August 2008

Steering a course to sustainability

Mining industry addressing issues of social and environmental responsibility

By D. Zlotnikov

Elk Valley Coal employee taking water samples as part of environmental testing

In today’s environmentally sensitive world, you’re unlikely to find a mining company that hasn’t had to field questions about its environmental record. Still, as legislation and public awareness continue to set new goals for environmental and social responsibility, the race towards more sustainable operations is one in which all industry members must participate.

While sustainability is certainly not a new concept for mining companies, the importance of its pursuit cannot be overstated. “Mining companies have been aware of sustainability issues and managed them, but have been doing so implicitly,” said Henry Stoch, senior manager for corporate responsibility and sustainability at Deloitte. “But today’s legal and social environment is one that requires this to be explicitly included in a company’s strategy.”

Managing risk

The need for a global strategy, Stoch explained, comes down to managing one’s risk. One illustration of this practice offered by Stoch was the work of Anglo American in some of its African operations. “Anglo realized that in order to have viable, long-term operations, it needed to ensure viability of the local community and workforce. To that end, they figured out the cost of treating their employees who were HIV positive, and the cost of lost labour and how that would affect their production and stock value. The latter far outweighed the costs of setting up a large-scale, anti-retroviral drug project, which is what they did.”

Such initiatives are more than demonstrations of good corporate citizenship and ensuring that the company maintains its social license; there are also clear financial benefits for doing so.

“It’s important to realize how these externalities impact your business viability in the long term,” said Stoch. In his opinion, today’s mining companies must extend their focus beyond the immediate future and consider the factors potentially affecting operations in the next three, five, or even seven or more years.

Taking care of business

Not all sustainability initiatives require the implementation of large-scale programs. Sometimes it entails that companies rethink the way they conduct business on a daily basis.

Derek Teevan, manager of government and corporate affairs at De Beers Canada, explained the steps the company took to minimize the footprint of its Victor and Snap Lake operations in northern Canada. Both sites receive their equipment and supply shipments primarily in winter, when they can be accessed by the winter roads. De Beers has opted to limit airborne shipments to personnel and perishables, to minimize both its transportation costs and carbon footprint. But the implication of this access restriction means a lot more must be stored onsite — and a lot of planning.

“For everything you take in, you have to consider how you’re going to store it, consume it and dispose of it,” Teevan said. De Beers has worked to minimize this cost, and related environmental impacts, by cutting down wherever possible on packaging materials. Additionally, De Beers has endeavoured to minimize the number of people onsite at any given time. “This limits the strain on the local environment and the mine facilities,” explained Teevan.

Similarly, in the spirit of incremental improvement, the Ontario Mining Association (OMA) undertook an air leak management project in 2006. Pilot studies were done at three mines (McCreedy West, Copper Cliff South and the Williams mine). Initiatives focusing on only the major and medium leaks resulted in annual savings of $100,000 in energy costs per mine and, in some cases, allowed the operators to avoid the added costs and environmental impact of purchasing and transporting additional compressors.

Not all external forces present challenges — sometimes there are unexpected benefits that mining companies can take advantage of. Teevan mentioned one such synergy that helped decrease both the costs and the carbon impact of the Victor mine. “When we were working on the environmental impact assessment for the mine, it looked like the only viable option was for us to undertake onsite power generation with diesel generators,” he explained. But before the assessment was completed, legislative changes in Ontario made it more cost-effective to extend power lines to the remote site. De Beers went back to the original evaluation and determined that connecting Victor to the grid was more preferable in terms of cost and environmental impacts. “This was a factor beyond our control,” said Teevan, “but we took advantage of the opportunity when it presented itself.”

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