Managing environmental impacts and opportunities
Our strategic pillar of operational excellence incorporates a commitment to minimising the environmental impact of our operations. We share global concern for environmental degradation and resource scarcity as we are dependent on these resources to operate. Due to the nature of our business, our operations have an environmental impact that needs to be reduced, mitigated or remediated. This includes our responsibility to minimise our environmental footprint by adopting cleaner technologies, and to improve the efficiency with which we use input resources such as energy and water.
There is an increased global focus on reducing carbon emissions with the 21st Conference of Parties (COP21) that was held in Paris and focused on the issues of global warming. Intensive users of energy are likely to be pushed to find creative ways to improve energy efficiency and to manage their carbon footprint cost effectively. For the platinum industry, this is both a challenge and an opportunity. Despite the energy-intensive nature of its primary production, PGMs play an important role in reducing pollutants from the combustion of fuel through catalytic converter technology, among others.
Our regulatory environmental obligations are tied to our licence to operate and defined by the range of legislation that applies to our industry. Our environmental strategy goes further to entrench a proactive approach to managing our long-term impact on our host communities and the natural environment around our operations. To this end, we participate in various research and development initiatives to improve our scientific understanding through continuous improvement for sustainable mining.
Our environmental strategy has four pillars:
- Maintaining our licence to operate
- Resource management and use
- Minimising environmental footprint and impact
- Stakeholder relations
Community protests over service delivery and the severe impact of local water infrastructure failures during 2015 emphasise the seriousness of the potential water crisis South Africa faces. We are reliant on water to operate our business, and it is an increasingly scarce resource. Dry conditions and municipal potable water supply challenges underscore the material importance of managing this resource efficiently.
Water is needed to lubricate drill bits and for cooling purposes in underground mining, and is used extensively in the Group’s processing plants.
South Africa’s power utility, Eskom, continued its load-shedding programme during 2015, requiring consumers to reduce their electricity consumption at short notice. Lonmin is an Eskom premium user and has agreements in place with the energy provider that include predetermined warnings requesting load curtailing to determine how we can reduce electricity use while ensuring the safety of our employees. A remaining concern is the planned future tariff hikes that will have an impact on the affordability of electricity and Company sustainability.
There were changes to environmental regulations published and to regulations regarding the planning and management of residue stockpiles and residue deposits from a prospecting, mining, exploration or production operation. These developments have significantly changed how residue deposits and stockpiles are planned for and managed, due to the reclassification of residue deposits and stockpiles as hazardous waste. This will add a significant administrative and cost burden to the Company, as mine residue deposits and stockpiles will need a composite landfill liner, which will double the cost of the design and construction of these facilities, particularly for tailings facilities. Furthermore, size, weight, reuse options, and vehicle accessibility on site have not been accounted for within these regulations.
Air quality is managed in terms of the atmospheric emissions licences at our smelter, base metals refinery, precious metals refinery and laboratory. Significant capital investment will be required to ensure the Process Operation meets the 2020 minimum emissions limits set by the National Environmental Management: Air Quality Act, 39 of 2004. Extensive ambient and source monitoring networks are in place to monitor performance and to identify areas of concern to mitigate adverse impacts.
Lonmin recognises the importance of reducing greenhouse gas emissions and is committed to managing its carbon footprint responsibly. The Company’s Climate Change Response Strategy and Risk Management Policy incorporate the risks climate change poses to our operations and industry. Mechanisms aimed at reducing carbon emissions – such as carbon taxes – must be weighed carefully against cost and competitiveness considerations to arrive at a balanced and sustainable solution.
Understanding ecological goods and services formed the basis in establishing environmental management requirements, risk planning and liability management to strive for our vision of Zero Harm. Biodiversity in and around our operations is protected and managed through our biodiversity action plans and compliance-related projects. Biodiversity is a key concern for Lonmin and many stakeholders, and we report on it accordingly.
This chapter provides an overview of the main areas of material environmental matters, how these are managed, monitored and, where possible, mitigated. The programmes discussed are predominantly situated in the North West Province near Marikana, where the majority of Lonmin’s operations are located.
The strike in 2014 affected the comparability of data with the prior year. While there was limited to no production during the five months of the strike, core equipment for ventilation and water pumps remained operational and maintenance took place. Environmental management continued unabated to ensure compliance with legal requirements
Government and regulators
Government sets environmental regulatory standards and monitors compliance with these to achieve equitable access to natural resources and the responsible management of the mining industry’s direct and indirect environmental impacts. The DMR is responsible for overseeing the mining industry of South Africa and the extraction of the country’s mineral resources, working closely with the Water and Sanitation, and Environmental Affairs and Energy departments. Engagements are undertaken at national, provincial and local levels.
Lonmin shares environmental resources with the communities in which it operates and engages to understand the concerns of community members. The Company has an official environmental complaints number where concerns can be logged, and the precious metal refinery has a facility for physically logging concerns.
Industry bodies and associations
The Company works closely with industry bodies and associations, including Business Unity South Africa (BUSA), the National Business Institute (NBI) and the South African Chamber of Mines to ensure that the Company’s stance on environmental matters is represented and registered. Through our memberships with the ICMM and the Chamber of Mines, the Company is indirectly involved in advocacy on environmental issues such as the feasibility of renewable energy programmes to supplement the national grid, carbon tax and climate change.
Risks and opportunities
The information below discusses the risks to sustainability that were identified, with particular reference to the environment, and indicates where to find detail on how Lonmin manages and mitigates these risks. More information can be found in the Annual Report and Accounts 2015. Various opportunities identified in the environmental sphere are also highlighted in this chapter.
Access to secure energy and water
Recent increases in electricity tariffs, the Company’s inability to reduce this cost any further, its reliance on sole state-owned suppliers along with unreliable electricity supply have severely compromised Lonmin’s operations and margins. Rolling power outages, voltage imbalances or reductions in availability may restrict production or could require Lonmin to shut down production. A more stable electricity environment, in terms of both pricing and supply, is therefore critical. Water utilisation has also been challenging; both from an infrastructure point of view as well as availability. Lonmin’s smelting, mining and refining activities require significant amounts of water, and shifting rainfall patterns and increasing demands on the local water supply have, and will in the future, caused water shortages.
