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1 Take another look at your footprint

2 Energy and Emissions: Initiatives towards a more sustainable future. Orica Blast Based Services

3 Our research shows that up to a 5 10% reduction in energy and emission intensities is achievable in many mining operations.

4 ENERGY AND EMISSIONS 1 Energy and Emissions: Orica Blast Based Services initiatives Orica is aware of the reality and urgency of the climate change issue and its potential impact upon our world and on the mining industry. Our Customer research has indicated that energy and greenhouse gas emissions are the most difficult issue many of our Customers face. On the one hand, companies aspire to year upon year energy and emissions reduction targets. On the other hand, they must continue delivering economic value to shareholders through increased development. Our mandate to operate as an industry and as individual companies is becoming increasingly dependent on our accountability for our carbon footprint and environmental impact, as well as the broader tenets of sustainability including health and safety, community and culture. In response, Orica has made significant investment in developing technologies to bring about a step change in environmental performance when deployed successfully into a mining operation. Our research and scenario modeling indicates that a 5 10% reduction in energy and emission intensities is achievable in many mining operations. This may be achieved by improving the productivity of mining processes using Blast Based Services technical innovations, concurrently increasing the value of the reserve. Our approach is carefully planned in collaboration with our Customers through a site scoping study using a Value Calculator which enables us to identify where and how improvements can be made using Blast Based Services technologies. We recognise that increasing stripping ratios and declining ore grades will inevitably lead to increases in mine site energy and emission intensities; however it is possible to reduce the magnitude of these increases. Orica s Blast Based Services can deliver improved efficiencies. No one product or service provides the answer to the carbon problem, but Orica has developed processes that make it possible to achieve meaningful improvements to the mining energy and emission footprint. Orica is committed to the ongoing journey towards a more sustainable mining industry, and we will continue to invest in research and development. Orica is pleased to demonstrate how Blast Based Services can assist our Customers now in their own sustainability journey.

5 2 ORICA MINING SERVICES How do Blast Based Services help to achieve Energy and Emissions reduction targets? Improving mining productivity and profitability will lead to improvement/reduction in GHG and energy intensities. The central approach is for Orica technical specialists to evaluate a site and identify the opportunities for Blast Based Services to make meaningful changes to productivity and to improve the energy and emission intensities. The Value Calculator is a key component of Orica s proprietary software. It enables us to input site-specific mine information and quantify the potential improvements in productivity, energy and emissions intensity. The combination of technologies and processes to achieve these outcomes is site-specific and therefore tailoring to each mine will be necessary. In general the Blast Based Services philosophy of improving mining productivity and profitability could lead to improvement/reduction in GHG and energy intensities.

6 ENERGY AND EMISSIONS 3 Typical examples of how increased productivity can reduce energy and emissions: Reducing coal loss/increasing coal recovery. This can have a significant impact on the total mine emission per tonne of coal produced. Improved throw blasting outcomes, reducing GHG from dragline electricity consumption per tonne of coal produced. Improved diggability, yielding a significant increase in coal exposure rate, again reducing GHG from dragline electricity consumption per tonne of coal produced. Decreasing the number of drill and blast cycles required to recover the same amount of coal. Improved fragmentation to improve downstream mineral processing e.g. crushing and grinding. These scenarios are provided as indicative examples. In many cases, the improvements can be significantly increased by the synergistic relationships between the technologies. Site-specific forecasts (improvement plans) are made in partnership with our Customers, using the Value Calculator Software. Importantly, our BBS technologies are designed to simultaneously improve productivity, improve the energy and emission intensity and improve profitability. This is a real and long term sustainable outcome.

7 4 ORICA MINING SERVICES How do you know it works? Our energy and emissions initiatives are the result of rigorous scientific research by the Orica global technical team. Key examples include: Open cut coal throwblasting Orica has demonstrated and published case studies of side-by-side blasts that show increases of the order of 5 to10 percentage points in throw without any increase in explosives energy inputs. Comprehensive scenario modeling forecasts have been met or exceeded by the results achieved at Customer sites. Through the application of Orica s Blast Based Services, productivity improvements have been achieved which translate into reductions in energy and emission intensities of these magnitudes. Coal Recovery with Stratablast In a large Queensland operation, coal recoveries in excess of 100% were achieved in three successive strips using Stratablast. Conventionally, coal losses here and in many other mines employing throwblasting can range between 5 25%. A 10% decrease in coal loss throughout a mine will essentially increase coal production by 10% and reduce the mine s energy and emission intensities by about 10%. Detailed case studies may be found in the final pages of this publication.

8 ENERGY AND EMISSIONS 5 How do I implement Orica s Energy and Emissions initiatives? Orica s Blast Based Services specialists understand the challenges our Customers face in relation to energy and emissions. Our three phase process provides a framework to address your energy and emissions targets whilst improving profitability: 1. Pre Site Visit Discuss your energy and emissions targets, economic objectives and site-specific issues 2. Site Scoping Study Jointly analyse data and determine techno-commercial solution Validate solutions using Value Calculator Develop joint action plan 3. Implementation Joint resource allocation and delivery Your Orica Blast Based Services technical specialist will work closely with your site teams, using the Calculator as a planning tool, to identify where significant improvements can be made in productivity, energy and emissions. An implementation plan will be developed specifically for your mine site, including quantified forecasts for energy and GHG, and profitability. Orica specialist blasting and technology resources will deliver the plan together with your site team and nominated project manager. The initial forecasts from the Value Calculator will be reported against regularly. The Power of Partnership for a more sustainable future.

