security rationale for the U.S.

and Western countries for reducing dependence on China as the world’s largest refiner of Class 1 nickel, cobalt and manganese.

With our NORI and TOML contract areas ranked as the world’s first and second largest undeveloped nickel projects, respectively, by Mining.com in both 2022 and 2023, we believe the polymetallic nodules found in our NORI and TOML contract areas offer an internationally governed source of key battery metals that can effectively be decoupled from Chinese supply chains.

● Advancing developing countries :

All three of our Sponsoring States are small developing Pacific Island nations impacted by climate change, each of which expect to receive income streams from their sponsored areas if exploration contracts are granted to extract polymetallic nodules in their sponsored areas.

Royalties from commercial production of polymetallic nodules payable to the ISA are required to be distributed by the ISA with focus on developing countries.

Our Competitive Advantages

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western seaboard:

There are four critical battery metals (nickel, copper, cobalt and manganese) in relatively high concentrations in polymetallic nodules and we believe our contract areas have estimated in situ quantities of these metals in quantities equivalent to the requirement for 280 million EVs, roughly the size of the entire U.S.

There are four critical battery metals (nickel, copper, cobalt and manganese) in relatively high concentrations in polymetallic nodules and we believe our contract areas have estimated in situ quantities of these metals equivalent to the requirement for 280 million EVs, roughly the size of the entire U.S.

passenger vehicle fleet on the road today.

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mineral dependence by re-shoring battery material supply chain in the U.S.

Our resource is 1,500 miles from San Diego and we believe we can eventually process and refine our polymetallic nodules in the U.S.

which could potentially decrease the supply chain in the U.S.

to 1,500 miles.

● Opportunity to reuse existing assets and skills:

We believe there is an opportunity for us to partner with offshore service providers with deep operational experience in subsea environments gained in the oil and gas industry and with existing assets that can be repurposed for our offshore operations.

● Demonstrated offshore technology:

In November 2022, NORI and Allseas completed the Pilot Mining Test where approximately 4,500 tonnes of wet nodules were collected and more than 3,000 tonnes of wet nodules were lifted 4.3km to the surface after traversing over 80km of the seafloor in the NORI Area D, achieving a production rate of 86.4 tonnes per hour with a scaled-down prototype seafloor nodule collector vehicle.

● Demonstrated onshore technology:

In 2021, we successfully completed calcining and smelting of nodules into a manganese silicate product and nickel-copper-cobalt alloy intermediate, followed by conversion and sulfidation of the alloy into matte.

Testwork on the matte to define conditions for the hydrometallurgical refinery has been successfully conducted on several process stages and we anticipate completion of the program in 2023.

● Opportunity to reuse existing offshore assets and skills:

We have taken advantage of this opportunity by forging a strategic alliance with Allseas Group S.A.

(“Allseas”), a leading offshore contractor in 2019.

In 2020, Allseas acquired a drillship that was repurposed and classified as the world’s first deep-sea mining vessel.

● Demonstrated offshore nodule collection technology:

In November 2022, NORI and Allseas completed the Pilot Mining Test where approximately 4,500 tonnes of wet nodules were collected and more than 3,000 tonnes of wet nodules were lifted 4.3 kilometers to the surface after traversing over 80 kilometers of the seafloor in the NORI Area D, achieving a sustained production rate of 86.4 tonnes per hour with a scaled-down prototype seafloor nodule collector vehicle.

● Demonstrated onshore nodule processing technology:

In 2021, we successfully completed the calcining and smelting of nodules into a manganese silicate product and nickel-copper-cobalt alloy intermediate product, followed by conversion and sulfidation of the alloy into matte.

Testwork on the matte to define conditions for the hydrometallurgical refinery has been successfully conducted on all process stages and we anticipate completion of the program in the first quarter of 2024 with generation of what we believe will be battery-grade nickel and cobalt sulfates in test quantities.

● Opportunity to reuse existing onshore assets and skills:

We believe there is an opportunity for us to partner with onshore processors with deep operational experience in processing nickel-bearing ores and with existing Rotary Kiln Electric Arc Furnace (“RKEF”) plants that can be repurposed for processing our nodules into intermediate products.

We have taken advantage of this opportunity by signing a non-binding memorandum of understanding (“MoU”) with PAMCO, an experienced operator of a nickel laterite smelting complex in Hachinohe, Japan (IRA-compliant jurisdiction) in 2023.

Following the completion of a prefeasibility exercise by PAMCO to assess nodule processing at their facility, we have signed a binding MoU in November 2023 to complete a feasibility study to process the first 1.3 Mtpa (wet) of nodules at PAMCO’s facility.

A demonstration trial at PAMCO’s Hachinohe facilities with 2,000 tonnes of nodules collected during the mining pilot is expected to take place in 2024, which would further de-risk the project.

● Lower expected production cost:

At our potential steady state production (expected to be approximately 12.5Mtpa of wet nodules from 2030 to 2045), we expect to be the second lowest cost nickel producer in the world, when reflecting the value of our byproducts).

Based on the Initial Economic Assessment completed for NORI Area D project in March 2021, which was based on potential steady state production of approximately 12.5Mtpa of wet nodules from 2030 to 2045, we expected to be the second lowest cost nickel producer in the world, when reflecting the value of our byproducts).

This Initial Economic Assessment was based on a high-capital asset expenditure (“CAPEX”) approach to our development and commercialization of operations where the majority of offshore and onshore production assets would be newly built by us.

However, we are currently pursuing a low-CAPEX approach for our NORI Area D project where we reuse existing production assets.

● Lower expected environmental, social and governance footprint:

The LCA completed by Benchmark in March 2023 shows that the NORI Area D project performed better in most impact categories analyzed than all the land-based routes chosen for comparison.

We are developing a new type of high-grade multi-metal source found on the abyssal plain - a low biomass, low carbon sequestration deep-sea environment removed from human settlement.

The LCA completed by Benchmark in March 2023 shows that the NORI Area D project model performed better in most impact categories analyzed than all the land-based routes chosen for comparison.

This favorable comparison is explained by the fact that we are developing a new type of high-grade multi-metal source found on the abyssal plain, a low biomass, low carbon sequestration deep-sea environment removed from human settlement.

Exploration Contracts

We currently hold exclusive exploration rights through our subsidiaries in NORI and TOML and exclusive commercial rights through agreement with Marawa, to certain polymetallic nodule areas in the CCZ.

NORI our wholly-owned subsidiary, holds exploration rights to four blocks (NORI Area A, B, C, and D, the “NORI Contract Area”) covering 74,830 km 2 in the CCZ that were granted by the ISA in July 2011.

We currently hold exclusive exploration rights through our subsidiaries NORI and TOML and exclusive commercial rights through an agreement with Marawa, to certain polymetallic nodule areas in the CCZ.

NORI our wholly-owned subsidiary, holds exploration rights to four blocks (NORI Area A, B, C, and D, the “NORI Contract Area”) covering 74,830 square kilometers in the CCZ that were granted by the ISA in July 2011.

NORI is sponsored by Nauru pursuant to a certificate of sponsorship signed by the Government of Nauru on April 11, 2011.

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AMC subsequently compiled the NORI Technical Report Summary, dated March 2021, which included an initial assessment and an economic analysis of NORI Area D prepared in accordance with the SEC Mining Rules.

The NORI Technical Report Summary is filed as Exhibit 96.1 to this Annual Report on Form 10-K.

TOML our wholly-owned subsidiary which we acquired in March 2020, holds exploration rights to an area covering 74,713 km 2 in the CCZ that were granted by the ISA in January 2012 (the “TOML Contract Area”).

The NORI Technical Report Summary is filed as Exhibit 96.1 to this Annual Report.

TOML our wholly-owned subsidiary which we acquired in March 2020, holds exploration rights to an area covering 74,713 square kilometers in the CCZ that were granted by the ISA in January 2012 (the “TOML Contract Area”).

On March 8, 2008, Tonga and TOML entered into a sponsorship agreement formalizing certain obligations of the parties in relation to TOML’s exploration application to the ISA (subsequently granted) for the TOML Contract Area.

The sponsorship agreement was updated on September 23, 2021.

TOML commissioned a Technical Report Summary by AMC, dated March 2021, which is filed as Exhibit 96.2 to this Annual Report on Form 10-K.

DGE, our wholly-owned subsidiary, entered into agreements with Marawa and Kiribati which provide DGE with exclusive exploration rights to an area covering 74,990 km 2 in the CCZ (the “Marawa Contract Area”).

TOML commissioned a Technical Report Summary by AMC, dated March 2021, which is filed as Exhibit 96.2 to this Annual Report.

DGE, our wholly-owned subsidiary, entered into agreements with Marawa and Kiribati which provide DGE with exclusive exploration rights to an area covering 74,990 square kilometers in the CCZ (the “Marawa Contract Area”).

The exploration contract between Marawa and the ISA (the “Marawa Exploration Contract”) was signed on January 19, 2015.

To date, limited offshore marine resource definition activities in the Marawa Contract Area have occurred.