Supply constraints in respect of energy or water could impact our ability to operate effectively and meet our production targets. Furthermore, cost increases in respect of these utilities impact our margins. Water availability is becoming a critical consideration for the survival of any business and remains a basic human need. Government must find the balance between authorising water use, supplying water and delivering services as required by communities; however, this is challenging, especially due to informal settlements and pressures from development.
Opportunities and mitigation
The Company recognises that the national power utility is experiencing challenges in terms of supplying energy to meet national demand. As part of ensuring optimal electricity usage, Lonmin conducts monthly and daily electricity monitoring and reporting. Lonmin is a member of the Eskom energy-intensive user groups. Additional initiatives to ensure optimal usage is the Electricity Conservation Programme and load-shedding contractual agreements to manage supply-side constraints. As part of ensuring appropriate continuity during an outage, the Company has implemented risk-based scenario planning based on available Eskom capacity. From a water optimisation perspective, the Company has implemented and monitors water conservation and demand management initiatives.
Lonmin engages with communities and other stakeholders and seeks opportunities for environmental management that will be sustainable. The Company supports the sustainability of local communities through investing in critical water and sewage infrastructure. Improvements in water management have increased the recycling of water, added inflows from dewatering and reduced the dependence on municipal supply. We work closely with Eskom to manage our power use responsibly and avoid outages.
Increasing environmental regulatory requirements, legislation and amendments1
Increasing environmental legislation for mining and processing requires careful understanding and management to ensure compliance and avoid unnecessary costs. Various regulatory requirements must be complied with and it is therefore critical that these are understood and that appropriate measures are implemented to ensure compliance.
Lonmin and other mining companies continue to engage with the South African government and the broader community in order to raise awareness of the risks associated with resource nationalism. In addition, issues of concern to stakeholders are being addressed in the government-driven Project Phakisa.
Opportunities and mitigation
By taking a proactive approach to our environmental obligations, we can demonstrate good stewardship and build our relationships with communities and regulators. There are opportunities to work more closely with industry partners and government so that environmental matters are sustainably managed on both a regional and national basis.
|1||This risk is not part of Lonmin’s principal risks, but is important in the context of our environmental management.|
Accountability and governance
Ultimate accountability for the Company’s environmental performance resides with the Board, through the Safety, Health and Environment Committee, and the Exco, supported by senior management at corporate and operational levels. A separate Safety, Health and Environment Committee – a subcommittee of the Exco – reviews SHE performance monthly to identify critical concerns and opportunities, and to monitor operational safety, health and environmental performance.
Environmental management and compliance are managed by the Lonmin environmental department, which also monitors environmental performance. Operational compliance and accountability are driven by line management at the operational areas, supported by the operational environmental departments. The Company takes a precautionary approach to environmental management, aiming for best practice and continual improvement. To support this approach, service level agreements with operational areas were established, that encapsulate risk management, accountability and the protection of the environment through the application and monitoring of standards, policies and procedures.
Lonmin’s approach to environmental stewardship is outlined in the Safety and Sustainable Development Policy and in the Lonmin Sustainable Development Standards. Lonmin’s Environmental Management Plan (EMP) defines the processes by which the Company will meet its environmental obligations.
The Company’s ISO 14001 environmental management system (EMS) is well managed and we have maintained our certification through annual third-party verification. The integrity of the EMS and the Company’s overall environmental performance are monitored and verified through a range of internal and external audits. These include quarterly internal KPI audits, external EMP performance assessments, water use licence audits, various permit and licence audits, Mining Charter audits, internal and external ISO 14001, and environmental legal compliance audits. Environmental incidents and complaints are logged on the ISO 14001 environmental management system registers for action and close-out. The ISO 14001 environmental management system is a self-regulatory tool that promotes the minimisation and management of potential environmental impacts.
There is a range of internal environmental indicators and targets that are reported against on a monthly basis to track performance on environmental matters. Detailed reports are provided every month to the operations, SHE and Exco Committee and the Board, and every quarter to the Board SHE Committee, which meets quarterly to review the Company’s performance on SHE matters.
External policies, frameworks and regulations
The primary Acts that apply to Lonmin’s environmental impacts are the MPRDA, the National Environmental Management Act, 107 of 1998 (the National Environmental Management Act), and the National Water Act, 36 of 1998 (the National Water Act), with numerous other relevant legislation and associated regulations. The requirements of our various mining rights include an EMP approved by the DMR.
Lonmin’s approach to environmental responsibility is also shaped by:
- the ICMM principles of sustainable development (Principle 6: Seek continual improvement of environmental performance and Principle 7: Contribute to biodiversity and integrated approaches to land use planning); and
- the UNGC (Principle 7: Businesses should support a precautionary approach to environmental challenges, Principle 8: Undertake initiatives to promote greater environmental responsibility and Principle 9: Encourage the development and diffusion of environmentally friendly technologies).
During 2015, Lonmin submitted its ninth consecutive CDP report and its second CDP Water Disclosure report – the first Water Disclosure report for public disclosure.
In the spirit of transparency and our commitment to following best practice reporting principles, we are committed to disclosing incidents that may have an environmental impact. Level three environmental incidents are those incidents that have a moderate impact on the environment, but are reversible within the lifetime of the operations. Lonmin had no environmental incidents above a level three in 2015. There were six level three environmental incidents this year. Three were related to water and three to emissions (five incidents occurred at Marikana and one at the PMR. All of these incidents were reported to the regulating authorities.
To gain a better understanding of our environmental programmes or incidents, please contact us.
Approach and performance
The following section discusses the specific approach and the 2015 performance for each material environmental area at Lonmin.
Water availability in South Africa represents a serious challenge for the country and its development. South Africa is rapidly approaching full use of all easily accessible water. The few remaining large-scale water resource development opportunities will be challenged to meet forecast demand, making delivery and supply of water costly. Water is not only a key input in Lonmin’s operations, it is an essential resource for the communities that surround us. The growth of nearby towns and settlements will see demand and pressure on bulk water infrastructure continue to grow.
Climate change also has an impact on water and thus proactive water management is required to counter its effects.
The Marikana water infrastructure network spans a distance of about 30 km, delivering water to and from the various mining and processing areas. Not only does Lonmin distribute water for operational activities, the Company also acts as a water services intermediary by distributing water to surrounding communities.
