Sustainability website / Environment / Policy and approach

Policy and approach

Policy and approach / Performance and goals

Our aim is to preserve the long-term health, function and viability of the natural environments affected by our operations. Xstrata’s Sustainable Development Policy sets out our commitment to identify, analyse, evaluate and eliminate or otherwise treat all significant potential and actual impacts of our activities and operations on the environment, biodiversity and landscape functions. Appropriate education and awareness about the environment, biodiversity and landscape function is provided to relevant personnel using specialist advice as required. Every managed operation is independently audited at least once every three years, dependent on risk and performance, against Xstrata’s Sustainable Development Policy and 17 Sustainable Development Standards. Xstrata’s Sustainable Development Framework has been designed to provide assurance to the Board that the performance and systems in place at our operations are consistent with Group expectations and a number of international standards, including ISO14001 and the ICMM principles. A document mapping Xstrata’s framework to international standards is available from the Xstrata website.

(see SD Management Standard 10: Environment, Biodiversity and Landscape Functions and SD Management Standard 13: Life Cycle Management – Projects and Operations).

Xstrata’s operations and projects span 18 countries and a wide variety of natural environments with varying degrees of ecological sensitivity. The Group’s key environmental impacts are:

• greenhouse gas emissions, primarily from methane emitted during coal mining and indirect emissions from energy use;
• use of scarce natural resources in particular water and energy;
• potential impacts on biodiversity and landscape functions, e.g. impact on ecosystems, watershed management, control of soil erosion;
• product responsibility (for example the carbon liability of the Group’s thermal coal production);
• waste and tailings management;
• emissions to water and air (for example sulphur dioxide emissions from metallurgical smelting operations); and
• closure and closed site management.

Other key environmental challenges and opportunities include:

• the potential impacts of climate change on our business including from changes to legislation or regulation and physical threats;
• increased demand for Xstrata Technology’s products and services to improve the efficiency, cost and environmental profile of mining and metals operations;
• Xstrata’s recycling business enables the re-use of waste metal to generate additional revenue and extends the life cycle of metals, including recycling electronic scrap to eliminate an increasing source of landfill waste.

Performance and goals

Policy and approach / Performance and goals

SD Assurance programme

In 2007, 33 assurance audits were carried out, including baseline audits at five former Falconbridge copper operations and four Xstrata Nickel projects. Excluding the acquired Falconbridge operations and projects, the average score of the 24 sites audited in 2007 against SD Standard 10: Environment, Biodiversity and Landscape Functions was 79%, just below the ‘good’ level (>_80%). The acquired operations achieved lower average scores in this standard (below the ‘satisfactory’ level) and detailed action plans are being implemented to address environmental performance and systems.

Environmental incidents

Environmental incidents represent the number of uncontrolled incidents that occur at or as a result of our managed operations. Reducing the number of environmental incidents that occur is an indicator of our success in achieving our aim of eliminating, mitigating or remediating the environmental impacts of our activities. All managed operations record environmental incidents on a scale of one to five according to the severity of environmental impact, defined in the table on this page. High potential risk incidents (including ‘near-misses’) are also reported by every operation and include any environmental incident which could have led to a category 4 (serious) or category 5 (disastrous) incident. Every incident is investigated and reported to the Executive Committee, Board and all HSEC and environmental managers across the Group, to facilitate learning from near misses.

Our target is to reduce the total number of incidents with no category 3, 4 or 5 incidents each year. In 2007, the total number of environmental incidents increased from 1,143 in 2006 to 1,418 in 2007. The increase in overall environmental incidents corresponds to the increased scope and scale of the Group in 2007 following the acquisition of Falconbridge in 2006. On a like-for-like basis, stripping out the impact of acquisitions in 2006, total incidents decreased by 8%.

No category 4 or 5 incidents (major or disastrous) have ever occurred at Xstrata’s operations or projects. In 2007, 11 category 3 incidents occurred, compared to 23 in the previous year.

As in the previous year, stormwater discharges off site at Mount Isa Mines in Australia remained a significant cause of category 3 incidents (5 reported in 2007, down from 12 in 2006). A three-year plan commenced at Mount Isa in 2007 to upgrade stormwater and containment facilities and prevent uncontrolled incidents. Approximately A$1 million was spent on the Death Adder Gully Project, which commenced in November 2007, and other dam works to manage stormwater events more effectively. High levels of rainfall in the region in 2007, which exceeded the ten-year average, also contributed to system overflows and these issues are being addressed as part of the three-year project.

Copper concentrate spillages occurred off-site at Ernest Henry mine in Queensland, Australia due to vehicle roll-over incidents and at Alumbrera mine in Argentina due to a failure in the concentrate pipeline. Flash flooding in the Dominican Republic following Tropical Storm Noel led to a spillage of ferronickel. A breach of air emissions (SO₂) limits at the Mount Isa copper smelter occurred in 2007 due to rapidly changeable wind direction and changed characteristics of the plant as part of ongoing improvements in emissions control. Emissions controls have been improved to account for the impact of the amended plant design. A three-year Smelter Emissions Project was launched in 2007 to address SO₂ emissions at Mount Isa Mines (see Air Emissions).

Environmental fines

One fine of US$600 was incurred at the Tampakan copper project in the Philippines in July 2007. The fine was issued by the Department of Environment and Natural Resources and related to the construction of a new coreshed at the Liberty barangay without an environmental compliance certificate in October 2006 by Sagittarius Mines, prior to Xstrata gaining management control at the end of March 2007. The compliance certificate has since been issued.

Environmental awards

In July, Xstrata Copper’s Tampakan project in the Philippines received the Department of Environment and Natural Resources’ (DENR) Region XII Outstanding Achievement in Environment and Natural Resources Award. This award was in recognition of the project’s “exceptional contribution to the advancement, management, advocacy, conservation, preservation and development of the environment and natural resources concerns in Region 12.”