ISSUE 51, OCTOBER 2023
ART MEETS MINING IN THE HIGH CHILE DESERT
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PATHWAYS TO NET ZERO MINING:
NOT EXACTLY A CLEAR WAY AHEAD
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y now, most mining companies, and certainly all of the majors, have announced targets to achieve net zero emissions. The majority plan to meet this objective by 2050, with some exceptions (Australia’s Fortescue is aiming for 2040, while China Shenhua Energy has a 2060 deadline).
These targets come with detailed plans to reduce emissions from mines’ own operations (Scope 1), as well as energy use (Scope 2) and parts of supply chains (Scope 3), and the roadmap generally features interim objectives set for 2030 or even 2025. This means the sector is getting closer to having to show actual results in its pursuit of decarbonization – yet obstacles remain that could jeopardize the achievement of short and long-term targets.
RENEWABLE ENERGY CAPACITY Almost all [off-grid] miners plan to switch from fossil fuels to renewables-based energy to power their operations. Along with improving energy efficiency, this is the best way to tackle Scope 2 emissions, which can represent anywhere from 5% of emissions for coal miners to almost half for gold miners.
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With six years to go before interim climate deadlines, the path to net zero mining is not as clear as it should be.
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But to this day, there simply isn’t enough renewable energy being generated in the world to supply the entire sector, let alone other sectors making the same transition. “The biggest challenge is going to be the absolute scale that’s required. And with that scale, the power supply is going to be a real challenge. The mining industry, when it’s not self-supplying, will have to compete with every other renewable power user that’s trying to move towards net zero,” Anthony Knutson, Metals and Mining Emissions Research Lead at Wood MacKenzie, tells Energy and Mines. Miners may take comfort in the International Energy Agency’s (IEA) latest Net Zero Roadmap published in late September 2023, which states that “limiting global warming to 1.5 °C remains possible due to the record growth of key clean energy technologies”. However, according to the IEA, global renewable power capacity still needs to triple by 2030 to meet the demands of a 1.5ºC scenario. Some in the sector believe that achieving zero-carbon energy supply within targets will require exploring options besides solar and wind generation. “This is not going to be a popular statement, but if we are going to be talking about fossil fuelfree energy, we have to be talking about nuclear,” says Tom Juric, Divisional Director at Liebherr Canada, pointing out that this is a personal opinion, not his company’s.
‘WAIT AND SEE’ NO LONGER AN OPTION While energy capacity and technological challenges will take time to be overcome, industry experts warn that miners cannot simply sit and wait, and worry about a perceived lack of action, even from miners that have announced ambitious targets. Maarten Van Koppen, Vice President of Product Management at MacLean Engineering, says he has observed contradictory behavior from clients: “We’ve seen some mining companies that have set really aggressive targets for 2030 move ahead with [conventional] equipment, even though that equipment might last them 20 years. You’re either not going to meet your targets or you’re going to accept the fact that you’re going to have to replace it halfway through its life. I think there still is often a bit of a disconnect between corporate targets and local decisions.” This is partly due to the fact that some of the technology needed to decarbonise – particularly around mobility – is still in its infancy. For instance, the debate between hydrogen and batteries is ongoing, though the recent decision made by Australia’s three largest miners (BHP, Rio Tinto and
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Fortescue) to focus exclusively on battery-electric vehicles certainly sent a clear demand signal to OEMs. For Juric at Liebherr, there is no single silver bullet, and that makes it difficult for miners to commit to one technology. “Diesel was easy to produce, easy to manufacture, easy to transport, easy to store, and so on. The current technologies that we are seeking to displace it with, things like hydrogen, ammonia, electricity, have their advantages, but there’s also some considerations and perhaps disadvantages. So I think the biggest challenge there is for mining houses to converge on one or a couple of technologies. Nobody has a definitive, ‘this is the way we’re going to go’. I believe people are waiting for the technology to catch up, and my caution to the industry is: don’t wait too long.” He recommends making a decision and sticking to it, while maintaining some flexibility “should something better come along”. Carbon pricing regulations – particularly the EU’s Carbon Border Adjustment Mechanism (CBAM), which will effectively impose the EU’s carbon tax on many non-EU mining products – are widely seen as the catalyst needed to prompt action, even from those reluctant to it.
