Download Module: Introduction Module: Management [Investor]

Anglo American
CDP 2013 Investor CDP 2013 Information Request
Module: Introduction
Page: Introduction
0.1
Introduction
Please give a general description and introduction to your organization
Anglo American is one of the world’s largest mining companies. Our portfolio of high quality mining assets and natural
resources includes platinum group metals and diamonds, with significant interests in copper, iron ore, metallurgical coal,
nickel and thermal coal, as well as a divestment portfolio of other mining and industrial businesses. We operate in Africa,
Europe, South and North America, Australia and Asia.
For the purposes of the CDP and other sustainable development reporting, we include only managed businesses. The
information presented covers Anglo American companies, subsidiaries and joint ventures over which we have
management control; it does not include independently managed operations such as Cerrejón and Samancor. De Beers,
which had been an associate, but became part of the Anglo American Group in August 2012, is reported on in an ad hoc
manner.
0.2
Reporting Year
Please state the start and end date of the year for which you are reporting data.
The current reporting year is the latest/most recent 12-month period for which data is reported. Enter the dates of this year first.
We request data for more than one reporting period for some emission accounting questions. Please provide data for the three
years prior to the current reporting year if you have not provided this information before, or if this is the first time you have
answered a CDP information request. (This does not apply if you have been offered and selected the option of answering the
shorter questionnaire). If you are going to provide additional years of data, please give the dates of those reporting periods
here. Work backwards from the most recent reporting year.
Please enter dates in following format: day(DD)/month(MM)/year(YYYY) (i.e. 31/01/2001).
Enter Periods that will be disclosed
Sun 01 Jan 2012 - Mon 31 Dec 2012
0.3
Country list configuration
Please select the countries for which you will be supplying data. This selection will be carried forward to assist you in
completing your response
Select country
South Africa
Australia
Brazil
Chile
Peru
United Kingdom
Canada
Zimbabwe
Rest of world
0.4
Currency selection
Please select the currency in which you would like to submit your response. All financial information contained in the response
should be in this currency.
USD($)
0.6
Modules
As part of the request for information on behalf of investors, electric utilities, companies with electric utility activities or assets,
companies in the automobile or auto component manufacture sectors, companies in the oil and gas industry and companies in
the information technology and telecommunications sectors should complete supplementary questions in addition to the main
questionnaire.
If you are in these sectors (according to the Global Industry Classification Standard (GICS)), the corresponding sector modules
will not appear below but will automatically appear in the navigation bar when you save this page. If you want to query your
classification, please email [email protected].
If you have not been presented with a sector module that you consider would be appropriate for your company to answer,
please select the module below. If you wish to view the questions first, please see https://www.cdproject.net/enUS/Programmes/Pages/More-questionnaires.aspx.
Module: Management [Investor]
Page: 1. Governance
1.1
Where is the highest level of direct responsibility for climate change within your company?
Individual/Sub-set of the Board or other committee appointed by the Board
1.1a
Please identify the position of the individual or name of the committee with this responsibility
Safety & Sustainable Development (S&SD) Committee of the Board. The S&SD Committee’s comprises executive and
non-executive members of the Board including the Chairman (Peter Woicke), CEO (Cynthia Carroll), Sir John Parker, Ray
O’Rourke, Jack Thompson, Brian Beamish and David Weston and business unit CEOs and other Group Directors
regularly attend. Committee plays a non-executive oversight role in relation to the environmental (including climate
change), social and workplace risks and opportunities faced by Anglo American.
1.2
Do you provide incentives for the management of climate change issues, including the attainment of targets?
Yes
1.2a
Please complete the table
Who is entitled to benefit
from these incentives?
The type of
incentives
Incentivized performance indicator
Management group
Monetary
reward
Executive officer
Monetary
reward
Executive officer
Monetary
reward
Energy managers
Monetary
reward
Specific targets vary between individuals given the wide nature of
Anglo American operations. Targets will also vary depending on the
nature of their specific jobs and how directly they work on climate
change and energy. Those with direct responsibility, as well as their
superiors, have well-defined targets that are specifically related to
remuneration. We also have various internal awards for best practice
and innovation in environmental management.
The Group Director of Business Performance and Projects is on the
Global Management Committee and Exco and is ultimately responsible
for climate change issues, which are included in his performance
contract.
Mine managers and business unit CEOs' performance contracts now
all include quantitative targets that are in line with new operational
energy and GHG-reduction targets that have been set as part of the
ECO2MAN process.
Energy managers' remuneration is linked to quantitative energy and
carbon targets developed through bottom-up ECO2MAN process.
Other:
Environment/sustainability
managers
Monetary
reward
Environment/SD managers' remuneration is linked to quantitative
carbon and climate change targets in line with ECO2MAN targets.
All employees
Recognition
(nonmonetary)
All employees are eligible for the Anglo American Applaud awards,
which has categories for entries related to climate and energy
initiatives.
Attachments
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/InvestorCDP2013/1.Governance/Anglo American annual-report2012.pdf
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/InvestorCDP2013/1.Governance/Anglo American 2012 SDR.pdf
Page: 2. Strategy
2.1
Please select the option that best describes your risk management procedures with regard to climate change risks and
opportunities
Integrated into multi-disciplinary company wide risk management processes
2.1a
Please provide further details
A) Scope of the process
Anglo American’s risk management process is applied across all project evaluations and operations in the Group and
throughout the life of a mine (from initial project planning to mine closure). It is governed by Anglo American’s integrated
risk management standard and related policies, supporting guidelines and assessment tools as well as an associated
assurance process. The scope of the process identifies both commercial and non-commercial risks which are further
reviewed by Anglo Business Assurance Services (ABAS). In the case of climate change, business units implement Anglo
American’s “Energy and GHG Emissions Management Standard” using the guideline document (ECO2MAN) and related
self-assessment tools.
b) How risks/opportunities are assessed at a company level
The process of risks and opportunity identification is detailed in Anglo American’s integrated risk management standard,
which outlines an assessment process from an asset level to business unit. Each business unit in turn compiles and
submits a report on key risks and opportunities (including climate change issues) to the Group for review and further
presentation to the board. The risks are assessed against a five-by-five box matrix, which categorise them in terms of
potential impact and likelihood of occurrence.
c) How risks/opportunities are assessed at an asset level
The process of risk and opportunity identification at an asset level is conducted using the Group’s Energy and GHG
Emissions Management standard and its associated assessment tools. The Group technical assessment tool allows
operations to asses themselves and assets against 10 requirements of the performance standard and plot their level of
compliance achieved. These 10 requirements are:
1. Management must demonstrate commitment and support for the energy and GHG emissions management system.
2. Energy and GHG emissions performance improvement opportunities must be incorporated into specifications, designs,
systems and processes and the savings achieved must be recoded.
3. GHG emissions and energy performance must be taken into account when procuring services, products and equipment.
4. Operations must implement and document a comprehensive energy and GHG emission planning process.
5. Operations must annually conduct and document energy and emission performance reviews.
6. Operational guidelines for energy and GHG emission reporting must be clear and comprehensive.
7. Energy consumption of all significant energy consuming equipment must be measured where practically possible and
economically viable.
8. Baselines and trends must be established for significant energy consumption and GHG emission sources.
9. The performance of significant energy and GHG emission sources must be monitored on a regular basis.
10. Viable targets must be set to lower energy consumption and GHG emission.
ECO2MAN provides specific guidance on what to do next. For example, if an opportunity is identified to make a piece of
equipment more efficient, the standard is supplemented by tools for mapping a business as usual baseline and delivering
the outcomes to progress energy and carbon saving opportunities.
d) The frequency of monitoring in terms of weeks/months/years
While the frequency of risk assessments depends on the level of risk, they are undertaken at least annually. However the
Group’s technical standard refers to a quarterly review process for projects and operations, with annual reports from each
business unit to the Group Technical Standards Board (GTSB).
A dedicated global safety and sustainable development risk and assurance team provides expert opinion on the adequacy
of risk control measures to ensure that current and emerging risks are effectively controlled, while our corporate and
operational subject matter expertise enables us to identify and manage critical safety, health and social, as well as
environmental, improvement opportunities. This includes the physical and legal risks and opportunities related to energy
consumption and climate change. Material risks are reported to, and reviewed by, the Board.
e) Criteria for determining materiality/priorities
The process to prioritise climate change risks involves consideration of the potential/actual magnitude of financial and nonfinancial impacts, as well as their likelihood of occurrence and root causes. It is undertaken through a risk management
“bowtie” framework of monitoring, control and improvement effectiveness. For example, based on the criteria of financial
and non-financial impacts likelihood of occurrence and potential impact, carbon taxes are considered to be most material.
f) To whom are the results reported
Site level energy and GHG risks are consolidated and reported to business unit leadership and then further consolidated
into the Group Risk Register and Group Sustainability Risk Report. These are reviewed by the Anglo American Executive
Committee and the Audit and Safety & Sustainable Development Committee of the Board.
2.2
Is climate change integrated into your business strategy?
Yes
2.2a
Please describe the process and outcomes
Anglo American aims to become the leading global mining company – the investment, the partner and the
employer of choice – through the operational excellence of world class assets in the most attractive
commodities, and through a resolute commitment to the highest standards of safe and sustainable mining. We
seek to achieve this aim through our four strategic elements:
- Investing in world class assets in those commodities that we believe deliver the best returns through the
economic cycle and over the long term.
- Organising efficiently and effectively to outperform our competition throughout our value chain; this
commitment to operational excellence includes provision for assessing the financial and non-financial value of
sustainable development (including energy-reduction) initiatives for greenfield projects and the extent to which
they create shared value.
- Operating safely, sustainably and responsibly, in the belief not only that this is fundamental to our licence to
operate, but also that this is an increasingly important source of competitive advantage.
- Employing the best people, recognising that attracting, developing and retaining the best talent is essential to
achieving our goal of being the leading global mining company.
Our approach to delivering on these strategic elements is underpinned by our belief that our ability to do so is
integrally linked to our commitment to sustainable development.
a) The process by which the strategy is influenced: The Anglo American Group strategy was developed
taking into account the major challenges the company faces and aims to enable our operations and local
communities to address and adapt to the cause and effects of climate change. The process of climate change
risk and opportunity identification is detailed in our Climate Change Strategy, which outlines an assessment
process at asset and business unit levels. Each business unit in turn compiles and submits a report on key
risks and opportunities (including climate change issues) to the Group for review and future presentation to
the board. These risks, together with other S&SD risk and opportunities, influenced the inclusion of “operating
safely, sustainably and responsibly” as one of the three key elements of our Group strategy to be the leading
global mining company.
b) What climate change aspects have influenced the strategy: Our strategy has been influenced by our
need to achieve the maximum economically sustainable energy and carbon savings in or business and the
use of our products and to run cost-efficient, low-carbon- if not carbon-neutral mines by 2030. This will
minimise our exposure to emerging climate change regulation (including carbon taxation), maximise
opportunities in our markets, and build adaptation measures against the impacts of region-specific climate
change. For example Anglo American Platinum has begun piloting platinum based fuel cells, demonstrated at
COP17 in 2011, as an alternative power system for underground locomotives.
c) The most important components of the short term strategy that have been influenced by climate
change: Climate change-related matters have had the greatest influence, in the short term, on our overall
drive for operational excellence (one of the core components of the Group strategy), most significantly in
terms of energy and carbon emissions savings, with all our operations having targets in place for energy and
carbon emissions reduction to 2015.
d) The most important components of the long term strategy that have been influenced by climate
change: Anglo American has embarked on a Mine2030 project, which aims to anticipate what context we will
operate within in 17 years' time, and what the business has to in order to be prepared for the future. As part of
the project, the technical division is establishing ‘technology development pathways’, including planning
around how to operate carbon neutral mines by 2030, our key objective for all new mines by then. Another key
component of our long term strategy that has been influenced by climate change relates to the coal business
and our investment in clean coal and carbon sequestration technologies. Together, these have the potential to
make coal mining viable in a carbon constrained world.
e) How this is gaining you strategic advantage over your competitors: We believe that our climate
change strategy and overall Group strategy puts us in the best position to:
• develop strategic relationships with communities and governments;
• minimise our exposure to emerging climate change regulation (including carbon taxation), like in South
Africa and Australia where carbon taxes will impact on the profitability of all coal businesses;
• maximise opportunities in our markets; and
• build adaptation measures against the impacts of regional climate change, like the climate change
adaptation measures that have been built into the Minas Rio project in Brazil.
• save money. During 2012 we saved US$ 75 million in energy costs by implementing energy efficient and low
carbon projects.
f) What have been the most substantial business decisions made during the reporting year that have
been influenced by the climate change driven aspects of the strategy.
• We continue to invest in the identification and implementation of innovative technologies aimed at using
energy more efficiently. These include technology solutions to optimise processes and machinery at our
operations, such as air compressors, ventilation fans, pumps, draglines, conveyors and electric motors being
replaced with more energy efficient ones across the Group. We implement these technologies because of
current and emerging risks related to climate change.
• In addition to focusing on energy and carbon savings technologies, we are investing in developing and
deploying technologies that will enable us to run cost efficient carbon-neutral mines by 2030. Our technology
development vision form a critical part of our long term business strategy.