Through the Lonmin Integrated Water and Waste Management Plan (IWWMP) and the Water Conservation and Water Demand Management Strategy, Lonmin focuses on securing, optimising and avoiding contamination of ground and surface water resources. Lonmin also assesses water-related risks through its structured, multi-disciplinary risk assessment process, which covers all operations and some key suppliers, including the Rand Water utility as Lonmin’s primary water supplier.
Through the risk assessment processes, the Company realises that it has to seek ways to lower the intake of freshwater and increase the reuse of water.
Consequently, one of the biggest opportunities in the Bushveld Igneous Complex lies in using backfilled opencast pits that can store large volumes of water, as a source of water to the operations, using anthropogenic aquifers to support the intake of freshwater.
Anthropogenic aquifer systems or aquifer storage and recharge (ASR) has a wide range of applications, most commonly the storage of water in the subsurface for later use. Water filters into the subsurface aquifers through infiltration basins or by injection boreholes, enabling the user to store surplus water that would otherwise be lost through evaporation from dams and rivers and/or spillages during high-flow events, and use this water in times of limited availability.
The South African government has recognised ASR as a method to enhance aquifer conditions and developed the Artificial Recharge Strategy to introduce ASR as a water management option and to provide guidance on how it can be applied in South African conditions (Department of Water Affairs, 2007). As a result, Lonmin will have guidance from government and many well-documented international case studies available as references.
The Integrated Water Balance (IWB) uses specialised software that simulates scenarios and risk assessments to enable Lonmin to make informed decisions about its water use and manage the effectiveness of the strategy. Using the latest long-term figures, the IWB assists in determining the best ways to transfer water from water-positive areas to water-deficit areas within the operations, increases understanding of water ?ows, improves efficiency, investigates opportunities, reduces costs, and decreases potable water consumption. It is an important tool to standardise best water practices throughout the business.
Water use is governed by the National Water Act, the Water Services Act and the National Environmental Management Act, and regulated through approved Water Use Licences. The burden to comply in all respects with the applicable legislation is significant, due to the vast area covered by the Lonmin operation and complexity of the water systems. Due to the nature of the ore and the manner in which it is processed, no acid mine drainage is generated from PGM mining and processing activities.
Lonmin manages and monitors water use through the environmental management system, and includes groundwater modelling, surface and groundwater monitoring, toxicity testing and bio-monitoring. Compliance is monitored through various auditing mechanisms.
- Participating in the CDP Water Disclosure Project.
- Developing infrastructure in support of the Water Conservation and Demand Management Strategy.
We established a Water Conservation and Demand Management Strategy with the view to:
- secure access to sufficient water to supply our operations and sustain our Life of Business Plan;
- optimise our freshwater consumption and use process water more efficiently; and
- minimise the contamination of ground and surface water resources around our operations, ultimately to reduce our closure liabilities.
Lonmin purchases freshwater for its Marikana and PMR operations from the Rand Water utility and Buffelspoort allocation, and our Limpopo operations draw water from regional well fields.
- Total water consumption for 2015 was 8,326,566 m3 (2014: 6,206,167 m3), a 34% increase on the strike-impacted prior year.
- Water efficiency was 5.8 m3/PGMoz (2014: 7.04 m3/PGMoz).
Our five-year target (to 30 September 2017) is to reduce our aggregate freshwater intake per unit of production by 15% from the 2012 baseline year. In 2015, against the 2012 baseline year, water efficiency improved by 9.7%, less water was used and production ounces delivered were higher, positively impacting our water efficiency.
Water recycling and reuse
The Lonmin Integrated Water Balance optimises water reuse and recycling through a closed loop reticulation system in the processing plants to reduce and minimise water withdrawals. The Company’s Marikana operations have seven waste water sewage treatment plants from which final effluent is used for operational processes. Through the closed reticulation system, 13.4 million m3 (2014: 9.51 million m3) of water was recycled and reused.
|1||Comparing year on year, considering the restated figure of 2014, there is an improvement as a result of additional grey water lines being activated increasing the volume of water to be recycled.|
Groundwater and surface water monitoring at 11 borehole and 109 surface monitoring sites measures water quality at the operations. Water quality is compared to SANS 241 Standards for drinking water and Water Use Licence parameters. Lonmin is committed to protecting water quality through our water conservation and demand management strategy aligned to ensure water distribution across the operation to minimise the risk of discharge – in line with the conditions of our Water Use Licences. Preventative and management procedures are in place for discharges and monitoring equipment is placed at risk areas to measure the volume of discharges, should they occur.
Any discharge that occurs is reported to the Department of Water and Sanitation. Water samples are taken at source and if a discharge enters a stream, upstream and downstream samples are also taken to determine the impacts on water quality. Internally, a flash report is generated and, based on our risk ranking tables, a level three incident is reported based on a combination of volume, quality, impact on the environment and legal requirements. A full investigation is undertaken and action plans put in place to reduce discharges. The Water Conservation and Water Demand Management Strategy and Integrated Waste Management Plan (IWMP) allow maximum water reuse, which reduces the amount of water purchased from Rand Water and reduces discharges into the environment.
Three level three water discharge incidents occurred during 2015 (2014: eight):
- A discharge on 28 November 2014 of final treated effluent from the K3 Waste Water Treatment Works into the Crocodile West Catchment Area.
- A discharge on 4 January 2015 of process water from the Rowland Corner Dam into the Crocodile West Catchment Area.
- A sewage spill on 6 September 2015 as a result of vandalism and blockage of a manhole in the Khalamtwana settlement.
The volume of all three discharges is estimated to be 57.5 m3. The final effluent from the K3 Waste Water Treatment Works and the discharge from the Rowland Corner Dam had limited impact on the receiving environment due to the low volume of the discharge. Sadly, the vandalism of the manhole resulted in sewage discharge reaching the Modderspruit and Kareespruit; the results of the analysis performed indicated that the water quality is poor. Action plans were implemented to ensure early warning when manholes are vandalised to prevent similar incidents. None of our discharges reached or had an impact on any biodiversity-sensitive or protected water bodies.
The reduction in water discharges compared to last year is due to differences in rainfall and production levels, where 2015 had less rainfall and the reduced production in 2014 resulted in less water being recycled, causing dams to overflow. We have also commenced with phased implementation of an integrated water balance project.
