Decoupling Growth from Emissions

Chile is vulnerable to climate change, as can be seen from the higher temperatures and decreased precipitation in the north and centre of the country. In this context, Antofagasta Minerals has created a standard and a climate change strategy, and is sourcing non-conventional renewable energy for its operations.

OUR APPROACH

In 2016, Antofagasta Minerals approved the Climate Change Standard, with several important aims to:

  • Identify risks and opportunities associated with climate change at each operation.
  • Promote innovation in energy efficiency and the use of clean energy in the Group’s operations and projects.
  • Mitigate greenhouse gas emissions.
  • Measure and report results.

The Group has measured and publicly reported its carbon emissions to the Carbon Disclosure Project (CDP)1 since 2009.

1 The Carbon Disclosure Project is a leading international organisation that monitors and publishes companies’ carbon and water footprints. Find more information at www.cdp.net

Chile contributes 0.2% of global carbon emissions. In 2016, the country ratified the Paris Agreement, launching a sustainable energy strategy1 that committed the country to achieving a 30% reduction in its carbon dioxide (CO2) emissions intensity. As part of this commitment 100% of major consumers, including the mining industry, must make efficient use of energy by the year 2035 and 70% of electricity will come from renewable sources by 2050.

In 2016, the government defined which companies will be subject to the new tax on the emission of pollutants from stationary sources. This will not directly affect mining companies.

OPERATING CONTEXT

The Group’s energy consumption and CO2 emissions will continue to increase due to the lower ore grade, the increased hardness of the rock, the ageing of the mine (which means digging to a greater depth and transporting loads further) and the decision to use seawater2.

The main challenge for Antofagasta Minerals is to keep growing without proportionally increasing its emissions. It is therefore focused on looking for opportunities to reduce its emissions, both in electricity supply sources and in its own operations, as well as incorporating energy efficiency criteria from the start of its new mining projects.

1 www.energia.gob.cl/sites/default/files/hoja_de_ruta_cc_e2050.pdf
2 Pumping water from the coast to the operations increases the consumption of electricity provided by the Northern Grid (SING)

72% of the Group’s CO2 emissions relate to electricity consumption, so its priority is to diversify its electricity supply based on renewable energy sources.

In 2016, 17% of total energy consumption was generated by renewable sources, up from 5% in the previous year.

All operations have long-term electricity supply contracts, so efforts must be focused on reducing emissions by replacing the use of diesel with more economical and sustainable fuel sources. For instance, some of the Group’s operations are converting to natural gas for heating solutions in the SXEW plants.

ALTO MAIPO HYDROELECTRIC POWER PROJECT

In January 2017, Los Pelambres completed the sale of its 40% interest in the Alto Maipo hydroelectric project. With this sale, the company and Antofagasta Minerals have relinquished all ownership of this project, as it no longer part of the Mining Group’s strategy. An agreement was reached to modify the existing long-term contract for the purchase of energy from Alto Maipo.

The Climate Change Standard guides the implementation of initiatives to mitigate emissions from all operations and future mining projects. In order to do this, using the abatement curve methodology, critical activities are identified to devise technically and economically viable reduction projects. Antofagasta’s emissions have been rising steadily, mainly due to two new operations in the Group’s portfolio. In 2016, total emissions reached 2.8 million tonnes of CO2, a higher figure from

Antofagasta’s emissions have been rising steadily, mainly due to two new operations in the Group’s portfolio. In 2016, total emissions reached 2.8 million tonnes of CO2, a higher figure from previous year. The intensity of emissions increased by 13%. The increase was due to the commissioning of Antucoya and the acquisition of Zaldivar.

CO2 emissions by location (Tonnes of CO2 equivalent)

1. Scope 1 + Scope 2
2. Total CO2 emissions per tonne of fine copper produced (scopes 1 and 2)