Potential climate change could have significant impacts on our assets. Market volatility related to climate risks are likely to increase and be on the agenda of investors. To this end, our Climate and Energy Management systems form the heart of our mitigation approach and include an Energy Efficiency Programme to improve how we plan our energy use through better monitoring, metering and reduction.
We have set the goal to decrease GHG emission intensity by at least 5% by 2023 compared to 2018. In order to achieve this target, we improve energy efficiency through innovation, including low carbon and renewable energy technologies. We embed energy efficiency into new project design, technology updates and in equipment procurement processes, and engaged with suppliers to estimate upstream emissions and well as with off-takers to assess downstream carbon footprint.
By 2025 our target is to achieve 7% of renewable energy of the total electricity generation.
We regularly assess and monitor climate related risks at all our sites, the last estimation did not reveal any risks with significant impact on our business.
As opposed to seasonal frost where the ground thaws periodically, permafrost is comprised of soil, rock or sediment that remains permanently frozen, varying from a few meters to several hundred meters in thickness. Permafrost has a top active layer that thaws seasonally during the warm season and freezes again in the winter.
Degradation of permafrost means that a portion of the active layer does not refreeze during winter.
Most Russian territories, including the Far North and adjacent areas of Siberia, Far East and Northern European zone of Russia, which in total cover nearly 64% of the country, have sub-arctic and arctic climates with severe and long winters. Average winter temperatures range from minus 15 oC to minus 20 oC in Northern European zone of Russia and from minus 40 oC to minus 50 oC in the Northern parts of Eastern Siberia which, together with a short warm season, represent conditions conducive for permafrost to form.
Mining in such severe climates presents unique geotechnical challenges. The effect of permafrost on the rock matrix is a key engineering concern. In the cold weather, ground conditions are impacted by both permafrost and seasonal frost. Seasonal freeze-thaw cycles present unique challenges for the construction of roadways and surface infrastructure.
Yes, four of our operating assets (Mayskoye, Dukat, Omolon, Svetloye) and two development projects (Nezhda and Prognoz) are located within the permafrost zone, representing 36% of our total reserves (9.0 Moz of 25.2 Moz) — see map below.
We fully recognise that global climate changes require us to be more vigilant, and we are on a path to eventual carbon neutrality. We now use electrified equipment in our open pits and underground mines, generate renewable energy and we are gradually taking steps towards enhancing our energy efficiency. We are involved in a power line construction project for Nezhda to replace six diesel power plants and we are building a new solar plant for Omolon. In addition, we report on our energy and GHG profile together with TCFD disclosure in our Sustainability Reports.
The key risk is that thawing of permafrost soils around buildings’ foundations can lead to a deterioration in their stability. This in turn could result in bearing capacity failure and deformation of building structures, unacceptable operating conditions or complete collapse of buildings and structures, leading to economic and environmental damage as well as human casualties.
The main methods of managing and potentially mitigating this risk include implementing constant ground monitoring measures and strict adherence to buildings’ and structures’ operating conditions. Both methods are set out in the project design.
Pit walls located in permafrost quaternary soils may suffer deformations equivalent to the size of one rock step (not greater than 30 m).
These processes are predicted by using calculations that are carried out by experts with extensive experience of working with permafrost soils.
Other significant risks include:
- Reduction of the operation time of winter roads and ice crossings.
- Increase in the water levels during flood season.
- Longer flooding period.
- Decrease in mine roadways’ stability.
- Decrease in the stability of open-pit walls.
- Rise in groundwater level.
We successfully mitigated the negative impact of permafrost ground thawing under the sorption shop at Birkachan, Omolon hub. The company managed to prevent any disruption and structural damage.
A technological solution was developed, the columns of the building frame were lifted and the steel structures were straightened using hydraulic jacks whilst the column bases were refilled.
The temperature of the soil surrounding the foundation and inside the building is regularly monitored with constant control over the building structures absorption. If required, our design vendor update the thawing basin model.
We mitigate the risk of accidents by complying with rules and regulations at the design, construction and operation stages.
Monitoring is a key prevention method.
Monitoring includes field observations of the condition of foundation soils, the temperature regime inside the building, and the building structure movements.
We conduct unscheduled inspections of buildings and structures during periods of maximum thawing (from August to September) and after emergencies (natural disasters and accidents).
Upon detecting any signs of thawing of permafrost ground and hazardous defects in building structures, we inform all of the involved parties and take the appropriate measures to address the issue.
Special focus is on the safety of fuel storage facilities, in particular:
- all storage facilities are designed by taking into account the peculiarities of permafrost. Raw materials for construction are selected with reference to climate conditions
- regular external and internal monitoring of facilities are conducted
- we have zero tolerance to any deviations from regulatory requirements and design parameters at potentially environmentally hazardous facilities
- the logistics of fuel and lubricants supply is carefully worked out to determine the optimal minimum volume of the stored supplies to reduce any possible negative impact
- we perform emergency drills dedicated to elimination of fuel spills at fuel storage facilities.
At mining sites (pits, underground mines), the processed ore is represented by rock formations. Rock is affected by permafrost thawing processes but even in the thawed state, rock retains strength. As part of the design work, the impact of changes in the thermal regime on the strength of rocks and the stability of open and underground workings are evaluated.
All Polymetal facilities located in permafrost areas are designed in accordance with the applicable rules and regulations and with an assumption of operating at thawed or thawing ground conditions.
At the design stage, the Company conducts research aimed at assessing the impact of the degradation of permafrost on pits, buildings and infrastructure stability. It requires complex engineering and geological surveys:
- Close engineering and exploration drill hole spacing
- Increasing drilling depth
- Thermometric drilling and permafrost rock temperature measurement
- Assessing thermophysical properties of permafrost rock in both permafrost and thawing state
- Modelling of thawing basin
- Identification of potential foundation absorbing in relation to years of operation
At the construction stage in permafrost, we apply the following solutions:
- Use of modern anti-filtration technologies with due regard for weather conditions
- Construction of a thermal layer at building foundations
- Introduction of a climate factor into the raw materials procurement process
- Selection of appropriate ventilation temperatures
- Ventilated underground space or employment of permafrost rock stabilization systems
0.5-1.7metre increase in dam’s height in order to secure permafrost rock
- Construction of enclosing structures for hydraulic facilities towards their downstream segment
- Installation of surface drainage systems.
Furthermore, in order to ensure safety of our fuel storage facilities we use the following construction solutions:
- Antifiltration foundations
- Bunding of fuel storage facilities
- Installation of fuel spill and vapor sensors with an alarm and voice alert system.
Capital expenditures at permafrost areas are 15% higher than in regular areas on average. In certain cases (i.e. waterlogged ground), capex requirements could be up to 30% higher.