Water and the community
Responsible stewardship of scarce water resources has a direct impact on the GLC. The Company partners with local municipalities to find solutions for community water sources, including enabling and aligning local economic development in support of water infrastructure creation.
Bulk water infrastructure for the Wonderkop/Nkaneng area was built during 2015. The municipalities use Lonmin’s bulk infrastructure to supply water to the communities of Segwaelane, Oustad, Wonderkop, Marikana and Mooinooi, with Lonmin playing only an intermediary role. To support the local municipalities and communities further, Lonmin treats 20 megalitres (Ml) of waste water from communities per day, through two waste water treatment plants and tanker discharge points. The Company also provides maintenance support to the municipality services and will remove blockages, when notified.
Water recycling and discharge incidents
|Water recycling and reuse|
|Volume of water recycled and reused (million m3)||27||31||9.51||13.4|
|Water discharge incidents|
|Discharge incidents reported and investigated (number)||8||7||8||3|
|1||In order to evaluate the reuse and recycling figures, the utilisation of a simulation model is undertaken. The dynamic model is frequently updated and refined to align to production, and actual water consumption once it becomes available. The model was refined as part of continuous improvement in 2015 and to improve comparability between the 2014 year and 2015 year; we are restating the 2014 figure to be 9.5 million m3.|
Energy security and efficiency
Energy, primarily in the form of electricity, is a critical input for our operations. Electricity is used to power surface and underground ventilation fans, dewatering pumps, material handling equipment, smelters and winder plants. Therefore, supply interruptions can have a negative effect on our ability to achieve process efficiencies in our operations, and on the safety of our employees underground.
Electricity constitutes approximately 7% of operating cost and the price of electricity is expected to increase well ahead of inflation for the foreseeable future. Energy efficiency initiatives therefore not only contribute to improving our carbon footprint, but also have a direct impact on cost efficiencies.
Lonmin is a member of the energy-intensive user group, which regularly communicates with Eskom regarding power interruptions and supply constraints. The depth of our mines does not require air refrigeration for mining operations and we can manage notified interruptions to minimise the impact on production. We achieve this by shutting down concentrator streams so that mining production and smelter power can be kept stable.
Lonmin’s energy management strategy is based on the SANS 50001 standard. Our operations work closely with Eskom to manage company electricity demand in accordance with agreed levels.
Energy efficiency projects are centrally managed, tracked and reported and there is an annual capital budget in place to pursue strategic new technologies and various research and development initiatives. Electricity consumption targets are set per area and reported on monthly, with specific energy efficiency projects launched to reduce electricity consumption.
Energy consumption and efficiency
Our 30 September 2017 target is to improve our aggregate energy consumption per unit of production by 8% from the 2012 baseline. We report energy efficiency performance in terms of MWh per PGMoz produced and in kWh per tonne mined. Energy consumed increased to 6,783 TJ, and from the 2012 baseline we have seen an increase of 3.8%. However, our energy efficiency compared to the 2012 baseline has improved by 1.8%. Year-on-year, our energy efficiency improved by 12%, but the impact of the 2014 strike needs to be taken into account. Our operations have a high baseload, meaning that even when there is no production, running of essential equipment and services still consumes a significant amount of energy. Achieving our energy efficiency targets requires that we achieve our production targets.
- Total energy consumption for the year was 6,783 TJ (2014: 4,696.7 TJ), an increase of 45% year-on-year.
- Our energy efficiency improved year-on-year by 12% from 5.32 GJ/PGMoz to 4.68 GJ/PGMoz.
- Indirect energy (electricity) consumption 1,620,862 MWh, or 5,835.1 TJ (2014: 3,994 TJ).
- Electricity efficiency per kWh/tonnes hoisted was 143.72.
- Direct energy 950 TJ (2014: 702.1 TJ).
Existing energy efficiency targets will be reviewed to ensure these are achievable in the light of the new production profiles linked to the recently announced shaft closures.
Energy efficiency projects
During 2015, Lonmin energy efficiency projects included:
- Completing the roll-out of 290 new 45 kW energy-efficient ventilation fans at all shafts.
- Investigating optimisation of the compressed air network in our mines, which is progressing well, with support from Eskom.
- Rolling out energy-efficient lights underground.
- Retrofitting various surface areas with energy-efficient lights and day/night switches where possible.
- Optimising the control of the main surface ventilation fans, which resulted in a 3,352 kWh saving.
The fuel cell project at the precious metals refinery is on hold for now as we continue seeking funding to make the project viable. However, we continue supporting fuel cell development as it is an important product stewardship initiative. To demonstrate our support, we have co-sponsored the launch event of the Chamber of Mines’ 100 kW fuel cell that runs on platinum and natural gas, which will provide baseload power to their building in Johannesburg.
The improvement in energy efficiency was driven by the decrease in opencast mining combined with the increased PGM production and the success of many initiatives in the area.
Savings per energy-efficient technology (2015)
|Technology||R million||MWh saved|
Solar plant update
The environmental authorisation for a solar plant capable of delivering 1 MW of power was issued, and on-site generation at the main offices at the operations in Marikana will be trialled.
Mining, processing and refining of metals generate extensive amounts of general and hazardous waste that can impact the natural environment and surrounding communities if not managed properly. Lonmin is committed to minimising the waste it generates through preventing and reducing waste production, and through recycling and reuse wherever possible. Where waste is treated and/or disposed of, we do so responsibly and in accordance with the relevant legislation. We prioritise the identification of alternatives to disposal to landfill, whenever possible, to reduce our environmental footprint, minimise costs and adhere to legal requirements.
General waste includes domestic waste, packaging, garden waste, building and demolition waste, rubber, scrap metal, wood, food waste, tyres and business waste, which includes industrial plastic. Hazardous waste consists mainly of calcium sulphite and PMR liquid waste, and smaller amounts of other hazardous waste streams, generated by the laboratories and operational sites. Regulatory changes reclassified waste rock and tailings as hazardous waste, increasing the Company’s required capital outlay in lining tailings facilities and management of residue deposits and stockpiles.
