Australia’s mineral and energy resources are a major contributor to the nation’s economy. They make modern life possible and are essential to our renewable energy transition. While mining is helping us prosper – bringing employment, education, healthcare and essential infrastructure to our communities – there are downsides. To ensure a lasting legacy, mining companies have an opportunity to rethink land and water stewardship and plan for sustainability beyond mine closure.
Sustainability has long been on the agenda of mining companies requiring their operations to be undertaken in a safe, environmentally, and socially responsible manner. Increasingly, having a social licence to operate is key to making economic contributions and supporting society in alignment with Australia’s net zero targets and the Paris Agreement on Climate Change as well as the United Nations Sustainable Development Goals.
“Climate change, resource scarcity and energy efficiency are global trends that all industries are grappling with, including the mining and energy sectors,” says Jason Fong, Director, Geotechnical at BG&E Resources.
“To meet the rising demand for critical minerals and other commodities required for the energy transition, mining companies are being challenged with delivering increasing output and shareholder returns while at the same time decarbonising their operations.
“Fundamentally, this is not a new concept, but performance is growingly being assessed through an Environmental, Sustainability and Governance (ESG) lens by the full gamut of stakeholders. From shareholders to partners and governments, financiers, employees, local communities, and Traditional Owners – all stakeholders are scrutinising a company’s returns against ESG risks.
“Our experience shows that early recognition and integration of ESG practices into mining operations can optimise the interest of all stakeholders and unlock greater cost-savings and value-creation opportunities.
“Today, mining companies are taking significant steps to be more sustainable – not only to be compliant and future-proof their operations – but because it also makes good business sense, and it is the right thing to do as well.”
The Importance of Accountability
Several high-profile mining disasters around the world including tailings dam failures and irreparable social and environmental damages are putting pressure on the industry to become more accountable.
Recent changes in both global and local standards for tailings management, as well as mining and environmental legislative reforms are leading to a rapid shift in how mining companies are exploring and operating in Australia.
“These stricter standards and other reforms are strengthening current practices and significantly raising the bar for mining companies to achieve strong ESG outcomes,” says Jason. “This is elevating accountability to the highest organisational levels and adding new requirements for independent oversight, particularly around tailings management, mine closure and rehabilitation.
“More and more, we are seeing mining companies boost operational efficiency with low-carbon technology and methods,” says Jason. “Economics are playing a key part in this shift, particularly with the rising cost of carbon emissions, which in WA is going to be impacted by the recent introduction of the Safeguard Mechanism. “We are working on various projects around the country, helping clients develop large renewable energy generation projects such as wind and solar farms in various mine sites, to significantly lower their operational costs, reduce Scope 1 and 2 emissions and improve energy security, while at the same time delivering ESG outcomes.
“We have also completed a decarbonisation study for an iron ore Tailings Storage Facility (TSF) of a leading mining company. Apart from identifying ways to cut costs, reduce risks and lower carbon emissions overall, we also uncovered a significant opportunity to recover material from future plant feed. This alone decreases plant per tonne operating costs, increases production and reduces Life of Mine (LoM) TSF costs. Our approach to decarbonisation has been integrated throughout the TSF lifecycle, which will ensure our client achieves its Scope 1 and 2 emission targets as efficiently as possible.”
Global Industry Standards on Tailings Management
There are additional challenges, but also opportunities, facing mining companies to adopt and comply with global standards to make mines more compliant and environmentally sustainable.
As of 5 August 2023, members of the International Council on Mining and Metals (ICMM) were required to publish their progress towards conformance with the Global Industry Standard on Tailings Management (GISTM) for TSFs with the highest potential consequences in the event of a failure. By August 2025, the standard will be expanded to include all other facilities.
The GITSM was developed after the failure of a tailings facility in Brazil in 2019, through an independent process convened by ICMM, the United Nations Environment Programme (UNEP) and Principles for Responsible Investment (PRI). Containing 77 requirements, the GITSM integrates social, environmental, local economic and technical considerations which strive to achieve the goal of zero harm to people and the environment.
“Companies such as Anglo American, Rio Tinto and Glencore reported their progress towards GISTM conformance this year,” says Jason. “The standard, which applies to both existing and future facilities, represents a positive change for the industry. We have the capabilities to assist companies with compliance to GISTM, particularly with geosciences and engineering services as well as data analytics and predictive interventions.
“Education is key to managing TSFs holistically. That is, teaching the operators of the TSFs how to run them effectively and how to integrate long term post closure requirements to minimise whole of life negative impacts and minimise costs.”
