TARGETS ARE NO LONGER ENOUGH –
CARBON TAKES CENTER STAGE IN MINERS’ STRATEGY
One after the other, speakers at the recent Energy & Mines Australia Virtual Summit described how their companies were—out of necessity—including carbon considerations in their strategic decision making. They realize, as pointed out in Issue 24 of Energy and Mines, that today’s largest cohort of consumers—voters and soon-to-be legislators—are climate conscious millennials and generation Z. With only 30 years remaining until 2030, mine operators understand that they can no longer talk solely about targets for future progress.
E&M quotes Rio Tinto’s Senior Manager, Energy and Climate Change, Michael Scotton as explaining: “Stakeholders want to go beyond long-term goals and understand how we’re implementing our strategy, what are the concrete actions taken to deliver those targets. Customers are also looking to understand the embedded emissions in our products and want to decarbonise their supply chains to provide low-carbon products themselves.”
The economic landscape is changing. Many countries of the world are beginning to introduce carbon taxes, and this trend is likely to accelerate. Even where there is no carbon tax, governments are creating other incentives to reduce emissions. Investors, too, are beginning to show a strong preference for green projects. Said Lachlan Shaw, Head of Commodity Research at National Australia Bank, during the Summit, “There’s already a shadow carbon price almost being built into how…projects are financed and the returns required, and these things are progressing quite quickly now.”
Non-governmental pricing signals are also emerging. Witness the fact that low carbon aluminium is now trading at a premium in the European metals market, which Shaw says shows that “the market is now starting to value the reduction of carbon footprint by suppliers.”
E&M writes that to meet their net zero carbon targets, mines have to solve a three-part equation involving baseline power, material movement, and processing. On the power side, options for power generation include adding wind and solar to existing diesel generators in hybrid plants, which can lead to significant cash operating cost reductions.
Another opportunity for mining decarbonization, albeit a challenging one, is material movement. For instance, 43% of BHP’s emissions come from diesel, primarily used in fleets. The company has trialed a number of electric vehicles at its mines, and sent a clear signal to the market of the need for an electric heavy-duty haul truck — which manufacturers are beginning to work on. Newmont Goldcorp has also been active with its Borden site in Canada—the world’s first 100% electric mine. While lowering emissions, such measures increase the demand for electricity in mines, which in turn increases demand for renewable power generation technologies.
Processing is another challenging area where some initiatives are showing promise. Per E&M, one of them is mechanical vapour recompression for bauxite refining, which would create the heat needed to produce aluminium from renewable electricity. 247Solar Plants™ can produce industrial-grade of nearly 1000℃, potentially useful for thermal comminution and other applications.
Altogether, E&M concludes, “the triple-whammy of carbon price (whether set by governments or by markets themselves), customer demand and investor appetite is set to be an efficient propeller for miners on their 30-year race to decarbonisation.” Read the full article here.
TESLA GOING SOLO TO MINE LITHIUM IN THE US
Tesla founder Elon Musk recently announced plans for his company to directly mine lithium in the state of Nevada to support his company’s expansive battery manufacturing ambitions. According to articles in Australian Mining and Business Insider, mining its own lithium will allow Tesla to both shorten and gain greater control over its materials supply chain.
Tesla also touted an innovative process for using ordinary salt and water to leach lithium from clay deposits. Per Australian Mining, lithium raw materials typically are mined and then converted into a metal sulphate before chemicals and water are added to create the final product. This creates a large amount of wastewater and waste by-products, something Tesla aims to eliminate. “Nobody has done this before to our knowledge,” Musk says, “and it’s a very sustainable way of obtaining lithium; all of the elements are reusable.”
Tesla claims to have acquired the rights to a 10,000-acre lithium clay deposit in Nevada, where it also plans to build its own cathode plant and lithium conversion facility. This is all part of Tesla’s plan to become self-sufficient, significantly reducing costs and the distance that needs to be travelled before materials used in electric vehicle and battery manufacturing can reach the company.
By leveraging the enormous deposits of lithium and nickel that exist in the US, and by localising its cathode production, Tesla claims it can reduce the miles travelled by the materials that end up in the cathode by up to 80%.
RESPONSIBLE MINING INDEX – COMPANY REPORTS, BEST PRACTICES AND MORE
Each year the Responsible Mining Foundation, a Swiss-based NGO, publishes its Responsible Mining Index (RMI) Report. This year’s report came out in February, but we just came across it, so apologies to any readers for whom this isn’t news. For anyone else, we thought it was worth sharing.
According to the foundation’s website, “The RMI Report 2020 is an evidence-based assessment of the economic, environmental, social and governance (EESG) policies and practices of 38 large-scale mining companies that operate in more than 780 mine sites and together account for 28 percent of the world’s mining activity by value of production. In addition, the Report assesses 180 individual mine sites in 45 countries against 10 basic indicators of responsible mining.”
The report includes:
Company Reports: 38 individual company result pages with scores and contextual information
Mine-Site Reports: Individual scores of 180 mine sites selected out of 750+ operating sites surveyed in the report
Leading Practices: Practices that are exceptionally responsive to the challenges and opportunities of responsible mining
Document Library: More than 3,800 source documents, which have been used in the 2020 assessment
How does your company stack up? View the report and download a summary here.