MINING’S TOUGH DECISIONS ON CLIMATE

David Stewart, Head of Mining Business Development at specialized carbon finance company, Invert is providing a joint case study with Karora Resources, on Nov 2nd at the Energy and Mines Toronto Summit. In this interview, David discusses mine ESG and mine climate performance.

DAVID STEWART: With increasing focus on ESG metrics and climate change, there are many ways mining companies and their investors are thinking differently, but some notable examples are: (1) what are you mining, (2) where are you mining it, and (3) how are you mining it?

• The emergence of ESG into the mining investor landscape has catalyzed shifts in commodity exposure, with materials such as thermal coal being divested by diversified miners like Rio Tinto, and increasing interest in electrification materials like lithium, nickel, and copper.

• The strategic location of mineral deposits is increasingly important. Mines are energy intensive, and so there has been surging interest in jurisdictions with low-carbon/renewable power grids such as British Columbia and Quebec, and it is becoming more difficult to invest in areas where only diesel generator power is available like Nunavut and other remote locations.

• Climate change is driving miners to consider GHG emissions profiles even at the early planning stages of the mining cycle. For example, underground mines have half the emissions intensity of their open pit counterparts on average, on a unit of production basis, and therefore are more attractive investments at face value.

DS: Some companies are having to make tough decisions which were beforehand considered obvious. For example, building a new, large-scale open pit mine might be financially savvy, but could compromise the company’s climate goals. In some circumstances, however, therein lies the opportunity. When planning a new mining project or a production expansion project, the company can incorporate greener technologies into the overall project scope, such as a solar farm, to both expand production and to reduce GHG emissions concurrently. At Invert, we work with clients both in production and in development stages, and are able to partner with them in developing their emissions reduction roadmaps which inform their mine planning decisions.

DS: The two largest sources of emissions in mining are generally the equipment fleet and the power source. Electrification of an equipment fleet, including use of battery mobile equipment in underground mines, or trolley assist in open pit haul trucks, are currently being employed to great effect today. Access to or the generation of renewable energy is also a major focus, and as mentioned earlier, impacts how investors or companies view and rank certain jurisdictions over others.

DS: At Invert we operate at the core of the carbon ecosystem. Especially through our Business to Business division, we are eager to meet and partner with mining companies and apply our dual-track approach to an accelerated path towards net zero: first focus on emissions reductions, then invest in carbon offset projects.