Climate change
Gold Fields' climate change programme focuses on the assessment and mitigation of climate change-related risks, including the development and implementation of action plans and energy management programmes to reduce emissions , while at the same time ensuring water security. Gold Fields' objectives are to minimise the Company's contribution to climate change and to build resilience to impacts of climate-related risks on our operations and host communities. It is increasingly clear that the negative physical impacts of climate change are real and immediate, due to:
- The long-term risks posed by climate change to the Group's operations and surrounding communities
- Increasing efforts to regulate carbon emissions in most of our jurisdictions
- Taxes increasingly imposed by governments on non-renewable energy consumption
Climate change-related regulations, comprising carbon emission and renewable energy targets, continue to evolve across our regions, and we consistently assess and investigate how these changes will affect our operations. These are detailed in the regional reports.
Task Force on Climate-related Financial Disclosures (TCFD)
Business impact on the climate, and companies' ability to withstand climate change, are issues of increasing global importance, and vital to our stakeholders. In 2018, Gold Fields became the second Johannesburg Stock Exchange Limited (JSE)-listed company in South Africa (and the first mining company) to publicly back the United Nations (UN)-endorsed recommendations of the TCFD. The recommendations have been adopted by many national financial regulators.
By following the TCFD, we will be reporting our climate-related performance in a more targeted and practical way than before, linking it to financial risks and opportunities. In 2019, we will release our first TCFD report, which will replace our annual submission in terms of the CDP, formerly the Carbon Disclosure Project. The report details aspects of governance and climate-related risks, as well as our risk management framework, our strategic approach in adapting to and mitigating impacts of climate change, and presents trends in our key climate change-related metrics.
Gold Fields has been disclosing emissions, risks and opportunities for more than 10 years through the CDP. Key energy and carbon emissions data are assured externally. Gold Fields maintained its A- score for its 2018 CDP performance, ranking it among the leaders in the mining sector for both our disclosures and management practices.
| Gold Fields Scope 1 – 3 CO2 emissions |
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Group performance and strategies
The 2018 Group risk register includes the impact of climate change among the top 20 Group risks. Furthermore, the Board's Safety, Health and Sustainable Development (SHSD) Committee reviews the performance of energy and climate change programmes on a quarterly basis. Every five years we review our vulnerability to climate change and develop Group-wide strategies and programmes in response to these.
During 2017 our Ghanaian operations' piloted use of an ICMM climate-data viewer tool, which provides insight into physical changes in precipitation, temperature, wind and water stress levels. These outcomes were used in developing adaptation plans, such as reviewing design flood lines and inclusion of climate change impacts in our project standards. The ICMM tool is in the process of being rolled out to our other operations.
Our carbon emission performance mirrors the energy usage trends at our operations. These are detailed in Group energy performance. Gold Fields' disclosures cover all three carbon emission scopes, Scope 1 - 3, both in absolute figures and intensities. Total Scope 1 - 3 CO2-e emissions during 2018 amounted to 1.85Mt, a significant drop from 1.96Mt in 2017, reflecting the decrease in total energy usage to 11.62TJ in 2018 from 12.18TJ in 2017. Emission intensity was unchanged from the 0.66t CO2-e/oz in 2017, due to a decline in Group gold production. Our aspirational target is to reduce cumulative carbon emissions by 800kt CO2-e between 2017 and 2020. Cumulative carbon emission reductions from 2017 - 2018 totalled 265kt CO2-e.
Our commitment to low-carbon and renewable energy is a significant contributor to our efforts in reducing carbon emissions. All our operations, other than South Deep, are largely powered by LP gas, a low carbon energy source. In Q1 2019, Granny Smith and Agnew announced significant renewable energy projects to be operational later in 2019 or early 2020 . South Deep, Tarkwa and Damang are also investigating developing renewable energy assets in the near future.
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Regional performance |
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KEY RISKS |
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2018 KEY DEVELOPMENTS |
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- Adequacy of flood management measures
- Declining water availability
- Tailings dam stability
- Increased cooling costs
- Legislative changes
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Australia’s government is reviewing the safeguard mechanism
(SGM) introduced in 2016, which applies to facilities emitting
more than 100,000 tonnes CO2-e emissions each year. We
expect Gruyere, once operational, to also be governed by the
SGM with the baseline determined by its production plan.