Lonmin’s Integrated Waste Management Plan (IWMP) aligns with the requirements of the National Environmental Management: Waste Act (the Waste Act), the relevant waste by-laws and other regulations, norms and standards. The IWMP informs the process whereby waste is generated, handled and transported within the activities of collection, reuse, recycling, treatment and, finally, disposal. The IWMP is managed through the environmental management system and supports cost reduction by preventing double handling of waste and by segregating waste streams to maximise separation and improve cost recovery through reuse, recycling and refurbishment.
We set targets for both general and hazardous waste disposal to landfill and monitor progress against the targets. Compliance to waste management procedures and legislation is measured through internal and external ISO 14001 audits, and the internal and external audits of on-site permitted and licensed waste facilities. Lonmin performs third-party audits on external hazardous waste facilities to ensure compliance and our adherence to the requirement of duty of care of our hazardous waste from cradle to cradle/grave. We undertake research and development work related to our waste streams to determine clean technology alternatives and reuse, recycling and treatment opportunities. This is aligned with the prohibition of various waste streams to landfill.
During 2015, additional waste separation projects were rolled out at various operations across Marikana, and an e-waste collection system was established at the information management department and process operations. A Lonmin Waste Management Standard was developed to define the way waste management is approached in the business to ensure compliance and reduce the Company’s impact on the environment.
- Waste separation projects were rolled out at various business units.
- Waste recycling projects rolled out at processing plants to recycle paper, glass, plastic, cardboard and tin cans.
- An e-waste collection system was established at the information management department and process operations.
- The Lonmin Waste Management Standard was developed, defining the Company’s approach, ensuring compliance and reducing environmental impact.
- A community waste swop shop was initiated at Wonderkop.
General waste is separated on-site at plants, shafts and offices into domestic waste, mixed recyclables, wood, steel and rubber. Waste that can be reused, refurbished and recycled is taken to internal transfer areas such as the salvage yards (Marikana and Limpopo operations) or the waste storage area at the PMR, where independent parties collect the waste for reuse and recycling. The Company’s general waste goes to the licensed Mooinooi GSB landfill site at the Marikana operation, while the other operations use the nearest permitted municipal landfill sites. Specialist external waste concentrators are used for the collection, the internal and external transportation of waste and the operation of the Mooinooi landfill site. Monthly meetings are held with these contractors to ensure compliance with contract and legal requirements.
- 16,595 tonnes of general waste generated, increased 57% compared to 2014 due to the limited waste generated during the five-month strike period in 2014.
- 8,585 tonnes of general waste to landfill in 2015.
- 48% of general waste recycled or reused during the year:
- 6,498 tonnes recycled
- 1,392 tonnes reused
- 120 tonnes composted.
Our 30 September 2017 target is to reduce general waste to landfill by 5%, from the 2012 baseline year. General waste to landfill decreased by 13.6% in 2015 compared to the 2012 baseline year.
Calcium sulphite (CaSO3) is a residue generated from the capture and treatment of sulphur dioxide (SO2) emissions from the smelter. The capture and generation are directly linked – the more SO2 captured, the more CaSO3 is generated. Extensive research was undertaken regarding cleaner production technologies for the generation of CaSO3, where it is hoped that a product can be generated from this process rather than a waste stream. It is the most significant component of Lonmin’s hazardous waste stream and is disposed of at a licensed waste disposal site.
In 2013, Lonmin temporarily closed and capped the CaSO3 dams on site and installed a seepage drainage collection system, to capture residual seepage to prevent environmental impacts. Our preferred long-term option is to rework and convert the estimated 100,000 tonnes of stored CaSO3 in these dams into gypsum for the production of cement and other building products. However, the technical and economic viability of this option still has to be confirmed. If this is not possible, responsible rehabilitation and closure of the CaSO3 dam will be incorporated into the permanent closure design at a later stage.
The PMR produces acid and alkaline liquid waste streams. Our aim is to have a closed-loop system, with much of our research going into reusing the sizeable water component within this waste stream by recycling this back into the process plants, replacing municipal water input. Currently, offsite treatment and disposal to landfill are the waste management options for this waste stream. Another closed-loop system project, which will promote our aim of zero waste disposal to landfill, is the PMR waste incinerator. This project was initiated to allow for the application of the waste hierarchy principle promoting reduced disposal to landfill, to manage the loss of PGMs through waste streams going off site, and to reduce the theft risk of PGMs.
Our aim is to reduce hazardous waste production through continuing research and development into cleaner technology use, generating non-hazardous products and waste, reducing toxicity through treatment technologies or reusing and recycling hazardous waste materials. These include ash waste as an input into brickmaking and e-waste refurbishment.
All of Lonmin’s hazardous waste streams were analysed and classified according to the new Waste Management and Classification Regulations and associated Norms and Standards. We are in the process of developing safety data sheets for various waste streams to provide the transporter and end user with information in terms of responsible handling and management of these waste streams. Waste procedures are being updated to include classification status and possible additional landfill sites should these be required.
The Environmental Regulations and Amendment Act for waste management published in 2014 transferred governance of mine residue deposits and stockpiles from the MPRDA, where they were not classified as a waste, to the Waste Act, where they are classified as hazardous waste and are subject to waste licensing requirements, regulations and standards. Lonmin is engaging with the Chamber of Mines regarding the legalities and challenges in managing waste streams within the existing legal framework.
PerformanceIn 2015, 90,297 tonnes of hazardous waste were generated, of which:
- 86,881 tonnes sent to landfill which includes:
- 58,166 tonnes of CaSO3 were sent to landfill, an increase of 57% on 2014
- 26,593 tonnes of PMR waste effluent were sent to landfill
- 2,122 tonnes of other hazardous waste.
- 3,404 tonnes were recycled and reused.
- 12 tonnes of hazardous waste were incinerated.
CaSO3 and PMR effluent production is linked to production, which increased in 2015 due to the strike in 2014.
Our five-year target (for 30 September 2017) is to reduce hazardous waste to landfill by 5% off the 2012 baseline year. In 2015, hazardous waste to landfill showed a 5.8% increase from the 2012 baseline year. The operation of our SO2 control equipment reduces our atmospheric SO2 emissions, but the process generates calcium sulphite, a hazardous waste, thus increasing our hazardous waste footprint. (Refer to Air quality.) Achieving the targeted reduction will require significant capital expenditure, which is challenging in the Company’s current constrained capital position.