• Emerging carbon regulation in Australia and South Africa continues to be a major factor in decisions made
around coal investments. The Australian Government has stated that every cent raised from carbon unit
revenue is to be used to provide assistance to households and business. Moranbah North and Capcoal
underground are eligible for the Coal Sector Jobs Package (CSJP) and together will receive $23.4 million
annually for five years. The CSJP is a $1.257 billion grant programme which will provide transitional
assistance to coal mines that have a high fugitive emissions intensity from 2011-12 to 2016-17 to assist with
the transition of a carbon price. Our key concerns remain that there is no assistance for our growth projects
and there is a lag in technology necessary to abate our major source of emissions, ventilation air methane.
Anglo American is a member of the FutureGen Industrial Alliance, a non-profit organisation which was formed
to partner with the United States (U.S.) Department of Energy on the FutureGen project. The project, called
FutureGen 2.0, is a first-of-its-kind, near-zero emissions coal-fired power project that uses oxy-combustion
technology and carbon capture and storage (CCS) to reduce the CO2 emissions from the power station by
90% at demonstration scale. The project has progessed to phase two (full feasibility) of the FutureGen 2.0
project. Phase one included identification of a sequestration site in Morgan County USA, preliminary
characterisation, test drilling and approval of the power purchase agreement by the Illinois Commerce
Commission. Phase two will include detailed design, pre-construction and engineering as well as permitting.
• In response to the high costs of energy and generation constrains in the electric market in Chile, the Power
Supply strategy is being updated at the business unit level, in order to manage risks and build new options to
assure sustainable and competitive energy for the operations in the medium term.
• The Brazilian equivalent of the Carbon Disclosure programme, the EPC platform, published our inventory
together with other 60 companies, representing up to 20% of national total, discounted the effect of the
deforestation. This continuous visibility of GHG management promotes the Anglo American brand and helps it
to be considered one of the leading companies in the sustainability area. it also helps internal employees to
embrace the mind-set to use renewable energy sources.
2.3
Do you engage in activities that could either directly or indirectly influence policy on climate change through any of the
following? (tick all that apply)
Direct engagement
Trade associations
Funding research organizations
2.3a
On what issues have you been engaging directly?
Focus of
legislation
Corporate
Position
Details of engagement
All companies listed on London Stock Exchange will be
required to report their carbon emissions under a
regulation expected in April 2013. Guidance for quoted
companies, to help them comply with the requirements of
the regulation, is also being drafted. Emissions can be
expected to be first reported in the 2013/14 Annual Report.
Proposed solution
Mandatory
carbon
reporting
Support
Mandatory
carbon
reporting
Support
Carbon tax
Support
with major
exceptions
Energy
efficiency
Support
A consultation by the environment department (DEFRA)
showed broad support for the requirement from business
groups such as the Confederation of British Industry to
prepare national low-carbon roadmaps at least every
seven years. Other ministers may also prepare sectoral
roadmaps. The draft regulation establishes a new “national
expert advisory body on climate change”, which will mostly
be made up of senior representatives of the country’s
environment agency, sustainable energy authority, farming
authority and economics institute. Anglo American
engaged with DEFRA on the guidelines and differed only
on reporting based on intensity figures.
Anglo American engaged regularly with the Australian
government on the Australian National Greenhouse and
Energy Reporting Scheme (NGERS) and has developed a
guideline which outlines specific requirements and
processes for the management of risk and compliance
obligations relating to Energy and GHG Emissions, for
both Metallurgical Coal and its individual sites to assist
with compliance.
We participate in multi-stakeholder events, government
consultations and support industry awareness raising
campaigns. We communicate our responsibility to take
action and contribute to the design of equitable and
effective policies. Our aim is to support policies that
mitigate carbon emissions while not compromising
economic development and jobs. We do this by investing
in technology and innovative research and development
projects that help the sector cut greenhouse gas
emissions. Our position in this regard varies across each
region we operate in. In South Africa, we are especially
active in discussions around a carbon pricing policy and
have welcomed the opportunity to participate in the debate
and in the development of a solid fact base to influence an
effective carbon policy aligned with the country’s
development objectives. Anglo American’s concern with
the tax design specifically has to do with the element of
benchmarking or “z factor” which is meaningless with
potential dire consequences for the mining industry. It will
be essential for the draft policy paper long outstanding to
address this. We are also working with the government
regarding the national utility’s proposed increase in energy
costs, which could see the country’s energy costs doubling
over the next few years. In July 2012, Australia introduced
its Carbon Pollution Reduction Scheme, with a $23 per
tonne of carbon dioxide equivalent (CO2e) fixed price
period for three years, moving to a flexible period (marketbased emissions trading scheme) from 1 July 2015. The
impact on our Metallurgical Coal business is already
significant, and stands to escalate as production increases
and new projects come on stream.
In South Africa we chair the Energy Efficiency Leadership
Network (EELN). The EELN is a collaboration between
DOE, NBI, and BUSA to assist South African business
sector with skills and capacity building on energy
management and reports on best practice for information
sharing. The work of the EELN will assist with delivery of
the National Energy Efficiency Action Plan (NEEAP).
Comply
Comply
In SA, we supported the
National Treasury’s move to
engage on the development
of policies to address climate
change and adaptation as
well as its assertion that
reducing GHG emissions
while promoting economic
growth, employment, energy
security and poverty reduction
are not mutually exclusive. In
support of this, Anglo
American suggested that a
pricing policies must be
developed on a sound fact
base, carbon pricing should
be considered as part of other
complementary measures
while maintaining industry
competitiveness and
remaining revenue neutral.
Comply
2.3bAre you on the Board of any trade associations or provide funding beyond membership?
Yes
2.3c Please enter the details of those trade associations that are likely to take a position on climate change legislation
Trade
association
Industry Task
Team on
Climate
Change
(ITTCC)
Is your
position on
climate
change
consistent
with theirs?
Consistent
Please explain the trade association"s position
The Industry Task Team on Climate Change (ITTCC) in South
Africa represents energy intensive industries and collectively
responded to discussions papers published by the National
Treasury and the Department of Environmental Affairs (DEA).
ITTCC communicated its support for the National Treasury’s move
to engage on the development of policies to address climate
change and adaptation as well as its assertion that reducing GHG
emissions while promoting economic growth, employment, energy
security and poverty reduction are not mutually exclusive. In
support of this, Anglo American (via the ITTCC) suggested that:
pricing policies must be developed on a sound fact base, carbon
pricing should be considered as part of other complementary
measures while maintaining industry competitiveness and
remaining revenue neutral. In response to the DEA’s discussion
paper, the ITTCC expressed its position on key elements namely
How have you,
or are you
attempting to
influence the
postion?
The position
expressed by the
ITTCC is
consistent with
Anglo American
as the position is
derived from
consultation with
industry peer
companies as
National
Business
Initiative (NBI)
Consistent
Energy
Efficiency
Leadership
Network
(EELN)
Consistent
International
Energy
Agency Clean
Coal Centre
(IEACCC)
Consistent
South African
Centre for
Carbon
Capture and
Storage
(SACCCS)
Consistent
FutureGen
Alliance 2.0
Consistent
International
Council of
Mining Metals
(ICMM)
Consistent
the preservation of a level international playing field for emissionsintensive, trade-exposed sectors; consideration of a broad set of
policy instruments to compliment carbon pricing; a co-ordinated
southern-African (not just South African) approach to climate
change; consideration of sectoral solutions; transformation of the
South African energy sector and the use of policy instruments to
facilitate abatement opportunities such as carbon capture and
storage and coal-to-liquid technologies.
The NBI aims to mobilise business as a whole towards the
formulation of a business climate change response strategy
through: increased awareness, voluntary collective action, policy
engagement, mitigation activities, adaptation, and promotion of
capacity building initiatives through partnerships. The views of the
NBI represent the collective views of business sectors in South
Africa.
In South Africa we chair the Energy Efficiency Leadership Network
(EELN). The EELN is a collaboration between DOE, NBI, and
BUSA to assist South African business sector with skills and
capacity building on energy management and reports on best
practice for information sharing. The work of the EELN will assist
with delivery of the NEEAP.
The IEACCC is a research organisation that focuses on clean coal
technologies, many of which reduce the emissions associated with
coal combustion and production. This organisation undertakes
numerous research projects annually, predominantly as desktop
reviews of technologies available, the status of each, and relevant
legislation and makes this information available to its members
and to the public to stimulation innovation and technology
adoption. Anglo American is a member of the IEACCC and hold a
position on the Executive Committee. We play a role in proposing,
selecting and vetting the research topics.
SACCCS commenced in 2004 with desktop research into CCS in
South Africa. An Atlas of CO2 storage potential in SA was
published in 2010 and SACCCS is now working towards a Pilot
CO2 Storage Project (PCSP) in 2017, which if successful will be
followed by a demonstration scale project in 2020 and
commercialisation of the technology in SA in 2025. This project will
prove that it is possible for coal-fired power to have very low
emissions which will be critical for energy security as SA is
currently dependent of coal-fired power for 93% of its electricity.
This will therefore be a direct benefit to Anglo as a coal producing
company. Anglo American holds a position on the Board of
Governors, which meets in Johannesburg quarterly. We also hold
a position on the Steering Committee and Chair of the Stakeholder
Engagement Sub-committee.
Anglo American was a founding member of the Alliance and made
a $300k upfront membership payment. Recently, each industrial
member contributed $250k for Phase II of the project. When the
project goes to financial close, each industrial member will
contribute $10million towards the project. This project will prove
that it is possible for coal-fired power to have very low emissions
which will be critical for energy security as coal is likely to continue
being a significant part of the energy mix globally for many years.
This will therefore be a direct benefit to Anglo as a coal producing
company.
well as other
energy intensive
consumers.
No
No
No
No
No
In discussion with ICMM on mechanisms in South Africa, Peru and
Brazil
2.3d
Do you publically disclose a list of all the research organizations that you fund?
Yes
2.3e
Do you fund any research organizations to produce public work on climate change?
Yes
2.3f
Please describe the work and how it aligns with your own strategy on climate change
Achieving our long-term milestones in energy management hinges on identifying and implementing innovative, stepchange technologies. We are researching many opportunities with key stakeholders, and we have invested nearly $200
million to date in low-carbon and energy-efficiency research and technology development, including $15 million in 2012.
Our technology vision is to run cost-efficient, low-carbon (if not carbon-neutral) mines by 2030. Our approach focuses on
three areas: Reducing how much energy we use, Recovering and re-using some of that energy, using alternative energy
sources. In parallel, we continually investigate opportunities for carbon offsetting. Anticipated developments include
energy-efficient options for energy intensive haul trucks and materials lifting activities. Innovative projects include
harnessing and re-using the energy generated from braking systems, as well as reducing road rolling resistance to
improve vehicle efficiency. We are working with key suppliers to design and develop alternatives to trucking. At Platinum in
South Africa, we are piloting a demonstration prototype slurry pump to save pumping costs, while a gravity pump is being
demonstrated in our Copper operations in Chile. In 2012, we also funded research into alternatives to copper ore milling,
which is one of our biggest energy consumers. By working with our supply chain any advancement made can benefit their
other customers.
2.3h
What processes do you have in place to ensure that all of your direct and indirect activities that influence policy are consistent
with your overall climate change strategy?
We have a climate change community of practice which meets regularly to discuss developments within each business
unit and region that we operate in, including engagement with, and funding of, various initiatives. These information
sharing sessions allow for experiences and best practices to be shared, but no formal process is in place to ensure that
we are not funding organisations that influence policy development that is inconsistent with our strategy.
Page: 3. Targets and Initiatives
3.1
Did you have an emissions reduction target that was active (ongoing or reached completion) in the reporting year?
Absolute target
3.1a
Please provide details of your absolute target
ID
tar
1
Scope
Scope
1+2
%
reduction
from base
year
% of
emissionsin
scope
100%
6%
Base
year
2012
Base year
emissions
(metric
tonnes
CO2e)
21200000
Target
year
2012
Comment
The Group’s short term target was set
to achieve its longer term objective
against projected business as usual
curve using known business growth,
changes and demands. To achieve
this target projects were identified. For
example our methane management
programmes at Metallurgical Coal in
Australia.
3.1d
Please provide details on your progress against this target made in the reporting year
ID
tar
1
%
complete
(time)
100%
% complete
(emissions)
100%
Comment
The Group achieved a savings of 3.3 MtCO2e during 2012 due to emissions
reduction activities, representing a 15% reduction in emissions against our 2012
business-as-usual (BAU) baseline. The reduction is despite the ramping up of our
Los Bronces Copper operation as well as at our Barro Alto Nickel operation, both
being significantly energy intensive operations. Other factors that marginally resulted
in lower total scope 1 and 2 emissions for 2012 was the exclusion of sponcom from
publicly reported information. The decision was made to exclude these emissions
due to the lack of a universally accepted methodology to calculate these emissions.
The exclusion of sponcom allows for more accurate peer to peer benchmarking.
Another factor that should be considered is the industrial action that occurred at
some of our South African operations in quarter 4 of 2012.
3.2
Does the use of your goods and/or services directly enable GHG emissions to be avoided by a third party?
Yes
3.2a
Please provide details (see guidance)
Each year we produce 40% of the world’s newly mined platinum. Platinum & its associated group metals (PGMs) already
contribute to reducing greenhouse gas emissions & saving energy as PGM catalysts allow pharmaceuticals, fine & bulk
chemicals to be made with fewer process steps, milder conditions & better yields. The unique properties of the PGM
iridium (most corrosion-resistant element with a melting point over 2000ºC) are employed to make the crucibles in which
sapphire crystals are grown. These crystals are used in the production of light-emitting diodes (LEDs). LEDs in flatscreen
TVs, smartphones and laptop computers not only enable these technologies, but use up to 40% less electricity than
conventional technologies. An LED light uses less than 20% of the energy of an incandescent light. The PGM ruthenium is
behind a one hundred-fold increase in the storage capacity of desktop computer hard drives over the past decade.
