Around 70% of operations in the world’s six largest mining companies — BHP Billiton, Rio Tinto, Anglo American Vale, Xstrata and Glencore International — take place in water-stressed countries.
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In such circumstances, access to clean water is often a key aggravator in clashes between mining companies and local communities, making it harder for miners to win the social licence to operate.
International Council on Mining and Metals’ (ICMM) new water stewardship position statement encourages its members to take a collaborative approach to the challenge of responsible use of water resources, while also obliging them to commit to strong and transparent water governance.
Here, Heidi Vella speaks to ICMM manager Hayley Zipp about the need for change in water management and the anticipated impact of this new commitment.
Heidi Vella: Tell us about the new commitments ICMM and its members have made on water stewardship
Hayley Zipp: Our water stewardship programme has ramped up in the last three to four years and culminates in the launch of a commitment that our members are required to meet to be good water stewards.
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By GlobalDataIn 2014 we launched ICMM’s water stewardship framework, which was our way to present to the industry the common challenges water poses to mining companies. We then tried to create a common understanding of what steps can be taken to address those problems.
In 2015 we launched a practical guide to catchment-based water management for the mining and metals industry and will soon launch guidance to support consistent water reporting for the industry.
HV: Why did ICMM decide to focus on water stewardship, was it in response to growing criticism of water use?
HZ: I think, globally, water challenges are rising. This is, in part, because of climate change, which is changing the natural water cycle. We also have a growing global population resulting in an increased need for food, energy and water. All these pressures are increasing the strain on water which mining operations share with others.
Over the last 17 years we have seen a massive increase in community mining conflict issues. The World Bank Group’s Compliance Officer Ombudsman [which] deals with grievances related to mining projects reported a 58% increase in complaints against mining companies in relation to water between 2000 and 2017.
The social licence to operate is key for the industry to be able to continue mining, therefore community-mine relations around water needed to improve. More open, two-way dialogue is needed, along with finding a common language in which to talk about water challenges.
HV: What are the key challenges related to water use at a mine site?
HZ: One key challenge is increasing regulation. Because mining companies operate within the same catchment as agriculture, urban development and other industry we are seeing more cumulative impacts; more pollution and water stress arising due to increased use and competing pressures on the water resource, and so governments are being forced to look more carefully at where and how they allocate water resources. In response, water-related regulation is increasing.
In a water-constrained country like Chile, for example, the government is considering a desalination law which would ban miners or any industry that uses more than 150L of water per second from using freshwater.
Water will need to come from other sources such as desalinated seawater. This results in a huge amount of capital expenditure for the mining company to build a desalination plant which drives up the operating cost.
Historically, the industry spent about 10% of its capex on water infrastructure and now it spends around 30% in some instances.
Then there is the cost of conflict. When a mining company experiences delays or gets shut down because of protests this can results in losses of up to $20m a week for a large operation.
HV: Are miners now more focused on engaging with communities and other stakeholders on water issues?
HZ: Historically, mining companies tended to treat water management as an operational issue. It was very much managed ‘inside the fence’. The focus was on control of effluent discharges and water use efficiency of the operations.
I have seen a growing maturity in the way mining companies are considering water. The focus is now more ‘outside the fence’.
Companies are looking at water in a more dynamic and holistic way and asking, what are the needs and priorities of other water users? How is water used and managed by others? How are we impacting on that? Can we collaborate better to mitigate some of those shared risks?
HV: Is technology helping miners be better water stewards?
HZ: Technology has an important role to play in water stewardship. Some companies are investing resources in increasing their recycling abilities, for example, on membrane technology or ways to cool equipment as water is often used in cooling processes.
There is also a lot of investment in looking at how to screen water out of tailings to reduce the amount of water that goes into waste from mines.
For example, Goldcorp recently invested $60m in new technology at a mining operation looking at reducing water it uses to store mine tailings. Anglo American [is] also looking at recycling technologies to reduce the amount of freshwater it uses from the environment. Currently, 65% of the water it uses across its operations is recycled but its goal is to reach 95% over the next decade.
HV: You are a great believer in collaboration?
HZ: Absolutely – collaboration is key. Without collaboration between NGOs, local communities, government and mining organisations we are not going to be able to solve some of the bigger challenges and risks faced and that puts companies at greater risk.
In the collaboration space, we have seen a lot of interesting work coming out of South Africa where there is a big water supply-demand gap.
For example, Anglo American, BHP Billiton Energy Coal South Africa (now South32) and the local Emalahleni municipality formed a partnership to treat acid rock drainage that occurred from several legacy sites in South Africa. There was the challenge of mine-impacted water that the mining companies needed to remediate but there was also an opportunity to supply water to communities that didn’t have access.
The result of the partnership was the development of a water reclamation plant that used reverse osmosis technology to make the water drinkable. The companies used some of the treated water in their own processes but also supplied the local municipality with water for the local communities that previously didn’t have access.
HV: Does ICMM monitor member companies to make sure they uphold their commitments?
HZ: We monitor them through reporting commitments per the Global Reporting Indicators.
We have 23 members, but they operate in 58 countries with over 900 sites. Therefore, it is impossible for us to fully enforce the programme, but the reports are assured by third parties and we do go through them.
I think the beauty in what we do is in the collaboration and joint problem-solving and facilitating discussions between CEOs of different companies to tackle risk and problems and deal with those as a collective.
If an issue is raised against a member company, we take it to the firm and have a dialogue with them. So far there has always been a resolution and a way forward. There has never been a company saying ‘no, we refuse to do that’.
HV: Overall, for better water stewardship, what kind radical changes does the industry need to make in the future?
HZ: I think the most radical change would be to move to a co-management of water resources model rather than it being left at the doors of government or companies because that never works.
There are hugely complex water challenges we face as a global society, that come from many different channels, whether through a changing climate, pollution, overuse or simply through the interaction of the water body with the natural geology and ecology. There are so many ways that water challenges can arise and therefore we need more than one actor to solve them.
