Climate Change Puts Mining Companies in Catch-22

As countries around the world work to reduce carbon dioxide emissions in an effort to slow global warming, the extraction of metals such as cobalt, nickel and copper grows even more important. Forecasts from the World Bank estimate that by 2050, the demand for minerals and metals needed to produce clean energy in order to meet the objectives set under the Paris Agreement will have grown by close to 500%.

This surge in demand is expected to affect nature and biodiversity negatively, however, with Re:wild warning that over one-third of great apes in Africa were at risk due to increased demand for minerals essential for green technologies. Simultaneously, one study determined that the mining sector was becoming more vulnerable to the impacts of climate change. The study noted that almost 50% of production for gold, copper, zinc and iron ore are in high water stress areas, highlighting that this was expected to increase.

The study, conducted by McKinsey, explained that 40% of iron ore produced in Russia would suffer from extreme water stress by 2040. This situation was predicted to be the same in Chile, where 80% of copper production is located in areas with high water stress. By 2040, the consultancy expects 100% of copper production to be affected.

In other news, mines in different parts of the world have had to close down temporarily due to water shortages, which has cost operators millions.

To improve the resilience of production assets, mining operations will have to decrease water intensity. Experts also note that the rising of sea levels and extreme heat are other impacts of climate that the mining sector will have to address. In addition to this, the sector continues to deal with pressure to reduce emissions as businesses globally and examine the carbon impact of their supply chains.

To help with emissions reduction, the mining sector is expected to electrify its operations, not just by employing the use of renewable energy but also by replacing diesel-fueled vehicles with alternatives powered by fuel cells or batteries, or using hydrogen, LNG or e-fuels. It is also expected that machine learning and AI shall be used to streamline operations and identify opportunities to reduce emissions. Additionally, the use of autonomous fleets may be employed to improve efficiency of mining operations.

The demand for coal is expected to drop as the pressure to decarbonize intensifies, with many mining companies trying to find ways to replace revenues generated from the production of coal. At the moment, coal, which makes up almost one-half of the global mining market, is performing well.

As businesses such as First Tellurium Corp. (CSE: FTEL) (OTCQB: FSTTF) continue mining green-energy metals and availing them for use for innovative technologies, it could become easier for players in the mining industry to decarbonizes while also minimizing the impact of their activities upon the environment.

NOTE TO INVESTORS: The latest news and updates relating to First Tellurium Corp. (CSE: FTEL) (OTCQB: FSTTF) are available in the company’s newsroom at

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