Anglo American Platinum together with Johnson Matthey and international mining & coal group Anglo American PLC
jointly developed technologies that will mitigate the effects of methane from mine ventilation air. A particular focus is also
on technologies which could utilise platinum group metals. Reducing the methane in mine ventilation air would directly
reduce GHG emissions since methane has a GWP 21 times more potent than CO2. Mine ventilation air typically contains
0.3 – 1% methane. An estimation of the amount of emissions avoided is calculated based a study from Coaltech in 2000
on the methane released from SA coal mines. The total methane released from the coal mining industry amounts to about
72 000 tCH4/ year. Assuming 10% of this could be avoided it would amount to a saving of 7200tCH4/year which is
equivalent to 151 200 tCO2e/ year.
Since their introduction in the 1970s, platinum, palladium and rhodium-based catalysts, have delivered massive reductions
in harmful emissions from automotive internal combustion engines. Our platinum business unit has also launched a
platinum-based fuel cell powered mine locomotive prototype in May 2012 as part of its strategy to (a) capitalise on
opportunities presented by climate change, and (b) mitigate against the risk that climate change may impact negatively on
the use of PGM’s in the auto catalyst market. This project was a collaboration between Vehicle Projects, Trident South
Africa & Battery Electric. This partnership will initially deliver five fuel cell locomotives to be tested for underground use at
our platinum mines. A fuel cell is a gas battery that produces electricity as long as it is fed with hydrogen gas. An estimate
on the amount of emission reductions in a platinum based fuel cell was calculated based on a life cycle assessment. The
results show that GHG reduction is dependent on the source of hydrogen. Assuming a fuel cell utilising H2 from a
renewable source, CO2e can be reduced by 650 tCO2e per year compared to importing electricity from the grid to
produce the same amount of power. Assuming the H2 was obtained from a reforming process would reduce GHG
emissions by 156 tCO2e per year. This calculation is based on a grid emission factor of 1.03tCO2e/MWH. Standards and
methodologies used to estimate savings for these initiatives are the same as used for our Anglo American Platinum
carbon footprint: ISO 14064-1 & The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard
(Revised Edition). General emission factors used for calculating the possible savings are also the same as used in this
year’s carbon footprint calculations. These technologies may be used to generate CERs or ERUs depending on the
location of the mine, at a future time.
Our Kumba Value-In-Use department continued with research on finding techniques and methods that can be employed to
enhance downstream steel making processes. During 2012, research was conducted into agglomeration methods aimed
at improving sinter quality in blast furnaces. Agglomerating very fine concentrate into micro pellets suitable for sinter feed
improves productivity. This is due to decreasing the fuel rate compared to using the concentrate directly in the sinter. The
sinter plant would use less fuel (coke) decreasing the CO2 emissions. The improvement in sinter productivity & quality
allows the blast furnace operator to increase the sinter in the burden, leading to coke saving, translating into decreased
CO2 emissions from the blast furnace.
Typically a steelmaker would emit about 1800 kgCO2e per ton of steel produced. The decrease in coke consumption (i.e.
CO2 emissions) varies from plant to plant and is not linear with the amount of concentrate replaced by micro pellets as per
Kumba’s proposal. Typical concentrate additions is about 20% to 30%, if this is replaced with micro pellets the CO2
emissions will decrease with 91 kg/t of steel produced. Kumba is planning two projects totalling about 7 million tonnes of
concentrate per annum, this could reduce supplier emissions by 0.42 million tCO2e per annum.
The methodology & emission factors used for the emission reduction calculations are the same as is used in the carbon
footprint calculations of Kumba. The methodology is ISO 14064-1, and the emission factors were obtained from the Anglo
American Group database. CERs or ERUs are not considered by Kumba because emission savings are achieved and
owned by a third party.
3.3
Did you have emissions reduction initiatives that were active within the reporting year (this can include those in the planning
and implementation phases)
Yes
3.3a
Please identify the total number of projects at each stage of development, and for those in the
implementation stages, the estimated CO2e savings
Stage of development
Under investigation
To be implemented*
Implementation
commenced*
Implemented*
Not to be implemented
Number of
projects
116
139
Total estimated annual CO2e savings in metric tonnes CO2e (only
for rows marked *)
167380
210025
93
1067990
222
0
3399347
0
3.3b
For those initiatives implemented in the reporting year, please provide details in the table below
Activity type
Low carbon
energy
installation
Description of activity
In South Africa, we have voluntarily initiated a
$12 million independent power producer (IPP)
project to help recover waste heat energy
from our platinum converting process (ACP),
based at our Waterval smelter complex in
Rustenburg. The project focuses on extracting
waste heat given off during the ACP converter
cooling-off process (scope 1 activity). In the
past, this cooling process was undertaken
using air-based fans. The new process will
use a high pressure water system, in which
the extraction of waste heat is achieved by
implementing an organic rankine cycle
technology. This technology is based on a
closed system of fluid that allows heat
recovery from lower temperature sources
such as industrial waste heat. The lowtemperature heat is converted into electrical
energy that feeds into a grid system. The
introduction of private sector power
generation has multiple benefits, including job
creation, reducing the financial burden on the
state and improving supply and pricing. With
funding from Investec bank and development
Estimated
annual
CO2e
savings
(metric
tonnes
CO2e)
Annual
monetary
savings
(unit
currency as
specified
in Q0.4)
Investment
required
(unit
currency as specified
in Q0.4)
Payback
period
19000
1500000
12000000
11-15
years
Fugitive
emissions
reduction
Low carbon
energy
installation
Energy
efficiency:
Processes
Fugitive
emissions
reduction
finance from the South African Department of
Trade and Industry, this is a collaborative
project that will provide long-term benefits for
our Platinum business and the wider
community. Our Platinum business unit has
signed a Power Purchase Agreement with the
IPP for 15 years. The estimated CO2 savings
associated with this initiative is 19ktCO2e per
annum and a monetary saving of $1.5 million
related to energy costs is expected.
Where the coal seam conditions allow, such
as, at New Denmark Colliery, flaring of coal
mine methane (scope 1 emission) is possible.
Flaring at New Denmark in 2012 resulted in
the prevention of 5,761 tons of CO2e from
methane being released into the atmosphere.
This is a voluntary initiative. Thermal Coal
continues to investigate other technologies
available for capture / combustion / utilisation
of coal mine methane. At present we are
unable to quantify the annual monetary
savings and will only be able to do so when
the South African Carbon Tax policy is
implemented in 2015, these savings are
expected to realise a monetary saving due to
the reduction in taxable fugitive coal mine
methane emissions. the flaring at New
Denmark will continue for the life of the mine
or until favourable conditions change.
At Thermal Coal the installation of heat pumps
at most of our industrial change houses was
completed successfully in mid-December.
This is a voluntary initiative to reduce our
scope 2 emissions. The systems will be
closely monitored to ensure that they deliver
the required hot water and energy cost
savings. The heat pumps will continue to be
used for the life of each mine or until
scheduled maintenance requires they be
replaced or when newer technology becomes
available
Ventilation systems are critical to ensuring
safe working conditions in underground mines
and run continuously and require significant
energy. At Thermal Coal’s Goedehoop colliery
we have voluntarily reduced our GHGs
emissions by improving how we manage
these systems. By isolating the areas
underground that require ventilation and
identifying and addressing any leaks, we have
reduced the amount of methane flushed out of
the machinery as well as the electricity (scope
2) required to run the ventilation system.
Ventilation systems at other underground
collieries in Thermal Coal are also set to be
optimised, contributing greatly towards our
2015 ECO2MAN targets. The initiative is
expected to continue for the life of the current
ventilation fans and will continue until new
innovations deliver similar or better results.
The carbon emissions saved is related to a
saving in electricity power of approximately
2.5MW, which equivalent to powering
approximately 2 100 households. This saving
represents an energy cost saving of $1.8
million per annum, with an initial investment of
$3.7 million that has a payback period of two
years.
The use of methane-rich coal mine waste gas
drained at two of the underground mines,
Capcoal underground and Moranbah North, in
gas fired electricity generation plants and
pipeline sales has reduced fugitive emissions
(scope 1) from this source significantly and
has been initiated by our Metallurgical Coal
business unit on a voluntary basis to reduce
their exposure to climate change legislature.
Underground fugitive emissions at the
Moranbah North mine and Capcoal
underground mine continue to improve
through better rich gas capture rates due to
improved field practices and gas plant
expansions. Increased capture of fugitive
emissions remains the key area of activity
with an expansion of the gas drainage facility
at German Creek and will continue for the life
of the mines.
Our Kumba Iron Ore business has been
4473
0
1600000
4048
287277
954288
1-3
years
225570
1800000
3700000
1-3
years
14904
996907
876287
<1 year
Transportation:
use
piloting a diesel (scope 1) energy efficiency
management system (DEEMS). The system
conducts an analyses of haul truck fuel
performance through parameters such as lift
and hauls distance and involves the use of an
online dashboards and diagnostic tools to
understand and respond to fuel performance
inefficiencies, such as Optimising of dispatch
routes (saving on L/T Distance), Payload
optimisation (continuous) (L/T moved), Refuelling level improvement (L/T moved). The
average carbon emissions saved annually is
1600tCO2e due to the saving of 600 000 litres
of diesel and $750 000 per annum. The cost
of this voluntary initiative was $400 000
consisting of baseline update and completion,
computer equipment and systems integration,
software development and integration,
professional support.
1600
750000
400000
<1 year
3.3c
What methods do you use to drive investment in emissions reduction activities?
Method
Compliance with regulatory
requirements/standards
Dedicated budget for low
carbon product R&D
Internal price of carbon
Internal finance
mechanisms
Partnering with
governments on
technology development
Dedicated budget for
energy efficiency
Comment
We have partnered with Johnson Matthey on the development of a technology for
capturing and using ventilation air methane (VAM) from mine shafts, as well as jointly
examining opportunities relating to fuel cell technology. This will allow us to reduce our
emissions and thereby lower our exposure to carbon compliance costs. Our Group
Technical Standard (GTS 23) has been rolled-out across the business, and sets out the
minimum requirements for carbon and energy performance management. Implementation
of GTS 23 within the business units is supported by our Safety and Sustainable
Development and Technical Solutions corporate functions.
Anglo American has launched a $13.8 million fund to invest in platinum-based technology
companies in South Africa. Platinum-based fuel cells provide a significant economic and
environmental development opportunity for the country by facilitating the provision of
clean, reliable and cost-effective power. In Australia, we hold a 20% interest in MBD
Energy, which is undertaking applied research into an algal synthesiser process that
involves entrapping CO2 from power station fuel gases for the production of biodiesel and
other by-products.
We have incorporated an internal price of carbon for operations in Australia and have
issued carbon pricing guidance for business units in South Africa.
In late 2011 Anglo American launched the $12.2 million Green Fund as part of Zimele,
the company’s enterprise development initiative in South Africa. The fund will not only
help generate real and tangible employment opportunities in communities in South Africa
but also aims to empower and encourage entrepreneurs to operate in the green
economy. The fund is seeking investment opportunities, primarily in areas close to or
associated with our operations, that mitigate carbon, reduce energy and water
consumption, and improve waste and emissions management.
Through our Platinum business we are partnering with the fuel cell company Altergy and
the South African government to manufacture and market platinum-based emissionsreduction technologies locally and in other sub-Saharan countries. This collaboration
marks the launch of the government’s strategy to develop a manufacturing-based
‘hydrogen economy’ and transform and expand uses for the country’s national resources.
A prototype of a platinum- based fuel cell was demonstrated at COP17 and is currently
being piloted at our Platinum business unit as an alternative power system for
underground locomotives.
Each of our business units are required to budget for projects (and where necessary the
capital requirements) to meet their energy and carbon emissions savings targets which
have been decided through the implementation of ECO2MAN.
Page: 4. Communication
4.1 Have you published information about your company's response to climate change and GHG emissions performance for
this reporting year in places other than in your CDP response? If so, please attach the publication(s)
Publication
In other regulatory
filings (complete)
In mainstream
financial reports
(complete)
Page/Section
reference
Climate change
and energy page
60-63
Climate change
and energy page
30-31
Attach the document
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/Investor-4.1-C3-IdentifytAttachment/Anglo
American 2012 SDR.pdf
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/Investor-4.1-C3-IdentifytAttachment/Anglo
American annual-report2012.pdf
Module: Risks and Opportunities [Investor]
Page: 5. Climate Change Risks
5.1
Have you identified any climate change risks (current or future) that have the potential to generate a substantive change in your
business operations, revenue or expenditure? Tick all that apply
Risks driven by changes in regulation
Risks driven by changes in physical climate parameters
Risks driven by changes in other climate-related developments
5.1a
Please describe your risks driven by changes in regulation
ID
Risk driver
Risk1
Carbon taxes
Risk2
Carbon taxes
Risk3
Carbon taxes
Description
The South African
government has confirmed
that a carbon tax will be
phased in from January 1,
2015. An updated policy
paper was published in
March 2013 for further
comment and consultation.
This carbon tax will be
phased in, with the first
phase scheduled to
commence on 1 January
2015, and end in 2020. The
rate was announced of
R120 per ton of CO2
equivalent, with this rate
increasing by 10% per year
during this first phase of
implementation. However,
during the first phase, a
basic tax-free threshold of
60% will apply, as well as
off-set percentages of 5% to
10%. This is to allow
emission-intensive and
trade-exposed industries to
invest in cleaner technology.
