Greenhouse Gas Emissions and Production Cost Footprints in Australian Gold Mines
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Journal of Cleaner Production 267 (2020) 122118 Contents lists available at ScienceDirect Journal of Cleaner Production journal homepage: www.elsevier.com/locate/jclepro Greenhouse gas emissions and production cost footprints in Australian gold mines * Sam Ulrich a, b, , Allan Trench c, b, d, Steffen Hagemann b a CSA Global, 3 Ord Street, West Perth, Western Australia, 6005, Australia b Centre for Exploration Targeting, School of Earth Sciences, The University of Western Australia, 35 Stirling Highway, Crawley, Western Australia, 6009, Australia c UWA Business School, 35 Stirling Highway, Crawley, Western Australia, 6009, Australia d CRU Group, Chancery House, 53-64 Chancery Lane, London, WC2A 1QS, United Kingdom article info abstract Article history: Australia has a globally significant gold mining sector for which both greenhouse gas (GHG) emissions Received 22 June 2019 data and production cost data are often available on an individual mine basis. Establishing relationships Received in revised form between GHG emissions and production costs has the potential to shape the future of the gold industry 5 March 2020 in Australia through greater focus upon cleaner, efficient production. GHG emissions data from Australian Accepted 6 May 2020 gold mines reveal consistent, significant relationships between gold grade and GHG emissions intensity Available online 14 May 2020 per ounce. Higher gold grades are associated with lower GHG emission intensity per ounce. Differences Handling editor: Kathleen Aviso in both emissions intensity and gold grades exist between open pit mines, underground mines and those operations which source ore from both open pit and underground. Open pit gold mines have the highest Keywords: GHG emissions intensity but lowest costs. Underground mines have the lowest GHG emissions intensity Greenhouse gas emissions but costs that are above open pit mines. Australian gold mines exhibit declining gold grades that are Production costs predicted to continue over the coming decade. These projected lower gold grades will lead to higher GHG Gold emissions intensities in the absence of other GHG abatement interventions. Significant opportunities Energy consumption exist, to materially reduce GHG emissions at Australian gold mines with interventions underway. Broader Footprints adoption of solar and wind energy, changing how underground mines are cooled and the introduction of electric vehicles and mining fleet, especially in underground mines, are key impact areas. © 2020 Elsevier Ltd. All rights reserved. 1. Introduction scrutiny is on the industry’s environmental impact by regulators, investors and the general public. Australia is the second-largest producer of gold in the world, This study focuses on GHG emissions of gold mines in Australia. and this sector accounts for 1.1% of Australia’s annual GHG emis- However, the authors make reference where appropriate to the sions. As such, reducing emissions in Australia’s gold sector and the required energy consumption for gold production. It is the first cost of doing so is of critical importance for the sustainability of the study to investigate whether relationships exist between GHG sector. Gold is important to Australia’s economy being its sixth- emissions and energy consumption with reported costs of pro- largest export of goods and services valued at A$19.1 billion in duction, All-in Sustaining Costs (AISC), the source of the gold 2018 or 4.4% of total exports (Department of Foreign Affairs and mined, whether via open pit (OP), underground (UG) or both (OP & Trade, 2019). UG) and the individual mine power source. It builds upon previous A better understanding of GHG emissions and the measures that sector-based studies. can be taken to reduce them, allows Australia’s gold mine owners to The world gold industry produces over 3000 tonnes of mined improve their environmental credentials in times when far greater gold per annum. China is the largest gold producer, producing 401.1 tonnes (12.90 million ounces) in 2018 (China Gold Association, 2019). Australia is the second-largest, producing 315.1 tonnes (10.13 million ounces) of gold in 2018 (Department of Industry * Corresponding author. Centre for Exploration Targeting, The University of Innovation and Science, 2019). Other significant gold producing Western Australia, 35 Stirling Highway, Crawley WA 6009, Australia. nations are Russia, USA and Canada (U.S. Geological Survey, 2018). E-mail address: [email protected] (S. Ulrich). https://doi.org/10.1016/j.jclepro.2020.122118 0959-6526/© 2020 Elsevier Ltd. All rights reserved. 