Special supplement: Anglo American: Prospecting for a sustainable future

Today's challenge for companies is achieving sustainable development by growing revenues and increasing profitability while maintaining the highest ethical, environmental and social responsibility standards.

Mining giant Anglo American faces the same requirements - developing a global resource company while addressing climate change and sustainable development.

Established in South Africa in 1917, the company now has mines around the world supplying over 40 percent of global platinum demand and producing significant amounts of diamonds, copper, nickel, zinc, iron ore and coal.

Company leaders say one of the first responsibilities of Anglo American "is to ensure that its use of natural resources is as efficient as possible". The group has set itself the target of reducing energy consumed per unit of output by 15 percent and carbon emissions by 10 percent by 2014.

"We are looking to reduce both our energy use and carbon emissions primarily through a program to increase energy efficiency," said Roger Wicks, Anglo American's head of energy. "Key to this program is the measurement of our energy intensity at site level and, after making due allowance for the energy challenges that mining brings such as declining ore grades, to use that information to hold site managers responsible for meeting our reduction targets."

Through an alliance with Shell and its participation in several research initiatives, Anglo American is supporting the development of the next generation of clean coal technology that is designed to significantly improve power generation efficiencies and address global energy issues while reducing carbon emissions.

"As a major producer of coal, which remains an important part of the energy mix required to meet the world's energy needs, we have a responsibility to work with our customers and with help from governments to seek ways of using this crucial energy source to minimize or eliminate the climatic impact," said Sir Mark Moody-Stuart, Anglo American's chairman.

Anglo American is also partnering with Johnson Matthey to bring new hydrogen fuel cell technologies to markets in an effort to provide an alternative energy source for transportation.

Aside from global concerns, each Anglo American mine also faces significant local challenges to protect the environment and develop the community in which it operates. Maintaining ISO9001 and OHSAS14001 at all sites ensures compliance to managerial and environmental standards but more is required to achieve long-term sustainable development.

Anglo American also developed an award winning "socio-economic assessment toolkit" to monitor local conditions and develop best practice programs to ensure the overall success of the community around its mining operations.

Programs range from healthcare and HIV treatment programs to literacy and local business development, efforts that have earned the company a reputation as a leader in corporate social responsibility and sustainable development.

In China's Shaanxi province, Anglo American has partnered with Plan International, an NGO working to alleviate poverty through community projects. This partnership is working in Mengjiawan township of Yulin to provide sanitation for over 2,700 people at a cost of about $100,000. Even though Anglo American has not yet started mining in the area it understands that the future success of its coal project in Yulin is dependant on local community support and the sustainable development of its resources.

Energy Efficiency

During the mining, smelting and refining processes, large amounts of energy is used to convert ore-bearing rock into usable metals and minerals, which unfortunately also results in large amounts of greenhouse gases.

Anglo American has set itself voluntary reduction targets that will be met through a company-wide energy efficiency program launched after energy experts examined the operational opportunities and innovative thinking of employees was harnessed. Measuring energy use is complex because the baseline is always changing - mining depth changes each year, haul road distances and ore grades change over time. Anglo has invested in the development of new techniques to deal with these complexities.

Examples of energy initiatives can be found in Anglo American's coal division that has invested over $2 million in energy-saving projects at its South African mines, delivering energy savings of 18 gWh and 12,600 tons of carbon dioxide (CO2).

Anglo American is investigating using the Kyoto Protocol's Clean Development Mechanism to develop a project that will replace inefficient pneumatic rock drills with efficient electric drills at underground mines.

Anglo American has also helped Chinese customers achieve their environmental goals. Baosteel, one of the largest and most profitable steel companies in China, has recently been switching to the Corex process, the most environmentally and energy efficient steel production process that requires a specific type of ore feed supplied by Anglo American's iron ore mine in South Africa. The process has a range of advantages that include lower investment and production costs, lower coking coal consumption resulting in 95 percent reduction in sulfur dioxide emissions and lower CO2 output and high operational flexibility. Exhaust gases can be used to generate 1 billion kWh of electricity annually.

By fostering a mindset that is open to improving efficiencies in every area, Anglo American will continue to deliver energy savings through a range of initiatives ranging from installation of energy-efficient light bulbs to more efficient pumps, motors and less carbon intensive fossil fuels. With about $15 billion of approved mining projects, the company is focused on these new opportunities for achieving further efficiencies.

"Our strong project pipeline provides an opportunity to ensure we install the most energy-efficient technologies at the commencement of very large and long-term project investments," said Wicks. "We are focusing on energy, CO2 emissions and water efficiency. All investment proposals are required to factor in a cost of carbon to raise awareness and support efforts to reduce emissions."

(China Daily 11/10/2008 page5)