We expect to collaborate with Marawa to assess the viability of any potential project in the Marawa Contract Area, although the timing of such assessment is uncertain.

We are collaborating with Marawa to assess the viability of any potential project in the Marawa Contract Area, although the timing of such assessment is uncertain.

Marawa has delayed certain of its efforts in the Marawa Contract Area while it determines how it will move forward with additional assessment work.

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Our contemplated business spans the entire lifecycle from the resource acquisition and definition stage through the collection and transportation phases offshore into the processing and refining of nodules onshore and finally in product marketing and offtake (and eventually recycling of end-of-life products containing nodule-derived metals).

NORI and TOML, two of our subsidiaries, intend to operate in the CCZ under the effective supervision, regulation and sponsorship of the government of Nauru and the Kingdom of Tonga, respectively.

We intend to engage in processing operations in locations that are yet to be determined.

We have chosen an asset-light approach to our operations and have focused on forming deep strategic partnerships with leading offshore and onshore companies.

NORI and TOML, two of our subsidiaries, intend to operate in the CCZ under the effective supervision, regulation and sponsorship of the Republic of Nauru and the Kingdom of Tonga, respectively.

We intend to utilize processing operations in locations that are yet to be finalized.

We have chosen a capital-light approach to our operations and have focused on forming deep strategic partnerships with leading offshore and onshore companies.

Our key strategic alliances include:

Allseas Group S.A.

Allseas, a leading global offshore contractor, has developed and successfully tested the pilot nodule collection system in the NORI Area D, completed in the fourth quarter of 2022.

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Glencore International AG (Glencore) holds offtake rights to 50% of the NORI nickel and copper production.

Glencore has the right to purchase from DGE 50% of the annual quantity of copper material and 50% of the annual quantity of nickel material produced by DGE from ore derived from the NORI Contract Area at a processing plant directly owned or controlled by DGE.

Hatch and KPM:

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(KPM) to develop a near-zero solid waste flowsheet.

The primary processing stages of the flowsheet from nodule to NiCuCo matte intermediate were demonstrated as part of our pilot plant program at FLSmidth and Xpert Process Solutions’ (XPS, a Glencore company) facilities.

The matte refining stages are being tested at SGS Lakefield.

The near-zero solid waste flowsheet is expected to serve as the basis for our onshore processing facilities.

In November 2022, we entered into a non-binding memorandum of understanding (“MoU”) with Pacific Metals Co Ltd (PAMCO) of Japan, to evaluate the toll treatment of an initial quantity of 1.3 million tonnes of wet polymetallic nodules per year at PAMCO’s Hachinohe smelting facility starting in 2025.

The toll treatment is intended to take place on a dedicated rotary kiln-electric arc furnace (RKEF) processing line and produce two products:

nickel-copper-cobalt alloy — an intermediate product used as feedstock to produce Li-ion battery cathodes — and a manganese silicate product used to make silico-manganese alloy, a critical input into steel manufacturing.

In November 2022, TMC entered into a non-binding MoU with PAMCO of Japan.

In November 2023, we entered into a binding MoU with PAMCO whereby they must complete a feasibility study (anticipated to be completed during the third quarter of 2024) to toll treat 1.3 million tonnes of wet polymetallic nodules per year at its Hachinohe, Japan smelting facility, which is expected to start in the second quarter of 2026, if we obtain an exploration contract from the ISA in a timely manner.

PAMCO’s Hachinohe facility is located on the coast in northern Japan and is equipped with port and processing infrastructure required to receive and process polymetallic nodules and to ship products to customers.

Under the MoU, PAMCO will undertake studies to estimate the cost of processing polymetallic nodules through existing facilities and identify any additional equipment requirements, currently expected to be minimal.

This work will inform expected nodule through-put, process operating conditions and product specifications for PAMCO’s dedicated production line.

PAMCO has received a 22-tonne sample of polymetallic nodules for use in the evaluations.

In parallel, PAMCO is studying the addition of a facility to process the intermediate alloy to nickel-copper-cobalt matte, which is an upgraded intermediate battery supply chain feedstock.

It is anticipated that the additional facility would be constructed once commercial processing of polymetallic nodules to alloy has been demonstrated.

There can be no assurance that we will enter into a binding MoU or definitive strategic alliance with PAMCO in a particular time period, or at all, or on terms similar to those set forth in the MoU, or that if a binding MoU or definitive strategic alliance are entered into by us or that the existing facility will be able to successfully process nodules in a particular time period, or at all.

The toll treatment is expected to take place on a dedicated RKEF processing line and produce two products:

nickel-copper-cobalt alloy, an intermediate product used as feedstock to produce Li-ion battery cathodes, and a manganese silicate product used to make silico-manganese alloy, a critical input into steel manufacturing.

PAMCO successfully completed a pre-feasibility exercise pursuant to the non-binding MoU signed by the parties in November 2022.

Under the binding MoU signed in November 2023:

● PAMCO, with our support, expects to complete the feasibility study by the third quarter of 2024.

● We will provide PAMCO with the exclusive right to the first 1.3Mtpa of the expected 3Mtpa of wet nodule collection capacity our first nodule collection system until completion of the feasibility study.

● The parties will enter into good faith negotiations to finalize definitive processing agreements on completion of the feasibility study.

The feasibility study is expected to confirm operating parameters and product specifications for PAMCO’s dedicated production line and define the scope and execution plan for any additional equipment requirements, which are expected to be minor.

An extended pilot demonstration program utilizing existing kilns and furnaces at PAMCO’s Hachinohe, Japan facility is expected to treat a 2,000 tonne sample of polymetallic nodules collected during the successful pilot nodule collector test completed by Allseas in November 2022 on NORI Area D, with the goal of optimizing the furnace refractory selection and confirm commercial scale operating parameters such as tapping temperatures and dusting rates when treating nodules through the Hachinohe facility.

The cost of processing polymetallic nodules will also be estimated to help finalize the definitive processing agreements.

In parallel, PAMCO is continuing to study the addition of a converting facility to process the intermediate alloy to nickel-copper-cobalt matte, which is an upgraded intermediate battery supply chain feedstock.

It is expected that the additional facility would be constructed once commercial processing of polymetallic nodules to alloy has been demonstrated.

There can be no assurance that we will enter into a definitive strategic alliance with PAMCO in a particular time period, or at all, or on terms similar to those set forth in the binding MoU, or that if a definitive strategic alliance are entered into by us or that the existing facility will be able to successfully process nodules in a particular time period, or at all.

Phased Project Development

Currently, we are an exploration stage company with a completed initial assessment, working towards a pre-feasibility study.

We expect to enter into the feasibility study phase in 2023, having completed the pilot collection test with Allseas in the CCZ in the fourth quarter of 2022.

Currently, we are an exploration stage company with a completed Initial Economic Assessment, working towards a pre-feasibility study that will form an integral part of our ISA application for an exploitation contract for the NORI Contract Areas.

We expect to enter into the feasibility study phase in 2024, having completed the pilot collection system test with Allseas in the CCZ in the fourth quarter of 2022.

Having significantly advanced resource definition and environmental baseline studies on NORI Area D, we intend to apply for an exploitation contract on that area first.

If we obtain an exploitation contract, we then plan to start with a small-scale commercial production (“Project Zero”) end of 2024 / start of 2025 in which we expect to collect and process at least 1.3Mtpa of wet nodules.

If we obtain an exploitation contract, we then plan to commence production offshore (“Project Zero”) at the end of the first quarter of 2026 using the Hidden Gem vessel which, subject to further modifications, is expected to be upgraded to a maximum capacity of 3.0 Mtpa of wet nodules.

Subject to the success of Project Zero and any regulatory requirements, we then expect to move into the next phase of production (“Project One”) in which we intend to scale up production and expect to collect and process up to approximately 12.5Mtpa of wet nodules at steady state (expected 2030-2045), as outlined in the NORI – D Technical Report Summary.

Current Work Program

We are currently focused on applying for our first exploitation contract from the ISA on the NORI Area D, as defined below, with the goal of starting commercial production end of 2024 / start of 2025.

We are currently focused on preparing to submit our application to the ISA for our first exploitation contract, which will include the entire NORI Contract Area, with the initial collection activities occurring within NORI Area D only following the July 2024 meetings of the ISA’s twenty-ninth session.

Assuming a review process of approximately one-year, we expect to be in production offshore at the end of the first quarter of 2026, if the application is approved.

To reach our objective and initiate commercial production, we are:

(i) defining our resource and project economics, (ii) developing an offshore nodule collection system, (iii) assessing the ESG impacts of offshore nodule collection, and (iv) developing onshore technology to process collected polymetallic nodules into a manganese silicate product, and an intermediate nickel-copper-cobalt matte product and/or end-products like nickel and cobalt sulfates, and copper cathode.

(i) defining our resource and project economics, (ii) developing a commercial offshore nodule collection system, (iii) assessing the environmental and social impacts of offshore nodule collection, and (iv) developing onshore technology to process collected polymetallic nodules into a manganese silicate product, and an intermediate nickel-copper-cobalt matte or nickel-copper-cobalt alloy product and/or end-products like nickel and cobalt sulfates, and copper cathode.