As a result of the carbon
tax, the gradual phasing out
of the electricity levy is also
being considered. Anglo
American’s concern with the
tax design specifically has
to do with the element of
benchmarking or “z factor”
which has potentially
significant consequences for
the mining industry.
Australia’s carbon pricing
mechanism (CPM)
commenced on 1 July 2012
with a $23 fixed price period
for three years, moving to a
flexible period (market
based emissions trading
scheme) from 1 July 2015.
The carbon price applies to
companies with direct
emissions greater than
25,000 t CO2e, excluding
fuel and fugitive emissions
from decommissioned
mines. There is a
considerable carbon cost to
the Metallurgical Coal
business in Australia and is
estimated to range between
USD 7 million in 2012 and
69 million by 2016.
The Chilean Government
has launched its new
National Energy Strategy for
2012 to 2030, which sets
out the Government’s
commitment to energy
efficiency. The Strategy
establishes the framework
for how the energy market
will operate, energy saving
goals and the framework for
renewable energy
promotion mechanisms. The
implementation of nonconventional renewable
energies (NCRE) in the
Chilean energy system is
emphasized and there is a
need to increase NCRE
Potential
impact
Timeframe
Direct/
Indirect
Likelihood
Magnitude
of impact
Increased
operational
cost
1-5 years
Direct
Virtually
certain
High
Increased
operational
cost
Current
Direct
Virtually
certain
High
Increased
operational
cost
1-5 years
Direct
More likely
than not
Lowmedium
Risk4
General
environmental
regulations,
including
planning
Risk5
Voluntary
agreements
participation in the grid from
3%, as it stands today, to
230% by 2020. The
Strategy supports large
scale hydroelectricity
projects by proposing an
increase of the participation
of traditional hydro from
today’s 34% to 46%. The
Chilean Senate passed a
law, legally binding these
targets, thus replace the
previous NCRE targets of
10% NCRE participation by
2024. It is still possible that
a carbon tax will form part of
the Chilean Strategy.
The South African National
Climate Change Response
Policy, published in October
2011, gives major carbon
emitting sectors until
October 2013 to conform
with government’s carbon
budgets aimed at
contributing to the country’s
goal to reach a peak in
annual emissions by 2025.
Reducing the production of
GHG emissions would begin
from 2036 onwards. To
monitor progress, the
government will publish a
Climate Change Response
Measurement and
Evaluation System within
two years. On the issue of
emissions, the paper states
that after 2025, South
Africa's carbon emissions
should level out for 10
years, before declining in
absolute terms by 2036.
The new 'trajectory range'
provided in the White Paper
seeks to raise the level of a
national emissions peak to a
high of 614 Mt CO2eq in
2025. Implementation of this
White Paper is planned to
be rolled out over a two year
period. For Anglo American,
this means setting carbon
reduction targets in line with
these goals and investing in
carbon reduction measures.
The South African national
electricity utility, Eskom,
proposed a power
conservation programme
(PCP) to be implemented in
the event of electricity
shortages. It was not
implemented during 2012,
but it is anticipated that
electricity shortages will
occur during 2013, and that
PCP could become effective
during the year. This will
impose very punitive
electricity tariffs for users
who exceed allocated
electricity limits. This may
affect Anglo American
operations in South Africa
that may not be able to
reduce their energy
consumption.
Increased
operational
cost
>10 years
Direct
Very likely
Lowmedium
Increased
operational
cost
Unknown
Direct
About as
likely as
not
Medium
5.1b
Please describe (i) the potential financial implications of the risk before taking action; (ii) the methods you are using to manage
this risk and (iii) the costs associated with these actions
Risk1: Carbon taxes in South Africa
Potential financial implications before taking action: If the proposed tax of ZAR 200/ton (2005 prices) on
CO2 was to be applied in the form currently being discussed, there would be a 11% reduction in our cash flow
from our SA based operations (based on 2020 forecast turnover).
Managing the risk: We have, via the ITTCC, engaged with the government to suggest that:
• carbon pricing should only be considered in conjunction with other complementary measures
• a gradual implementation approach should be adopted;
• climate change policy instruments should be considered in conjunction with the broader policy context to
ensure coherence;
• industry competitiveness needs to be preserved; and
• a carbon tax should be revenue neutral.
Costs: The costs of the consultant fees and other expenses are estimated at $ 974,421.
Risk 2: Carbon tax in Australia
Potential financial implications before taking action: Currently all of Anglo American’s metallurgical coal
mines meet the 25,000 t CO2e threshold and therefore are covered by the CPM. Under the government’s
CPM, our current operations and planned investments will face cost increases of more than $810m Anglo
Share by 2020 and a cost increases over the life of individual mines of 2% to 12%. In terms of our projects,
the value of our four planned new mines would be reduced by 24-32% under the proposed CPM (100%
basis). To remain internationally competitive, we will need to reduce internal costs and potentially shed jobs. If
we do not take these steps, we risk losing market share and the viability of our operations will be at risk.
Australia may lose Anglo American’s investment of $4 billion, more than 3,200 jobs and $5.7 billion in ongoing
royalty payments to State Government’s coffers, with little or no impact on global emissions as projects will
likely proceed in other countries.
Managing the risk: Our Metallurgical Coal business is working with the government, Minerals Council of
Australia and the Australian Coal Association to deliver a better outcome for our business in the form of
amendments to the Clean Energy Legislative Package. The Federal Opposition is also engaged regarding its
Direct Action Policy and statements that they will work to repeal the Clean Energy Act if they gain power in the
2013 election. In parallel, we continue to reduce our exposure to carbon taxes by lowering our carbon footprint
through investment in energy saving, carbon abatement and clean coal technologies. This includes the
reduction to emissions through improved drainage and capture pre and post mining; improved flare capacity;
and expansion of German Creek Power Station by 13MW, Investigating Ventilation Air Methane mitigation
technology, the expansion projects that include current best practice methane capture technology and
exploring domestic and international opportunities to create and/or purchase offset credits.
Costs: The cost of our engagement with government includes HR, consultancy, reporting and travel expenses
as well as investment into the development of carbon abatement and energy saving technology, such as our
acquisition of a stake of around 20 per cent in Australian-based MBD Energy. In addition, we have invested
$120 million over the past five years to abate 8 MtCO2e using all available commercial scale technologies,
such as energy efficiency and the use of our coal mine methane in the Moranbah North and Capcoal power
stations. The estimated direct carbon costs for 2012 was $17 million. Despite receiving a carbon assistance
income, an operating loss is estimated. This trend is expected to continue to 2016.
Risk3: Carbon tax in Chile
Potential financial implications before taking action: The financial implications will depend on the
proposed tax.
Managing the risk: Anglo American’s Copper team keeps abreast of the developments on the introduction of
a carbon tax. In addition, we continually seek to reduce our carbon footprint which will reduce our exposure to
carbon taxes.
Cost: Many mitigation efforts are in assessment phase and have not been financially quantified.
Risk 4: Carbon reduction targets
Potential financial implications before taking action: Investments in energy saving and carbon abatement
projects would increase the cost of doing business in the short term, but should have a return on investment
through lower energy costs and avoided carbon taxation. For example our fugitive emissions reduction
initiative at our Thermal Coal operation, New Denmark, the annual operating expense is approximately $
200,000.
Managing the risk: Anglo American has implemented a carbon and energy reduction programme called
ECO2MAN. The programme has been used to guide the development of new energy and GHG emissions
savings targets at every managed site. These take into account current and emerging regulation. South
African sites piloted targets in 2011 and the methodology was rolled out to the remainder of our operation in
2012. These targets will enable us to implement reduction measures in line with national requirements. In
parallel, we engage with the South African government to influence the design of related policies and
mechanisms.
Cost: The estimated costs incurred to date for the implementation of ECO2MAN is $1 million. The cost of
specific reduction measures will depend on the nature of the energy saving and carbon reduction projects.
Risk 5 Power conservation
Potential financial implications before taking action: The power conservation programme (PCP), if
implemented will affect our operations in South Africa that are not able to reduce their energy consumption
through the imposition of very punitive electricity tariffs for users who exceed allocated electricity limits. This
risk is even greater if the reduction requirement is increased from 10% to 20%.
Managing the risk: ECO2MAN is an energy and carbon performance management programme which
includes, among other aspects, the development of targets which take into account external risks, including
the potential PCP imposed by power utility Eskom in South Africa.
Costs: The estimated costs incurred, to date, for the implementation of ECO2MAN is $1 million.
5.1c
Please describe your risks that are driven by change in physical climate parameters
ID
Risk driver
Description
Climate change is
expected to have
an impact on sea
levels due to an
increase in the
melting of landbased ice. Anglo
Potential impact
Timeframe
Direct/
Indirect
Likelihood
Magnitude
of impact
RskC1
Sea level
rise
RskC2
Change in
precipitation
pattern
RskC3
Uncertainty
of physical
risks
RskC4
Change in
precipitation
pattern
American's MinasRio Acu Port, from
where we will
export the majority
of our iron ore once
the Minas-Rio
project is complete,
has identified rising
sea levels as a risk
to the operation, but
only in about 20
years.
Climate change is
expected to have
an impact on
precipitation
patterns. Anglo
American
commissioned the
UK Met Office to
conduct an
assessment of
potential future
changes in
freshwater
availability resulting
from climate
change for the area
around the MinasRio iron ore project
in Brazil.
Specifically,
precipitation
patterns and runoff
for four local basins
were analysed.
Potential impacts
on local vegetation
were also analysed.
The study sought to
understand whether
changes would
result in less rain,
more rain or more
extreme patterns.
Physical risks
associated with
climate change may
involve changes in
temperatures and
precipitation
patterns, erratic
weather, and rises
in sea levels.
Uncertainty
associated with
these potential
changes poses a
risk for Anglo
American given the
long life of our
mines and our
inability to move
operations.
The rainfall in
Australia every year
since 2010 has
resulted in critical
parts of the mining
operations
becoming
inoperable. Coal
production was
impacted to varying
degrees.
Inability to do
business
>10 years
Direct
Unlikely
Low
Reduction/disruption
in production
capacity
>10 years
Direct
More likely
than not
Lowmedium
Increased
operational cost
Unknown
Direct
Unknown
Unknown
Reduction/disruption
in production
capacity
Current
Direct
Virtually
certain
Mediumhigh
5.1d
Please describe (i) the potential financial implications of the risk before taking action; (ii) the methods you are using to manage
this risk; and (iii) the costs associated with these actions
RiskC1: Sea level rise
Potential financial implications: The financial risk of unexpected sea level rises is an inability to get our future product to
market. For example, if sea levels were to stop product getting to market, it could cost up to approximately $150 million a
week.
Managing the risk: Anglo American contracted the UK Met Office to simulate various scenarios that will result in the rise
of sea levels at varying degrees of severity. The study also took into account the socio-economic impacts over time. Even
the highest impact scenario indicated that sea level rises would be relatively small and should not pose a significant risk in
terms of the current design of the port
Cost: The cost of study was USD$ 240,000
RiskC2: Change in precipitation patterns
Potential financial implications: While there is currently an abundance of water in the region of our Minas-Rio project,
we anticipate that future industrial and mineral development will strain resources. This may increase water costs or pose
difficulties in renewing our water licenses in that region.
Managing risk: We commissioned the UK Met Office to conduct an assessment of potential future changes in freshwater
availability resulting from climate change for the areas around all our projects. The top 15 projects most exposed to this
type of risk were then modelled to predict precipitation, and run-off patterns for four local basins were analysed to
understand what the potential scenarios could be to 2050. This was deemed to be the most critical time of emergence for
the top 15 projects. Historical weather patterns for the last three decades were reviewed to develop a case study on
climate adaptation, and economic considerations for new projects were taken into account. In summary, it was found that
slightly less water may be available in the dry seasons and slightly more in the wet seasons in future. These results are
being taken into account in the project planning and design. Climate change adaptation guidance being developed for
project teams to better understand potential risks and a new “Sustainability Valuation Approach” is being rolled out to
ensure all project decision take all sustainability issues, including adaptation, into account.
Costs: The cost of study was USD$ 240,000 and provided information for Risks C1&2.
RiskC3: Uncertainty of physical risks
Potential financial implications: It is not practical to quantify the financial implications pertaining to uncertainty.
However, it is clear that without certainty, we are unable to plan optimally for climate changes in the future. These changes
may result in operational disruptions; impact on future growth and license to operate; increase the cost of pre-treatment to
obtain desired water quality; increase costs for wastewater treatment to meet more stringent regulations; result in
regulatory restrictions for specific industrial activities and investments; and increase the responsibility (and costs)
associated with implementing community water infrastructure and watershed restoration projects to mitigate reputation
risks. Extreme weather conditions may result in energy security challenges; disruption to linear infrastructure; flooding
affecting mines; and storms affecting port availability and rail power supply. These risks could all potentially have serious
implications for productivity levels and costs, the transportation of our products and the safety of our employees,
contractors and service providers.
Managing the risk: Anglo American commissioned Imperial College, London, to conduct a high-level three-year climate
change impact-assessment study for selected operations. This has since been followed by a report issued in 2010 on the
expected impacts of climate change on the Olifants River catchment and Sishen iron ore mine in South Africa. Where
possible, these results are being used to ensure that operations, associated communities and supply chains are
safeguarded against any potential negative impacts. We have also commissioned studies to gain a better understanding
of the risks posed by weather and climate change to a broader range of our sites through the afore-mentioned ‘Time of
Emergence’ research. Anglo American has commissioned work with ERM to develop a recommended practice for the
evaluation of climate risks and adaptations for capital projects and current operations.
