Rising consumer demand is driving concerns around the “availability”, “accessibility” and “criticality” of metal resources. Methodologies have emerged to assess the risks related to global metal supply. None have specifically examined the initial supply source: the mine site where primary ore is extracted. The complex orebodies database project offers a methodology that enables the assessment of a global dataset of extractives projects according to their Environmental, social, and governance (“ESG”) risks. We consider these risks as “situated”, and part of the geographic context in which mining activities takes place.
ESG risks are critical to the development of new mining projects and the conversion of resources to mine production. They are now considered more and more by investors as risks that can be financially material. If dealt with in a proactive way, these risks can also enhance long-term company value. ESG factors can play a particularly strong role in the development of mining projects. The early stages of development of a mine are the most vulnerable. When a project is at its infancy and revenues have not yet been generated, potential opponents can more easily contest it and cause delays, or even compromise the project. During these early stages, dramatic changes can occur for the communities living near or within the mining lease, providing fuel for conflicts to spark and amplify.
Our methodological framework is made of eight composite indicators related to eight key ESG risk domains relevant to mining: water, tailings, biodiversity, social vulnerability, land uses, indigenous peoples, political fragility, and approval and permitting. We overlay these indicators with a global dataset of mining projects in operation and pre-production stages. Spatial information for these mining projects was accessed through the S&P Global Market Intelligence database.
In a first study, we applied the framework to three major metals, iron, copper and aluminium. We found the percentage of global reserves and resources that are located in complex ESG contexts (i.e., with four or more concurrent medium-to-high risks) is 47% for iron, 63% for copper, and 88% for aluminium. In a second study, we considered a set of 20 metal commodities involved in the renewable energy transition. Our findings show that platinum and cobalt exhibit the most concerning risk profiles.
Biography
Dr. Eleonore Lebre is an engineer turned researcher, currently working at the Sustainable Minerals Institute, the University of Queensland. As part of her main research project, Eleonore develops a Complex Ore Bodies database that includes social and environmental data and assesses the risks associated with operating mines and new discoveries. She connects this work with topical issues such as tailings dam failures, renewable energy transition and critical metals.During her work at the SMI’s Centre for Social Responsibility in Mining Eleonore also developed expertise in mining-induced displacement resettlement, sustainability reporting, H&S incident investigation and mine closure. Before that, Eleonore completed her PhD across the Sustainable Minerals Institute’s environmental and social centres. Her thesis applies the concept of circular economy to the problematic of mining waste in the objectives of minimising waste and optimising resource extraction.
Eleonore Lebre, Deanna Kemp, John Owen, Rick Valenta
Centre for Social Responsibility in Mining, Sustainable Minerals Institute, The University of Queensland, QLD 4072, Australia, email: e.lebre@uq.edu.au
Centre for Social Responsibility in Mining, Sustainable Minerals Institute, The University of Queensland, QLD 4072, Australia.
W.H.Bryan Mining & Geology Research Centre, Sustainable Minerals Institute, The University of Queensland, QLD 4072, Australia.
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