Economics and Law
The long-term benefit or harm from natural resource extraction hinges on the process of recovery and the terms of the economic and regulatory framework that governs it. WP3 will address the legal and policy framework regarding land rights, risk allocation and social license to operate, best practise to develop opportunities for local economic benefit, and implications of resource extraction for the local and regional geopolitical landscape. A particular focus is how the various precepts of the Natural Resources Charter can be extended to deal with a potentially resource-rich economy wanting to make an energy transition. New precepts will be added that relate specifically to the exploitation of renewable energy raw materials, especially their potential co-recovery with geothermal energy. We will investigate the best ways to allocate the mineral rights from an economic, political and regulatory point of view, including an analysis of the allocation or responsibilities and risk through regulation, contract and property rights, and its relation to investment incentives. We will compare the outcome of this analysis to the status quo in Montserrat and elsewhere, to suggest changes to current ‘best practice’. We will then investigate the best way of ensuring that the revenue is managed appropriately by either investing revenues domestically, for example via local downstream materials processing, or handing them out as citizens’ dividends in an equitable manner. We will look at how best to deal with the risk and volatility of resource revenues in the face of rapidly evolving green-tech needs. In this regard the polymetallic nature of saline geofluids, as identified in WP2, offers a significant advantage over most conventional mining operations.
Evaluating management of resource revenues will occur in coordination with an understanding of the physical features – capital investments, environmental risks, maintenance, resource outflows, reservoir dimensions and production longevity (WP1), processing options (WP2), and social welfare and ambitions of the government and citizens of Montserrat (WP4). We will draw lessons from the case study for the broader geopolitics of critical materials extraction in the context of disruptive new technologies, such as saline geofluids. Collectively the findings of WP3 will identify key inflection points for sustainability and equity in the development of new green resources. A key objective of WP3 is to write up a case study for the NRC that can be ported to other nation states developing an energy transition strategy.
