Most of the major mining houses have made commitments to achieve carbon neutrality by 2050 and set ambitious mid-term (2030) targets. As these commitments form part of company’s investor reporting they are binding. Mining houses therefore need to ensure they meet the commitments or face penalties.
Several technologies provide the capacity to achieve the reductions; these include renewable energy (solar, wind, thermal, cogeneration etc.), electric, hydrogen or hybrid vehicles, as well as energy-efficient processing options, equipment, ventilation and conveying. Beyond technology, policy level changes can reduce carbon footprint including for instance a focus on local or carbon neutral suppliers, transport alternatives, offsetting and waste management strategies.
Decarbonisation technology is increasingly available and is being tested in the mining industry; however, implementing this technology is no simple matter.
Transitioning to this new technology meets the following challenges and risks:
• Performance and availability at scale with the potential to increase supply based on demand
• High capital and operational costs
• Timeframes for overhaul and the associated costs
• After-sales service and skilled maintenance workforce to effectively maintain the equipment
Time factors and stricter regulations remain significant challenges to this transition.
Implementation of new technology is hampered by the timeframe needed to test, adapt and troubleshoot the technology to an acceptable level of assurance, traditionally 10 to 15 years. Technologies are also often not off-the-shelf products. To be effective, solutions need to be tailored to site conditions, type of mine, and specific objectives of the installation. A typical mine life of about 10 to 15 years is therefore too short to implement many aspects of decarbonisation technology.
Investment into new mines is further limited by stricter regulatory limitations imposed, for example, by national power regulators. Although partnerships with Independent Power Producers (IPPs) offer opportunities, IPPs typically require 20–30-year contracts, an impractical commitment when most mines are usually established before a 20-year life is confirmed.
Furthermore, the permitting requirements in some jurisdictions for new technology (like renewable energy) remain uncertain. Without the benefit of previous experience, authorities are often unable to make quick decisions; this adds to the costs and timeframes of implementation of new technology.
Nonetheless, miners and investors have set ambitious transformation targets and are working proactively to address assurance issues to facilitate this transition. Mining companies and technology providers can be commended for their actions to increase the likelihood of meeting the stated targets. However, the extent of the technological transformation required is unprecedented. Supply chains and maintenance support systems that have developed over decades will now have only years to adapt to new technologies.
SRK recognizes the challenges in implementing decarbonization technologies but understands that a rapid roll-out is needed to meet commitments. SRK has adapted and grown it's skills in the engineering fields of mining, civil, environmental and mineral processing engineering to effectively identify alternative technologies while maintaining practical considerations tailored to specific mine sites.
SRK is engaging with a range of industry participants to understand and facilitate ongoing progress by identifying and working to eliminate areas of regulatory and technical uncertainty.