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SOLVING THE INFRASTRUCTURE EQUATION Even in areas where the path to net zero is seemingly straightforward, implementation remains challenging. For instance, electric vehicles for underground mines are becoming broadly available, but companies have yet to figure out how to charge them with 100% renewable energy. “That link has not been made very often just yet,” notes Van Koppen. “For starters, you need to really understand how much power you’re going to need, especially if you’re going to be self-generating, and the reduction in ventilation that you can realize. And then, make sure that the power is of sufficient quality to ensure that the power electronics don’t have a hard time with it. There are not a tonne of case studies out there just yet to my knowledge,” he adds. Projects like Torex Gold’s Media Luna in Mexico, which involves the construction of a solar plant as well as the implementation of battery-electric equipment, could inform the next steps in the transition – as long as learnings are shared with the wider industry.
“I think there’s a lot more that could be done in terms of collaboration, if we could just come to terms with this competitive advantage being eroded by sharing information and results. Perhaps together we could somehow crack that magic code that would be akin to us creating some renewable diesel that was net zero and easy to generate, using waste products and all that sort of stuff: that would be a watershed moment. Information and data sharing could accelerate us by decades,” says Juric.
SUSTAINABILITY TARGETS ARE KEY TO THE FUTURE OF THE INDUSTRY As things stand, the risk that miners could miss their net zero targets, especially the interim goals set for 2030, does exist – but pressure from investors, governments and society should keep the sector in line. According to Knutson at Wood MacKenzie, the likelihood of meeting targets depends on locations and commodities mined. He explains: “In terms of meeting their goals and the wider 2050 targets, I think these are achievable. They’re definitely striving for that, and
it’s not all lip service: a lot of money has been invested. But there’s a lot of moving parts, a lot of balls in the air that need to connect, as well.” One thing is for sure: meeting climate targets will be key in attracting the right talent to guide the industry through the transition to a sustainable economy. Already, companies are facing challenges in hiring the next generation of engineers and operators, as the industry’s reputation as environmentally and socially disruptive is deterring graduates from pursuing a career in mining. MacLean is working with colleges to develop the right curriculum to meet the sector’s talent demand for technicians who have to maintain the new battery electric equipment, but Van Koppen notes that it hasn’t “seen a lot of uptake”. For Knutson, the mining industry has been “demonized”, and sustainability is a crucial element in cleaning up its reputation. “We haven’t done a good job promoting it, but we need that human capital in there to support sustainability efforts going forward.”
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Image courtesy B2Gold
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Pampa Elvira Solar, Minera Gaby, Atacama Desert, Chile, July 2017 A 27.5-megawatt solar-thermal array heats water for the electro-winning process at nearby Minera Gaby
Renewable Energy and Mining in the High Desert of Chile 13
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Lithium evaporation ponds, Minería Besalco, Atacama Desert, Chile, August 2022
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y the time Jamey Stillings flew over the Atacama Desert’s stark landscape in a small Cessna, gyromounted camera in hand, he felt he already knew it intimately. For months, he had poured over satellite imagery to better understand the area’s geography. From the Chilean Coastal Range, which blocks nearly all ocean moisture from the interior, to the expansive Salar de Atacama and soaring volcanos of the Andes, the desert is distinctive. Unlike deserts of the southwestern United States—often veiled by creosote bush, piñon, and juniper—the Atacama reveals its geology with unabashed directness. No vegetation obscures its naked beauty. Over time, water and wind have shaped this land, and rain, though rare, often suggests itself as its dominant sculptor. Upon this striking geoscape, humankind imposes its will. Immense open-pit mines account for nearly a third of the world’s copper production, and the brine in lithium mine evaporation ponds will eventually power our cars, computers, and smartphones. Vast solar and wind utility-scale energy projects generate electricity for Chilean industry, commerce, and culture. From an aerial perspective, humankind’s stewardship of this land reveals the unembellished evidence of our demands and desires. The diverse geography of the Atacama Desert gives it a unique set of attributes, and Stillings was committed to documenting them with his distinct aerial aesthetic. In 2017 and 2022, he crisscrossed the Atacama Desert of Chile from Iquique to La Serena, photographing mines, renewable energy projects, and the dramatic landscapes of the region’s rugged and raw beauty. Historically, electricity generated using imported coal and natural gas was transmitted to mines and population centers throughout the North. Yet, the Atacama has some of Earth’s highest solar and wind energy potentials. Since 2008, through government policy, private investment, and public pressure, Chile’s renewable energy development has become an example for other countries and mining operations worldwide. This trend accelerated as the price of solar and wind projects became competitive with fossil fuels for electricity production. Between 2008 and 2020, non-hydrological renewable energy capacity in Chile grew by 1900%. Most major mining operations have converted to 100% renewably sourced electricity for both economic and environmental reasons. There is no political downside to lowering the carbon footprint of mining operations. For Stillings, the growing dynamic between the mining industry and the rapidly developing renewable energy sector is a compelling subject.