(i) Resource definition and project economics:

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We plan to continue to define our resource in the NORI and TOML areas, develop project economics to pre-feasibility and feasibility level and convert resources into reserves.

(ii) Offshore nodule collection system development:

(ii) Commercial offshore nodule collection system development:

We are working with our strategic partner and investor, Allseas, to develop a system to collect, lift and transport nodules from the seafloor to shore.

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An Environmental Impact Statement (“EIS”) for this pilot trial was submitted to the ISA in July 2021 and approved on September 7, 2022, with infield testing commencing on September 19, 2022.

The surface production support vessel, the Hidden Gem , was acquired by Allseas in March 2020 and has strategic importance to us, since it supported the pilot trial and is expected to be upgraded to a small-scale, low-capital early production system.

The vessel and collector system successfully completed trials in shallow and deepwater in the first half of 2022 prior to completing the collector test in the NORI-D Area in the fall of 2022 where approximately 4,500 tonnes of wet nodules were collected and more than 3000 tonnes of wet nodules were lifted 4.3km to the surface after traversing over 80km of the seafloor, achieving a production rate of 86.4 tonnes per hour.

The vessel and collector system successfully completed trials in shallow and deepwater in the first half of 2022 prior to completing the collector test in NORI Area D in the fall of 2022, where approximately 4,500 tonnes of wet nodules were collected and more than 3000 tonnes of wet nodules were lifted 4.3 kilometers to the surface after traversing over 80 kilometers of the seafloor, achieving a production rate of 86.4 tonnes per hour.

As a result of the successful collector test in the fourth quarter of 2022, where more than 3000 tonnes of wet nodules were lifted to the Hidden Gem , Allseas and NORI believe that they can upgrade the pilot nodule collection system, including the Hidden Gem , into the first production system, which we refer to as the Project Zero Offshore Nodule Collection System.

In August 2023, we announced that Allseas and NORI are executing on a plan designed based on Allseas’ estimates to increase the maximum production capacity of the Project Zero Offshore Nodule Collection System from the previous estimate of 1.3 million wet tonnes per annum to up to an estimated 3.0 million wet tonnes per annum in stepped increments, a potential increase of 130%.

The upgrades are expected to include the addition of a second collector vehicle, the use of a wider diameter riser pipe from the seafloor to the surface, implementation of a larger compressor spread and improvements to the system designed to further mitigate its environmental impacts.

System capacity is expected to be increased over time as production and experience milestones are met, which we believe will help manage operational risk, minimize up-front capital expenditure requirements and allow for staged increases in capacity as environmental review thresholds are met.

The work program with Allseas during 2023 focused on the review of the pilot nodule collection system performance, review of operational issues and identification of potential improvements to overall system performance.

Key aspects include scaling the technology to meeting the anticipated commercial production rates of the Project Zero Offshore Nodule Collection System and integration of the scaled-up technology into the Hidden Gem .

Engineering scope has been split into six major work packages:

(1) collector, (2) vertical transport system (riser and riser handling equipment), (3) storage & offloading, (4) control & automation, (5) electrical & instrumentation, and (6) flow assurance.

Engineering studies have progressed on the offshore nodule offloading and transportation system, including hydrodynamic simulations and dynamic positioning analysis of the vessel-to-vessel interface during the nodule offloading activity.

In line with engineering milestones, design reviews have been conducted at the Allseas office in Delft, Netherlands.

The design reviews are attended by us, Allseas and third-party consultants.

Regular meetings are held between us and Allseas project teams covering engineering, procurement, scheduling and estimating, operational planning (including health and safety aspects) and environmental impact.

Further to our non-binding term sheet entered into in March 2022 with Allseas, we continue discussions with Allseas regarding the specifics of these upgrades and the continued development of the Project Zero Offshore Nodule Collection System and anticipate reaching definitive agreements on commercial terms and key terms around continued development and commercial operations with Allseas before the submission of the NORI exploitation application in 2024.

There can be no assurances, however, that we will enter into definitive agreements with Allseas in a particular time period, or at all, or on terms similar to those currently expected, or that if such definitive agreements are entered into that the Project Zero Offshore Nodule Collection System will be successfully developed or operated.

In addition, on August 1, 2023, we entered into an Exclusive Vessel Use Agreement with Allseas pursuant to which Allseas will give exclusive use of the Hidden Gem to us in support of the development of the Project Zero Offshore Nodule Collection System until the system is completed or December 31, 2026, whichever is earlier.

In consideration of the exclusivity term, we have issued 4.15 million of our common shares to Allseas (“Common Shares”) on August 14, 2023.

We expect that the definitive agreement with Allseas discussed above will extend the exclusive use of the Hidden Gem .

(iii) Environmental and social impact assessment (“ESIA”) for offshore nodule collection :

The ESIA is an integral part of preparing our application for the ISA exploitation contract on the NORI Area D.

The ESIA is an integral part of preparing our application for the ISA exploitation contract on the NORI Contract Area.

Our ESIA program consists of over 100 studies and relies on the work of several independent deep-sea research institutions.

In 2022, we undertook the collector test monitoring campaigns which involved completion of pre-collector test baseline data collection, monitoring of the collector test to and completion of post collection surveys to determine the immediate collector impact to the environment.

The monitoring was undertaken using the Island Pride , a vessel contracted from Ocean Infinity Group Limited, deploying 2 ROVs, 3 AUVs and an array of more than 50 seafloor sensors, supervised by multiple teams of scientists and sediment plume expert consultants, DHI Water and Environment Inc.

The monitoring was undertaken using the Island Pride, a vessel contracted from Ocean Infinity Group Limited, deploying 2 remotely operated vehicles (“ROVs”), 3 autonomous underwater vehicles (“AUVs”) and an array of more than 50 seafloor sensors, supervised by multiple teams of scientists and sediment plume expert consultants, DHI Water and Environment Inc.

and HR Wallingford.

These campaigns commenced on July 15, 2022 and were completed on December 23, 2022, representing 146 operational days at sea.

We continue to assess the data collected from these tests.

The preliminary plume results from the collector test have been shared with a wide range of stakeholders and presentations were conducted at the ISA during the fourth quarter of 2023.

In October 2023 we entered into a services agreement with a third party in order for NORI to conduct an assessment of the benthic impact of the 2022 collector test in NORI Area D approximately 12 months post the collector test activities (“Campaign 8a”), which we believe will strengthen the quality of NORI’s EIS and Environmental Management and Monitoring Plan (“EMMP”) by providing additional information on the environmental regeneration of the collection test area.

The key activities completed during campaign 8a were box cores, multicores, benthic and covariance lander works, and megafauna and sedimentation survey around the test field area.

Notwithstanding that Campaign 8a was subject to coordinated disruptive activities by Greenpeace International (“Greenpeace”) designed to prevent and obstruct the campaign, it was successfully completed on December 28, 2023.

The team selected 19 sampling stations in the locality of the 2022 nodule collection system test in NORI Area D and conducted 39 multicore deployments, recovering 395 individual core samples.

These yielded more than 600 subsamples that will be shared with independent researchers from leading marine research institutions for further biological analysis.

Additionally using a remotely operated vehicle, the research team deployed innovative seafloor lander systems that are capable of measuring seafloor oxygen fluxes using eddy covariance methods.

This resulted in over 600 hours of data acquisition at a maximum deployment depth of 4,285 meters, which we believe is the first time these bespoke sensor suites have been deployed at abyssal depths.

This data is further supplemented by over one thousand core sub-samples for geochemical analysis.

Researchers also conducted the fourth annual recovery and redeployment of three oceanographic moorings within NORI Area D.

The sensor payload on the moorings provides insights into the soundscape, regional oceanographic currents, and particulate organic carbon flux in the Eastern CCZ regions.

This data contributes to the long-term oceanographic time series and importantly will cover the El Niño-Southern Oscillation fluctuations.

Greenpeace spent 11 days, actively obstructing the planned work of Campaign 8a, resulting in a significant impact to the work scopes planned for the campaign which we were able to successfully mitigate.

In the case of TOML and our planned work as part of Campaign 8a, its work scope included the deployment of long-term monitoring moorings which was completely obstructed and was not able to be completed.

The NORI and TOML work scopes were part of ISA approved plans of work and in NORI’s case, the post disturbance sampling was a specific suggestion of the ISA.

NORI pursued legal action through the Dutch courts to halt Greenpeace’s activities and requested further assistance from the ISA.

The District Court of Amsterdam ruled that Greenpeace’s occupation of NORI’s contracted vessel, the MV Coco, was unlawful, which led to the disembarkation of Greenpeace personnel.

Greenpeace continued to actively obstruct NORI’s and TOML’s activities notwithstanding the court ruling.

(iv) Onshore technology development:

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We continue testing the hydrometallurgical refining phase where matte is processed to produce nickel sulfate, cobalt sulfate, copper cathode and fertilizer grade ammonium sulfate.