Costs: The cost of the Imperial College studies was in the region of USD$ 240,000, while the current cost incurred for the
work on recommended practices is approximately USD$ 250,000
RiskC4: Change in precipitation pattern
Potential financial implications: Although our Metallurgical Coal operations had systems in place to transfer, redirect
and convey surface and groundwater for normal operating conditions, the rainfall received in 2010 and early 2011 resulted
in critical parts of the mining operations becoming inoperable. Production was impacted to varying degrees. Some of the
issues that contributed to reduced production included: access roads being closed; open cut pits and underground areas
collecting excessive amounts of water; capacity of the pumping and pipe systems being exceeded; coal conveyors being
inundated; some water storage dams filling up to unmanageable levels; and an inability to pump water from the mine into
the local water courses due to environmental regulations. Production decreased by 3.6 million tonnes during the first
quarter of 2011 as a result of the flooding. Production levels recovered over the remaining months in 2011; however the
cost of recovery from the flooding came at an operating cost of approximately USD$ 62 million.
Managing the risk: The Rain Immunisation Project (RIP) was initiated in 2010 and continued in 2011. Its aim was to
decrease the production time lost at our operations most affected by 2010 and 2011 rains. A review of water-related risks
was also conducted. Workshops were undertaken at each operation using a risk control analysis to identify water hazards
and develop a control effectiveness chart. The information gathered as part of the risk review was integrated into the RIP.
The first phase of the RIP is now complete and has delivered:
• Extensive pump and piping works at Capcoal and Dawson, with significant upgrades to backbone pipelines
• Flood proofing of critical infrastructure and maintenance of flood protection infrastructure such as raising conveyors,
dredging dams to obtain more storage capacity, upgrading levels for diversion of non-mine-affected water
• Road sheeting works on the semi-permanent roads (ramps and haul roads); the application of Dust-A-Side (DAS), a dust
suppressant product, to maintain their trafficability in wet weather; and upgrades to underground mines drainage network
and dewatering capacity.
Cost: Our Metallurgical Coal business unit capital expenditure for recovery and improvement programmes was AU$88
million in 2011 and is expected to increase by USD$ 10.4 million in 2012.
5.1e
Please describe your risks that are driven by changes in other climate-related developments
ID
RskE1
Risk driver
Reputation
Description
Potential
impact
Anglo American aims to
be an investment of
choice, a partner of
choice and an employer
of choice. Having a poor
reputation in relation to
our environmental and
climate change-related
performance may
hamper access to
finance or result in the
company not being a
partner of choice for
host governments or an
employer of choice for
skilled workers.
Reduced stock
price (market
valuation)
Despite current levels of
uncertainty related to
climate change policy,
we believe that most
supply chains will shortly
Timeframe
Direct/
Indirect
Likelihood
Magnitude
of impact
Current
Direct
Very likely
Medium
RskE2
Changing
consumer
behaviour
RskE3
Increasing
humanitarian
demands
be actively involved in
reducing their
greenhouse gas
emissions. While this
presents risks for coal
businesses, research
indicates that coal will
remain a very important
part of the energy mix in
the long term. Our
challenge is to mature
clean coal and carbon
sequestration
technologies in order to
mitigate the carbon
impact of coal
combustion.
Opportunities in
environmentally friendly
technologies exist within
other Anglo American
commodities such as
platinum and copper
(such as platinum-based
fuel cells)
Climate change, left
unmitigated and without
adaptation measures,
will affect vulnerable
communities the most
severely. The majority of
Anglo American’s
operations are in the
developing world where
we engage in numerous
socio-economic
development initiatives.
These are directed in
particular at vulnerable
communities
surrounding our
operations as well as
associated with our
supply chain. The
impact of climate
change in the context of
existing community
vulnerabilities has the
potential to undermine
the desired outcomes of
Anglo American’s
development objectives,
including but not limited
to disruptions at our
operations, supply
chains and transport
infrastructure or may
cause harm to
employees and local
communities in the
future.
Reduced
demand for
goods/services
>10 years
Indirect
(Client)
Very likely
Mediumhigh
Wider social
disadvantages
>10 years
Direct
Very likely
Mediumhigh
5.1f
Please describe (i) the potential financial implications of the risk before taking action; (ii) the methods you are using to manage
this risk; (iii) the costs associated with these actions
RskE1: Reputation
Potential financial implications of the risk before taking action:
The financial advantage of a good reputation attracting high calibre employees is not possible to quantify, however, it is
known that many socially responsible investment (SRI) funds will only invest in companies with a proven track record of
environmental and social responsibility. The Social Investment Forum estimates that SRI funds account for an estimated
$3.74 trillion out of $33.3 trillion in the U.S. investment marketplace today.
Methods used to manage risk: Through our proactive engagement with employees, investors, NGOs, governments and
other stakeholders on the issue, supported by a range of communications activities, we hope to demonstrate that climate
change is a critical issue to the business. We participate in the CDP, release an annual Sustainable Development Report
and our Chief Executive hosts an annual presentation to SRI analysts. We also have a range of initiatives internally to
demonstrate to employees how important the Group considers climate change and the initiatives that it is involved in to
respond to the climate change risk. These initiatives are also aimed at raising awareness among our own employees and
encouraging them to take a keener interest in climate change and its impacts.
Cost of these methods: The human resources costs are absorbed into the normal HR costs of the business, while the
annual SD report costs in excess of $160 000 to produce annually (including assurance fees).
RskE2: Changing consumer demand
Potential financial implications of the risk before taking action: The financial implications, given the level of
uncertainty, are not quantified but relate to a lower demand for coal. However, this may be mitigated by a potential
increase in the demand for commodities such as platinum and copper which could potentially be used in energy and
carbon efficiency technologies.
The methods you are using to manage this risk: With regard to coal, our most important response to mitigating this risk
is through investment in clean coal and carbon capture and storage technology research to help our customers reduce
their emissions. We are involved in a number of industry research initiatives, such as the US-based FutureGen Industrial
Alliance, the Otway CO2 storage project in Australia and the South African Centre for Carbon Capture and Storage. More
directly, we hold a 20% interest in MBD Energy, which has begun applied research into an algal synthesiser process
which involves entrapment of CO2 from power station flue gases.
Cost of these methods: We have invested $ 120 million over the past five years in Australia to abate 8 MtCO2e using all
available commercial scale technologies.
RskE3: Increasing humanitarian demand
The potential financial implications of the risk before taking action: While the financial implications of increasing
humanitarian demands is not known, recent examples of Anglo American offering its support in terms of disaster relief
include $ 1.5 million donated to the Australian government during the recent floods, $ 10 million donated to the Chilean
government after the 2010 earthquake and $ 5 million donated to the Japanese government after the 2011 earthquake
and tsunami.
The methods you are using to manage this risk: The best way we can mitigate this risk is by proactively working with
host communities to improve their socio-economic circumstances, which will in turn strengthen their ability to plan for and
guard against climate change. There is also an opportunity to proactively take future climate change vulnerability into
account when investing in infrastructure and other physical development activities. Zimele’s Green Fund will consider
investing in green projects in communities associated with or close to our operations.
The costs associated with these actions: Anglo American spent $ 154 million on social investment during 2012.
Page: 6. Climate Change Opportunities
6.1
Have you identified any climate change opportunities (current or future) that have the potential to generate a substantive
change in your business operations, revenue or expenditure? Tick all that apply
Opportunities driven by changes in regulation
Opportunities driven by changes in physical climate parameters
Opportunities driven by changes in other climate-related developments
6.1a
Please describe your opportunities that are driven by changes in regulation
ID
OpA1
OpA2
Opportunity
driver
Potential impact
Timeframe
Direct/Indirect
Likelihood
Magnitude
of impact
International
agreements
Many of Anglo
American's
operations are
hosted in nonAnnex 1
countries,
which may
take
advantage of
the Clean
Development
Mechanism
(CDM) of the
Kyoto
Protocol.
Reduced capital
costs
Current
Direct
Virtually
certain
Lowmedium
Air pollution
limits
The increased
use of
platinum as a
primary
material to
reduce air
pollution in
industrial
activities,
including the
emission of
GHGs, is a
significant
opportunity for
the platinum
industry and is
supported by
regulation.
This
opportunity
includes
existing
markets, such
as the use of
platinum in
autocatalysts,
but also
focuses on
emerging
New
products/business
services
Current
Indirect
(Supply chain)
Virtually
certain
Mediumhigh
Description
OpA3
OpA4
Carbon taxes
Cap and
trade
schemes
markets such
as fuel cells
and clean coal
technologies.
CCS has been
identified as
one of the
eight near
term priority
flagship
programmes
for South
Africa (SA) in
the National
Climate
Change
Response
White Paper
(2011).
Carbon
capture and
storage
technology will
prove that it is
possible for
coal-fired
power to have
very low
emissions
which will be
critical for
energy
security as
coal is likely to
continue being
a significant
part of the
energy mix
globally for
many years.
This project
will prove that
it is possible
for coal-fired
power to have
very low
emissions
which will be
critical for
energy
security as SA
is currently
dependent of
coal-fired
power for 93%
of its
electricity. This
will therefore
be a direct
benefit to
Anglo as a
coal producing
company.
Research into
using algae to
sequester
CO2 emitted
by coal-fired
power stations
by the
University of
Cape Town
(UCT). Anglo
American is
investigating
the potential of
using circular
fluidised bed
combustion
technology to
generate
power from its
discard coal.
Algal
sequestration
technology will
be used to
reduce the
carbon
Increased
demand for
existing
products/services
1-5 years
Direct
Virtually
certain
High
Wider social
benefits
1-5 years
Indirect
(Client)
About as
likely as
not
Lowmedium
OpA5
General
environmental
regulations,
including
planning
emissions of
this power
project if
successful.
The IEACCC
is a research
organisation
that focuses
on clean coal
technologies,
many of which
reduce the
emissions
associated
with coal
combustion
and
production.
Anglo
American has
access to
research
reports and
information
about new
technologies
which can
mitigate the
impact of the
downstream
use of our
product.
Increased
demand for
existing
products/services
Unknown
Indirect
(Client)
Unknown
Low
6.1b
Please describe (i) the potential financial implications of the opportunity; (ii) the methods you are using to manage this
opportunity and(iii) the costs associated with these actions
OpA1: International agreements
The potential financial implications of the opportunity: There is an opportunity cost for not taking
advantage of CDM projects in terms of CERs lost. Conversely, operations have the opportunity to offset or
mitigate the capital costs of carbon reduction projects through CDM projects.
The methods you are using to manage this opportunity: All of Anglo American's operations in the
developing world actively review CDM opportunities. For example, Thermal Coal’s New Denmark colliery has
developed and installed two portable methane flaring off mechanisms, which have reduced its annual
methane emissions by 15% and will generate income from carbon credits (from 2011). Anglo American
Platinum has a number of projects in differing stages of development that could be taken forward as CDM
projects. These include electric drilling, solar water heating, various compressor efficiency and pumping
projects and the installation of a thermal co-generation heat recovery process on a high-pressure cooling
system.
The costs associated with these actions: Thermal Coal's mobile methane flares cost $ 1.3 million, which
we expect will be offset through the sale of CERs in around three years. In the case of Platinum, the actual
project costs are still being defined, but the cost of taking a single CDM project through to registration range
between $ 122,000 and $ 366,000.
OpA2: Air pollution limits
The potential financial implications of the opportunity: There are potentially significant financial benefits
for Anglo American in the use of platinum to assist industry and business to address air pollution, considering
a number of important factors such as the increase in vehicles over the next twenty years and anticipated
tightening in air pollution limits globally. Total demand for platinum in fuel cells reached 20,000 oz for the first
time in 2010, with the use of fuel cells in commercial applications becoming increasingly mainstream. At 2012
prices, 20,000 oz of platinum is valued at $30.66 million.
The methods you are using to manage this opportunity: Platinum has invested in a company “Clean
Energy Investment”, which is a partnership between Altergy Systems (a fuel cell power system developer and
manufacturer), Platinum and the South African government’s Department of Science and Technology, to
manufacture and market fuel cells in sub-Saharan Africa. At the recent COP17 climate change conference in
Durban, South Africa, we demonstrated fuel cell technology to the delegates and key stakeholders. The 150
kilowatt platinum-based fuel cell generator used hydrogen to generate electricity that was fed into the local
grid.
Anglo American has also signed a cooperation agreement with Johnson Matthey to investigate the use of
platinum group metals in clean coal technology. More than 90% of our Platinum business unit’s GHG
emissions are indirect emissions attributed to electricity consumption. Therefore the key factor in our strategy
to reduce GHG emissions is our energy savings drive.
The costs associated with these actions: We have created a $12.2 million fund and are working in
conjunction with government and a fuel cell supplier to grow the market and create applications for fuel cells.
Platinum holds 17.5% of the equity and 43% of the voting rights in Johnson Matthey Fuel Cells Limited.
Platinum is also developing fuel cell technology in partnership with Johnson Matthey.
OpA3: FutureGen Alliance 2.0 and SACCCS
The potential financial implications of the opportunity: CCS is cost competitive when compared with other
low emission energy technologies. Lessons learnt through this project will help to reduce the costs of the
technology, making it more financially viable. The U.S. Department of Energy has committed $1 billion to this
project. CCS is cost competitive when compared with other low emission energy technologies. In SA, the
techno-economic feasibility of using this technology must be determined because the main emission sources
are situated in the interior of the country, a minimum 600km from the nearest potential offshore storage sites.
