Improving Quarry Sustainability

Overview

Sustainability is increasingly the focus of investors and the community alike. Increased cost of capital and public outrage expressed against companies with poor ESG records are becoming more and more common and there is an ever increasing demand not only action to be taken but to ensure that companies have a clear plan. A recent article in the Australian Financial Review noted:

“ESG is likely to undergo a journey similar to workplace safety - change will only come from strong leadership, better processes and a fundamental shift in culture from the boardroom to the front line.” (AFR 30 Mar 2021).

Sustainability is not an option

Sustainability is not an option for any company - it is more a case of when these initiatives are wholeheartedly embraced, not if.

"A coalition of the world's biggest investors will push companies to align capital spending with emissions reduction pledges after determining that none of Australia's biggest emitters have climate targets fully aligned with the goals of the 2015 Paris Agreement." (AFR 23 Mar 2021)

and per the Macquarie Bank 2020 ESG Ratings Report:

"The basket of companies with the highest ESG scores has outperformed the bottom basket since the inception of our survey in 2011. There is a strong relationship between revisions to ESG scores as a signal for future performance. Companies with the largest positive revisions to their ESG scores have delivered better returns than those with negative revisions, by 5.1% on an annualised basis."

Decarbonisation of the quarry industry will need to be addressed by multi-national and local industry players alike?to improve their performance and meet ever more stringent sustainability criteria.

Quarry sustainability is possible

Our experience shows that significant CO2 reduction is possible in most operations through the techniques identified below.

What can be done about it?

Emissions within quarrying can be broken down into three broad types:

• Scope 1 (from diesel)
• Scope 2 (from electricity generation)
• Scope 3 (from supply chain and transport)

Options to reduce Scope 1 emissions

Multiple efforts are required to address the main sources of emissions, including better resource definition and extraction planning, operational efficiency improvement, new drive-train technology and a switch to green electricity.

Improve resource definition and extraction planning

Probably one of the best ways to reduce Scope 1 emissions is simply not to dig up material that is not economic to extract. The use of?resource optimisation?and?scheduling?tools ensures that there is a viable extraction plan for the deposit that:

• Clearly identifies what is economic to extract and the stages to extract it
• Reduces overburden movement (and double-handling)
• Ensures that there is a clear picture of what areas need to have vegetation removed and which can to be?rehabilitated
• Budgets not only operational and capital expenditure, but the estimated?CO2 impact of the plan

You need to to baseline your extraction operations, work out how improved resource definition and extraction scheduling/planning will improve sustainability and provide estimates on how CO2 kg/tonne will be reduced accordingly.

Improve operational efficiency

Significant improvement in operational efficiency can be achieved in a range of ways such as:

• Providing a link between strategic resource planning to?operation plans
• Ensuring that load and haul fleets are matched to production requirements
• Loading haul trucks to the correct payload
• Not double handling material
• Eliminating unnecessary idling and unproductive use
• Upgrading equipment to more fuel efficient models

Central to all improvement actions are the need for robust data collection and analysis using agnostic?quarry information systems?that can pull data from a wide range of sources. This ensures that at all times, we can monitor emissions vs. plan and identify opportunities for improvement.

Drivetrain advances

To become fully carbon neutral, a change in drive train technology is required. We believe that there is significant opportunity for the use of electric and particularly,?electric autonomous haul trucks?in quarries.

By way of example:

The Volvo CE Electric Site pilot conducted during a ten week period at a quarry in Gothenburg, Sweden as a partnership with construction company Skanska. The pilot included electric and hybrid autonomous vehicles and the resulted in up to 98% less emissions of CO2.?

We are actively involved in research and collaboration in this field with leading players in this field.

It is worth noting that work done to improve resource optimisation, extraction scheduling and detailed planning is a vital part of this evolution and one that we have now been working on for some years.

Sustainable fuels

Options exist for mobile equipment to switch to liquid sustainable fuels (biofuels or synfuels) with the potential to decrease carbon emissions by 70%, while using existing equipment and infrastructure.?

How is it done?

Before anything else, you want to?have a clear idea of what you are trying to achieve?and once decided,?resource and support it?until it "grows root" in your business.

We find there are four distinct phases these types of transformations go through:

1. Carry out?Resource optimisation?and?scheduling?to ensure economic viability of extraction
2. Adopt?Digital transformation?techniques (see diagram below) to ensure effective collaboration and a single source of truth
3. Implement a?Quarry information System?to ensure that the data needed for good decision making is available and consumable - this provides an accurate baseline and way to measure progress.
4. Put in place an effective rolling quarterly?Quarry Operations Plan?to reduce wasted time and resources

These initiatives are "front loaded" in terms of time and resources and our experience is that even if you have your own technical team, our assistance is vital to help manage the upfront workload and help you avoid known pitfalls. This said, a vast majority of these initiatives will not only improve sustainability, they will reduce operating costs as well, making them self-sustaining.

Lastly, it is important to find champions within the business who can work with us and help ensure that this initiative becomes a part of your business.

There are solutions to help move quarries to net zero and we look forward to being your partner.

For more information, please contact Steve Franklin on [email protected] or +61 474 183 939.

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