2 S. Ulrich et al. / Journal of Cleaner Production 267 (2020) 122118 Australian gold production is sourced from around 63 different Australia is heavily reliant on non-renewable fuels for electricity mining operations (December 31, 2018), comprising 46 gold-only generation, accounting for over 80% of electricity generated and 17 gold-plus other metals deposits, with approximately 54% (Table 3). The coal contribution has dropped from over 80% to 60%, of mines operating underground, 22% as open pits and 24% mining and natural gas has increased to 21%. The renewable energy from both open pit and underground sources in 2018. contribution has increased from 10% to 17% in the last decade, with Australia’s GHG emissions and energy consumption for the year an increase in electricity from wind and solar. ending June 30, 2018 were 533.7 million tonnes of carbon dioxide The existing knowledge base on gold production costs (AISC) equivalent (Mt CO2-e) (Department of the Environment and Energy, and the significant relationship to grade focused upon UG mines 2018) and 6172 PJ (Department of Environment and Energy, 2019a) (Ulrich et al., 2019). The current study extends grade-cost analyses respectively. The Australian gold mines in this study represent over to all Australian gold mines. 90% of Australia’s annual gold production, produced 5.9 Mt CO2-e or There remains considerable opportunity to deepen the under- 1.1% of Australia’s total GHG emissions and consumed 67.1 PJ or 1.1% standing of the variations in GHG emissions and production effi- of Australia’s total energy consumption. ciency in Australian gold mining, especially given the unique role of In this study gold mining refers to the processes of mining, gold in global financial markets (Baur and Oll, 2019) and the eco- processing, concentrating and smelting to produce gold dore bars nomic significance of the industry to Australia. at the mine before sent for refining at a third party (Fig. 1). 2. Data and methods 1.1. Study context This section summarises the GHG emissions, energy consump- tion, gold production statistics and costs data, its treatment and There is limited academic literature explicitly relating to GHG analysis. This study uses data from January 1, 2014 to June 30, 2018. emissions and energy consumption in gold mining. Previous The start date is governed by the introduction of the AISC measure, studies are based on company reported data or life cycle assess- by the World Gold Council in June 2013 (World Gold Council, 2013) ment (LCA) studies. The company reporting studies explain the and subsequently reported by most gold producers in Australia main driving factors of GHG emissions in gold mining, with quan- from 2014. All data were aggregated into a tabular database for titative assessments of the relationship to ore grade. The effect of analysis. declining gold grades over time highlights the sustainability issue The evolution of cost-reporting in the global gold industry, of increasing GHG emission footprints per unit of gold produced. specifically the recent widespread adoption of AISC as a cost pro- The LCA studies provide an understanding of the relative contri- tocol, makes systematic investigation into the relationships be- bution of individual production inputs to energy and carbon foot- tween production cost-efficiency, GHG emissions-intensity and prints. The LCA studies typically include some Scope 3 emissions, energy consumption possible. whereas the company reported studies only Scope 1 and Scope 2 emissions (Fig. 1). However, no studies provide a quantitative breakdown on a mine by mine basis or show the impact of initia- 2.1. GHG emissions and energy consumption data tives implemented to reduce GHG emissions. Summaries of these studies GHG emissions and energy consumption as intensities are GHG emission and energy consumption data were sourced from in Table 1 and Table 2, respectively. the Australian National Greenhouse and Energy Reporting (NGER) Some studies are specific to parts of the mining process, such as scheme data (Clean Energy Regulator, 2016, 2017, 2018, 2019), re- energy consumption used in ore comminution (Ballantyne and ported on the Australian financial year basis; 1 July to 30 June; and Powell, 2014; Ballantyne et al., 2012), greenhouse gas emissions from company sustainability data reported on either the Australian of the mining fleet (Peralta et al., 2016) and reducing greenhouse financial year or calendar year basis. Based on the assumption that gas emissions by different blasting approaches (Goswami and the gold mines are in a steady-state of production, the specific, Brent, 2016). intra-year timing of the GHG emission and energy consumption In Study Not in Study Scope 1 – Direct GHG emissions Scope 3 – Other indirect emissions Mining Processing Concentrating Refining and Downstream uses and smelting recycling Jewellery 99.99% Gold Onsite electricity generation emissions Investment Gold doré bars Scope