05 Feb Does climate change matter for the mining sector in Africa? An Indaba.
January 2020 – Africa needs better stewardship of its natural resources to limit adverse social and environmental impacts, enhance linkages with domestic economies, and ensure equitable resources access and utilization. Better natural resources governance will enable countries and communities to extract greater social and economic value from the development of their natural assets. Governance reforms will become a perquisite. The long-term objective of such governance reforms will be to improve development outcomes from the sustainable use of renewable and non-renewable resources. This requires deepening knowledge of natural resource management through better analytics and policy support in order to create the ecosystem for sustainable development. As an example, the mining sector could take advantage of development associated with technology – the so called fourth industrial revolution (4IR) – mitigate and adapt to climate change.
Mined resources and climate change: The natural resources sector is both a cause and a victim of climate change. As an example, mining is energy-intensive and a major emitter of greenhouse gases. Total carbon dioxide emissions vary across the industry, largely depending upon the type of resource mined, the design and nature of the mining process adopted. Over time mining deposits become increasingly deeper and of declining ore grade. This results into growing demands for water and greater mine waste, thereby raising energy consumption, and increasing the industry’s climate footprint. Recent enhanced scrutiny of the industry’s carbon emissions and the deepening in climate negotiations are increasing pressure on mining companies to explore ways to reduce their emissions, for example by using renewable energies.
Conversely, a changing climate will have both direct (operational and performance-based) and indirect (securing of supplies and rising energy costs) impacts on the mining activities. Increasingly a number of these impacts may cross-fertilize to potentially result in newer, more complex arrangements of second-order impacts. Underlining these risks is the fact that some of the Africa’s largest mining operations currently operate in remote, climate-sensitive regions like in the Eastern DRC. The associated reputational risks to concerned mining companies and their socio-political capital to operate may be fatally damaged. These risks and the absence of a concerted industry-wide approach to adapt to and mitigate climate change may undermine investor confidence and impact insurance offerings over the long-term.
As recent mining Indaba discussions suggests (https://www.miningindaba.com/business-programme), for the case of non-renewables natural resources, there are real prospects of stranding (of carbon assets) whereby African countries many incur a structural and economic risk due to decarbonization and pressure for transition to clean energy. Yet there are opportunities for the continent to create new industries and markets for this low-carbon transition. They can do so by focusing on increased production of minerals that serve as critical inputs in the manufacture of low-carbon technologies (or ‘strategic minerals’). 4IR offers an opportunity to minimize the carbon footprint of extractive industries through carbon capture and sequestration, emissions control, and operations that are more efficient. For the renewables, the onset of climate change is degrading the continent’s forests, land, water and fisheries. This has immense implications for food and energy security, population displacements and more broadly, sustainable socio-economic development. There are also opportunities in the renewable sector for climate change mitigation – such as carbon capture and storage. Clearly climate change risks can trigger innovation and some of this innovation has begun to take place already, albeit mainly to reduce costs.
The extractives sector plays an indispensable role in the economic development models and plans of many regions and countries – thus the need to make the connection between climate change and natural resource development and associated vulnerability to climatic shifts. Climate change risk further aggravating natural environmental conditions and disrupt resource-dependent livelihood generation, including herding, agriculture and fisheries. Moreover, limited technical and financial resources pose a challenge for current efforts to adapt to a changing climate. Therefore, it is important that the role of the extractives sector in a broader development context, including its complex interlinkages with a changing climate is better understood and incorporated in long-term policy and strategic decision making.
Experience and data suggest that increases in the intensity and frequency of extreme weather events, changes in the distribution of precipitation and warmer temperatures will adversely affect mining and wider sector. As the climate continues to change, the Africa’s mining and wider natural resources sector needs to recognize these changes, understand how the changes will impact them and develop adaptation strategies to minimize negative impacts to infrastructure and operations. Research on industry perspectives in Canada by Ford et al[1] indicates that climate change is an emerging concern for the mining industry, but limited action has been taken to plan for or adapt to changing conditions. As examples, mining infrastructure is vulnerable to changes in climate and weather, as these have the potential to affect buildings and built structures, slope stability, tailings and water retention structures, and site hydrology. Equally, transportation infrastructure may be affected. Land-based transportation routes could face risks collapse from flooding including road embankment instability and accelerated erosion. Road networks will also be compromised, as a warming climate will make it more difficult to maintain bitumen surfaces to support heavy traffic flows.