Additionally, we were engaged in several technical scoping studies for a potential first small-scale production plant in Asia.

On March 16, 2022, we announced a business collaboration with Epsilon Carbon Pvt., LTD.

(“Epsilon Carbon”) to complete a pre-feasibility study for a new-build commercial polymetallic nodule processing plant in India.

However, having faced significant issues in securing process engineering capacity in 2022, Epsilon Carbon and TMC agreed that using an existing metallurgical facility requires less capital expenditures and which we believe may offer a lower risk solution for the Project Zero Plant and the construction of a new build plant in India should be revisited once Project Zero is in production.

In November 2022, we signed a non-binding MoU with PAMCO to evaluate the toll treatment of an initial quantity of 1.3 million tonnes of wet polymetallic nodules per year at PAMCO’s Hachinohe smelting facility starting in 2025.

Potential progression to a NiCuCo matte product along with potentially higher throughputs are also included in the evaluation study.

We expect this partnership to progress to a binding MoU and a strategic alliance in the second half of 2023, subject to successful evaluation study outcomes and agreement to mutually acceptable commercial terms, in lieu of continuing to pursue an opportunity to build a new Project Zero Plant in India together with Epsilon Carbon as was previously envisioned under our March 2022 business collaboration MoU with Epsilon Carbon.

There can be no assurance that we will enter into such binding MoU or definitive strategic alliance in a particular time period, or at all, or on terms similar to those set forth in the MoU, or that if such binding MoU or definitive strategic alliance are entered into by us or that the existing facility will be able to successfully process nodules in a particular time period, or at all.

In addition, as described above and below, in 2022 and 2023, we entered into a non-binding MoU and a binding MoU with PAMCO to study the possibility of using PAMCO’s facility in Hachinohe, Japan to produce up to 1.3 million tonnes of net polymetallic nodules per year.

PAMCO is continuing to study the addition of a converting facility to process the intermediate alloy to nickel-copper-cobalt matte, which is an upgraded intermediate battery supply chain feedstock.

It is expected that the additional facility would be constructed once commercial processing of polymetallic nodules to alloy has been demonstrated.

There can be no assurance that we will enter into a definitive processing agreement in a particular time period, or at all, or on terms similar to those set forth in the binding MoU, or that the existing facility will be able to successfully process nodules in a particular time period, or at all.

Summary of Mineral Resources

Below is a summary table of estimated mineral resources in NORI and TOML contract areas as of December 31, 2023.

The estimated mineral resources in these areas were determined in 2021 as of March 17, 2021, and also reflect the estimated mineral resources as of December 31, 2022, as none of the mineral resources in these areas were depleted by mining or any other activities.

See Item 2 - Properties below for additional information about our estimated mineral resources.

The estimated mineral resources in these areas were determined in 2021 as of December 31, 2020, and also reflect the estimated mineral resources as of December 31, 2023, as none of the mineral resources in these areas were depleted by mining or any other activities.

See Item 2 entitled “ Properties ” below for additional information about our estimated mineral resources.

Both of these contract areas are in the exploration stage.

Summary Mineral Resources, In-Situ, at end of the fiscal year ended December 31, 2023 at 4kg/m2 abundance cut-off and based on nickel metal $16,472/t;

nickel in nickel sulfate $18,807/t Ni;

copper metal $6,872/t;

cobalt metal $46,333/t;

cobalt in cobalt sulfate $56,920/t Co;

manganese in manganese silicate $4.50/dmtu Mn.

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Indicated mineral

Measured + indicated

indicated mineral

Inferred mineral

mineral resources

TOML (Areas A to F)

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These estimates are presented on an undiluted basis without adjustment for resource recovery.

As reflected in the initial economic analysis of NORI Area D contained in the NORI Technical Report Summary, a discounted cash flow analysis considering the intended pre-development work in 2024, discounting at 9% per annum, and assuming metal prices for nickel metal $16,472/t;

As reflected in the Initial Economic Assessment of NORI Area D contained in the NORI Technical Report Summary, a discounted cash flow analysis considering the intended pre-development work up to the end of 2024, discounting at 9% per annum, and assuming metal prices for nickel metal $16,472/t;

nickel in nickel sulfate $18,807/t Ni;

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Through our strategic partnership with Allseas, a former drillship vessel (the Hidden Gem ) acquired by Allseas in February 2020 has been converted and modified to undertake a pre-production collector test in which a collector vehicle, RALS and other systems have been tested.

If we obtain an exploitation contract, the first phase of commercial production (“Project Zero”) would then be expected to commence after the Hidden Gem has been upgraded to become a production support vessel that can produce at least 1.3 Mtpa (wet) of nodules.

The nodules collected in Project Zero are expected to be processed through existing third-party Rotary Kiln-Electric arc Furnace (“RKEF”) facilities on a tolling basis.

The nodules collected in Project Zero are expected to be processed through existing third-party RKEF facilities on a tolling basis.

In the next phase of development (“Project One”), as outlined in the NORI – D Initial Assessment Technical Report Summary, production is expected to be expanded with an additional converted drillship ( Drill Ship 2 ), a subsequent upgrade to the Hidden Gem , and the construction of a bespoke production support vessel ( Collector Ship 1 ).

Illustration of a polymetallic nodule production system operated at 4km depth (picture not to scale)

Illustration of a polymetallic nodule production system operated at 4 kilometers depth

In order to test the collection system, we entered into a contract with Allseas to undertake a pre-production collector test, which was successfully completed in the second half of 2022.

We expect that Project Zero commercial production would then commence after the upgrading of the Hidden Gem into a production vessel.

If we obtain an exploitation contract, we expect to collect at least 1.3 Mtpa (wet) of polymetallic nodules as part Project Zero.

If we obtain an exploitation contract, we expect to commence Project Zero Collection at a rate of 1.3 Mtpa increasing in staged increments to up to 3.0 Mtpa of wet polymetallic nodules.

For Project One, we believe that a fleet of three production vessels, each with multiple dedicated nodule collector vehicles, could be estimated to produce approximately 12.5 Mtpa of wet nodules at steady state (expected 2030-2045), which we intend to process, either at a new facility to be constructed by us or by potential processing partners, subject to available capital, or at third-party facilities pursuant to a toll treatment model.

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The intention is to implement the project in multiple phases that will allow the offshore collection systems to be tested and then polymetallic nodule production to be gradually ramped- up.

We also believe that this approach will de-risk the project for a relatively low initial capital investment.

We believe that this approach will de-risk the project for a relatively low initial capital investment while retaining operational options, particularly in relation to logistics, to decrease unit operating cost as production is scaled up.

Additionally, this phased development will allow for an adaptive approach to environmental management providing learning at small-scale which would be applied as production increases in scale.

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Hatch has developed a near-zero solid waste flowsheet and has overseen a pyrometallurgical pilot plant program consisting of several phases:

the pyrometallurgical processing phase has been completed at FLSmidth’s and XPS Solutions’ (Glencore subsidiary) facilities, the hydrometallurgical refining phase is in progress at SGS facilities.

the pyrometallurgical processing phase has been completed at FLSmidth’s and XPS facilities, the hydrometallurgical refining phase is in progress at SGS facilities.

Pursuant to an engineering and consulting services agreement, Hatch is assisting and advising us during the development of the pilot test program and is analyzing and interpreting the testing results through reports provided by such test facilities.

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These RKEF plants were originally built to convert nickel laterite to ferro-nickel alloy or nickel pig iron and could potentially be converted to smelt polymetallic nodules.

While we have not completed the negotiations of any definitive agreements with RKEF plants owners, we believe that we may be able to do so in the future on commercially reasonable terms.

In the future, based on the work performed by Hatch and subject to available capital, we are contemplating the construction of a processing plant(s) for Project One, which may include pyrometallurgical and hydrometallurgical circuits.

Nodule processing would be increased in phases by treatment in this new plant or plants.

In November 2023, we signed a binding MoU with PAMCO, where PAMCO must complete a feasibility study (expected to be completed during the third quarter of 2024) to toll treat 1.3 million tonnes of wet polymetallic nodules per year at its Hachinohe, Japan smelting facility expected to start in the second quarter of 2026, consistent with the commencement of NORI’s planned first production offshore from the end of the first quarter of 2026, if our expected application to the ISA for an exploitation contract is approved assuming a review period of approximately one year.

The toll treatment is expected to take place on a dedicated RKEF processing line and produce two products:

Strategic Alliances and Key Commercial Agreements

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Pursuant to the Amendment, except as provided therein, Allseas may not, without our prior written consent, terminate the Strategic Alliance Agreement or the PMTA before NORI receives an ISA exploitation contract.

Also on March 4, 2021, we issued the Allseas Warrant to Allseas, which became exercisable for 11.6 million common shares in November 11, 2022, upon the successful completion of the CCZ trial using the PMTS.

The Allseas Warrant was issued to Allseas in lieu of any future obligation to issue the Success Fee Shares.

