If material is not included in the articles Creative Commons license and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. It is also possible that mineral exploration occurs less often within PAs and this, in turn, lowers the rate of mining in these areas. Remaining Wilderness may indirectly capture some mining threats, as sites with road networks and infrastructure are not considered wild thus resulting in low levels of overlap25; however, KBA designation completely ignores mines and mineral resources, focusing instead on where biodiversity occurs21. And our survey suggests mining companies are in a strong position to capitalize on a fresh raft of opportunities. Stakeholders expect miners to better assess risks and opportunities, and articulate these through transparent, outcome-based measurement and assurance. 21,24,25. 9, 4621 (2018). Not only are there accidents, but exposure to dust and toxins, along with stress from the working environment or managerial pressures, give rise to a range of diseases that affect miners. Catastrophic declines in wilderness areas undermine global environment targets. 7, 302311 (2014). Comparing scales of environmental effects from gasoline and ethanol production. Among the leaders, gold has been performing its usual countercyclical safe-haven role, with rising prices, compounded by supply disruptions in key producing countries. Global metal flows in the renewable energy transition: exploring the effects of substitutes, technological mix and development. The oil price has declined by a smaller amount than seen in previous crises: year to date, it is down some 35 percent, whereas it plunged 77 percent in 2008 and it fell 76 percent in 201416. Necessary actions include strengthening policies to avoid negative consequences of mining in places fundamentally important for conservation outcomes, and developing necessary landscape plans that explicitly address current and future mining threats. For more information about our organization, please visit ey.com. Science 367, 3033 (2020). However, similar to PAs, critical mining areas overlapping Remaining Wilderness were significantly more dense than other mining areas overlapping Remaining Wilderness (3.1 vs. 1.9; D=0.15, p=0.01; Supplementary Data3). Overview Unregulated mining has the potential to release harmful substances into the soil, air, and water. Conserv. Approximately 8% of the global area potentially influenced by mining overlapped with PAs (Fig. Overwhelmingly, surveyed companies agreed they now need to have a clear, measurable ESG strategy. and M.C.D. For example, annual coal production (7813Mt in 2018)29 greatly exceeds that of copper metal (21Mt)30 (i.e. Meanwhile, global conflict and resource nationalism have pushed geopolitics higher up the ranking, requiring miners to develop a deeper understanding of the impact of geopolitics on strategy.
Top mining and metals risks and opportunities in 2023 - EY The authors include Marcelo Azevedo, Jochen Berbner, Scott Crooks, Sigurd Mareels, and Camila Nucci. Mining and metals companies face their greatest ever talent shortage following a massive wave of retirements and resignations. Miners face new expectations, including around contributing to livability and protecting cultural heritage. Discover how EY insights and services are helping to reframe the future of your industry. These dynamics are highly uncertain and dependent on many factors, most notably including the mix of technologies, infrastructure, and the strategies ultimately used to mitigate carbon emissions and delivery of future energy demands. 1. & Hockings, M. The performance and potential of protected areas. Lovejoy, T. E. Conservation biology: the importance of wilderness. Renew. An ecoregion-based approach to protecting half the terrestrial realm. Thus, the world coal industry transports two orders of magnitude (100) more material than the copper industry. In the first and second quarters of 2020, Chinese import of coal has been strong. To understand the implications for the mining sector, we have assessed the potential impact on industry-level revenues and earnings before interest, taxes, depreciation, and amortization (EBITDA) under four scenariosA1, A2, A3, and A4that represent different shapes of economic recovery (Exhibit 6). 30 May 2023 04:15:18 Careful strategic planning is urgently required to ensure that mining threats to biodiversity caused by renewable energy production do not surpass the threats averted by climate change mitigation and any effort to slow fossil fuel extraction and use. We repeated this process for subsets of mining areas by development status (pre-operational, operational, closed; Supplementary Table3) and commodity type (critical areas only, other areas only, and areas targeting both commodity types; Supplementary Table1). We develop outstanding leaders who team to deliver on our promises to all of our stakeholders. Results suggest that an expansion in mining areas globally will threaten PAs and Key Biodiversity Areas (regardless of commodity type), but increasing the proportion of mines targeting materials critical for renewable energy production may also disproportionality increase the threats to biodiversity within currently protected areas. Commodity price risk remains the top risk the industry faces, while the new addition of global pandemic risk at number two is unsurprising. You are using a browser version with limited support for CSS.