The methods you are using to manage this opportunity: Anglo American holds a position on the Board,
which meets in Washington quarterly. There are also fortnightly progress meetings which are held by telecon.
Anglo American holds a position on the Board of Governors for the South African Centre for Carbon Capture
and Storage (SACCCS), which meets in Johannesburg quarterly. We also hold a position on the Steering
Committee and Chair of the Stakeholder Engagement Sub-committee.
The costs associated with these actions: Anglo American was a founding member of the Alliance and
made a $300k upfront membership payment. Recently, each industrial member contributed $250k for Phase II
of the project. When the project goes to financial close, each industrial member will contribute $10 million
towards the project.
Costs associated with management of the project are primarily for travel and communications.
Anglo American was also a founding member of the SACCCS and makes an annual contribution of $12 200.
Costs associated with management of the project are primarily for travel and communications.
OpA4: Algae research at UCT
The potential financial implications of the opportunity: The introduction of the carbon tax in South Africa
will mean that this project has the potential to reduce the exposure of the project to the tax.
The methods you are using to manage this opportunity: A steering committee has been established which
will guide the project and make decisions at the end of each of the phases on how to proceed. Expertise from
James Cooke University and MBD Energy in which we are invested will be sought when necessary
The costs associated with these actions: The budget for Phase 1 and 2 of the project is approximately $2
million.
OpA5: IEACCC research
The potential financial implications of the opportunity: The development of clean coal technologies will
allow developing countries to continue using an affordable source of energy to grow their economies.
The methods you are using to manage this opportunity: Anglo American is a member of the IEACCC and
hold a position on the Executive Committee. We play a role in proposing, selecting and vetting the research
topics.
The costs associated with these actions: An annual membership fee of $31 000 was paid in 2012. Costs
associated with management of the project are primarily for travel and communications.
6.1c
Please describe the opportunities that are driven by changes in physical climate parameters
ID
OpC1
Opportunity
driver
Description
Potential
impact
Timeframe
Direct/
Indirect
Likelihood
Magnitude
of impact
Other
physical
climate
opportunities
While no direct
opportunities related to
physical changes have
been identified (like an
increase in precipitation in
a water-scarce region, for
example), the opportunity
and competitive advantage
for Anglo American lies in
our ability to understand
the anticipated changes.
Reduced
operational
costs
6-10 years
Direct
Very likely
Medium
6.1d
Please describe (i) the potential financial implications of the opportunity; (ii) the methods you are using to manage this
opportunity and (iii) the costs associated with these actions
OpC1: Other physical climate opportunities
The potential financial implications of the opportunity: While no direct opportunities related to physical
changes have been identified (like an increase in precipitation in a water-scarce region, for example), the
opportunity for Anglo American lies in our ability to understand the anticipated changes, and to develop robust
adaptation strategies that guard our operations, and the value chains, environments and communities linked
to those operations, against negative impacts. This is true for projects and operations throughout the world,
but in particular for high-risk regions with already-scarce water resources such as South Africa and Chile.
ECO2MAN and the Anglo American performance standard (GTS 023) provide the guidance required for all
sites (including projects) to identify potential opportunities and incorporate them into the planning of a site and
implement targets and initiatives that will exploit the opportunity to achieve potential savings in energy and
GHG emissions. Water related impacts as a result of climate change have resulted in serve flooding at some
of our Metallurgical Coal operations since 2010. Our operations are located in regions that at times oscillate
between severe drought and flood conditions. Current scientific evidence suggests that climate change may
result in a further increase in this kind of rainfall variability in the long term (and also in other geographies).
The methods you are using to manage this opportunity: Opportunities are being assessed through our
climate-change impact-assessment projects with Imperial College and the UK Met Office that will deliver
regional climate change models, which will be used to establish a risk/opportunity inventory of our current and
future operations around the world and influence our methodology for taking climate change risks and
opportunities into account in mine planning, as set out by ECO2MAN and the energy and climate change
performance standard. In response to serve flooding at some of our Metallurgical Coal operations the
business initiated the ‘Rain Immunisation Project’, a climate adaptation initiative that seeks to decrease the
environmental risks and production time loss at the Moranbah North, Capcoal, Foxleigh and Dawson
operations caused by rainfall variability.
The costs associated with these actions: The costs incurred for the work done by the UK Met Office and
Imperial College amounted to approximately $320 000. The first phase of the rain immunisation project
involved an initial investment of $ 82.5 million.
6.1e
Please describe the opportunities that are driven by changes in other climate-related developments
ID
OpE1
OpE2
Opportunity
driver
Potential impact
Timeframe
Direct/
Indirect
Likelihood
Magnitude
of impact
Reputation
While reputation built
on how Anglo
American addresses
climate change has
been listed as a risk,
taking meaningful
action on the issue
can also be an
opportunity to attract
talent into our
workforce, and
position Anglo
American as the
partner of choice for
organisations, other
businesses and
governments with
expectations of
proactive and
responsible carbon
management. Through
the use of social
media and increased
marketing activities,
Anglo American has
shared their
achievements and ongoing initiatives in the
space of climate
change and energy
savings.
Investment
opportunities
Current
Direct
Very likely
Lowmedium
Other
drivers
Multi-disciplinary
synergies Increasingly, we seek
out investments to
effect positive change
in more than one
sustainable
development
discipline. For
example, a new
enterprise
development fund in
South Africa has been
established to help
create jobs while
delivering
environmental
benefits. The Zimele
Green Fund will target
investment
opportunities that
mitigate carbon
emissions, reduce
energy and water
consumption, and
improve waste and
emissions
management. Created
in November 2011, the
Fund is already
reviewing potential
investments to assess
their commercial and
technical viability and
degree of alignment
with Anglo American’s
environmental
objectives, such as the
retrofitting of low
income government
provided housing in
South Africa with solar
Wider social
benefits
Current
Indirect
(Client)
Virtually
certain
Lowmedium
Description
OpE3
Other
drivers
water heaters.
Regulatory, physical
and other
opportunities
combined drive the
need for innovation in
the business, which in
turn builds valuable
intellectual property.
Despite current levels
of uncertainty related
to climate change
policy, we believe that
by 2020 most supply
chains will be actively
involved in reducing
their greenhouse gas
(GHG) emissions. This
presents risks for our
coal businesses, and
opportunities in
environmentally
friendly technologies
exist within other
commodities such as
platinum and copper.
New
products/business
services
Current
Direct
Very likely
Medium
6.1f
Please describe (i) the potential financial implications of the opportunity; (ii) the methods you are using to manage this
opportunity; (iii) the costs associated with these actions
OpE1: Reputation
Potential financial implications of the opportunity: The financial advantage of a good reputation attracting high calibre
employees is not possible to quantify, however, it is known that many SRI funds will only invest in companies with a
proven track record of environmental and social responsibility. The Social Investment Forum estimates that SRI funds
account for an estimated $3.74 trillion out of $33.3 trillion in the U.S. investment marketplace today. If Anglo American was
not recognised as a company with a sound environmental and social track record, we would be limiting our access to the
above mentioned $3.74 trillion and attracting skilled employees.
Methods we are using to manage this opportunity: Through our proactive engagement with employees, investors,
NGOs, governments and other stakeholders on the issue, supported by a range of communications activities, we hope to
demonstrate that climate change is a critical issue to the business. We participate in the CDP, release an annual
Sustainable Development (SD) Report and our Chief Executive hosts an annual presentation to SRI analysts. We also
played an important role in assisting the SA National Planning Commission in its study on transitioning to a low carbon
economy, through leading the development of the SA Coal roadmap and participating in the commission’s roundtable
meetings.
We also have a range of initiatives internally to demonstrate to employees how important the Group considers climate
change and the initiatives that it is involved in to respond to the climate change risk. These initiatives are also aimed at
raising awareness among our own employees and encouraging them to take a keener interest in climate change and its
impacts.
Costs associated with these actions: The human resources costs are absorbed into the normal HR costs of the
business, while the annual SD report and associated assurance procedures costs in excess of $ 635,000 to produce
annually.
OpE2: Cross-disciplinary synergy
Potential financial implications of the opportunity: Linking carbon-abatement objectives with other work streams, such
as biodiversity and community development, has the potential to enhance the outcomes of our investments. While this will
not necessarily result in altered social investment spending, promoting broad-based outcomes will help the company meet
multiple objectives. For example, a new enterprise development fund in South Africa has been established to help create
jobs while delivering environmental benefits. The Zimele Green Fund will target investment opportunities that mitigate
carbon emissions, reduce energy and water consumption, and improve waste and emissions management. Created in
November 2011, the Fund is already reviewing potential investments to assess their commercial and technical viability and
degree of alignment with Anglo American’s environmental objectives, such as the retrofitting of low income government
provided housing in South Africa with solar water heaters.
Methods we are using to manage this opportunity: Anglo American has proactively put mechanisms in place to
encourage multi-disciplinary collaboration. For example, our mandatory social and environmental impact assessment
standard requires a holistic view of the likely impact of an operation on its natural and social environments. Similarly,
Anglo American’s Socio-Economic Assessment Toolbox raises community concerns and opportunities across a spectrum
of disciplines. Though collaboration on a practical level is still in early stages, an example is a proposed community solarwater heating project.
We are investigating how we can use revenue that could be generated by Voluntary Emission Reductions (tVERs) to
enhance not only our response to climate change, but also other priority areas. For example, we could integrate carbon
abatement and biodiversity programmes in a way that generates tVERs through reforestation programmes. Another option
includes installing solar-water heating in communities with no access to electricity, which has the additional benefit of
climate change mitigation and tVERs should the programme qualify as a CDM project. We could also work with
communities to improve agricultural and pastoral management in order to increase organic carbon in the soils and thereby
optimise the natural ecosystem capacity to sequester carbon. Carbon-biodiversity links could work especially well in Brazil,
given the government’s focus on decreasing the rate of deforestation in that country.
Costs associated with these actions: Given that the opportunity lies in taking a new approach, there has been no
additional cost implication at this point.
OpE3: Intellectual property
Potential financial implications of the opportunity: Building intellectual property within the business builds competitive
advantage through developing the technology and capability to reduce our cost of compliance with energy and climate
change regulation . and possibly operating costs in the face of increasing energy costs in South Africa. There are also
broader benefits to society and the business as we learn to implement new and more efficient ways of mitigating the cause
and effects of climate change.
Methods we are using to manage this opportunity: We are in the unique position that we produce platinum group
metals (PGMs) for use in autocatalysis, which reduces toxic emissions from internal combustion engines, as autocatalysts
produce water and carbon dioxide rather than carbon monoxide, nitrous oxides and particulates. At the recent COP17
climate change conference in Durban, South Africa, we demonstrated fuel cell technology to the delegates. The 150
kilowatt platinum-based fuel cell generator used hydrogen to generate electricity that was fed into the local grid. Fuel cell
technology has advanced significantly in the past decade, to the point where it can almost be regarded as a mature
product. The biggest impediment to it playing a base-load role is the availability, cost and supply of fuel.
Costs associated with these actions: We have created a $12.2 million fund and are working in conjunction with
government and a fuel cell supplier to grow the market and create applications for fuel cells.
Module: GHG Emissions Accounting, Energy and Fuel Use, and Trading [Investor]
Page: 7. Emissions Methodology
7.1
Please provide your base year and base year emissions (Scopes 1 and 2)
Scope 1 Base year emissions (metric
tonnes CO2e)
Base year
Sat 01 Jan 2011 - Sat 31
Dec 2011
8480000
Scope 2 Base yearemissions (metric
tonnes CO2e)
9400000
7.2
Please give the name of the standard, protocol or methodology you have used to collect activity data and calculate Scope 1 and
Scope 2 emissions
Please select the published methodologies that you use
The Greenhouse Gas Protocol: A Corporate Accounting and Reporting Standard (Revised Edition)
7.2a
If you have selected 'Other', please provide details below
7.3
Please give the source for the global warming potentials you have used
Gas
CH4
CO2
Reference
IPCC Second Assessment Report (SAR - 100 year)
IPCC Third Assessment Report (TAR - 100 year)
7.4
Please give the emissions factors you have applied and their origin; alternatively, please attach an Excel spreadsheet with this
data
Fuel/Material/Energy
Diesel/Gas oil
Liquefied petroleum gas (LPG)
Methane
Motor gasoline
Metallurgical coke
Petroleum coke
Natural gas
Waste oils
Biodiesels
Emission Factor
2.68
2.98
21
2.4
2.5
3.17
0.00215
2.46
0.0708
Unit
metric tonnes CO2e per m3
metric tonnes CO2e per metric tonne
metric tonnes CO2e per metric tonne
metric tonnes CO2e per m3
metric tonnes CO2e per metric tonne
metric tonnes CO2e per metric tonne
metric tonnes CO2e per m3
metric tonnes CO2e per m3
metric tonnes CO2e per m3
Page: 8. Emissions Data - (1 Jan 2012 - 31 Dec 2012)
8.1
Please select the boundary you are using for your Scope 1 and 2 greenhouse gas inventory
Operational control
8.2
Please provide your gross global Scope 1 emissions figures in metric tonnes CO2e
8470754
8.3
Please provide your gross global Scope 2 emissions figures in metric tonnes CO2e
9403534
Reference
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
IPCC Guidelines
8.4
Are there are any sources (e.g. facilities, specific GHGs, activities, geographies, etc.) of Scope 1 and Scope 2 emissions which
are not included in your disclosure?