The Allseas Warrant will expire on September 30, 2026.

The PMTA terminated by its terms upon the successful completion of the PMTS, whereas the overarching Strategic Alliance Agreement will remain in place.

The PMTA terminated by its terms upon the successful completion of the PMTS, whereas the overarching Strategic Alliance Agreement remains in place.

On March 16, 2022, NORI and Allseas entered into a non-binding term sheet for the development and operation of a commercial nodule collection system.

The PMTS developed and tested by Allseas is expected to be upgraded to a commercial system with a targeted production capacity of at least 1.3 Mtpa of wet nodules with expected production readiness by the fourth quarter of 2024 (“Project Zero System”).

The PMTS developed and tested by Allseas was expected to be upgraded to a commercial system with a targeted production capacity of at least 1.3 Mtpa of wet nodules (“Project Zero System”).

NORI and Allseas intended to equally finance all costs related to developing and getting Project Zero System into production that were estimated at less than EUR100 million.

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Once in production, NORI expected to pay Allseas a nodule collection and transshipment fee estimated at approximately EUR 150 per wet tonne in the first year of operations and expected to be reduced by more than 20% in the following years as Allseas scaled up production to at least 1.3 Mtpa of wet nodules.

Following the successful completion of the NORI Area D pilot collection system trials in November 2022 and subsequent analysis of pilot data, the parties are reviewing Project Zero System production target increases, system design changes and associated cost estimates revisions and intend to enter into a binding Heads of Terms in the second half of 2023.

The parties expect to further detail their relationship in three separate definitive agreements for engineering, conversion/build and commercial operations phase, respectively.

Subject to the necessary regulatory approvals, Allseas and NORI also intend to investigate acquiring a second production vessel similar to the Hidden Gem , a further Samsung 10000, with the potential for it to be engineered to support a higher production rate of 3 million tonnes of wet nodules per year and lower associated per tonne production cost.

Following the successful completion of the NORI Area D pilot collection system trials in November 2022 and subsequent analysis of pilot data, the parties reviewed Project Zero System production target increases, system design changes and associated cost estimates revisions.

In August 2023, we announced that Allseas and NORI were executing on a plan designed based on Allseas’ estimates to increase the maximum production capacity of the Project Zero Offshore Nodule Collection System from the previous estimate of 1.3 million wet tonnes per annum to up to an estimated 3.0 million wet tonnes per annum in stepped increments, a potential increase of 130%.

Key aspects include scaling the technology to meeting the commercial production rates of the Project Zero Offshore Nodule Collection System and integration of the scaled-up technology into the Hidden Gem.

Engineering scope has been split into six major work packages:

(1) collector, (2) vertical transport system (riser and riser handling equipment), (3) storage & offloading, (4) control & automation, (5) electrical & instrumentation, and (6) flow assurance.

Engineering studies have been progressed on the offshore nodule offloading and transportation system, including hydrodynamic simulations and dynamic positioning analysis of the vessel-to-vessel interface during the nodule offloading activity.

In line with engineering milestones, design reviews have been conducted at the Allseas office in Delft, Netherlands.

The design reviews are attended by TMC, Allseas and third-party consultants.

Regular meetings are held between TMC and Allseas project teams covering engineering, procurement, scheduling & estimating, operational planning (including health & safety aspects) and environment.

Further to our non-binding term sheet entered into in March 2022 with Allseas, Allseas is proceeding with system design and TMC continues its discussions with Allseas regarding the specifics of these upgrades, associated cost estimates and operational implications of the continued development of the Project Zero Offshore Nodule Collection System.

We anticipate reaching definitive agreements on commercial terms and key terms around continued development and commercial operations with Allseas before the end of 2024.

In addition, in August 2023, we entered into an Exclusive Vessel Use Agreement with Allseas pursuant to which Allseas will give exclusive use of the Hidden Gem to us in support of the development of the Project Zero Offshore Nodule Collection System until the system is completed or December 31, 2026, whichever is earlier.

In consideration of the exclusivity term, we have issued 4.15 million Common Shares (valued at $6.5 million) to Allseas on August 14, 2023.

We expect that the definitive agreement with Allseas discussed above will extend the exclusive use of the Hidden Gem.

There can be no assurances, however, that we will enter into definitive agreements with Allseas contemplated by the non-binding term sheet in a particular time period, or at all, or on terms similar to those set forth in the non-binding term sheet, or that if such definitive agreements are entered into by us that the proposed commercial systems and second production vessel will be successfully developed or operated in a particular time period, or at all.

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Concurrent with entering into the Glencore Offtake Agreements, Glencore made an equity investment of $5 million into our Company.

Non-Binding Memorandum of Understanding

On March 16, 2022, we announced a business collaboration with Epsilon Carbon to complete a pre-feasibility study for a new-build commercial polymetallic nodule processing plant in India with the targeted production capacity of more than 30,000 tonnes per annum (TPA) of an intermediate nickel-copper-cobalt matte product used for active cathode material (CAM) for Nickel Manganese Cobalt (NMC) and other nickel-rich cathode chemistries for lithium-ion batteries and more than 750,000 TPA of manganese silicate by-product expected to be used in manganese alloy production for the steel industry (“Project Zero Plant”).

Epsilon Carbon intended to deliver a pre-feasibility report (“PFR”) for a potential plant in India powered by renewables and with the targeted processing capacity of 1.3 million tonnes per annum (Mtpa) of wet nodules and production start in time to receive nodules collected from NORI Area D starting around the fourth quarter of 2024, subject to our subsidiary NORI securing an exploitation contract from the ISA.

However, Epsilon Carbon and TMC agreed that using an existing metallurgical facility requires less capital expenditures and which we believe may offer a lower risk solution for the Project Zero Plant and the construction of a new build plant in India should be revisited once Project Zero is in production.

In November 2022, we entered into a non-binding MoU with Pacific Metals Co Ltd (PAMCO) of Japan, to evaluate the toll treatment of an initial quantity of 1.3 million tonnes of wet polymetallic nodules per year at PAMCO’s Hachinohe smelting facility starting in 2025.

The toll treatment is intended to take place on a dedicated rotary kiln-electric arc furnace (RKEF) processing line and produce two products:

Binding MoU with PAMCO

Potential progression to a NiCuCo matte product along with potentially higher throughputs were also included in the evaluation study.

PAMCO successfully completed a pre-feasibility exercise pursuant to the non-binding MoU signed by the parties in November 2022.

In November 2023 TMC signed a binding MoU with PAMCO, where PAMCO must complete a feasibility study (expected to be completed during the third quarter of 2024) to toll treat 1.3 million tonnes of wet polymetallic nodules per year at its Hachinohe, Japan smelting facility which is expected to start in the second quarter of 2026, if we obtain an exploration contract from the ISA in a timely manner.

The toll treatment is expected to take place on a dedicated RKEF processing line and produce two products:

We expect to pursue this existing Project Zero Plant opportunity in lieu of continuing to pursue an opportunity to build a new Project Zero Plant in India together with Epsilon Carbon, as was previously envisioned under our March 2022 business collaboration MoU with Epsilon Carbon.

Under the new binding MoU:

● PAMCO, with our support, expects to complete the feasibility study by the third quarter of 2024;

● We will provide PAMCO with the exclusive right to the first 1.3Mtpa of the expected 3Mtpa of wet nodule collection capacity of our first nodule collection system until completion of the feasibility study;

● The parties will enter into good faith negotiations to finalize definitive processing agreements on completion of the feasibility study.

The PAMCO feasibility study is expected to confirm the operating parameters and product specifications for PAMCO’s dedicated production line and define the scope and execution plan for any additional equipment requirements, which are currently expected to be minor.

An extended pilot demonstration program utilizing existing kilns and furnaces at PAMCO’s Hachinohe, Japan facility is expected to treat a 2,000 tonne sample of polymetallic nodules collected during the successful pilot nodule collector test completed by Allseas in November 2022 on the NORI Area D, with the goal of optimizing the furnace refractory selection and confirm commercial scale operating parameters such as tapping temperatures and dusting rates when treating nodules through the Hachinohe facility.

The costs of processing polymetallic nodules will also be estimated to help finalize the definitive processing agreement.

It is expected that the additional facility would be constructed once commercial processing of polymetallic nodules to alloy has been demonstrated.

We expect this partnership to progress to a definitive agreement before the end of 2024, subject to successful feasibility study outcomes and agreement to mutually acceptable commercial terms.

There can be no assurance that we will enter into a definitive tolling agreement in a particular time period, or at all, or on terms similar to those set forth in the binding MoU, or that if a definitive tolling agreement is entered into by us or that the existing facility will be able to successfully process nodules in a particular time period, or at all.

The metals production industry is capital intensive and competitive.

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These competitors may have greater financial resources, as well as other strategic advantages to operate, maintain, improve and possibly expand their facilities.

Additionally, Chinese resources firms have historically been able to produce minerals and/or process metals from land-based operations in developing countries across the globe (e.g., cobalt in the Democratic Republic of the Congo, nickel in Indonesia and Philippines) at relatively low costs due to economic and regulatory factors, including less stringent environmental and governmental regulations and lower labor and benefit costs.