“Running a TSF is not a mining company’s core business, so ensuring that operators are armed with the critical knowledge to manage the dams and understand the triggers of key risk events, makes all the difference in their effectiveness.”
In addition to the GITSM, the Towards Sustainable Mining (TSM) framework recently adopted by Mining Council of Australia members, is providing additional measures to demonstrate and enhance ESG performance at site level. Member companies are now reporting annually against TSM indicators, with results verified externally.
“The added transparency that standards such as the GITSM and TSM bring to the management of TSFs is helping mining companies implement best practices in planning, design, construction, operation, maintenance, monitoring, closure and post closure activities,” adds Jason. “Ultimately, this translates into delivering greater ESG performance and positive impacts to the bottom-line.”
Leaving a Positive Legacy: Mine Closure and Rehabilitation
Alongside tailings management, the industry has embraced the concept that mine closure extends past the operational stage of when mining ceases and decommissioning is complete – it must include a comprehensive plan that defines post-mining management including rehabilitation and relinquishment.
“The future of the mining industry is dependent on leaving a positive legacy,” says Jason.
“Companies today recognise that to gain access to future resources, they need to demonstrate the effective management and closure of mines with the support of the communities where they operate – particularly Traditional Owners.
“Ongoing engagement with the community throughout the LoM makes good business sense for companies to sustain their operations in the long-term.”
The legacy framework below provides a visual context for understanding the nature of the mineral resource legacy:
“Mine closure is a process,” says Jason. “To be successful, it needs to start with early planning, involve progressive rehabilitation during operations, and culminate with final decommissioning, rehabilitation and relinquishment.
“From our experience, the companies that are successful in this process intervene early – sometimes five or ten years out from final closure in order to balance storage volume and long-term landform and land – use objectives.”
Considering the mining industry’s ambition to achieve net zero emissions by 2050, plans for land and water stewardship and rehabilitation are critical.
Applying circular economy thinking to mining waste presents a major opportunity to reduce the liability and increase the value of waste materials arising from mining and processing operations.
An example is Glencore, which closed operation at the Liddell Coal Complex in the NSW Hunter Valley this year has plans to repurpose the site into an Industrial Renewable Energy Hub, including building a 500 MW grid-scale battery.
In a recent announcement, AGL Chief Operating Officer, Markus Brokhof said, “The demolition process is estimated to commence in early 2024 and take around two years to complete. More than 90 per cent of the materials in the power station will be recycled, including 70,000 tonnes of steel which is more steel than there is in the Sydney Harbour Bridge. Critical infrastructure, such as transmission connections to the grid, will be retained as the site transitions into the Hunter Energy Hub.”
“The industry’s approach to rehabilitation has improved significantly over past decades,” says Jason. “While community expectations have evolved, so too have corporate values, particularly from an ESG perspective. Technological advancements are also strengthening the science underpinning rehabilitation methods which is making it a little easier to take active steps towards leaving a positive legacy.
“One example is the work that we are currently undertaking with one of the world’s largest mining companies, providing advice for a scheduled mine closure plan, involving a residue pond closure and rehabilitation of the land. While the end of mining is not expected until later this decade, our client is undertaking progressive rehabilitation of the mine site and ensuring activities are planned, implemented and regulated to create a sustainable future for the Traditional Owners and broader region.”
ESG Practices are Creating Shared Value
Thinking and acting on ESG has never been more important. It is an inextricable part of how companies need to do business in what is quickly becoming a net zero economy. Put simply, ESG issues are influencing the companies people work for, buy from and invest in.
Kate Hartness, Director of ESG at BG&E Resources says, “While balancing the benefits of mining on the planet, people and profit is challenging – it is not impossible. Several giants and juniors are taking steps to fulfil their ESG goals.
“While this process can seem daunting, it does not need to be complicated. ESG frameworks work best when they are tailored to the unique business, government agency or project.
“The key is embedding ESG practices into operations for ease of monitoring, reporting and disclosures. This includes early engagement with stakeholder groups to help deliver maximise benefits (for all stakeholders), as well as to help proponents and governments to bring projects to market more swiftly.
“The more ESG practices are integrated into your core business strategy and operational execution – such as tailings management, mine closure and rehabilitation – the more likely you will attract and retain top talent, reduce risk, build stakeholder trust and deliver value to financiers and investors.”
The approach above enables proponents and government to truly make a difference to the communities in which they/we operate – both now and after production stops.
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