Sustainability in Mining: The Billion Dollar QuestionWed, 10/21/2015 - 08:27
Sustainability can be defined as maintaining productivity practices by using local resources without affecting or degrading the original condition of social and ecological systems, including the air, water, and land. Sustainability is achieved by managing four key development variables: economic growth, environmental control, social responsibility, and applied innovation. Without knowing the complexity of the meaning of “sustainability”, humans have survived and flourished since the dawn of civilization thanks to basic sustainable practices. The supply of minerals, such as tin, copper, lead, iron, and coal was maintained due to the development of the mineral extractive method known as mining. Mining has since then flourished as one of the primary activities for human survival. The necessity to secure the supply of raw material for manufacturing, as well as for energy generation, drove humans to explore and settle in sometimes inhospitable regions of the world, bringing with them economic progress to these early human settlements. We then developed education, a new sustainable mechanism to transfer this knowledge through time from one generation to the next through instruction and training. However, for our civilization, learning how to supply basic goods, such as food and raw materials needed for manufacturing, was not enough to secure survival. Population growth and constrained resources produced the need to advance common methods of agriculture and mining through innovation.
Innovation is then another form of sustainable development that could be defined as the result of a continuous strategy to improve current practices, methods, and technologies. This continuous improvement has been accomplished for centuries by two simple practices: effective education and applied research. Even though it was not originally recognized as a formal development strategy, sustainability was heavily practiced in different forms as a logical response for survival and the preservation of human civilization. For millennia, we have learned and mastered how to sustain the supply of raw material, feeding our economic markets with minerals and maximizing profits based mainly on production-driven strategies. Today, however, successful sustainability in the minerals industry needs a new approach based not just on production-profit goals but on a new and augmented production strategy aimed at achieving the sustainable well-being of local and regional communities.
This can be accomplished by adopting economic-inclusive strategies among regional stakeholders to secure a successful mining enterprise. More importantly, these strategies can ensure economic growth among the local communities during and after the life of a typical mining operation: geological prospection and exploration, mine development and production, and, finally, mine closure and reclamation. Interestingly, this particular definition of sustainable development in mining is gaining momentum not just among governmental agencies or NGOs, but from the private minerals industry itself.
In the last five years alone, several major mining investment initiatives around the world have been compromised, heavily delayed, or canceled. Countries with significant mining economies like Peru, Chile, and Colombia saw a mineral-rent index reduction of 24% between 2007 and 2012, according to the World Bank’s 2014 economic indicators. Considering that mineral-rent is defined as the difference of value of mineral production at world prices versus the total cost of production, measured as a percentage of the country’s GDP, a 24% decline represents about US$57 billion dollars of revenue that was never realized. From this amount, around 40%, or US$23 billion, was mainly attributed to political, social, and environmental factors, as reported by the Fraser Institute. This decrease in successful mining initiatives may be attributed to the lack of modern sustainable development and innovation strategies that will guarantee the preservation of local ecosystems and the sustainable economic growth of the region well beyond mining activities. Furthermore, the minerals industry worldwide is now facing a new PR challenge. For the first time, previously isolated regional mining communities can now share information almost in real-time. That is why, more than ever, a clear and sound environmental and socio-economic comprehensive mine plan must be implemented during the early stages of any minerals investment initiative and must be properly shared with regional stakeholders. In order to succeed, the mining industry requires an awareness of the transitional use of local ecological services.
This new strategy must be supported by innovative mining legislation as well as by the latest advancements in mineral extraction and environmental engineering. Today’s mining activities must adapt to a new culture where local ecological systems and services are simply borrowed from the planet. Sustainable mining development is no longer about simply maintaining the supply of minerals. That stage passed decades ago and we must now face the new challenge: finding best practices that can preserve that supply while ensuring the well-being of our communities.