Waste rock is generated primarily from underground workings, where non-ore-bearing rock is discarded as waste and disposed of onto waste rock stockpiles also known as mine residue stockpiles. There are also overburden waste stockpiles from our opencast pits, which are temporary facilities as the waste rock will be returned to the opencast pit during reinstatement and rehabilitation. Lonmin’s Marikana and Limpopo operations have 10 on-site waste rock dumps and continue seeking viable uses for this waste stream. Some of the finer waste rock material is supplied to a privately owned crusher plant on site, and the surrounding municipalities, private entities, the community and the South African National Roads Agency, SANRAL, also purchases waste rock for road construction. The waste rock at Limpopo is being reused by various entities and taken to a crusher plant offsite. In this way, 67,400 m3 of waste rock was reused during 2015, reducing our environmental liability and rehabilitation costs. In total, Lonmin generated 870.3 kt of waste rock during 2015 (2014: 85 kt), with the increase mainly attributable to strike-related production interruptions last year.
There are six operational and five dormant above-ground tailings storage facilities (TSFs), which store tailings from ore being milled at the concentrators. TSFs are managed in terms of a specific internal mandatory code of practices, which are also submitted to DMR and to the Department of Water and Sanitations’ Dam Safety Office. Current TSFs are lined with a layer of clay and managed by specialist tailings contractors, who are on site continuously to monitor TSF integrity, stability and functionality. Quarterly inspections are undertaken by specialist engineers to ensure compliance. All sites are grassed on perimeter walls and the dormant tailings dams are grassed on top to reduce dust generation and erosion. In addition, the tailings dams have irrigation systems to suppress dust, and chemical dust suppressant systems are in place at TSF 6. The revised waste legislation in terms of the National Environmental Management: Waste Act preclassifies tailings as hazardous waste and imposes stringent liner requirements for new facilities, at significant cost.
In 2015, 11,636 kt of tailings were generated (2014: 6,006 kt).
Lonmin has compiled an internal inventory of all areas that could be contaminated, regardless of whether assessments have been conducted to confirm contamination. A phased approach to the assessments is being implemented to confirm whether these areas would require registration on the Department of Environmental Affairs’ contaminated land inventory or not. Lonmin submitted a basic assessment application to the Department of Environmental Affairs in 2012 on the remediation of contaminated land at the PMR. Lonmin is conducting further studies to implement the required remediation measures.
Due to changes to the Waste Act, the basic assessment submission was no longer valid and Lonmin had to revert to the remediation order process. Lonmin received a remediation order for this application in 2014 and is working closely with the authorities on progress and actions related to this order.
Community waste management
Lonmin’s waste management initiatives extend into local communities to address the challenge of lack of service delivery, illegal dumping and littering. The Tedcor waste collection project was established in 2012 and has been successfully operating within the GLC for the past three years, collecting waste from 12 different areas and resulting in 4,328 tonnes of waste being removed from local communities in the past year.
The Company participates in clean-up campaigns in the community and is collaborating with the Rustenburg Municipality to construct a waste transfer station. The Marikana community will benefit from this facility through improved municipal service delivery, job creation and the introduction of a waste buy-back centre, where the community will exchange valuable waste for cash for specific items.
Lonmin established a waste swop shop at the Thlapi Moruwe Primary School in Wonderkop to address a number of burning community issues, including children and families in need, littering and over-used landfill sites. The project encourages local learners from all areas in and around Wonderkop to swop glass, paper, plastic and tins for stationery, clothing, toiletries and toys. The project teaches learners that waste has a value and an impact on the environment and their health if not managed properly. Since the start of the project in April 2015, the swop shop has collected more than 10 tonnes of recyclable waste, and the community of Wonderkop and its surrounding areas are visibly cleaner.
Summary of waste streams
|General waste to landfill||5,460||8,585|
|Hazardous waste to landfill||40,097||86,881|
|General and hazardous waste incinerated||7.53||277|
|Hazardous waste recycled, reused and treated||3,915||3,404|
|Waste rock (kt)||85||870|
General waste materials recycled and reused
|Ferrous and non-ferrous scrap1||3,581||4,360|
|Paper (and mixed domestic recyclables)||31||30|
|1||In previous reports metal liners with steel balls and concentrator scats and scrap were presented as separate line items. These amounts are not included in the total ferrous and non-ferrous scrap amount.|
Hazardous waste materials disposed to landfill, recycled and treated
|Hazardous waste (tonnes)||2014||2015|
|Calcium sulphite (CaSO3) sent to landfill (tonnes)||25,252||58,166|
|PMR effluent (tonnes)||13,431||26,593|
|PMR effluent (acidic waste)||2,522||1,334|
Emissions from our operations can affect the ambient air quality, and we acknowledge our responsibility to continuously manage and minimise this impact. The Air Quality Act regulates air quality in South Africa and focuses on both source and impact on the ambient environment. Listed activities are required to operate with an Atmospheric Emission Licence (AEL), which governs emissions.
Air quality management is an integral component of the Environmental Management Strategy, with emissions to the atmosphere minimised through the use of appropriate technology.
Lonmin’s smelter, base metals refinery, precious metals refinery and laboratory hold approved five-year AELs, as renewed through the relevant legislative requirements. Air quality objectives and requirements are managed through the Environmental Management Programmes incorporated into the ISO 14001 environmental management system. Emissions and ambient air quality monitoring is an integral part of the monitoring and management component of the system. Internal and external audits, emissions verification audits, emissions reduction management plans and the independent ISO 14001 certification audits are components of our management tools.
South African regulations, published in 2010, require that minimum emission standards are reached by 2015 and then subsequently reduced by 2020. Achievement to the year 2020 standards requires significant capital investment to ensure the emissions are reduced to the relevant minimum emission standards for the activity and the pollutant. Feasibility studies are in place to identify and research the appropriate technology that would provide the most sustainable solution to meet these requirements. The Air Quality Act makes provision to apply for the postponement of the 2020 standards.
Our principal atmospheric emission is sulphur dioxide (SO2), generated through smelting and converting activities at the smelter. Air pollution control equipment is maintained to minimise SO2 emissions released into the atmosphere. The fugitive capture system is fully operational and a positive trend was noted on the impact of ambient ground level concentration through various modelling scenarios. The chemical process used to remove the SO2 generates calcium sulphite (CaSO3) as a product, which is disposed of as a hazardous waste stream. The Company continually researches alternative technology that generates a by-product rather than a waste stream.
