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Major miners commit to net-zero Scope 1, 2 GHG emissions by 2050

06 October 2021 Keiron Greenhalgh

A group of 28 mining companies, including some of the biggest names in the sector, committed to net-zero Scope 1 and 2 GHG emissions by 2050 or sooner on 5 October.

Scope 1 emissions are direct emissions from sources controlled by an organization. Scope 2 emissions are indirect emissions associated with the purchase of power, steam, heat, or cooling.

Some of the companies, all of whom are members of the International Council on Mining & Metals (ICMM), have already committed to net-zero Scope 3 GHG emissions separately, and more may do so in the future. Scope 3 emissions include all other indirect emissions that occur in a company's value chain.

In addition to the 2050 pledge by the companies, they made a nearer-term promise. The ICMM members said that no later than the end of 2023, each would set Scope 1 and 2 pathways through short- and/or medium-term targets and accelerate action on Scope 3 emissions.

"We recognize that Scope 3 is critical to minimizing our overall impact and we will set Scope 3 targets, if not by the end of 2023, as soon as possible. Although all Scope 3 action depends on the combined efforts of producers, suppliers and customers, some commodities face greater technological and collaborative barriers than others," they said in a letter announcing the Scope 1 and 2 GHGs pledge.

The ICMM members also promised to focus on absolute reductions, although "intensity rather than absolute targets may be more appropriate in the short and medium term." They added that where intensity targets are used, the companies will disclose the corresponding absolute increase or decrease in GHG emissions.

Another sector with hard-to-abate emissions, maritime transportation, is among those to receive criticism for focusing on emissions intensity rather than absolute reductions.

On top of the other promises, the miners said they would report their progress on scopes 1, 2 and 3 emissions annually, obtain external verification of performance, and report in alignment with the recommendations of the Task Force on Climate-related Financial Disclosures.

The companies putting their names to the pledge are: Hydro, Freeport-McMoran, Antofagasta Minerals, Vale, Codelco, Newcrest Mining, Barrick, AngloGold Ashanti, Anglo American, Sibanye Stillwater, MMG, Polyus, Gold Fields, Alcoa, BHP, JX Nippon, South 32, Orano, Minsur, Teck, African Rainbow Minerals, Glencore, Sumitomo Metal Mining, Minera San Cristobal, Newmont, Mitsubishi Materials, Boliden, and Rio Tinto.

Hard-to-abate sector

Mining is a sector among those that will find it hard to abate its emissions, observers say, with substantial amounts of fuel required to extract the ore and then transport it in the first place and then transform it downstream by smelting for instance. Smelting typically requires large amounts of electricity.

In addition, mines are often in remote, harsh locations where sourcing significant amounts of renewable energy onsite or electricity via transmission lines can prove difficult and expensive.

Still, as the COP26 climate change meeting approaches, the miners' pledge won the backing of at least one key individual attempting to smooth the path to a carbon neutral world in 2050.

Gonzalo Muñoz, UN Framework Convention on Climate Change High Level Climate Action Champion, said: "I welcome the leadership and joint ambition of ICMM members to commit to a goal of net-zero Scope 1 and 2 GHG emissions by 2050 or sooner, and I strongly encourage companies to set Scope 3 GHG emissions reduction targets by the end of 2023."

Scope 3

Some of the signatories already have, in some cases after previously warning such a path was a fool's errand.

In February, Rio Tinto said it plans to tackle its Scope 3 emissions. The company's stance was an about-face for a company that in 2020 said considering such a goal was a bridge too far.

Rio Tinto is the largest iron ore miner by volume, according to company filings. Much of that heads to China, the world's largest steelmaker. Because steel is produced through an energy-intensive manufacturing process that involves both iron ore and coal, Rio Tinto Scope 3 emissions will be a substantial challenge to tackle.

As part of Rio Tinto's efforts to tackle its Scope 3 emissions, the Anglo-Australian firm said it was working with customers in the steel industry, investing in technologies it believes can reduce the carbon intensity of steelmaking by at least 30% from 2030, as well as developing "breakthrough technologies with potential to deliver carbon neutral steelmaking pathways by 2050."