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In 2010, Stillings initiated his aerial photography project focused on renewable energy, which spanned four years and involved nineteen flights to document the construction of the 392MW Ivanpah Solar concentrated solar plant in the Mojave Desert of the United States. The New York Times Magazine was the first to publish an extended photo essay in June 2012. The work became a museum exhibition and an awardwinning book, The Evolution of Ivanpah Solar, published by renowned German photobook publisher Steidl in 2015. Over time, his work has grown to cover a wide range of solar and wind projects throughout the American West, Japan, Uruguay, and Chile. Changing Perspectives: Renewable Energy and the Shifting Human Landscape has become the name for this ever-growing body of work. ATACAMA: Renewable Energy and Mining in the High Desert of Chile (Steidl, 2023), Stillings’ new book, was released in July. He will attend the Energy and Mines Toronto Summit this year to “listen, learn, build collaborative contacts and support for new project work” and sign copies of ATACAMA. Stillings’ vision is to build and expand Changing Perspectives internationally over the coming decade. His keen interest in the nexus between mining and renewable energy continues, and he has his sights set on a new extensive project, Changing Perspectives: Renewable Energy in Australia.
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ATACAMA Renewable Energy and Mining in the High Desert of Chile Photography by Jamey Stillings
Valle de los Vientos, wind farm, Atacama Desert, Chile, September 2022
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your Thought Leader for hybrid projects
The time to act on
2030 TARGETS
IS RUNNING OUT Interim decarbonization targets are looming ever closer, but the path to a green energy supply is anything but straightforward for miners. Martin Schlecht, Director Engineering & Projects at Dornier Suntrace, shares his insights on the main remaining challenges.
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ENERGY AND MINES: What do you see as some of the essential steps required to facilitate the shutdown of HFO engines during daylight hours for an off-grid mining operation?
optimum size of the solar plant based on whatever cost of energy or payback period against fuel cost savings you want to see.
MARTIN SCHLECHT: Shutting off all engines means you don’t have any spinning reserve available from the engines. So you need to replace the spinning reserve with the battery itself, with all its operational requirements. Engines are the safety net for off-grid operations, that every miner is used to, and it can be an emotional step to switch them all off in the first place.
But I think it will be a mind-blowing experience to be around the mine when suddenly there is silence in the powerhouses and the mine is still operating at full load.
It’s important to track the weather forecast, as you should not switch off all engines if you don’t have enough sunshine. At Fekola, we have a sophisticated weather forecasting system that gives operators a lot of advanced warning to get engines up and running: the clouds should not take you by surprise. Specific to HFO engines is that they should not be started more than once a day, as more starts would increase the maintenance significantly. So that sequence also needs to be optimized for each day’s operations.
MS: We did an assessment of the performance of the powerplant after one year (which was last year in July), and it exceeded the calculated performance. It delivers the expected 20% fuel savings, and since fuel prices went up sky high when Russia attacked Ukraine, the cost savings were higher than anticipated. So it has proven to be a hedge against the volatility of the fuel cost in a positive way.
It’s also a matter of how big the solar plant is and how many days during the year it will provide enough energy to switch off all engines. That’s a commercial evaluation: you find the
E&M: What are your key takeaways from your experience with the off-grid solar-battery hybrid system for B2Gold’s Fekola gold mine in Mali?
The operational experience at the Fekola gold mine has been positive so far, and they are able to operate and maintain it with their own power plant staff. We’re only involved on special occasions, so that works well. We’re already working on phase two, which involves growing the solar plant in order
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Aerial picture of the Kinross Tasiast Solar Power Plant in Mauritania
to be able to run on zero engines several days a year. That is definitely a sign of trust, both in the performance of the solar and battery plant but also in our work at Dornier Suntrace. E&M: Where are hybrid solutions for mines heading in terms of new and innovative strategies to drive further energy decarbonization for remote mining operations? MS: Last year at Energy & Mines, I presented a case study on integrating wind with solar and battery for an off-grid solution. And it showed that 85% renewables coverage can be reached at economic terms, when adding wind and solar at enough overcapacity to charge a battery. The case study showed that under used assumptions, a payback against heavy fuel cost would be possible within five to six years. But it’s a huge Capex: the investment into such a big renewable plant can easily reach the lower three digit million range, so quite significant even when compared to the overall investment into a mine. But the annual fuel savings will be huge as well. Basically it’s a trade-off of Capex versus Opex,
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and it’s also a question whether the mine is willing to invest into renewable energy for an existing asset or explore new assets. That’s where it becomes tricky, on where to allocate the funds that the mines have, and where they generate the best revenue from their core business perspective. And then of course, if you look at electrification of the mine fleet, there is potentially another load that needs to be supplied from renewable energy and that also will involve energy storage. You have batteries within the vehicles and at the charging locations, and that can also help you to leverage the fluctuations from the renewables. How these concepts work, how to organize the logistics for electrification and how much renewable energy you need at what time is something where we are reinforcing our team with our colleagues from our mobility section with their experience. Going forward, we will provide integrated engineering solutions that also cover the electrification of operations, including vehicle charging logistics, energy storage, conveyor systems, all integrated with the renewable energy generation on site.