The PMR uses various chemicals in its processes to extract and refine PGMs and as a result the following gases are emitted from various refining activities: CL2, HCl, NH3, particulate matter, NOx and SO2. A series of air pollution control equipment is in place to scrub and control emissions of these gases prior to release to the main stack. The waste effluent generated from the scrubbers is stored in the effluent tanks and removed by a service provider to a landfill site. The PMR is currently investing in research and development projects to reduce effluent, beneficiate waste, and recover and recycle water back to the process by 2020.
- SO2 emissions averaged 11.2 tonnes/day, which is below the permit limit of 16.5 tonnes/day for the smelter operations. The increase compared to 2014 is attributed to the increase in matte produced from the smelter in 2015, given that 2014 saw a decrease in production as a result of the protracted strike.
- Yearly average SO2 concentration for the concrete stack was 1,820 mg/Nm3 (2014: 724 mg/Nm3) and for the Sulphur Fixation Plant stack was 1,372 mg/Nm3 for the smelter operations.
- Renewal applications of the BMR, Lab and the Smelter AELs were approved by relevant licensing authorities.
Total suspended particles (TSPs)
TSPs, including dust, are generated from wind erosion of tailings dams, stacks, general mining activities such as drilling and blasting, materials handling, crushing and screening and from vehicle movement on paved and unpaved roads.
Lonmin manages TSPs through various dust suppression measures that include vegetation on the sidewalls of all tailings dams and surfaces of dormant tailings dams; chemical and water suppression on the surfaces of operational tailings dams and unpaved roads (grey water is recycled and reused in the process); sweeping of tarred/surfaced roads; and suppression systems at materials handling and crushing facilities. Air pollution control equipment is in place for the various processing activities to minimise particulate matter emissions from these sources.
During 2015, particulate matter management projects included:
- a new baghouse at Rowland Concentrator;
- a chute over the conveyor belt at Merensky Concentrator;
- commissioning of a pod irrigation system for K4 tailings dam; and
- feasibility studies conducted to implement a chemical dust suppressant dosing system at Tailings Dam 6 to replace the use of water trucks.
Ambient dust monitoring is undertaken in and around our operations, with fallout monitored on a monthly basis against both residential and non-residential dust fallout regulations. Sites located to monitor the impact from our tailing facilities continue, indicating the positive performance of our suppression measures.
Other emissions, including those classified as ozone-depleting substances (ODS), persistent organic pollutants, volatile organic compounds and hazardous emissions are present at our operations, although to a significantly lesser extent. In terms of our ODS programme, we have ensured no new purchase on these substances through our systems management in procurement.
At Lonmin climate change is a topic close to our hearts. Not just because we are committed to mitigating the impact of our own carbon footprint and adapting to climate change through the use of new technologies but because what we produce is part of the solution.
Chief Executive Officer, NBI Position Paper on Climate Change
Climate change poses risks and opportunities to our operations and the industry from both a physical and regulatory perspective. Physical risks include extreme weather events that could lead to operational disruptions, water discharges, increased operating costs and negative effects on local communities and the Company’s upstream and downstream supply chain. Changes in climatic patterns could increase heat and vector-borne diseases, increase water scarcity and result in a loss in biodiversity and increased operating costs. Regulatory risk arises primarily from the impending implementation of the national carbon tax scheme in South Africa, but also from the increased direct and indirect costs of carbon regulatory mechanisms, emissions standards and border tax adjustments. Climate change also raises the potential for increased reputational and litigation risk if carbon emissions are not managed responsibly.
The most significant source of greenhouse gas (GHG) emissions is the indirect emissions (scope 2) generated from use of electricity from a predominately coal-based power generation system. Lonmin’s main initiatives to reduce GHG emissions relate to energy efficiency projects through the Energy Management Strategy, which is certified in terms of SANS 5001.
The Company voluntarily discloses its GHG emissions and climate change matters through the CDP and has set targets for both energy and GHG emissions. The Chairman of the Board attended the Business and Climate Change Summit in Paris this year to facilitate the involvement of business, with the intention of encouraging meaningful progress and binding commitments from governments at the COP21 session.
The platinum industry plays an important role in managing GHG emissions through the role of PGMs in technology, such as fuel cells.
- Total carbon footprint for 2015 was 1,757,670 tCO2e.
- Electricity consumption comprises 95% of the total carbon footprint.
- GHG intensity for 2015 is 1.2 tCO2e/PGMoz.
The 46% increase in the Company’s carbon footprint in 2015, compared to 2014, is distorted by the strike in 2014, which resulted in limited to no production for five months. For the same reason, the improvement in GHG intensity, which is directly linked to production, is also not comparable (a decrease of 14% year-on-year).
Carbon tax is proposed as an economic instrument to move South Africa to a cleaner and greener economy. Lonmin fully understands our carbon footprint and the potential carbon tax to be attributed to our business. The carbon tax regime as currently proposed will affect Lonmin in two ways:
- As a direct cost of carbon tax on scope 1 emissions.
- As a pass-through cost from Eskom, which could amount to an increase of more than 7% in the year of inception, over and above any other electricity price increases that have been planned.
Lonmin recognises that a transition to a low-carbon economy is under way, that GHG emission reduction is necessary, that the risks have to be managed, and that opportunities should be implemented within a sustainable framework. We remain concerned above the implications carbon tax will have on costs and global competitiveness and add our voice to the debate, urging that the final mechanism strikes a reasonable balance between the ambitious and the achievable to ensure a sustainable transition.
The National Treasury has published the Carbon Tax Bill for public comment. The bill was published on the National Treasury’s website on 2 November 2015 and the comment period ended 15 December 2015.