The call to climate action: Africa must develop low-carbon pathways (LCP) for the natural resources sectors. Currently, few programmatic interventions address climate vulnerabilities in the continent’s natural resource sectors. It is paramount to adopt a holistic, integrated approach to the analysis of low-carbon development pathways for Africa’s natural resource sector by providing the evidence to drive low-carbon transitions agenda on the continent.
Under the Paris Climate Accord, African countries have committed to lower greenhouse gas emissions and pursue economic decarbonization through nationally determined contributions (NDCs). The Sustainable Development Goals (SDGs) also call for concerted climate action and low-carbon transition through the transformation of natural resource production, supply chains and consumption. Equally, homegrown solutions such as Agenda 2063, the Africa Mining Vision (AMV) and the Africa Continental Free Trade Area (AfCFTA) have collectively set out a roadmap for resource-based transformation and regional economic integration. It is important to holistically examine the risks and opportunities posed by climate change for Africa’s renewable and non-renewable natural resources. The analysis will identify the policy options and strategies for African countries to mitigate and adapt to the climate risks facing the natural resource sectors. Africa must understand that climate change will have a multiplier effect on supply chain risks by adding to the complexity and increasing or altering existing risks. Since a large and increasing number of extractive resources come from developing nations which already lack resources for climate adaptation, there is an increasing need to undertake robust measures to ensure that supply chains are climate-resilient and smart.
Rethinking sector strategies and responses: To address climate change risks and contribute to sustainable and inclusive development, there is need for a more strategic policy approach. Four are briefly outlined here:
- Climate smart minerals policies and the security of supply strategies: How climate change will impact individual mining areas must be critically studied and data availed. Data gaps and weak assessments are usually mirrored in minerals policies and resource strategies void of climate risks. The first step is to include climate change risks any assessments and get the identified risks reflected in minerals and resource policies. In general, these strategies should put more emphasis on long term security of supply strategies.
- Enhanced social and environmental standards in the natural resources sector: There are an increasing number of standards and initiatives to enhance the sustainability of the sector including EITI and the AMV. These resource governance reforms are a good starting point to address climate risks and augment the resilience of the sector and afford an opportunity for stakeholders to take proactive actions in improving global social and environmental standards. This would include promoting the ratification and implementation of existing international conventions and standards that are important for the extractives sector, implementing these standards at home and supporting the implementation as part of bilateral and multilateral development cooperation.
- Support national and regional voices on responsible mining: The natural resources sector can – if responsibly managed – contribute to economic growth and development. However, it is often accompanied by the risk of corruption and conflicts with other sectors and population groups being edged out as beneficiaries. Dialogue forums, transparency initiatives, consultations prior to decision-making and early information, for example in the form of independently conducted environmental and social impact assessments, can help to improve resource governance and address many of these risks. The European Commission has been active in establishing dialogues with the EU’s strategic partners for raw materials, and Germany has established several “resource partnerships” with different countries. These partnerships and other diplomatic modes of engagement could be used to have a broader debate on the role of extractives in sustainable development on the African continent; and
- Strengthen resource-climate diplomacy: Given the link between extractives and climate change, this provides a critical entry point for a larger debate on environmental and social standards in mining, and deeper engagement on climate change in general, with countries that ignore climate change as a policy priority. Natural resources can be used to link climate change to the broader development discourse of a country or region. Conversely, in countries or regions in which climate change is already part of a larger discourse on how to transform economies and societies towards more sustainability, climate change impacts on the natural resources/mining sector could add another important perspective. Africa needs to leverage its natural resources endowments to extract concessions in climate change negations and related actions.
[1] Ford, J., Pearce, T., Prno, J., Duerden, F., Berrang-Ford, L., Beaumier, M., Smith, T., and Marshall, D. 2010. Perceptions of climate change risks in primary resource use industries: a survey of the Canadian mining sector. Reg Environ Change. 10(1):65–81