The company also said it had teamed up with partners to enable the production of zero-carbon aluminum, and hopes to reach net-zero emissions from shipping of its products by 2050.

Glencore, which merged with coal to copper miner Xstrata in 2012, has also pledged to achieve net-zero Scope 1, 2 and 3 emissions by 2050. In its preliminary 2020 earnings statement in February, Glencore said its Scope 3 CO2 emissions fell to 264,000 metric tons (mt) in 2020 from 347,000 mt in 2019, while its Scope 1 and 2 CO2 emissions fell to 24,300 mt in 2020 from 29,200 mt in 2019.

Tough sledding

IHS Markit Pricing and Purchasing Service Director John Mothersole told Net-Zero Business Daily he was not surprised the mining industry was setting out ambitious goals to reduce its GHG emissions, given the increased focus on mining as an integral part of a transition in energy markets over the next 25 years.

"I suspect the industry will come close to, if not meeting, its target of net-zero emissions by 2050," he said. "The question to me is at what cost."

Over the past 50 years, he said, productivity growth has allowed real costs to remain steady or even continue to fall, so, the challenge is whether the industry will be able to maintain this record over the next 25 years.

Part of the problem will be the enormous mining trucks used, especially at open cast operations. Models such as Caterpillar's 797 series carry over 400 mt of ore, with the latest 797F model measuring 14.8 meters in length and 6.52 meters high while packing a 4,000 horsepower (hp) diesel engine. In contrast, Ford's SuperDuty F-350 heavy-duty truck —the big brother to the best-selling F-150 model that is about to go electric—tops out at 475 hp.

As a result, the ICMM members said they planned to accelerate the deployment of zero-emission mining vehicles in their operations and the wider industry through the Innovation for Cleaner Safer Vehicles initiative. The initiative brings ICMM members together with original equipment manufacturers to develop a new generation of mining vehicles

IHS Markit's Mothersole said there are challenges even in achieving Scope 1 targets by 2040 in above-ground mining vehicles. The energy density of the battery technology present today or likely to be available over the next 10 years doesn't look able to support mining operations at a cost the industry would see as viable, he said.

With miners looking to run such vehicles around the clock, the charging times required would imply a significant loss in productivity, said Mothersole. The same arguments would apply to loaders and excavators, he added.

One solution to the transportation fuel and electricity problem, if it is scalable at cost, said Mothersole, may be green or blue hydrogen. Green hydrogen production involves electrolysis using power from renewable resources.

Activity in Australia, one of the world's foremost mining centers, indicates the range of ideas that are being studied.

BP said a study into the feasibility of an export-scale green hydrogen and ammonia production plant in Western Australia found that production using renewable energy is technically feasible at scale. BP is one of a number of developers eyeing the state for export-scale green hydrogen and ammonia projects.

But some are targeting customers relatively close to home as well as abroad. InterContinental Energy and CWP Global proposed the Asian Renewable Energy Hub (AREH)—a 15-GW to 26-GW wind and solar facility that would supply power to local industry and an up to 10 million mt ammonia export project. AREH is to be located in northwestern Western Australia's Pilbara region, an iron ore industry hub.

TotalEnergies-backed Total Eren, meanwhile, signed a memorandum of understanding with Province Resources to carry out a feasibility study for the Australian miner's Hyenergy project in the Gascoyne region of northwestern Western Australia, which would utilize up to 8 GW of renewable electricity. The Gascoyne region is adjacent to the Pilbara region.

These efforts to cut emissions are voluntary, but Australian developers could be mandated to do so in the coming years, including Scope 3 emissions, according to Jodie Wauchope of law firm Dentons. In a recent article, Wauchope said a court in the Australian state of New South Wales ruled that Scope 3 emissions must be addressed in environmental planning applications by miners.

Posted 06 October 2021 by Keiron Greenhalgh, Editor, Climate & Sustainability Group, IHS Markit

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