Gold and climate change

Materials World magazine
,
27 Nov 2019

How can the global gold industry decarbonise while maintaining robust production and market value? Ceri Jones reports.

‘How can the gold value chain align with net-zero by mid-century?’ asked the World Gold Council’s (WGC) Gold and climate change: current and future impacts report, published in October 2019.

Building on 2018’s introduction, this latest paper aimed to present a realistic view of the carbon footprint of gold, as well as practical recommendations to reduce the metal’s environmental impact.

‘One of the things that comes through very clearly in the report is how much the emissions profile of the entire gold supply chain is concentrated at the mine site, which actually means that the route to decarbonise and to get to net-zero can be relatively focused – it is about reducing emissions at the mine site,’ WGC CFO, Terry Heymann, told Materials World.

With the manufacturing, sale and distribution of gold products contributing very little overall, the WGC set out an ideological framework to guide the industry on minimising emissions during the mining and processing stages, and to encourage a profitable new business model based on scientific insight.

The state of play

According to the WGC figures for 2018, global production released 32,700 CO2eq emissions per tonne of gold, based on the direct greenhouse gas emissions from the mining and processing (36% of total), and the associated energy consumption (43%). This was an increase of 3,500 tonnes on 2017.

To meet the goals set out in the Paris Agreement, WGC forecasted that the industry will need to achieve an 80% reduction in annual emissions to hit the 2°C rate, and 92% reduction to be in line with the 1.5°C rate, by 2050. To get there, the report suggested that gold mining companies target emissions reductions across the following five key areas:

  • Process and energy efficiency, including using smart technologies for asset management, like drones for surveying, LED lighting and advanced mechanical crushers and conveyors
  • Decarbonising electricity by sourcing from renewable energy suppliers and investing in energy storage technologies
  • Decarbonising transport by using electric and fuel-cell powered vehicles and machinery on sites and during ore transportation
  • Achieving energy self sufficiency by building renewable energy minigrids to eliminate diesel backup generators, and
  • Optimising chemical processes.

‘We recognise that we have been quite ambitious in setting out what this path could look like, and it will be challenging – but I think it is important that the industry has that ambition and goal that says, “This is what we could do, let’s figure out how we do that”,’ Heymann said.

‘This is about a pathway. 2050 is still a long time away and based on what we know today, both in terms of the existing technology but also what we see in decreasing costs curves […] means it is realistic.’

Heymann confirmed that the approach will vary greatly depending on the gold mining business, in terms of size, output, location, and operational limitations, but that a collective commitment is the desired response.

‘What it means for individual companies will be very situation specific. The cost of the technology is coming down and linked to that, you are increasingly getting a business case that is economically robust to decarbonise, which is partially about the will to decarbonise, but it’s a lot to do with the capital costs of putting in renewable energy options and increasing energy efficiency, and other things like minigrids over the lifecycle.’

Drilling the data

In terms of data gathering, Heymann confirmed that there is a degree of uncertainty as the figures are largely representative, although still more accurate than previous records. For instance, while corporate emissions totalling 78 million tonnes a year were based on reported production and smelter data, artisanal and small-scale miners (ASM) cannot be tracked so were estimated at 48 million tonnes as an indication of the size of the sector.

‘To get emissions data on ASM is almost impossible. But obviously ASM is an important part of the gold global production supply and it would be wrong to exclude it. I’m almost 100% positive that we have over-estimated emissions associated with ASM because we applied the same emissions per ounce intensity that we used for large-scale mining.’

Decarbonising and de-dieseling

Energy management is a major factor in the report, and WGC states that moving away from diesel is a real area of opportunity for miners. However, there are significant financial and legal challenges to implementing such broad changes, which suggest that action may be in the hands of the major players.

‘Some things are very capital intensive – building a huge solar array has the potential to significantly reduce greenhouse gases, but is a big capital investment decision. But there also examples of getting more energy efficient and, as simple as it sounds, switching lights off or using AI to regulate energy use better, and just challenge convention.

‘I think the hardest challenge will be for those places where there are regulatory restrictions that prevent them from decarbonising, such as places where the current situation doesn’t give a choice in terms of sourcing energy from, say, a national energy provider.

‘It is important for the industry to come together and engage with the regulator, the government, energy providers, and with others, because these situations are very rarely simple, but there’s a need to try and find a way through. We feel confident on behalf of the industry as saying this is what you should be aiming to get to, and think that mining companies should commit to that and use that as a spur to drive further innovation.’