Yes
8.4a
Please complete the table
Source
Fgasses
N2O
Scope
Scope
1
Scope
1
Explain why the source is excluded
After review, the contribution of F-gasses to Anglo American's carbon footprint was considered
negligible.
After review, the contribution of N2O to Anglo American's carbon footprint was considered
negligible.
8.5
Please estimate the level of uncertainty of the total gross global Scope 1 and 2 emissions figures that you have supplied and
specify the sources of uncertainty in your data gathering, handling and calculations
Scope 1
emissions:
Uncertainty
range
More than
2% but less
than or
equal to 5%
Scope 1
emissions:
Main sources
of
uncertainty
Scope 1 emissions: Please
expand on the uncertainty in
your data
Metering/
Measurement
Constraints
The accuracy requirements of the
EU ETS are detailed in the
schemes monitoring, reporting
and verification requirements. EU
ETS requires all measured values
to be subject to an uncertainty
assessment following the
principles of ISO Guide to the
Expression of Uncertainty in
Measurement and ISO 5168:2005
Measurement of fluid flow procedures for the evaluation of
uncertainties. The permitted
uncertainty depends on the size
of the installation and the
measurement method but is 2.5%
or lower. An overall materiality
level of 2% is applied by verifiers
when undertaking annual
verification of emissions, which for
the largest installations is 2% and
5% for the smallest installations.
There is no internationally
recognised methodology for
calculating CO2 emissions from
spontaneous combustion
(sponcom) – Anglo American has
developed its own method, which
is applied consistently throughout
operations but is no longer
reported externally.
Scope 2
emissions:
Uncertainty
range
Less than or
equal to 2%
Scope 2
emissions:
Main sources
of
uncertainty
Scope 2
emissions:
Please expand
on the
uncertainty in
your data
Metering/
Measurement
Constraints
Towards the end
of 2009 Anglo
American began
to emphasise the
importance of the
need for data
capturers to
understand units
of measure as
well as
magnitude, once
it was discovered
that units of
measure were
occasionally
overlooked when
capturing data.
8.6
Please indicate the verification/assurance status that applies to your Scope 1 emissions
Third party verification or assurance complete
8.6a
Please indicate the proportion of your Scope 1 emissions that are verified/assured
More than 90% but less than or equal to 100%
8.6b
Please provide further details of the verification/assurance undertaken, and attach the relevant statements
Type of
verification or
assurance
Reasonable
assurance
Relevant
standard
ISAE3000
Attach the document
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/Investor-8.6b-C3-RelevantStatement/2012 assurance
statement SDR page 68-69.pdf
8.7
Please indicate the verification/assurance status that applies to your Scope 2 emissions
Third party verification or assurance complete
8.7a
Please indicate the proportion of your Scope 2 emissions that are verified/assured
More than 90% but less than or equal to 100%
8.7b
Please provide further details of the verification/assurance undertaken, and attach the relevant statements
Type of
verification or
assurance
Reasonable
assurance
Relevant
standard
ISAE3000
Attach the document
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/Investor-8.7b-C3-RelevantStatement/2012 assurance
statement SDR page 68-69.pdf
8.8
Are carbon dioxide emissions from biologically sequestered carbon relevant to your organization?
Yes
8.8a
Please provide the emissions in metric tonnes CO2
0.16
Page: 9. Scope 1 Emissions Breakdown - (1 Jan 2012 - 31 Dec 2012)
9.1
Do you have Scope 1 emissions sources in more than one country?
Yes
9.1a
Please complete the table below
Country/Region
South Africa
Australia
Brazil
Chile
Peru
United Kingdom
Canada
Zimbabwe
Rest of world
Scope 1 metric tonnes CO2e
1954091
3193131
817867
576359
4705
1222947
103771
8660
589223
9.2
Please indicate which other Scope 1 emissions breakdowns you are able to provide (tick all that apply)
By business division
By GHG type
9.2a
Please break down your total gross global Scope 1 emissions by business division
Business division
Kumba Iron Ore
Iron Ore Brazil
Metallurgical Coal
Thermal Coal
Copper
Nickel
Platinum
Niobium and Phosphates
Exploration
Corporate
Vergelegen
Other Mining and Industries
Scope 1 emissions (metric tonnes CO2e)
430608
48834
3296052
770235
580608
1158246
532649
73933
3073
9270
455
1566791
9.2c
Please break down your total gross global Scope 1 emissions by GHG type
GHG type
CO2
Scope 1 emissions (metric tonnes CO2e)
5530171
CH4
2940583
Page: 10. Scope 2 Emissions Breakdown - (1 Jan 2012 - 31 Dec 2012)
10.1
Do you have Scope 2 emissions sources in more than one country?
Yes
10.1a
Please complete the table below
Country/Region
South Africa
Australia
Brazil
Chile
Peru
United Kingdom
Canada
Zimbabwe
Rest of world
Scope 2 metric
tonnes CO2e
7266477
622324
119547
1018262
59
134880
342
58364
183279
Purchased and consumed
electricity, heat, steam or cooling
(MWh)
7059163
709613
2237223
2483728
200
313248
13759
97257
12558
Purchased and consumed low carbon
electricity, heat, steam or cooling
(MWh)
507779
156494
1969330
2061494
10.2
Please indicate which other Scope 2 emissions breakdowns you are able to provide (tick all that apply)
By business division
10.2a
Please break down your total gross global Scope 2 emissions by business division
Business division
Kumba Iron Ore
Iron Ore Brazil
Metallurgical Coal
Thermal Coal
Copper
Nickel
Platinum
Niobium and Phosphates
Exploration
Corporate
Vergelegen
Other Mining and Industries
Scope 2 emissions (metric tonnes CO2e)
513985
238
622580
849936
1018291
262489
5210720
19458
282
29357
1435
874763
Page: 11. Energy
11.1
What percentage of your total operational spend in the reporting year was on energy?
More than 0% but less than or equal to 5%
11.2
Please state how much fuel, electricity, heat, steam, and cooling in MWh your organization has purchased and consumed
during the reporting year
Energy type
Fuel
Electricity
Heat
Steam
Cooling
MWh
17139486
12926749
0
0
0
11.3
Please complete the table by breaking down the total 'Fuel' figure entered above by fuel type
Fuels
Diesel/Gas oil
Natural gas
Liquefied petroleum gas (LPG)
Metallurgical coke
MWh
9182714
1916283
246036
826592
Motor gasoline
Petroleum coke
Biodiesels
Other: smaller quantity fuels used
Charcoal
122086
173216
23670
4607178
368
11.4
Please provide details of the electricity, heat, steam or cooling amounts that were accounted at a low carbon emission factor
Basis for applying a low
carbon emission factor
No purchases or
generation of low carbon
electricity, heat, steam or
cooling
MWh associated with low
carbon electricity, heat,
steam or cooling
Comments
The value presented if based on the energy mix of
electricity supplied to our operations and represents the
MWh supplied through the grid attributable to low carbon
electricity generated by supplier.
4695453
Page: 12. Emissions Performance
12.1
How do your absolute emissions (Scope 1 and 2 combined) for the reporting year compare to the previous year?
Decreased
12.1a
Please complete the table
Emissions
value
(percentage)
Reason
Direction
of change
Emissions
reduction
activities
16
Decrease
Divestment
0.9
Decrease
Comment
3.3 MtCO2e savings were achieved across the group during 2012
as a result of projects implemented to deliver reductions in GHG
emissions and energy consumption combined with the methane
management programmes at Metallurgical Coal in Australia.
Scaw Metals Group was divested in quarter 4 of 2012. As a result
of their divestment, their associated emissions are included up
until the point of divestment.
Acquisitions
Mergers
Change in output
Change in
methodology
5
Decrease
Our 2012 emissions data no longer includes the contribution of
spontaneous combustion in process emissions, which was partly
responsible for this reduction. We have discontinued reporting on
this as it is not industry practice to do so and there is no agreed
scientific methodology; however, we continue to estimate and
report on this internally.
4
Decrease
Reductions activities: a portion of the business unit's reductions is
attributed to industrial actions that halted activities for a short
period during quarter 4 of 2012.
Change in
boundary
Change in
physical
operating
conditions
Unidentified
Other
12.2
Please describe your gross combined Scope 1 and 2 emissions for the reporting year in metric tonnes CO2e per unit currency
total revenue
Intensity
figure
0.0006
Metric
numerator
metric
tonnes CO2e
Metric
denominator
unit total
revenue
% change
from previous
year
1.32
Direction of
change from
previous year
Increase
Reason for change
The Groups' revenue decreased
by 6% year on year, while
emission dropped by a smaller
margin.
12.3
Please describe your gross combined Scope 1 and 2 emissions for the reporting year in metric tonnes CO2e per full time
equivalent (FTE) employee
Intensity
figure
Metric
numerator
metric
Metric
denominator
% change
from
previous
year
Direction of
change from
previous year
Reason for change
The annual average employee
tonnes
CO2e
186
FTE employee
7
Increase
numbers have decreased by 11%
while our total emissions have only
decreased by 5%.
12.4
Please provide an additional intensity (normalized) metric that is appropriate to your business operations
Intensity
figure
0.065
Metric
numerator
metric
tonnes
CO2e
Metric
denominator
Other: tonne
ore mined
% change
from
previous
year
13
Direction
of change
from
previous
year
Decrease
Reason for change
All of our business units, with the exception of
Platinum and Nickel, mined more ore/product in
2012 when compared to 2011. Our Platinum
business unit was affected by the industrial
action in late 2012, halting operations eight
weeks at five of their mines, while our Kumba
Iron Ore business only experienced a similar
disrupting for 12 days. Our Nickel business unit
experiment a decrease in the amount of ore
mined as a result of their Loma de Níquel
ceasing reporting at the end of October after its
mining license was not renewed. The overall
decrease in the intensity observed can be
attributed to the emissions reduction activity
across all the business units.
Page: 13. Emissions Trading
13.1
Do you participate in any emissions trading schemes?
No, and we do not currently anticipate doing so in the next 2 years
13.2
Has your company originated any project-based carbon credits or purchased any within the reporting period?
No
Page: 14. Scope 3 Emissions
14.1
Please account for your organization's Scope 3 emissions, disclosing and explaining any exclusions
Sources of
Scope 3
emissions
Purchased
goods and
services
Evaluation
status
Relevant,
calculated
metric
tonnes
CO2e
320912
Methodology
The data provided has been calculated
by our Platinum, Kumba Iron Ore and
Thermal Coal business units. Platinum
developed a proprietary tool to
calculate their scope 3 emissions. The
tool was developed with the assistance
of a renowned consultant and
methodologies applied have been
verified by a third party. Our Thermal
Coal business unit employed the GHG
protocol tool for the calculation of
emissions from the production of
lime/hydrated lime/processing of
limestone is available on the GHG
Protocol website, as well as easily
interpretable methodologies in the
IPCC 2006 Guideline. Kumba Iron Ore
calculated this category in accordance
with the Scope 3 Accounting and
Reporting Standard by The
Greenhouse Gas Protocol Initiative.
The emissions associated with the
production of the purchased fuel - the
direct supplier emissions are estimated
by multiplying the amount of purchased
fuel by an emission factor associated
with the production of the fuel. The
data was obtained from supply chain
records.
Our Kumba Iron Ore business unit
Percentage
of
emissions
calculated
using
primary
data
46%
Explanation
Capital goods
Relevant,
calculated
620
Fuel-andenergyrelated
activities (not
included in
Scope 1 or 2)
Relevant,
calculated
1706764
Upstream
transportation
and
distribution
Relevant,
calculated
131999
calculated the category by; (i) Using
supply chain information on the
purchase of trucks and rock drills.
These are the largest moveable capital
investments. (ii) To get a factor, the
total emissions of caterpillar was used
and allocated according to the
percentage revenue that Kumba
contributed to Caterpillar. (iii) Transport
was ignored and allocation was on a
cost apportionment.
The data provided has been calculated
by our Platinum, Kumba Iron Ore and
Thermal Coal business units. Platinum
developed a proprietary tool to
calculate their scope 3 emissions. The
tool was developed with the assistance
of a renowned consultant and
methodologies applied have been
verified by a third party. The factors
used were sourced from Defra, the
IPCC and producer publications to
calculate the upstream emissions of
purchased fuels and the transmission
and distribution losses of electricity
purchased. In a similar manner our
Thermal Coal business unit developed
a proprietary methodology to estimate
these emissions rather than actual
emissions due to confidentiality of the
South African petroleum industry.
Kumba Iron Ore calculated this
category in accordance with the Scope
3 Accounting and Reporting Standard
by The Greenhouse Gas Protocol
Initiative. The emissions associated
with the production of the purchased
fuel - the direct supplier emissions are
estimated by multiplying the amount of
purchased fuel by the Scope 3
emission factor associated with the
production of the fuel. The data was
obtained from supply chain records.
The data provided has been calculated
by our Platinum and Thermal Coal
business units. Platinum developed a
proprietary tool to calculate their scope
3 emissions. The tool was developed
with the assistance of a renowned
consultant and methodologies applied
have been verified by a third party.
Only Diesel and Petrol have been
considered as the 2 fossil fuels that are
most material. The emissions
calculated are for transportation and
distribution services purchased by our
Platinum business unit, including
inbound logistics, outbound logistics,
and transportation and distribution
between a company’s own facilities (in
vehicles and facilities not owned or
controlled by the reporting company).