9 6 ORICA MINING SERVICES How is Orica addressing sustainability in its own operations? Orica aims to be among the best performers internationally in safety, health and environment. Orica has a number of priority areas in its journey towards sustainability in addition to the achievement of its public Challenge 2010 targets for water, energy, emissions and waste: In addition to the safety vision no injuries to anyone, ever, Orica aspires to become a business that does no harm to people and the environment, aiming towards: carbon-neutral water-neutral zero-waste producing; and environmentally friendly operations, products and services, in a commercially responsible way. As a diverse Australian-based business encompassing five subdivisions delivering mining services, chemicalbased consumables, consumer products, chemical services and chemical distribution, Orica has a wide-ranging view of sustainability as applied to its activities in 50 countries worldwide. Investment in new technologies to significantly reduce nitrous oxide emissions from its ammonium nitrate plants. Nitrous oxide emissions now account for more than 70% of Orica s greenhouse gas emissions and this is one of our most pressing challenges. Continued investment in research to assist our Customers to achieve step change reductions in energy and emissions. Voluntary participation in the Australian Government s Greenhouse Challenge Plus program, including monitoring and reporting greenhouse gas emissions annually.

10 ENERGY AND EMISSIONS 7 Orica s recent sustainability achievements include: Active participation in the Plastics and Chemicals Industry Association s (PACIA) Responsible Care Program aimed at improving safety, health and environmental performance and adopted by all Orica operations. Development, in close collaboration with PACIA, of the Chemical Industry Discussion Paper: Sustainability Leadership Framework for Industry. Product stewardship including involvement in the ammonia safety program (Ammsafe), the chlorine safety program (Safeguard), removal of security-sensitive ammonium nitrate from the Australian fertiliser market, and signatory to the International Cyanide Management Code. Further information regarding Orica s initiatives towards a more sustainable future may be found at: blastbasedservices

11 8 ORICA MINING SERVICES Energy and Emissions Case Studies Case Study 1: Open cut coal throwblasting In open cut coal mining there are four main types of GHG emissions. Three of these derive from the energy sources used on the mine, namely diesel fuel, electricity and explosives. The fourth is seam gas that is released when coal is exposed, often constituting the largest emission source on a mine. The use of throwblasting can reduce the amount of overburden that has to be moved by the dragline. The proportion of the total overburden that is displaced by the blast into a final spoil position is expressed as the percentage throw. Orica has demonstrated and published case studies of side-by-side blasts that show increases in the order of 5 to 10 percentage points in throw without any increase in explosives energy inputs. Effectively, this can reduce the dragline energy consumption by a similar proportion while uncovering a given amount of coal. This reduces the energy intensity per tonne of coal. Many operations also report on Scope 2 emissions due to electricity generation and these are similarly decreased, so reducing the mine s emission intensity per tonne of coal. Depending on the mine, dragline energy consumption and related Scope 2 emissions may represent between 15 30% of total mine energy and emissions. If these throw improvements were achieved throughout the mine then overall mine energy and GHG intensities could be decreased by 1 3%.

12 ENERGY AND EMISSIONS 9 Case Study 2: Coal recovery with Stratablast Orica has developed a new method of blasting that combines distinctly different blast types in individual layers into a single drill and blast event. This method can improve overall operational efficiencies by reducing the number of mining cycles and so reduce energy consumption. Orica offers full implementation of this BBS as Stratablast. The technique has been implemented at several sites in Australia to recover entire secondary coal seams that were previously deliberately spoiled due to operational constraints, since several layers of overburden, coal and interburden can now be drilled and blasted in a single cycle. This technique has also been specifically tailored to reduce coal losses from the major seam below a throwblast by protecting the coal with a layer of solid rock during the throwblast event. This protective layer is then fragmented in a later-firing stand-up blast, ensuring minimal coal movement and loss. Any increase in coal recovery from essentially the same mining inputs translates into an overall reduction in mine energy and emission intensities of a similar magnitude. All mine emissions, including the major emissions of coal seam gas, are now divided by an increased coal tonnage produced by the mine. In a large Queensland operation, coal recoveries greater than 100% of mine plan/budget were achieved in three successive strips using Stratablast. Conventionally, coal losses here and in many other mines employing throwblasting can range between 5 25%. A 10% decrease in coal loss throughout a mine will essentially increase coal production by 10% and reduce the mine s energy and emission intensities by about 10%. Orica is pleased to offer our Energy and Emissions Initiatives in support of a more sustainable future. We encourage you to ask your Orica Blast Based Services technical specialist for further information. Coal seam previously lost with throwblast Throwblast Coal protection layer Coal seam recovered with Stratablast Buffer material from throwblast Stand-up blast Coal protected with Stratablast

13 Further information regarding Orica s initiatives towards a more sustainable future may be found at: blastbasedservices Includes copyrighted material of DigitalGlobe, Inc., All Rights Reserved.

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