extracting different minerals, with different methods), we also analyzed a more conservative radius of 10km. 2), indicating extensive threats . Sovacool, B. K. et al. PubMed Renewable energy production will exacerbate mining threats to biodiversity, https://doi.org/10.1038/s41467-020-17928-5. Experienced mining and metals leader. CAS Another commodity to be hit sharply has been aluminum: its end sectors (such as automotive) have been severely affected from a demand point of view, and there has been limited smelting-capacity correction. Early in our explorations within this sector we discovered that the risks and opportunities for exploitation are very large, yet there seems to be extreme Geopolitics move up the ranking comes as miners feel the impact of the war in Ukraine, as well as US-China tensions and rising resource nationalism. Each crisis progressed through a period of price shock, followed by demand shock, supply-and-demand equilibrium, and finally demand recovery and the next normal: In the COVID-19 crisis, we have seen phase one and are currently experiencing phases two and three.
Opportunities and threats of the mining industry Mining areas also overlapped with conservation priority sites: 16% with Remaining Wilderness and 7% with Key Biodiversity Areas (Fig. Mining and the African environment. Critical mining areas contain five times more mines and target three times more commodities than other mining areas do (Supplementary Table1). Yet, none of these potential tradeoffs are seriously considered in international climate policies3, nor are new mining threats addressed in global discussions around post-2020 United Nations Strategic Plan for Biodiversity28,41. The EWG reportentitled Proof of Problems: Bitcoin Mining's Pollution Toll on U.S. Communities profiles six case studies of adverse effects of the cryptocurrency mining process known as "proof-of-work." "This report vividly shows how proof-of-work crypto-mining operations are contributing to increased air, water, and noise pollution in . Science 342, 425426 (2013). Get the most important science stories of the day, free in your inbox. The Board Imperative: Is your people strategy human enough? A Cross-sector Guide for Implementing the Mitigation Hierarchy. This article was written by McKinseys Metals & Mining Practice. On the impacts of mining Mining activities, including prospecting, exploration, construction, operation, maintenance, expansion, abandonment, decommissioning and repurposing of a mine can impact social and environmental systems in a range of positive and negative, and direct and indirect ways.
Evidence of the impacts of metal mining and the effectiveness of mining Lessons from the past: Informing the mining industry's trajectory to Change 60, 102007 (2020). There is, however, a unique aspect to the current crisis: an immediate supply correction driven by lockdown and physical-distancing measures and, in a few cases, exacerbated by disruptions not related to the COVID-19 crisis. Asking the better questions that unlock new answers to the working world's most complex issues. For conservation priorities, we analyzed 13,320 Key Biodiversity Areas (13.87 million km2), representing sites that contribute significantly to global biodiversity persistence. PubMed Most copper is produced in the form of concentrate, so the tonnage of material transported in a similar way to coal would be in the order of 80Mt.