Meeting reduction targets
Our target is to reduce scope 1 and 2 GHG emissions by 4% by 2017 from a 2012 baseline year. In 2015, GHG tonnes of CO2 increased by 11.8% against the 2012 baseline for scope 1 and 2 emissions. GHG efficiency has improved by 14% from 1.4 tCO2e/PGMoz in 2014 to 1.2 tCO2e/PGMoz in 2015. The year-on-year comparison is distorted by the strike in 2014, which resulted in limited to no production for five months. In total, Lonmin emitted 1,758 ktCO2e in 2015.
|GHG emission category||Emissions 2015
|Scope 1: Direct emissions from operations that are owned or controlled by Lonmin:||84,302||GHG protocol: Corporate Accounting and Reporting Standard|
|Scope 2: Energy indirect emissions from electricity:||1,669,489||GHG protocol: Corporate Accounting and Reporting Standard|
|? Electricity (1,669,489 tCO2e)|
|Scope 3: All indirect emissions that occur outside of Lonmin, upstream and downstream:||3,879||GHG protocol: Corporate Value Chain Accounting and Reporting Standard for the reporting of scope 3 emissions|
|Total carbon footprint (tCO2e)||1,757,670|
Detail on GHG and climate change assessment can be found in the CDP submission online at www.lonmin.com/
Biodiversity and land management
Mining is classified as a threatening process for biodiversity, and the Marikana Thornveld, in which our Marikana operations lie, is listed as a ‘vulnerable’ ecosystem under the National Environmental Management: Biodiversity Act, 10 of 2004. However, none of Lonmin’s operations are located in high biodiversity-sensitive areas, although it is likely for a number of protected/threatened species to be found at Lonmin’s operations. Relocation strategies are in place to transplant protected/threatened flora and relocate faunal species such as bees and snakes, should these be encountered at operations.
Biodiversity is deemed to be a material aspect, regardless of the ecosystem vulnerability of the operational area, as rehabilitation is a key regulatory and financial requirement for the Company that is linked to annual closure liabilities and is an area of interest for stakeholder groups.
All (100%) of the mining operations have biodiversity action plans (BAPs) that were updated to align with relevant legislation, regional and national conservation plans and the Mining and Biodiversity Guidelines. Lonmin’s updated BAP for the Marikana Operations in particular, aligns our approach to biodiversity management with the ICMM Principles and their position statement on mining and protected areas, the DMR Biodiversity Guidelines and the relevant legal statutes and regulations. The Marikana BAP is now supported by software that models key parameters like the potential buffering quality of existing wetlands and associated vegetation, faunal habitats (richness and abundance), and ecological degradation, and indicates where red data and protected species were observed on site. The new BAP GIS tool allows for rapid evaluation and identification of risks to biodiversity of proposed infrastructure development management and monitoring decisions and compliance risks.
Biodiversity risks are incorporated into operational risk registers and action plans are in place to address these potential risks.
- Updated the BAP for the Marikana operations, which includes a GIS management platform.
- Detailed screening of fauna and flora at all processing areas.
- Relocation of protected plant species.
- Updated the identification of red data species and protected species.
- Communication and awareness initiatives were held across the mines.
- A mass clearing of alien invasive species was initiated in collaboration with the government’s Working for Water project, the Kusuala Green and Biodiversity project and the GLC, creating 85 jobs for local community members.
A register of protected species (Schedule 11 of the Nature Conservation Ordinance of Transvaal – No. 1 of 1983), and a list of plants and animals on the International Union for Conservation of Nature (IUCN) Red List of Threatened Species sighted at our operations over the past 10 years, and the conservation status of these species, is available.
Lonmin consults with stakeholders in local communities to provide insight on heritage sites that were identified within Lonmin’s mining right area. Over 165 sites (including Iron Age sites, archaeological artefacts, graves and old building structures) have been identified around the Lonmin Marikana operations to date. A number of new graves were found in and around the Marikana mining right area during 2015. These were added to the heritage inventory and one of these sites was fenced off and demarcated to protect it, due to its proximity to our operations. A phased approach to the mitigation management plan for sites with significance rating one is being developed, which includes prioritising those sites which could potentially be impacted by mining-related activities.
Communities are contacted before significant projects are started, as per legal requirements, such as with the relocation of graves. All Environmental Impact Assessment (EIA) regulatory processes provide for community and public participation in projects at Lonmin. A comprehensive database of Interested and Affected Parties in and around Lonmin operations was developed. Lonmin also has formal environmental complaints registers at all operations, where any community members can raise their concerns regarding heritage sites or environmental issues.
Lonmin’s mine closure strategies and risk-based closure and rehabilitation assessment for the Marikana operations have identified risks for closure and address the potential impacts and risks on the available ecosystems during the operational phase of mining. Progressive rehabilitation and closure is systematically applied at the operations so as to meet the objectives of the closure strategies. The unscheduled forecast closure costs and scheduled closure costs are reviewed and assessed annually, and any shortfall in financial provision is made primarily through the issuing of bank guarantees, or transfers to the Lonmin Platinum Pollution and Rehabilitation Trust Fund.
The Marikana Closure Strategy and Risk Based Closure and Rehabilitation Assessment is being updated and consolidated into a Closure and Rehabilitation Strategy. In addition to this, the Department of Water and Sanitation (DWS) requirement for a Rehabilitation Strategy and Implementation Plan, as required by our Water Use Licence at Marikana, is being updated in alignment with the various rehabilitation plans.
Land management governance
On-site environmental officers monitor compliance with, and implementation of, rehabilitation programmes to manage land responsibly. This is supported by external audits to verify compliance with Legislation, Environmental Management Plan (EMP) Performance Assessment and ISO 14001 requirements, which consider land-related matters.
Lonmin’s Land Use and Biodiversity Standard was completed in 2015 and takes all legal and policy-related guidance on biodiversity from government into account. This standard reinforces the importance of planning for closure and rehabilitation during the operational phase.
The Environmental Drilling Standards and Protocol provides specific actions for prospecting and exploration with regard to on-site operational environmental requirements and rehabilitation. Regular inspections by on-site environmental officers are conducted to manage adherence and compliance and to ensure adequate remediation and rehabilitation has taken place at these sites.
|Land under Lonmin management||Hectares|
|Total land managed||25,112|
|Total area in use for Company activities in North West, Limpopo and Gauteng||22,375|
|Total area disturbed by opencast activities in North West||Merensky Reef – 244
UG2 Reef – 482
|Area rehabilitated to date||310|
|Area disturbed not yet rehabilitated||416|
|Total area covered by waste rock (surface – overburden)||150|
|Total area covered by waste rock (from underground)||60|
|Total area covered by tailings||1,075|