Additionally, Chinese resources firms have historically been able to produce minerals and/or process metals from land-based operations in developing countries across the globe (e.g., cobalt in the DRC, nickel in Indonesia and the Philippines) at relatively low costs due to scale, efficiency and regulatory factors, including less stringent environmental and social regulations and lower labor and benefit costs.

We may be unable to compete successfully with these and other competitors, including other land-based mining operations.

In addition to three contracts held by our subsidiaries and partners, 16 other entities (ISA Member States and private companies sponsored by ISA Member States) currently hold ISA Exploration Contracts for polymetallic nodules in the CCZ, Western Pacific and Indian Ocean Basin.

Furthermore, several Norwegian deep sea mining companies (Loke, Green Minerals) have stated ambitions and non-binding MoUs to acquire polymetallic nodule exploration contracts in the CCZ.

If and when they move into the exploitation phase, each of these contract-holders could become potential competitors with respect to the collection of polymetallic nodules and the production of nickel, manganese, copper and cobalt products.

In addition to the three contracts held by our subsidiaries and partners, 16 other entities (ISA Member States and private companies sponsored by ISA Member States) currently hold ISA Exploration Contracts for polymetallic nodules in the CCZ, Western Pacific and Indian Ocean Basin.

If and when they move into the exploitation phase, each of these contract-holders could become a potential competitor with respect to the collection of polymetallic nodules and the production of nickel, manganese, copper and cobalt products.

Furthermore, several nation states are working on developing polymetallic nodule resources inside their Exclusive Economic Zones (“EEZs”), with the Cook Islands granting three exploration contracts for polymetallic nodules in February 2022.

Beyond polymetallic nodules, nations like Norway, Japan and the Kingdom of Saudi Arabia are exploring other types of deep-sea resources containing some of the metals contained in polymetallic nodules.

Beyond polymetallic nodules, nations like Norway, Japan, Cook Islands and the Kingdom of Saudi Arabia are exploring other types of deep-sea resources containing some of the metals contained in polymetallic nodules.

There is increasing competition from new and existing marine mineral companies for the availability of marine exploration and support vessels, related marine equipment and specialized personnel, desirable exploration areas, suitable offshore collection and onshore processing equipment, and available capital.

Some of our competitors may equally find more promising resources, identify or develop more economic technologies, enter into strategic partnerships that constrain our optionality, or may develop novel methods to collect nodules from the seafloor or process nodules into metals that are more economic than we currently contemplate.

On March 4, 2023, UN member states agreed on the text for the conservation and sustainable use of marine biological diversity in areas beyond national jurisdiction (BBNJ Agreement or “High Seas Treaty”).

The treaty does not replace or amend UNCLOS, or the authority of the ISA, and must be interpreted consistently with the rights granted by the Convention.

The treaty has a goal of placing up to 30% of the world’s oceans under protection by 2030.

In the Clarion Clipperton Zone of the Pacific Ocean, where our subsidiaries operate, the ISA has already exceeded this target with 43% of the CCZ already under protection.

United Nations Convention on the Law of the Sea

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The 1994 Implementation Agreement and Part XI of UNCLOS are to be interpreted and applied together as a single instrument.

As of March 27, 2023, UNCLOS had been signed by 167 States (countries) and the European Union.

International Seabed Authority (“ISA”)

As of February 6, 2024, UNCLOS had been signed by 168 States (countries) and the European Union.

International Seabed Authority

The ISA is an autonomous international organization established under UNCLOS and the 1994 Implementation Agreement to organize and control activities in the Area, particularly with a view to administering and regulating the development of the resources of the Area, in accordance with the legal regime established under UNCLOS and the 1994 Implementation Agreement.

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To date, the ISA has approved 17 contracts in the CCZ for exploration of nodules, one in the Indian Ocean and one in the Western Pacific Ocean covering more than 1.35 million square kilometers of the seabed.

This represents only 0.3 percent of the world’s oceans seafloor.

This represents 0.3 percent of the world’s oceans seafloor.

Twelve of these contracts are sponsored by developing countries (including the sponsors of our subsidiaries NORI — Nauru, and TOML — Tonga, and our partner Marawa which is sponsored by the Republic of Kiribati).

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We are still in the exploration phase of the project and have not yet obtained an exploitation contract from the ISA (“ISA Exploitation Contract”) to commence commercial-scale polymetallic nodule collection in the CCZ.

An ISA exploitation contract application is comprised of several components, including an EIS for the proposed commercial operations, the end-product of a comprehensive ESIA program.

In addition, we do not have the applicable environmental and other permits required to build and operate commercial scale polymetallic nodule processing and refining plants on land.

An ISA exploitation contract application is comprised of several components, including:

Certificate of Sponsorship, Mining Plan, Financing Plan, EIS, Emergency Response and Contingency Plan, Health and Safety Plan and maritime Security Plan, Training Plan, EMMP and Closure Plan.

In addition, we do not have the applicable environmental and other permits required to build or modify and operate commercial scale polymetallic nodule processing and refining plants on land.

Section 1, paragraph 15 of the 1994 Agreement relating to the Implementation of Part XI of the UNCLOS allows a member state whose national intends to apply for approval of a plan of work for exploitation to notify the ISA of such intention.

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On June 25, 2021, Nauru submitted its notice to the ISA requesting that it complete the adoption, by July 9, 2023, of rules, regulations and procedures necessary to facilitate the approval of plans of work for exploitation in the Area.

In June 2022, a member State submitted a position paper to the ISA urging that the deadline to adopt the exploitation regulations be extended for a period of 15 years.

Although we believe that the notice submitted by Nauru to the ISA has increased the likelihood that exploitation regulations and any necessary rules, regulations and procedures to facilitate the approval of a plan of work for exploitation will be adopted by mid-2023, there can be no assurances that the adoption of these regulations will not be delayed or halted paused as a result of the actions of ISA member States.

The ISA did not complete the adoption of the rules, regulations and procedures by July 9, 2023, as required.

At its July 2023 28 th Session meeting, the ISA adopted a Council decision agreeing on a timeline and modalities of work until July 2024, with a view to adopt final exploitation regulations during the thirtieth ISA session in 2025.

Although we believe that the ISA will adopt the exploitation regulations and any necessary rules, regulations and procedures to facilitate the approval of a plan of work for exploitation by the thirtieth session as the ISA has indicated, there can be no assurances that the adoption of these regulations will not be delayed or halted paused as a result of the actions of ISA member States.

The Draft Regulations and several supporting standards and guidelines are at an advanced stage, but there remains uncertainty regarding the final form that these will take as well as the impact that such regulations, standards and guidelines will have on our ability to begin commercial operations in a timely manner, or at all.

If the ISA Council has not completed the adoption of such regulations within the prescribed time and an application for approval of a plan of work for exploitation is pending, the ISA shall nonetheless consider and provisionally approve such a plan of work for exploitation based on:

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There can be no assurance that the ISA will provisionally approve our plan or that such provisional approval would lead to the issuance of an exploitation contract by the ISA.

In December 2021, the ISA held in-person meetings in Kingston Jamaica and established a work plan and road map to finalize regulations by July 2023 for the commercial exploitation of seabed minerals, including those necessary for the collection of polymetallic nodules.

In November 2022, the ISA developed an updated road map for 2023 that includes three Council sessions and one week of Assembly meetings that will be focused primarily on the finalization of the regulations in 2023.

Once adopted, these regulations will create the legal and technical framework for exploitation of polymetallic nodules.

While, the ISA has developed a work plan and road map to adopt the Final Regulations by July 2023, there can be no assurance that such regulations will be adopted then, or at all.

If the Final Regulations are not adopted by July 2023, a plan of work for exploitation may nevertheless be submitted to the ISA for consideration and provisional approval pursuant to Section 1, Paragraph 15 of the Annex to the Agreement relating to the Implementation of Part XI of the UNCLOS.

There can be no assurance that the ISA will provisionally approve any such plan or that any such provisional approval would lead to the issuance of an exploitation contract by the ISA.

On March 4, 2023, the United Nations finalized the UN High Seas Treaty.

The treaty does not replace or amend UNCLOS, or the authority of the ISA, and must be interpreted consistently with the rights granted by the Convention.

The treaty has a goal of placing up to 30% of the world’s oceans under protection by 2030.

In the CCZ, where our subsidiaries operate, the ISA has already exceeded this target with 43% of the CCZ already under protection.

On August 1, 2023, we announced that our subsidiary, NORI, intends to submit its application for an exploitation contract to the ISA following the July 2024 meetings of the ISA.

NORI is conducting a post-collection test campaign, strengthening its environmental baseline data and its application for an exploitation contract.

This timing allows the Council to meet three more times to continue negotiating and progressing the rules, regulations and procedures.