Our Thermal Coal business unit
calculated the emissions associated
with the Transport of product from
respective operations, or from the
Rapid Loading Terminal, to the
Richards Bay Coal Terminal via
Domestic Rail within the Republic of
South Africa. The rail service provider,
Transnet SOC Limited, provided export
coal line specific emission factors for
the purpose of this calculation.
The data provided has been calculated
by our Platinum and Thermal Coal
business units. . Platinum developed a
proprietary tool to calculate their scope
3 emissions. The tool was developed
with the assistance of a renowned
consultant and methodologies applied
have been verified by a third party.
Platinum data only represents
emissions of waste sent to landfill and
the factor was sourced from EPA 2002,
Solid Waste Management and
Greenhouse Gases: A Life Cycle
Assessment of Emissions and Sinks,
EPA530-R-02-006, Chapter 7. This
5%
46%
41%
Waste
generated in
operations
Not
relevant,
calculated
65241
Business
travel
Relevant,
calculated
33623
Employee
commuting
Relevant,
calculated
69792
reference estimates GHG emissions
and carbon storage from landfilling in
the study, CH4 emissions, and
transportation related CO2 emissions
were considered, and carbon storage
that will result from landfilling each type
of organic waste and mixed MSW. Our
Thermal Coal business unit emissions
Includes (1) the treatment of waste
water at municipal sewage treatment
facilities as well as (2) disposal of solid
(non‐hazardous) waste at a land fill
site and the associated decay of said
waste (road transport of the waste to
the land fill site is not included in this
report). Due to lack of suitable
information on the construction and
operation of various municipal sewage
treatment facilities, it is assumed in this
report that all facilities are anaerobic
deep (>2m) collection lagoon type
facilities.
The data provided has been calculated
by our Platinum, Kumba Iron Ore,
Thermal Coal business units and our
South African corporate centre.
Platinum developed a proprietary tool
to calculate their scope 3 emissions.
The tool was developed with the
assistance of a renowned consultant
and methodologies applied have been
verified by a third party. Platinum data
includes business travel by air and
hired vehicle, sourced from supplier
and business travel by employees in
private vehicles. Our South African
corporate centre and Thermal Coal
business unit data includes business
travel by air and hired vehicles sourced
from their supplier. The figure
presented is for business air travel
originating out of South Africa provided
by our supplier. This data has been
partially verified (Platinum data only)
but is being used as a basis to develop
a full set of matrices to be used by the
entire Group. Air kilometres (KMs) are
captured in miles by the travel
consultant at point of booking
pertaining to relevant routing. These
mile figures are then validated by the
travel agent’s internal business analyst,
via random spot checks to ensure there
are no anomalies, and then converted
into KMs (using the standard 1.609344
conversion). The method to validate
the miles captured by the travel
consultant is by use of a calculation
tool that works off great-circle distance
(the shortest distance between any two
points on the surface of a sphere).
Once the total travelling distance has
been determined, the appropriate
emissions factor (reference: Green
House Gas Protocol) basis on seating
classification is multiplied by the
distance travelled to give CO2
emissions.
The data provided has been calculated
by our Platinum and Kumba Iron Ore
business units. Platinum developed a
proprietary tool to calculate their scope
3 emissions. The tool was developed
with the assistance of a renowned
consultant and methodologies applied
have been verified by a third party.
Gathering of information involved
surveying employees at each operation
to gain a representative sample set and
applying factors sourced from Defra.
Kumba Iron Ore calculated this
category accordance with the Scope 3
Accounting and Reporting Standard by
The Greenhouse Gas Protocol
Initiative. The emissions-based
screening assessment equation was
used to calculating the emissions from
employee commuting. Used total
employment figures. Assumptions were
46%
47%
37%
made on the split of employees using
different transports on different
operations.
Upstream
leased assets
Not
relevant,
explanation
provided
0
Investments
Relevant,
calculated
1274870
Downstream
transportation
and
distribution
Relevant,
calculated
9343258
no methodology applied
The data provided has been calculated
by our Platinum and Thermal Coal
business units. Platinum developed a
proprietary tool to calculate their scope
3 emissions. The tool was developed
with the assistance of a renowned
consultant and methodologies applied
have been verified by a third party and
includes the scope 1 and scope 2
emissions of the following joint
ventures on an equity share basis;
Modikwa, Kroondal, Marikana,
Mototolo, Pandora, Bafokeng Rasimone, Bokoni. Our Thermal Coal
business unit calculated scope 1 and
scope 2 emissions of their two
significant joint ventures, namely,
Mafube Colliery (50% equity share with
Exxaro) and Cerrejon Coal (33% equity
share with BHP Billiton and Xstrata).
The data provided has been calculated
by our Platinum, Kumba Iron Ore and
Thermal Coal business units. Platinum
developed a proprietary tool to
calculate their scope 3 emissions. The
tool was developed with the assistance
of a renowned consultant and
methodologies applied have been
verified by a third party. Our Thermal
Coal business unit calculated (1)
transport of product by domestic rail to
the end user (Eskom or other), (2)
transport of product by conveyor to end
user (Eskom) (the electrical energy
required for operation of the conveyors
is included in the scope 2 (CO2e from
electricity purchased) emissions
reported by each respective operation),
(3) international oceanic freight from
Richards Bay Coal Terminal to end
user. Our Kumba Iron Ore business
calculated this category with use of the
Scope 3 Accounting and Reporting
Standard by The Greenhouse Gas
Protocol Initiative, the transportation
and distribution of sold products in
vehicles not owned or controlled by the
reporting company were included. The
transportation and distribution of
Kumba’s sold product include: the
railway transport of iron ore from
Sishen to Saldanha, railway transport
of ore from Thabazimbi to
Vanderbijlpark and Newcastle and the
export of product via ship to mainly
China, Japan, Korea and Western
Europe.
The data provided has been calculated
by our Platinum and Thermal Coal
business units. Platinum developed a
proprietary tool to calculate their scope
3 emissions. The tool was developed
with the assistance of a renowned
consultant and methodologies applied
have been verified by a third party. The
0%
41%
41%
Many of our
assets in each
business unit are
company owned,
while the
majority of
emissions from
leased assets
are already
accounted for
under scope 1 or
scope 2. It has
been determined
that the
emissions from
leased assets
currently not
accounted for is
not material at
this stage.
Processing of
sold products
Relevant,
calculated
132295430
Use of sold
products
Relevant,
calculated
167161663
End of life
treatment of
sold products
Relevant,
calculated
640624
data presented was calculated using
the most energy intensive processes
for the products sold by our Platinum
business unit. The formula used to
calculate the emissions included the
mass of each product sold, multiplied
to the emissions factor for the
processing technique applied. Kumba
Iron Ore calculated this category in
accordance with the Scope 3
Accounting and Reporting Standard by
The Greenhouse Gas Protocol
Initiative. The emissions for downstream use of Kumba products were
calculated, up to steel production. It
includes emissions from the production
of sinter to steel. Data from the 2006
IPCC guidelines was used.
This figure was arrived at by applying
an emissions factor per tonne of coal
that was sold to various regions and/or
for particular use for our Thermal and
Metallurgical Coal business unit.
Our Kumba Iron Ore business unit
calculated this category by using data
from the World Steel Association to
obtain recycling rates. The emission
factor from the IPCC was used for
Electric Arc furnaces and apportioned
to the amount of steel produced from
product sold by Kumba in 2012.
32%
37%
5%
Downstream
leased assets
Not
relevant,
explanation
provided
0
no methodology applied
0%
Franchises
Not
relevant,
explanation
provided
0
no methodology applied
0%
Other
(upstream)
Not
evaluated
0
no methodology applied
0%
Other
(downstream)
Not
evaluated
0
no methodology applied
0%
Our Platinum
and Thermal
Coal business
units have
conducted
detailed
assessments of
their scope 3
emissions and it
was determined
that there were
no downstream
leased assets.
Anglo American
has no
franchising
activity;
therefore this
category is not
applicable to us.
Only the 15
categories
prescribed by
the GHG
protocol have
been assessed
by our platinum
and Thermal
Coal business
units.
Only the 15
categories
prescribed by
the GHG
protocol have
been assessed
by our platinum
and Thermal
Coal business
units.
14.2
Please indicate the verification/assurance status that applies to your Scope 3 emissions
Third party verification or assurance complete
14.2a
Please indicate the proportion of your Scope 3 emissions that are verified/assured
More than 20% but less than or equal to 40%
14.2b
Please provide further details of the verification/assurance undertaken, and attach the relevant statements
Typeof
verification or
assurance
Limited
assurance
Relevant
standard
ISAE3000
Attach the document
https://www.cdproject.net/sites/2013/72/772/Investor CDP 2013/Shared
Documents/Attachments/Investor-14.2b-C3-RelevantStatementAttached/AAP
assurance statement for scope 3 data assurance.pdf
14.3
Are you able to compare your Scope 3 emissions for the reporting year with those for the previous year for any sources?
Yes
14.3a
Please complete the table
Sources of
Scope 3
emissions
Reason for
change
Emissions
value
(percentage)
Direction
of change
Business travel
Change in
boundary
103
Increase
Use of sold
products
Change in
methodology
1
Decrease
Employee
commuting
Change in
boundary
13
Decrease
Downstream
transportation
and distribution
Change in
boundary
4
Increase
Investments
Change in
output
24
Increase
Comment
In previous years only emissions from business travel
originating out of the South African Anglo American
corporate office were detailed. This year Business
travel emissions from our Thermal Coal, Kumba Iron
Ore and Platinum business units have also been
included; resulting in an increase in emissions
reported.
Our Thermal Coal business unit has calculated their
emissions for this category based on the individual
sales data from each operation. Previously both our
coal business unit data was calculated using
averaged distribution data.
Last year employee commuting was assessed by our
Kumba Iron Ore business unit only. In 2012 our
Platinum and Kumba business units assessed this
GHG protocol category. Despite the data from
Platinum being introduced, a decrease can be
observed due to Kumba Iron Ore refining the
methodology.
In our previous submission, data from our Kumba
Iron Ore business unit was supplied but in 2012 our
Thermal Coal and Platinum business units also
assessed this GHG protocol category.
The data provided has been calculated by our
Platinum and Thermal Coal business units but
previously only account for investment by our thermal
Coal business unit. The scope 1 and scope 2
emissions of the following Platinum joint ventures on
an equity share basis; Modikwa, Kroondal, Marikana,
Mototolo, Pandora, Bafokeng - Rasimone, Bokoni.
Thermal Coal’s two significant joint ventures, namely,
Mafube Colliery and Cerrejon Coal have been
included.
14.4
Do you engage with any of the elements of your value chain on GHG emissions and climate change strategies? (Tick all that
apply)
Yes, our suppliers
Yes, our customers
Yes, other partners in the value chain
14.4a
Please give details of methods of engagement, yourstrategy for prioritizing engagements and measures of success







We are in the second year of our 10-year climate change strategy. The potential gains to our business in implementing
this strategy include:
Reduced exposure to emerging carbon policies and increases in energy costs
Improved ability to influence the development of effective government policy
Increased access to opportunities in our markets
Greater resilience to the physical impacts of regional climate change.
To realise these gains, we are focusing on driving operational excellence, investing in technology, and engaging and
partnering with our stakeholders.
Achieving our long-term milestones in energy management hinges on identifying and implementing innovative, stepchange technologies. We are researching many opportunities with key stakeholders, and we have invested nearly $200
million to date in low-carbon and energy-efficiency research and technology development, including $15 million in 2012.
Our technology vision is to run cost-efficient, low-carbon (if not carbon-neutral) mines by 2030. Our approach focuses on
three areas:
Reducing how much energy we use
Recovering and re-using some of that energy
Using alternative energy sources.
In parallel, we continually investigate opportunities for carbon offsetting. Anticipated developments include energy-efficient
options for energy intensive haul trucks and materials lifting activities. Innovative projects include harnessing and re-using
the energy generated from braking systems, as well as reducing road rolling resistance to improve vehicle efficiency. We
are working with key suppliers to design and develop alternatives to trucking. At Platinum in South Africa, we are piloting a
demonstration prototype slurry pump to save pumping costs, while a gravity pump is being demonstrated in our Copper
operations in Chile. In 2012, we also funded research into alternatives to copper ore milling, which is one of our biggest
energy consumers.
Our longer-term research areas include using liquefied petroleum gas (LPG) and methane capture to power trucks,
introducing clean-coal technology, and piloting platinum based fuel cells as an alternative power system for underground
locomotives.
14.4b
To give a sense of scale of this engagement, please give the number of suppliers with whom you are engaging and the
proportion of your total spend that they represent
Number of suppliers
% of total spend
Comment
14.4c
If you have data on your suppliers' GHG emissions and climate change strategies, please explain how you make use of that data
How you make
use of the data
Please give details
Identifying GHG
sources to
prioritize for
reduction actions
Each business unit is/has conducted scope 3 emissions assessments and are/have engaged with
their respective value chains. Our thermal Coal, Platinum and Kumba Iron Ore business unit have
completed their assessments and have begun to prioritise where emissions reduction activity can
be applied. Anticipated developments include energy-efficient options for energy intensive haul
trucks and materials lifting activities. Innovative projects include harnessing and re-using the energy
generated from braking systems, as well as reducing road rolling resistance to improve vehicle
efficiency.
Further Information
Scope 3 assurance was only sought by our Platinum business unit.
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Dorian Emmett, Group Head of Safety and Sustainable Development
CDP