Climate Change and Extractives


7. Managing emissions

Managing emissions in the mining sector

The mining sector is energy-intensive with 10% to 40% of operational costs on energy depending on context.  Extraction is responsible for up to 60%, and ore concentration and milling are responsible for up to 40% of energy consumption. (WEF, 2016)

Greenhouse gas (GHG) emissions in the mining and primary mineral extractive industries almost doubled between 1970 and 2010 as a result of production growth and are projected to increase by a further 45–60% by 2050 (compared to 2010 production). (BSR, 2014).

It is important that governments manage emissions so their extractives sector are carbon efficient in a carbon constrained world. There are several strategies that governments could pursue to reduce the carbon intensity of their mining sector.

  • Supporting low-carbon energy sources. Some private sector players are already taking action (see examples on next page). The decentralised nature of renewable energy sources also has the additional benefit that communities with no access to electricity, near to remote mine sites can gain access to energy. In these cases the shared use of energy infrastructure can also be promoted. 
  • Support sectoral energy efficiency programmes to reduce the energy intensity of production e.g. low-energy grinding technologies.
  • Carefully design appropriate policies, programmes and regulations to enable reductions and ensure successful implementation and enforcement.
  • Improve material efficiency by recycling or re-using materials. For example, one-tenth of paper, a quarter of all steel and half of all aluminium produced is scrapped (mainly in downstream manufacturing) and internally recycled.
  • Explore the potential for climate finance. Funding is available for climate change programmes from international funding mechanisms such as the Green Climate Fund and others. An overview of climate finance sources can be found at http://www.climatefundsupdate.org/.

Examples of private sector support for low-carbon energy sources

  • Rio Tinto has invested in the development of carbon capture and storage technologies

  • Exxaro has moved into alternative energy and formed a new business growth division exploring wind, solar, and coal bed methane projects in Africa.

  • Vale and Gold Fields have invested in biodiesel and other agricultural production that could be used as an alternative energy resource.

  • Barrick purchases renewable energy and has built natural gas, geothermal, solar, and wind facilities at its operations in the Americas.

Source: BSR (2011)

Managing emissions in the oil and gas sector  

In the oil and gas sector, the majority of emissions are generated when products are used rather than in the upstream, refining and processing of these products. 

There are several strategies that governments in resource-rich countries could consider to reduce the carbon intensity associated with the direct activities of their oil and gas sector such as:

  • Ensuring that the sector is working towards increasing energy efficiency. A useful resource guide is IPIECA’s Energy and GHG Efficiency Compendium.

  • Supporting the sector in reducing flaring (See IPIECA’s Guidance on Flaring). Initiatives such as the Global Gas Flaring Reduction partnership can help governments and the extractives sector in their efforts.

  • Managing methane emissions across the value chain.

  • Providing incentives for industry to implement Greenhouse Gas Reductions projects (a useful guidance from IPIECA on good practice can be found here).

  • Supporting programmes, partnerships and multi-stakeholder initiatives that are seeking out and implementing low carbon options.

  • Exploring the potential for climate finance from international funding mechanisms such as the Green Climate Fund and others. An overview of climate finance sources can be found at http://www.climatefundsupdate.org.

  • Working with the private sector to explore the potential deployment of carbon capture and storage technologies. A good example is the South African Centre for Carbon Capture and Storage (SACCCS) which is the leading authority for CCS activities in South Africa and in the region. Examples of public/private partnerships in this area are given on the next page. 

Climate related partnerships and multi-stakeholder initiatives in the Oil and Gas Sector

Source: The Oil and Gas Climate Initiative