Emissions reporting requirements support for the Eva Copper Mine

Challenge

Eva Copper is an iron-oxide copper-gold resource poised to become the largest new metal mine in North West Queensland, Australia. Harmony Gold required support to assess the potential requirements and financial implications for the Eva Copper Mine Project (EVAMP) under the Australian National Greenhouse and Energy Reporting System (NGERS) and the recently updated Safeguard Mechanism requirements. The Safeguard Mechanism, originally introduced by the Australian Government in 2016, serves as a pivotal policy to curtail emissions from Australia's largest contributors. Recently reformed, this mechanism aligns with Australia's international commitment to decarbonisation.

Solution

SLR was engaged with an objective to understand the application of NGERS reporting requirements to the EVAMP; establish an inventory of projected Scope 1 and Scope 2 Greenhouse Gas emissions; and inform financial models for the Project that appropriately reflect the implications of the Safeguard Mechanism over the life of the Project.

Our team identified the relevant regulatory requirements of NGERS and Safeguard Mechanism and how they apply to the mine, including identification of the relevant Production Variables for the calculation of Safeguard Mechanism baseline.

The rapidly evolving nature of carbon management and regulation in Australia posed significant challenges in identifying the relevant requirements that would be imposed on the project, with guidance either still to be provided or being updated during the study. SLR undertook significant consultation with the Clean Energy Regulator to test and confirm the assumptions and approaches used in the analyses.

High-level opportunities and risks associated with decarbonising the mine beyond the requirements of the Safeguard Mechanism were identified, together with opportunities for the Project in cases where Safeguard Mechanism Credits would potentially be created, and the financial implication of need to purchase credits in cases where the baseline was predicted to be exceeded.

Impact

At the time of preparing the study, final decisions regarding how to power the mine had yet to be made. Consequently, five different power options were modelled, with Scope 1 and 2 emissions estimated for the relevant emission sources over the Life-of-Mine for each power scenario. The relevant Safeguard Mechanism baseline was calculated for each year of the mine plan, and analyses completed to identify projected variations from the calculated annual Safeguard baseline levels.