Penalties are applied for exceeding emission baselines, or
domestic carbon offsets must be purchased to make up the
difference. Our Agnew and Granny Smith mines have not
exceeded their baseline, but St Ives did so in 2017; emission
credits from the Granny Smith gas power were used to offset the
penalties. The main impact of the SGM review, which is expected
to be implemented by mid-2019, will be the transition from
historic to calculated baselines, which will better reflect our
operations’ current production profiles.
We continue to manage the lack of certainty regarding the
government’s climate change policy through efforts to improve
energy efficiencies, as well as taking advantage of the
government’s carbon abatement initiatives. During 2018, this
initiative at Granny Smith generated 21,032 Australian Carbon
Credits Units (ACCUs), with a positive balance of 13,450 ACCUs
for use against future liabilities or trading in the open market. |
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STRATEGIC RESPONSES |
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- Flood management plans
and critical hazard
standards
- Trialling site-based
weather modelling at
Gruyere
- Maintenance of water
balances
- Implemented energy
management plans, with
a savings target of up to
10%
- Conversion to renewable
energies at Agnew, and
the assessment thereof
at Granny Smith
- Dynamic and predictive
water balances
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Regional performance |
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| West
Africa |
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KEY RISKS |
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2018 KEY DEVELOPMENTS |
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- Increased operational
costs linked to road
maintenance,
replacement of tyres
and dewatering
- Increased volumes of
contaminated water
requiring treatment
- Short-term impacts to
mining during intense
rainfall events
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Ghana experienced abnormally heavy rainfalls, which impacted
both Tarkwa and Damang, and resulted in production delays,
the Tarkwa pits being flooded, and additional diesel usage for
dewatering. In response, we modified our pumping, storage
and pit dewatering strategies.
In 2018, we implemented recommendations of the climate
change risk and vulnerability assessment conducted in 2017,
including increasing pumping capacity for pit dewatering,
reduced reliance on the national power grid, which is reliant on
hydro power, and engaging communities on climate change
impacts. We also started a new water treatment facility at
Damang, which includes adding chemicals to reduce nitrate
levels to approved standards, while improving water treatment
costs and effectiveness.
To meet the requirements of the Renewable Energy Act of 2011,
proposals for renewable power, amounting to 6MW for Damang
and Tarkwa, are currently being investigated. |
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STRATEGIC RESPONSES |
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- Staggering of pit floors
to aid drainage and
dewatering
- Review catchment
mapping
- Implement a control
process for maintaining
road quality for long
haulage routes
- Dynamic and predictive
water balances
- Provision made for rain
delays in operational plan
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Regional performance |
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| South
Africa |
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KEY RISKS |
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2018 KEY DEVELOPMENTS |
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- Variability in rainfall
intensity increasing costs
of alternative water
sources
- Temperature increases
affect surface cooling
plant efficiency and
causes heat stress for
surface employees
- Climate change-related
regulatory uncertainty
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South Deep continues to work with an independent power
producer (IPP) to finalise the construction of a 40MW solar
photovoltaic (PV) plant at the mine. In terms of the plan, the IPP
will raise funding for the plant in return for a long-term purchase
power agreement with South Deep. Funding issues are currently
being finalised. The IPP is consulting with the Department of
Energy on regulatory clarity around the licensing, technical and
other requirements of the plant.
Legislation to levy taxes on companies’ Scope 1 CO2 emissions
will come into effect on 1 June 2019. South Deep’s exposure to
the tax is minimal as its Scope 1 emissions, largely related to
diesel usage, were only 5,504t CO2-eq in 2018. A carbon tax levy
of R0.10/l was announced by the Finance Minister in early 2019,
which amounts to an exposure of around R197,000 (US$15,000)
for South Deep. However, should Eskom be allowed to pass on
the cost of the tax on diesel usage to customers, their electricity
tariffs could rise significantly. |
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STRATEGIC RESPONSES |
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- Dynamic and predictive
water balances
sources
- Reduce freshwater
withdrawals
- Reduce potential Scope1 and Scope2 and
emissions through
improved diesel
efficiencies and
renewable energy
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