New Probe Reveals 'Real-World Harm' of Crypto Mining Operations Watson, J. E. M., Dudley, N., Segan, D. B. Building a purposeful brand and a greater focus on re-skilling can help overcome talent shortages. Very targeted and highly coordinated, the attacks are launched by a broad set of attacker groups ranging from hacktivists to hostile governments and organized criminals. How Huawei's use of 5G and AI is transforming China's coal mining industry. The large extent of pre-operational mines targeting coal and other non-critical materials in artic and sub-arctic North America and Asia (Fig. This years ranking of the top 10 mining and metals risks and opportunities (pdf)reflects the competing priorities for miners in a fast-changing, volatile world. Replacing these workers and finding talent with critical skills will require a radical rethink of the sectors approach to attracting, retaining and nurturing talent. The greatest opportunities may lie in forging closer ties with government, increasing collaboration with stakeholders, including trade and sector groups, and exploring the potential of government incentives and co-investments. Nat. Note: Graphed proportions were calculated from full extent of mining and non-mining areas, whereas reported statistics were calculated using the 1km2 cells sampled at 100-cell intervals. Review ourcookie policyfor more information. PubMed fossil fuels and fertilizers; referred to as other mining areas). The overall impact on each commodity differs, with fertilizers and aluminum resilient while the average monthly production of nickel and zinc is down by approximately 20 percent. Technology, media & entertainment, and telecommunications. Ellaban, O., Abu-Rub, H. & Blaabjerg, F. Renewable energy resources: current status, future prospects and their enabling technology. Renewable energy development threatens many globally important biodiversity areas. S&P Global Market Intelligence (S&P, New York, 2018). volume11, Articlenumber:4174 (2020) Iron ore and metallurgical and thermal coal are likely to be hit hard as construction demand falls along with power requirements, in line with lower levels of economic activity. By Jon Stojan. Get the latest KPMG thought leadership directly to your individual personalized dashboard, Download a PDF version of this article Opens in a new window, View Print friendly version of this article Opens in a new window. Di Marco, M., Venter, O., Possingham, H. P. & Watson, J. E. M. Changes in human footprint drive changes in species extinction risk. However, despite their larger spatial extent, critical mining areas are less dense than other mining areas (2.0 vs. 3.5 for operational mining properties; Supplementary Table2), due to differences in resource distributions and relative production costs. 1 Additionally, 2020 has seen an increase in state-sponsored threats. S&P. by status [pre-operational, operational, and closed] and when using 10-cell radius; Supplementary Fig. The first was the second oil shock of the 1980s, and the most recent was the commodity-price crisis of 201516. When mining executives from across the globe responded to 2020s Global Outlook Survey Report, no one had heard of COVID-19. Instead, out method examines whether the minerals critical to produce these technologies and infrastructure were present or absent. Climate Action Plan. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients. Sonter, L.J., Dade, M.C., Watson, J.E.M. Copper prices are already above precrisis levels, with supply squeezed by lockdowns in Peru, although demand should return with country-level stimulus packages and especially investments in renewables and new grid infrastructure. Ultimately, miners need to reframe LTO around long-term value creation, anchoring the brand to this positive impact. Mining is the extraction of minerals and other geological materials of economic value from deposits on the Earth. Science 354, 11 (2016). This model has a hierarchical and cyclic . This was also done due to the urgency. This material has been prepared for general informational purposes only and is not intended to be relied upon as accounting, tax, or other professional advice. For example, water stewardship and biodiversity are fast becoming urgent priorities amid a changing climate. Observed differences between Remaining Wilderness and Key Biodiversity Areas (i.e. EY report highlights 10 key risks to the mining industry - and chief among them ESG and decarbonisation Disruption is fast reshaping the mining and metals sector's perception of where the biggest challenges - and paths to growth - may lie, according to EY's annual review of risks and opportunities in the global mining sector. Biodiversity conservation sites and priorities within mining areas. Maron, M. et al. A systematic understanding of the spatially explicit consequences (rather than potential threats, as investigated here) of various mining activities on specific biodiversity features, including those that occur in marine systems and at varying distances from mine sites (rather than within a predefined distance of 50km, as done here), is required. Nature 427, 145 (2004). Finally, to test the robustness of our results to the 100-cell sampling interval, we sampled our datasets at 300-cell intervals (starting at a different cell to ensure an entirely different set of sample cells) and repeated all analyses. No member firm has any authority to obligate or bind KPMG International or any other member firm vis--vis third parties, nor does KPMG International have any such authority to obligate or bind any member firm. 2), indicating extensive threats to currently protected biodiversity. Spatial data on Protected Areas and Conservation Priorities are available from refs. Mining threats to biodiversity will increase as more mines target materials for renewable energy production and, without strategic planning, these new threats to biodiversity may surpass those averted by climate change mitigation. Such decisions are not only motivated by a desire to adapt to an evolving market, but also to meet investors expectations around ESG performance. Laura J. Sonter. Scheffers, B. R. et al. EY helps clients create long-term value for all stakeholders.
