No. The sort of work we are talking about is immensely expensive. If a company is to get down and explore the resources in deep sea, that will mean a very expensive financial commitment. Companies have not come forward because it has not been worth their while to do so, but the world is moving on. There is no evidence to suggest that anything in UK regulation has been in any way off-putting; indeed, quite the contrary. The most recent company to go through the process made reference to the helpfulness of the British Government as it pursued its licence. I hope I can set my hon. Friend’s mind at rest: regulation does not seem to be an issue.
Let me make a little more progress. When one thinks of the offshore, what inevitably springs to mind first is the search for oil and gas. However, industry has yet to express an interest in possible supplies of hydrocarbons in the deep sea, which is why no international regulations have been developed for their exploration. That is not to say that it will not happen. It may sound odd to suggest that international regulations for the exploration of hydrocarbons would be needed when exploration for hydrocarbons is not new. Multinational corporations are exploiting hydrocarbons all around the world, often in very deep water, but the point is that when we talk of the deep sea and “the area”, we talk of the role of the
International Seabed Authority in managing the resources. So any exploration or exploitation would need to be under those ISA regulations, not national ones.
Let me deal now with some of the questions raised about the Bill, as it would be pertinent to do so now that I have set out the background, before providing some comment on the history of the Bill and why we are where we are with it. If I may, I shall discuss the issues in relation to the hon. Members who raised them.
I thank the hon. Member for Dumfries and Galloway for setting out the position of the Opposition and for indicating that the Opposition will support the Bill for the reasons that he set out. He rightly emphasised that policing needed to be done in respect of those who had applied for, and been successful in gaining, licences. The need to get on with the job has to be balanced with concern for the environment. Our intention is closely to scrutinise the activities of contractors. The current contractor is a highly reputable company, and we are satisfied that it will act appropriately.
The ISA has responsibilities, too, in respect of those who apply for licences from it. Reports have to be made to the ISA, whose legal and technical commission scrutinises them. We are pressing for improvements in the quality of the licences, which will become part of the negotiation; we anticipate greater exploitation of these resources. I shall say a little more about that in a few moments.
My hon. Friend the Member for Bury North raised a series of points. He mentioned the involvement of the European Union, but I am conscious that this is a track down which it would probably be inadvisable to go or spend any time; there might be some differences between him and me on certain elements of the EU. I would like to give him an absolute assurance, however, that there is no question of the UK ceding any powers to the EU, which is represented on the ISA for two reasons. First, a number of states without maritime interests want the EU to represent them, and secondly, a number of areas in the convention on the law of the sea fall within Community competence. They are listed in a declaration and include issues such as the marine environment, trade in minerals and fishing, and there is no intention to go any further.
Questions were raised about a company from a country outside the parties that had committed to the convention—and the United States came up as an obvious example. How would it go about things if it was prevented from participating? As my hon. Friend the Member for South East Cornwall suggested, it would need to seek a sponsorship from a party in a participating state. Such a sponsorship is not lightly handled; the regulations are covered by the ISA, which has set out in regulation 11 details of a certificate of sponsorship and the exact connection between a state and company wishing to apply for registration by using either its own state or another.
As for the position of the United Kingdom, we have a contractor that is largely based in the United States but has a subsidiary in the UK which allows it to apply through the UK to the ISA. Companies are not prevented from being sponsored by the fact that their nation states have not signed the convention, but they will be sponsored in a way that is properly controlled.
Members have asked what penalty would be imposed on a company that operated outside that sphere, and just went rogue and mined. I understand that there would then be a question mark over the title to the minerals, as a result of which the company would be at risk in selling on those minerals or anything else. As far as we are aware, however, the issue does not arise at present. The legislation has encouraged companies to operate in accordance with the rules because it is in their interests to do so. The costs of exploitation of resources in the deep sea are such that a company would not wish to be involved unless it was absolutely sure that it would be able to sell on what it had, and that it was protected. The legal ramifications of not going through international regulation would be enormous.