In the area of mine water management, both water supply and drainage will require optimization for the usage of renewable energy. For instance, the idea of water storage as energy storage in mine water management is a whole new field, we are currently developing with our water section. E&M: What are some of the challenges mining companies still face in trying to transition to renewable energy and address Scope 2 emissions? MS: We work mostly with gold mines and most of them had good business during the last years, since gold prices remain high. So for them, investing in renewables from their own funds is not so much of a concern, at least not in the sizes and dimensions that we’re supporting them currently. Still, some mines are moving, and some are still working on their options. However, when it comes to delivering on the 2030 decarbonization commitments that most mining companies have made, the time to act is running out. It is also relevant to note that electricity is only responsible for one large share of the emissions on a mining site, while operations produce the balance. Efficient conversion of mine operations to renewable energy supply requires a reassessment of all processes. At Dornier, we are working within our group on integrating both e-mobility and water management into the renewable energy supply scheme. Some of these commitments have to convert into physical renewable power generation within the next six years, and mines need to understand that a solar project, from conception to operation, will require at least two to three years. And with the renewables push everywhere, providers like us are very busy, so the work capacity is not idle. To find a competent supplier that has time when you need them, it’s good to plan ahead. I don’t see a bottleneck in terms of technology and equipment, but I do see it around the people that are actually supporting the implementation: engineers, workforce, and contractors doing the job. E&M: What should miners be thinking about when integrating renewable energy while trying to electrify fleets? MS: The discussion of hydrogen versus electrification is ongoing, however recently some aspects seem to turn towards electrification. For example Australia’s three largest miners made an announcement that they decided against hydrogen and are going to electrify trucks instead. I do understand that truck manufacturers are developing and already selling options, but manufacturing is not yet rolled out in full scale.
And when it comes to the different options to electrify mining operations, it may be good to think outside the box. Options are swapping an engine for a battery and figuring out how you charge it most efficiently alongside the truck operations, but also conveyor belts could be a substitute for hauling: it’s easier to electrify than trucks, it doesn’t need a battery, and it can run continuously from renewable electricity. For open pits, the concepts for electric trucks and charging logistics are being developed and there is no common knowledge at this point. I think you can improve further than simply swapping a diesel engine for a battery: there may be a transition in the nature of the fleet itself. E&M: What do you think needs to be considered during the hybrid design phase to account for the shift to decarbonized fleets - i.e. electric or hydrogen-powered mine trucks and equipment? MS: The electricity consumed by operations is of course an additional load, regardless of whether you generate hydrogen on site or charge electric vehicles’ batteries: both will require green electricity. Due to the efficiency of the electrolysis process, you usually need three to five times more green electricity to produce hydrogen compared to using the electricity in the first place. Batteries have 10 to 15% loss, which is very low compared to the losses that you have when using hydrogen. So going forward, hydrogen may not have too many benefits to outcompete the electric solution day to day. One should approach decarbonization gradually, assessing what degree of decarbonization is economic, but provides a benefit to the operations or at least keeps operations at an equivalent cost level. I would not say that every renewable investment needs to have an investment-level internal rate of return, but that is usually the way these investments are looked at. And if it’s just break-even at the cost level, that’s not very attractive as an investment. If not, there is a push to decarbonize for not losing the market, as for example could happen with Carbon Border Adjustment Mechanism taxes and the like. For now, we only implement projects that have such a strong cost benefit that they pay back within four to six years and bring huge savings on fuel cost. When the renewable plant is being amortized, it’s almost free of charge electricity, and the more years you have remaining to continue, the more profitable it will be for operations. And that may help the business case for hydrogen: as seasonal fluctuations occur, you could use some of the excess power you get during abundant periods to produce hydrogen-based fuel, store it, and then use it in seasons when renewables are scarce. However, these economics are still to be determined.
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