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AFRICA

Investors pump the gas

on gold miners

by Helen Reid, Jeff Lewis, Tanisha Heiberg, Reuters

nvestors are putting pressure on gold miners, whose high roadmaps and as governments implement stricter controls on
Igreenhouse gas emissions have been less scrutinised, to emissions,” she said.
report transparently and take concrete steps to curb them after Investors sank $US47 billion into gold ETFs in the first 10
a rally in prices this year drew closer attention to the sector’s months of 2020, up 203% from last year.
footprint.
Renewed interest in gold mining stocks – with $US3 billion
Gold miners are among the biggest emitters of greenhouse flowing into gold equity to November 2020 – has intensified
gases in the mining sector, although critics generally point to pressure, executives said.
coal miners and iron ore miners.
“We have certainly seen conversations around ESG ramping
Scope 1 and 2 emissions from gold are higher than those of up pretty significantly,” Newmont Mining Corp chief executive
copper, nickel, iron ore and metallurgical coal, before factoring Tom Palmer said in October.
in freight and downstream emissions, according to data from
Newmont has committed to a 30% reduction in greenhouse
ESG consultancy Skarn Associates.
gas emissions by
Heavy haul trucks 2030, and net zero
and power supplies emissions by 2050.
are major sources
No.2 gold miner
of emissions, while
Barrick Gold Corp
deteriorating gold
has committed
ore grades have
to reduce its
forced miners to
greenhouse gas
dig more rock to
emissions by at least
extract each ounce
10% by 2030.
of gold in an energy-
For Barrick and
intensive process. Source: Skarn
others, switching to
The World Gold
renewable energy
Council estimates the sector emitted 32,689t of CO2
sources to power mines can add to short-term costs. But it
equivalent per tonne of gold produced in 2018, up 12% from
helps satisfy investor demands for cleaner operations while
the 2017 total. They have not yet published estimates for 2019.
significantly reducing longer term energy costs at mines, which
George Cheveley, portfolio manager at Ninety One, which tend to be in isolated, off-grid locations with diesel generators
holds more than $US1 billion in gold assets, said gold miners’ the only option, industry consultants said.
emissions data had influenced decisions to shift the weight at
Barrick said a solar power plant at its Loulo mine in Mali delivered
which to hold certain companies in his funds.
a saving of 540,190L of fuel and 1,593t of CO2-equivalent during
“These numbers are increasingly important – carbon taxes the third quarter of 2020. Barrick is busy permitting a 100MW
could come in, so you need to establish your exposure,” he solar power farm in Nevada.
said.
Being on the grid has downsides.
In South Africa, the continent’s No. 2 producer of gold, a
South Africa’s Sibanye-Stillwater and Gold Fields Ltd blame
carbon tax on Scope 1 emissions is already in place and is
their high Scope 2 emissions in part on reliance on the national
set to expand to apply to Scope 2 emissions as well from the
grid’s coal-fired electricity generated by state power firm Eskom.
start of 2023.
The South African miners say red tape has stymied their efforts
Gold miners may have escaped the more intense scrutiny
to install renewable energy capacity.
faced by coal or iron ore mining partly because investors use
“There will obviously be increasing pressure to reduce emissions
gold as an “insurance asset” and portfolio risk hedge, Sora
from the mines,” a Sibanye-Stillwater spokesman said. “But
Utzinger, responsible investment analyst at Aviva Investors,
consideration needs to be given to the role and impact of Eskom
said.
and limited options available to the gold mines.”
“However, we believe this may soon change as more
international mining companies chart their own net zero
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