Consistent with NORI’s rights under the UNCLOS, and the 1994 Agreement relating to the Implementation of Part XI of UNCLOS (the Agreement), NORI reserves its right to submit an application for a plan of work for exploitation, which will be included as part of the application for an exploitation contract, prior to the ISA’s provisional adoption and approval of the exploitation regulations, the possibility of which was recognized in the ISA Council decisions ISBA/28/C/24 and ISBA/28/C/25, and to have that application considered and provisionally approved pursuant to Section 1, Paragraph 15 of the Annex to the Agreement.

At the third and final meeting of the 28 th ISA Session in November 2023, the Council agreed to consolidate the text of the draft regulations.

The main objective of such a consolidated text, is to better harmonize and clean the text based on negotiations of the interested stakeholders to date.

The consolidated text will be the basis for the negotiations of the regulators in 2024.

The NORI Exploration Contract

In July 2011, our wholly-owned subsidiary, NORI, was granted a polymetallic nodule exploration contract by the ISA, providing it exclusive rights to explore 74,830 km 2 in the CCZ pursuant to the NORI Exploration Contract (“NORI Exploration Contract”).

In July 2011, our wholly-owned subsidiary, NORI, was granted a polymetallic nodule exploration contract by the ISA, providing it exclusive rights to explore 74,830 square kilometers in the CCZ pursuant to the NORI Exploration Contract (“NORI Exploration Contract”).

The NORI Exploration Contract was approved by the Council on July 19, 2011, and entered into on July 22, 2011 between NORI and the ISA, and terminates on July 22, 2026, subject to extension.

The NORI Exploration Contract, which was granted pursuant to the ISA’s Regulations on Prospecting and Exploration for Polymetallic Nodules in the CCZ (the “Regulations”), formalized a 74,830 km 2 exploration area, has an initial term of 15 years (subject to renewal for successive five-year periods), and provides for certain obligations with respect to exploration, training, and other programs of activities for an initial five-year period.

The NORI Exploration Contract, which was granted pursuant to the ISA’s Regulations on Prospecting and Exploration for Polymetallic Nodules in the CCZ (the “Regulations”), formalized a 74,830 square kilometers exploration area, has an initial term of 15 years (subject to renewal for successive five-year periods), and provides for certain obligations with respect to exploration, training, and other programs of activities for an initial five-year period.

The NORI Exploration Contract also formalized the rights of NORI around future rights.

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The decision of the Council shall take account of that response and shall be based on substantial evidence.

As soon as practicable, NORI intends to submit an application to collect polymetallic nodules in the same area as its current exploration rights.

On August 1, 2023, we announced that our subsidiary, NORI intends to submit its application for an exploitation contract to the ISA following the July 2024 meetings of the ISA.

To date, no exploitation contracts for extracting minerals from the international seafloor have been granted.

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On February 3, 2022, the ISA confirmed that the Secretariat and Commission had reviewed NORI’s report and noted that the program of activities for the next five-year period was acceptable.

The ISA requested clarification on a few matters and noted that the periodic review would be concluded if the clarifications were received within 30 days.

On February 28, 2022, NORI provided the clarification in response to the request by the ISA and on June 1, 2022, the ISA accepted NORI’s proposed program of activities.

The ISA Council may suspend or terminate the NORI Exploration Contract, without prejudice to any other rights that the ISA may have, if any of the following events should occur:

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● pay an annual overhead charge to cover the costs incurred by the ISA in administering and supervising the contract;

● implement training programs for personnel of the ISA and developing countries in accordance with a training program proposed by NORI in its license application;

● implement training programs for personnel of the ISA and developing countries in accordance with an approved training program;

● take measures to prevent, reduce, and control pollution and other hazards to the marine environment arising from its activities in the CCZ;

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The TOML Exploration Contract

In March 2020, we acquired TOML from Deep Sea Mining Finance Limited, providing us with exclusive rights to explore a 74,713 km 2 area of the CCZ seabed.

In March 2020, we acquired TOML from Deep Sea Mining Finance Limited, providing us with exclusive rights to explore a 74,713 square kilometers area of the CCZ seabed.

TOML holds an exploration contract granted by the ISA and sponsored by the Kingdom of Tonga pursuant to the TOML Exploration Contract (“TOML Exploration Contract”).

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The TOML Exploration Contract was then signed on January 11, 2012 between TOML and the ISA and terminates on January 11, 2027, subject to a potential extension under the terms of the agreement.

The TOML Exploration Contract was granted pursuant to the ISA’s Regulations, as well as Article 153 of UNCLOS, and formalized a 74,713 km 2 exploration area.

The TOML Exploration Contract was granted pursuant to the ISA’s Regulations, as well as Article 153 of UNCLOS, and formalized a 74,713 square kilometers exploration area.

The TOML Exploration Contract includes an initial term of 15 years, which may be extended under the contract, and a program of activities to be completed within the first five-year period of the term.

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The review included a proposed plan of work for the next five-year period from 2022 to 2026.

For the second five-year period ending in 2021, the proposed program included the following:

(i) continue environmental baseline work;

(ii) complete pilot testing;

(iii) complete geotechnical studies;

(iv) complete feasibility studies;

(v) first draft EIS/EMMP;

and (vi) continue training.

TOML noted that the program was dependent on success at each stage, subject to change based on findings at hand at any particular time and reliant on funding which in turn is dependent to some extent on macro-economic conditions and development with regards to the authority and its stakeholders.

The five-year program ending in 2021 included activities prior to TMC’s acquisition of TOML in 2020.

Although the stated program objectives were not achieved, the ISA accepted TOML’s submission and explanations, and agreed to TOML’s next five-year program of activities.

On December 23, 2022, the ISA accepted TOML’s proposed program of activities for the 2022-2026 five-year period.

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On March 8, 2008, Tonga and TOML entered into the TOML Sponsorship Agreement formalizing certain obligations of the parties in relation to TOML’s exploration and potential exploitation of a proposed application to the ISA (subsequently granted) known as the TOML Area.

Tonga updated the sponsorship agreement with TOML in September 2021.

TOML updated the sponsorship agreement with Tonga in September 2021.

Unless otherwise terminated by the parties, the term for the TOML Sponsorship Agreement is for the duration of TOML’s ISA Exploration Contract and will automatically extend for a further 25 years upon TOML being granted an ISA Exploitation Contract.

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On July 26, 2012, the ISA Council approved a plan of work for exploration submitted by Marawa covering the Marawa Contract Area.

Due to uncertainty on the economic potential of the Marawa Contract Area, Marawa is currently considering its options, including potentially seeking a new area.

Marawa expects to finalize its decision in 2023.

Due to uncertainty of the economic potential of the Marawa Contract Area, Marawa is currently considering its options and expects to finalize its decision in 2024.

Marawa delayed certain work programs until it determines how it will move forward.

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To date, limited offshore marine resource definition activities in the Marawa Contract Area have occurred.

We expect to collaborate with Marawa to assess the viability of any potential project in the Marawa Contract Area, although the timing of such assessment is uncertain.

We are collaborating with Marawa to assess the viability of any potential project in the Marawa Contract Area, although the timing of such assessment is uncertain.

Marawa has delayed certain of its efforts in the Marawa Contract Area while it determines how it will move forward with additional assessment work.

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While the rates of payments are yet to be set by the ISA, the 1994 Implementation Agreement (Section 8(1)(b)) prescribes that the rates of payments “shall be within the range of those prevailing in respect of land-based mining of the same or similar minerals in order to avoid giving deep seabed miners an artificial competitive advantage or imposing on them a competitive disadvantage.”

An open-ended working group has met several times including most recently in October / November 2022 to discuss potential royalty and taxation regimes supported by modelling conducted by the Massachusetts Institute of Technology.

No final recommendations were made.

However, a 2% ad valorem royalty increasing to 6% after a period of five years of production was discussed as well as a 1% ad valorem environmental levy.

These amounts were used for the economic analysis included in the initial assessment contained in the NORI Technical Report Summary.

An open-ended working group has been formed and has met numerous times to discuss potential ISA royalty and sponsoring State taxation regimes supported by modelling conducted by the Massachusetts Institute of Technology.

A final royalty and payment regime has not been agreed.

However, recent discussions centered on a 2.5% ad valorem royalty on the gross metal value (“GMV”) of nodule ore for the first five years of commercial production, thereafter increasing to 4.5% if GMV is equal or lower than $510 per dry tonne of nodules and scaling linearly to 9.5% if GMV is at or above $720 per dry tonne of nodules.

An additional ad valorem environmental levy has also been discussed.

The economic analysis included in the initial assessment contained in the NORI Technical Report Summary was based on a slightly different set of assumptions about ISA Royalty that were in use back in 2021:

namely, 2% of GMV for the first five years, increasing to 6% thereafter plus 1% environmental levy.

Additional discussions have considered capping any proposed environmental levy once an agreed total value has been reached and might no longer be collected once sufficient funds are in trust.

We can provide no assurances that any such royalties or levies will not be greater than those discussed and could be significantly greater.

