The need to counter climate change is raising a whole range of important issues for mining services companies, which, in comparison with the mining groups they served, are small in scale. This was highlighted at a function, hosted by environmental consultancy Digby Wells on the fringes of the Investing in African Mining Indaba 2024 conference in Cape Town, by UK-based mining services company Capital Limited Group sustainability manager Stuart Thompson.
He pointed out that mining services companies lacked the financial resources to undertake significant and rapid decarbonisation. Yet, they were under increasing pressure from the mining groups to cut their emissions. Those mining services companies, such as Capital, that were listed on the London Stock Exchange (LSE), were also being pressured from that side regarding their climate actions. On the LSE, there was no separate category for mining services companies; they were grouped with the mining groups and were required to meet the same standards as the great mining houses.
But there were lots of important details that had to be worked out. Where did the mining company’s responsibility for carbon emissions end, and that of the mining services company begin? For example, the fuel used by mining services companies to power their vehicles, drill rigs, and on-site generators, was often provided by the mining company, as part of the services contract. So, were the resulting emissions the responsibility of the miner or the service provider? A lot of negotiations were needed to settle these issues, he observed.
Mining services companies lacked the financial depth to fund research and development into zero-emission equipment and systems by the original equipment manufacturers (OEMs). Further, he noted, there was the conundrum of what technology should be adopted: electric? Hydrogen?
Capital itself had adopted the combination of solar photovoltaic (PV) power and batteries to provide power to its deployed operations. Campsites, other sites, laboratories, and lighting were all now powered by solar energy by day and batteries by night. The company was also starting to use electric vehicles as light vehicles.
But its drill rigs and heavier vehicles still relied on fossil fuels. OEMs had started the development of electrically-powered drill rigs and other equipment. But the mining services companies had to wait for the completion of their development, trials and testing processes, and start of production, before they could acquire them – processes which would take several years. And, in parallel, it would be necessary to create solar PV systems which could recharge them, on site.
In the interim, an affordable and practical approach whereby mining services could reduce their carbon emissions was to optimise their operations, he highlighted. Optimisation would increase efficiency, reduce waste, reduce fuel expenditure and reduce carbon emissions. It would also save the companies time.
But, for mining services companies, carbon offsetting was the only way they could meet the required short-term carbon emission reduction targets. And that meant collaboration with other companies and other entities.