Climate Change Data

First Quantum Minerals Ltd.

Climate Impact & Sustainability Data (2020, 2023)

Reporting Period: 2020

Environmental Metrics

Total Carbon Emissions:4,259,000 tCO2e/year (2020)
Scope 1 Emissions:3,732,000 tCO2e/year (2020)
Scope 2 Emissions:527,000 tCO2e/year (2020)
Renewable Energy Share:79% of purchased electricity consumption in Zambia (2020)
Total Energy Consumption:23,096 TJ/year (2020)

ESG Focus Areas

  • Climate Change

Environmental Achievements

  • Reduced GHG emissions by almost 100,000 tonnes CO2e at Zambian operations in 2020 through innovations in mining technologies.
  • Expansion of Cobre Panama operations to be powered by renewable energy by 2023, saving approximately 70,000 tonnes of CO2e per year.

Social Achievements

  • Maintains strong links with host communities through regular engagement; undertakes initiatives to assist in the availability of key resources such as water and access to education and training.
  • $6.7 billion investment in Cobre Panama mine resulting in approximately 34,000 direct and indirect jobs for Panama.

Governance Achievements

  • Established an Environment, Health, Safety and Corporate Social Responsibility (EHS&CSR) Committee responsible for reviewing and monitoring climate change risk management policies and processes.
  • Integrated internal carbon pricing into new project evaluation process.

Climate Goals & Targets

Medium-term Goals:
  • Reduce absolute GHG emissions by 50% by 2030.
  • Reduce GHG intensity of copper mined by 50% by 2030.
Short-term Goals:
  • Reduce absolute GHG emissions by 30% by 2025.
  • Source alternative supply options of up to 50% of energy currently provided by Panama power station with renewable energy by 2025.

Environmental Challenges

  • Potential failure of tailings storage facilities due to increased rainfall or extreme weather events.
  • Increased intensity or frequency of extreme weather events impacting mining activities and health and safety.
  • Supply chain disruptions due to extreme weather events.
  • Power supply disruptions in Zambia (hydroelectricity dependent) and Panama (vulnerable power line infrastructure).
  • Adverse impacts of changing weather patterns on host communities in Zambia.
  • Stricter regulations and carbon pricing related to GHG emissions.
  • High costs and risks associated with transitioning to new technologies for decarbonization.
  • Shifts in customer preferences and increased stakeholder concerns regarding GHG emissions.
  • Potential reduction in capital availability due to sector stigmatization and pressure to decarbonize.
Mitigation Strategies
  • Regular scenario modelling and planning for extreme weather events in tailings management.
  • Implementation of health and safety procedures to minimize the impact of extreme weather events.
  • Active management of key supplies and engagement with host governments on infrastructure maintenance.
  • Engagement with local and national governments on power supply and exploration of alternative renewable sources.
  • Strong community engagement and initiatives to enhance resource availability and farming techniques.
  • Regular engagement with government authorities on regulatory changes.
  • Focus on mining and processing efficiency projects to reduce emissions.
  • Long-term contracts for power offtake and self-supply opportunities.
  • Engagement with OEMs to monitor availability of low-emission mine fleet technologies.
  • Prioritization of trolley-assist and electrification of pit machinery.
  • Commitment to reduce reliance on high-carbon fuels for power generation.
  • Price monitoring and offtake agreements for key inputs.
  • Transparency in reporting and engagement with stakeholders on climate change strategy.

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks
  • Increased rainfall and variability impacting tailings storage facilities
  • Extreme weather events impacting mining operations and infrastructure
  • Supply chain disruptions due to extreme weather
  • Power supply disruptions due to changes in rainfall (Zambia) and vulnerable infrastructure (Panama)
  • Adverse impacts of changing weather patterns on communities
Transition Risks
  • Stricter regulations and carbon pricing
  • High costs and risks of transitioning to new technologies
  • Shifts in customer preferences
  • Reduced capital availability due to sector stigmatization
Opportunities
  • Increased demand for copper in clean energy technologies
  • Opportunities for cost savings and improved efficiency through decarbonization
  • Premium pricing for low-emission products

Reporting Standards

Frameworks Used: TCFD, GRI, CDP

Reporting Period: 2023

Environmental Metrics

ESG Focus Areas

  • Sustainability
  • Greenhouse gas emissions reduction
  • Water management
  • Community engagement

Environmental Achievements

  • Upgrade of the Kansanshi smelter to increase processing capacity, which reduces downstream greenhouse gas emissions from the transport and refining of copper concentrate produced by Kansanshi and Sentinel
  • Expansion of trolley assist infrastructure across the Zambian operations to lower diesel consumption and associated mine fleet greenhouse gas emissions
  • Relocation and installation of in-pit crushers at the Zambian operations to optimize haul cycle efficiency and reduce mine fleet diesel consumption
  • Water initiatives at various operations for the management of water quality and reuse by operations

Social Achievements

  • Investments at Trident to enhance the social infrastructure serving both our workforce and local communities
  • Community engagement in relation to the La Granja development project in Peru

Governance Achievements

  • Dividend suspension
  • Capital expenditure reductions
  • Operating costs and other reductions
  • Working Capital reductions
  • Asset and stake sales
  • Financing activity

Climate Goals & Targets

Environmental Challenges

  • Suspension of production at Cobre Panama due to operational issues
  • Lower throughput and grades at Zambian sites
  • Inflationary cost increases driven by higher shipping rates, steel prices, power costs, labour rates and general inflation
  • Weak nickel market conditions
  • High operating costs at Ravensthorpe
Mitigation Strategies
  • Decisive action to conserve capital, lower costs and strengthen the financial position
  • Cost saving initiatives, including a change in strategy at Ravensthorpe to temporarily remove higher cost production
  • Reductions or re-phasing of planned capital programs by approximately $400 million in 2024 and $250 million in 2025
  • Targeting reductions in working capital requirements and savings in the procurement of materials, supplies and third party service costs
  • Exploring the sale of smaller mines and interests in its larger mining assets
  • Commenced discussions with banking partners to address and extend bank loan facilities

Supply Chain Management

Climate-Related Risks & Opportunities