Under the NORI Sponsorship Agreement between Nauru and NORI and under the TOML Sponsorship Agreement between Tonga and TOML, upon reaching a minimum recovery level within the tenement areas, NORI and TOML have agreed to pay Nauru and Tonga a seabed mineral recovery payment for polymetallic nodules recovered from the tenement area, annually adjusted (from year 5) on a compounding basis based on the official inflation rate in the United States.

In addition, NORI and TOML will pay an administration fee each year to Nauru and Tonga for such administration and sponsorship, which is subject to review and increase in the event that NORI or TOML are granted an ISA Exploitation Contract.

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Environmental Regulation

On March 4, 2023 the United Nations finalized the UN High Seas Treaty.

The treaty does not replace or amend UNCLOS, or the authority of the ISA, and must be interpreted consistently with the rights granted by the Convention.

The ISA is mandated through UNCLOS to “preserve and protect the marine environment” while developing the resources within the Area.

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The regulations are complemented by the LTC’s recommendations for the guidance of contractors on assessing the environmental impacts of exploration.

The exploitation regulations on deep-seabed collection will be complemented by various standards and guidelines.

The ISA is currently developing these Standards and Guidelines which are expected to be finalized by the LTC and adopted by the Council.

The exploitation regulations on deep-seabed collection will be complemented by various standards and guidelines, and thresholds.

The ISA is currently developing these standards and guidelines, and thresholds which are expected to be finalized by the LTC and adopted by the Council.

The ISA has divided the required standards and guidelines in three phases.

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Ten standards and guidelines have been prepared in Phase 1, provided to stakeholders for comment, reviewed and amended by the LTC and provided to Council for consideration and approval.

Additional standards and guidelines will be drafted as part of the development of Phase 2 in 2022 for stakeholder comment and review.

After drafting by the LTC, the standards and guidelines will be provided to the Council for review and adoption.

Additional standards and guidelines will be drafted as part of the development of Phase 2 and 3.

Although the environmental impact review process has not yet been finalized, all contractors have been made aware that the ISA requires the completion of baseline studies and EIA, culminating in an EIS for proposed commercial operations, prior to collection.

Guidance for contractors in terms of what will be expected in the EIS has been provided in ISA Technical Study No.

10 (ISA 2012a).

The EIS, along with an EMMP, will be required as part of the application for an ISA Exploitation Contract for operations in the CCZ.

Environmental impacts of exploration and potential collection activities have been studied, and NORI is working with several of the deep-sea research institutions that are contributing to our environmental and social impact assessment program, consisting of over 100 discrete studies.

An EIS and an EMMP, will be required as part of the application for an ISA Exploitation Contract for operations in the CCZ.

Environmental and social baseline studies are being conducted and NORI has engaged several leading deep-sea research institutions and scientists to contribute to our environmental and social impact assessment program, consisting of over 100 discrete studies.

NORI’s offshore exploration campaigns have included sampling to support environmental studies, collection of high-resolution imagery, full column physical and chemical oceanographic data and environmental baseline studies.

All offshore campaigns to support environmental baseline data collection have been completed.

Our last offshore campaign to collect environmental baseline data was completed in 2022.

An integrated collector test involving trialing of collector vehicle and riser system took place in 2022.

A key objective of this test was to monitor the environmental impact of the collection system and use these data to forecast the impacts for a full-scale commercial operation.

The environmental impacts of this test were monitored from a separate research vessel.

An additional environmental campaign was executed in 2023 to return to the site 12 months after the test.

Data collected from the test monitoring campaign and 12-month revisit campaigns will be used to forecast the impacts for a full-scale commercial operation in NORI’s EIS.

NORI intends to manage the project under the governance of an environmental management system (“EMS”), which is to be developed in accordance with the international EMS standard, ISO 14001:2004.

The EMS will provide the overall framework for the environmental management and monitoring plans that will be required.

The EMS will provide the overall framework for the environmental management and monitoring plans that are required.

NORI’s EMMP will specify the objectives and purpose of all monitoring requirements, the components to be monitored, frequency of monitoring, methods of monitoring, analysis required in each monitoring component, monitoring data management and reporting.

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In addition, the sponsoring State has a responsibility to put in place legislation to ensure the entity it has sponsored complies with UNCLOS and ISA rules and regulations.

Nauru implemented the Nauru International Seabed Minerals Act in 2015 which acts as a second layer of legislation with which NORI is required to comply.

To date, NORI’s assessment is that it is in compliance with existing exploration permits and contracts.

NORI estimates that it is in the middle stages of the exploitation permitting process.

Nauru implemented the Nauru International Seabed Minerals Act in 2015 which NORI is required to comply with.

NORI’s assessment is that it is in compliance with existing exploration permits and contracts.

In addition to working on key engineering aspects of the project such as designing the final nodule collector and the dewatering facility, NORI is also continuing the following tasks:

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● characterizing the nature of the seabed, water column and biology;

● conducting environmental baseline studies and impact assessments;

● finalizing environmental baseline studies and impact assessments;

● characterizing the nature of any materials returned to the environment;

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● developing other plans, including the EMMP and the various subordinate plans.

The potential future onshore environmental impacts have not yet been assessed because the processing plant that we expect to create or use through a tolling or other arrangement has not been determined or otherwise has not been designed in sufficient detail, and the location and host country (and hence regulatory regime) has not been confirmed.

The planned metallurgical process is expected to generate near-zero solid waste products, and the deleterious elements (for example, cadmium and arsenic) content of the nodules is understood to be very low, indicating that with careful management, the environmental impacts of the processing operation is expected to be low.

The potential future onshore environmental impacts have not yet been assessed because the processing plants that we expect to use through a tolling or other arrangement have not been finalized, and the locations and host countries (and hence regulatory regime) have not been confirmed.

The planned metallurgical process is expected to generate near-zero solid waste products.

The deleterious elements’ (for example, cadmium and arsenic) content of the nodules is understood to be very low, indicating that with careful management, the environmental impacts of the processing operation are expected to be low.

Intellectual Property

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Human Capital

As of December 31, 2022, we employed thirty-nine (39) employees and contractors.

As of December 31, 2023, we employed forty-six (46) employees and contractors.

None of our staff are covered by collective bargaining agreements.

Diversity and Inclusion .

We are committed to attracting, developing and retaining diverse talent that is inclusive of every age, gender, gender identity, race, sexual orientation, physical capability, neurological difference, ethnicity, belief and perspective.

Attracting Talent .

Our team is comprised of highly skilled individuals from a variety of fields.

Geographically, our staff are located in Tonga, Nauru, U.S., Canada, Australia, United Kingdom and United Arab Emirates.

We are committed to attracting, developing and retaining world-class talent that is inclusive of a diverse range of perspectives, age, gender, gender identity, race, sexual orientation, physical capability, neurological difference, ethnicity and belief.

Our goal is to develop cultural competency by seeking knowledge, increasing awareness, modeling respect and promoting inclusion.

Geographically our staff are located in Tonga, Nauru, United States, Canada, Australia, United Kingdom and United Arab Emirates.

Our team is comprised of highly skilled individuals with 61% of our staff holding post-graduate degrees, including 19% who hold a Ph.D.

Moreover, 32% of our staff are women and 29% of our staff are racially diverse.

People Engagement .

As a company working to pioneer a new industry and new ways of doing things, our success depends on attracting and retaining strong, independent, entrepreneurial, and multi-talented team members capable of dealing with high levels of uncertainty and adversity.

Our team is distributed across several continents and several time zones, with remote working being the norm for most of our staff.

Our team is distributed across several continents and several time zones, with remote working being the norm for most of our staff and multi-week offshore campaigns being the norm for our offshore team.

Despite physical and temporal separation, we maintain a strong sense of cohesion by attracting people who are intrinsically motivated by the company’s purpose and core values, cultivating a flat organizational structure and deep care for each other.

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Our EHS vision is to fully integrate environmental, health and safety into our operations, and to create a workplace free of incidents.

In 2022, we have relied on the EHS programs of our partners Allseas and a new offshore support service provider to conduct our operations in a safe manner and in compliance with applicable safety laws, rules and regulations.

In 2023, we relied on the EHS programs of our partners Allseas and a new offshore support service provider to conduct our operations in a safe manner and in compliance with applicable safety laws, rules and regulations.

These all involve EHS systems incorporating thorough planning, risk assessment and disciplined implementation of controls as well as culturally-based safety observations systems like safe act observations and obligation of “stop work if it is unsafe to proceed”.

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Our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports, are available to you free of charge through the Investors section of our website as soon as reasonably practicable after such materials have been electronically filed with, or furnished to, the SEC.

The SEC maintains an internet site ( http://www.sec.gov ) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the Securities and Exchange Commission.

We include our website address in this Annual Report on Form 10-K only as an inactive textual reference.

Information contained in our website does not constitute a part of this report or our other filings with the SEC.

The SEC maintains an internet site ( http://www.sec.gov ) that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

We include our website address in this Annual Report only as an inactive textual reference.

Information contained in our website does not constitute a part of this Annual Report or our other filings with the SEC.

Corporate Information

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business