Opportunities and threats of the Mining Industry - UK Essays of the top 10 mining and metals risks and opportunities (pdf). Investment in data capabilities will guide better, faster decisions. 29, 2023, 4:13 PM ET (AP) Mexico's ruling party sweeps mine reform, other bills to law Mexico's Senate has approved a wide-ranging reform of laws governing the mining industry, including a requirement that companies pay 5% of profits to local communities While compensation may help to overcome some of the expected biodiversity impacts of mining in some places39, rarely does this approach achieve No Net Loss outcomes universally39,40. Managing costs needs to be done with an eye on long-term value, as well as short-term gains. Parish, E. et al. We believe that the mining sector will remain relatively resilient and that part of the revenue loss driven by volume and price impact will be absorbed by the lower costs prompted by underlying currency devaluations versus the US dollar, as well as lower energy prices. Environmental co-benefits and adverse side-effects of alternative power sector decarbonization strategies. World Bank Group. Sampling at 100-cell intervals also removed most other sources of spatial autocorrelation (Supplementary Table4). CAS Mining areas were mapped using a 50-cell radius around known mining properties; non-mining areas include the remaining terrestrial land surface excluding Antarctica. The ability to access and replace reserves, economic uncertainty, political risk, community relations and social license to operate, and access to talent all rose in ranking, likely partly due to political and economic uncertainty driven by concerns over a global trade war. Rufus Wright, CEO and Founder of Crypto Caverns is providing reliable crypto mining services that are at the forefront of making the industry trustworthy . We distinguish areas targeting the materials that, among many other uses in society today, will be critical for renewable energy production (here referred to as critical mining areas) from those targeting other materials (e.g. Our critical mining areas should be considered as the sites potentially influenced by increasing demand for renewable energy technologies and infrastructure, rather than illustrative of the relative distribution of threats, which would be influenced by demand for other unrelated products (e.g. 4, 202206 (2011). 26, 30403051 (2020). While some protected areas (PAs) prevent mineral extraction and prospecting activities, more than 14% of PAs contain metal mines within or nearby their boundaries19 and consequences for biodiversity may extend many kilometers from mining sites20. Sustain. Summary. With the pandemic exposing weaknesses in the just-in-time model, we expect to see a mix of just-in-case and just-in-time supply strategies as miners find a way to balance supply chain resilience with costs. Integrated life-cycle assessment of electricity-supply scenarios confirms global environmental benefit of low-carbon technologies. Dinerstein, E. et al. & Gaston, K. J. Global disruption will also put new pressure on costs, productivity and workforce, prompting companies to explore opportunities to reimagine business models and accelerate innovation. However, critical mining areas overlapping PAs were significantly more dense than the other mining areas that overlapped PAs (3.5 vs. 1.6; D=0.18, p=0.01; Supplementary Data3; although differences were not statistically significant when using a 10-cell radius to define mining areas, or when sampling at 300km intervals), despite other mining areas being (on average) more dense globally (Supplementary Table1). With thermal coal, a similar story emerges. Well, the remarkable core insight of this years Outlook is the issues impacting the industry remain much the same as they were pre-coronavirus. Edwards, D. P. et al. the next 12 months, compared to the industry. In 2023, growing expectations around ESG, climate change and license to operate, as well as a more uncertain geopolitical environment, will top the agenda for mining and metals leaders. We sampled mining and non-mining areas at 100-cell (~100km) intervals (n=13,483), to remove potential issues with large sample sizes and the spatial autocorrelation created in our dataset by mapping mining areas using a 50-cell radius around each mining property. Lessons from the past: Informing the mining industrys trajectory to the next normal.
Environmental Risks of Mining - MIT - Massachusetts Institute of Technology 2001, Duya et al. An accelerated decarbonization agenda, and sharper focus on reporting emissions, creates a new urgency around better mitigating climate change risk. Conservation plans for these sites must identify and develop strategies to manage all major threats to biodiversity, to ensure that mining the materials needed for renewable energy production does not simply replace the climate change-related threats mitigated by reducing fossil fuel use22,23. Anyone you share the following link with will be able to read this content: Sorry, a shareable link is not currently available for this article. [ 1]
Top 10 risks for the mining industry | Mining Digital The Three Most Common Mining Industry Cyber Threats - Nozomi Networks 1) can be obtained by contacting the corresponding author. Mineral Commodity Summaries: Gold, Copper (USGS, 2018). We mapped non-mining areas as any land (excluding Antarctica) outside mining influenced areas. Publishers note Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. Commun. In the meantime, to ensure continued support, we are displaying the site without styles The themes of license to operate and disruption run through this year's risks as mining and metals companies have to deal with many new and variable factors, including societal expectations, digital transformation, and unique challenges to portfolio and capital investment decisions. Economic downturn and uncertainty rounds-out the top three, reflecting the significant volatility the sector has faced in 2020. To keep temperature increases below 2C, and halt associated biodiversity losses, 140 nations committed to the Paris Climate Change Accord to reduce anthropogenic greenhouse gas emissions by 90% (from 2010 levels) and reach carbon neutrality by 21003. 1; Supplementary Table1) and their proportional overlap with conservation priorities changes slightly (Supplementary Figs. Managing variability though modeling and digital twins can help miners unlock sustainable savings. What can previous crisis periods teach us about the impact of the COVID-19 pandemic on the mining sector, and what can we expect going forward? We use a 50km wide radius around each mining property to capture the potential influence of both direct and indirect impacts of mining on biodiversity, but also produced a conservative estimate of mining areas using a 10km radius (see Methods section). Energy Technology Perspectives 2015: Mobilising Innovation to Accelerate Climate Action. KPMG International provides no client services. Additionally, disruptions not related to the COVID-19 crisis are in placeand will continue throughout the yearas part of the nature of the mining sector. PubMedGoogle Scholar. 23rd September 2021 Back to Reports & Resources Philip Buckingham Content Marketing Executive Identifying some of the biggest social risks to mining operations, and why Environmental, Social and Governance issues are one of the biggest threats that mining companies now face. Global pandemic risk (unplaced 2020) Economic downturn/uncertainty (No 6, 2020) Community relations and social licence to operate - (No 4, 2020) strengthening in ESG agendas. (IUCN, Gland, 2008).
Renewable energy production will exacerbate mining threats to - Nature Nat. Interestingly, companies now rank access to key talent as the number nine risk their own organizations face, perhaps reflecting restrictions in travel across the globe. Rationalize, grow, transform miners are exploring potential future strategies to capture value. We analyzed 28,409 PAs (23.38 million km2) formally designated for conserving biodiversity and ecosystem services44. (IUCN, Gland, 2016). 2005 ). Contributing insightful points of view to the market around productivity and digital. McKinsey has developed a set of nine macroeconomic-recovery scenariosthat incor-porate three archetypes of viral spread and three degrees of economic-policy effectiveness. Mining areas with properties targeting materials critical for renewable energy technology and infrastructure are shown in blue, areas with properties targeting other materials are shown in orange, and those targeting both commodity types are shown in pink. 3; Supplementary Data1). The pace and complexity of the threats are growing . The top five mining risks 2021. This includes children, as . Nature 515, 6773 (2014). Meanwhile, the emergence of regulatory and compliance changes/burden enters the list in tenth position. By submitting a comment you agree to abide by our Terms and Community Guidelines. The insights and services we provide help to create long-term value for clients, people and society, and to build trust in the capital markets. Luderer, G. et al. New business models offer opportunities for miners to reposition for a changing future, with many companies considering the benefits of strategies to rationalize, grow and transform. Energy Policy 119, 226241 (2018). Enabled by data and technology, our services and solutions provide trust through assurance and help clients transform, grow and operate. Like other industries, mining operations were forced to scramble to respond to the pandemic, to ensure the safety of employees, the communities in which they operate, and the security of supply chains. was supported by the Sustainable Minerals Institutes Complex Orebodies program. A recent cyber security report found that most mines are attacked for intelligence gathering. These threats are concerning, given that wilderness lacks formal protection36 and any new infrastructure will erode its ecological integrity27. Provided by the Springer Nature SharedIt content-sharing initiative, Communications Earth & Environment (2023), Process Integration and Optimization for Sustainability (2023).
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