Sherritt strives to operate and maintain its tailings management facilities in accordance with global best practices for safety. We continually review our facilities and procedures and are committed to pursuing the highest standard of safety at our operations.
The Moa Nickel Site is operated by the Moa Joint Venture’s management, reporting to the Moa Joint Venture Board of Directors. The Moa Joint Venture is a 50/50 joint venture between Sherritt and a Cuban government agency. Accordingly, while the following reflects Sherritt’s approach to tailings management, Sherritt itself cannot control outcomes in relation to Moa Nickel Site tailings management.
Dam failure is the greatest risk for the tailings management facilities (TMFs) located at the Moa Nickel Site, which are part of the Moa Joint Venture. Our dam safety assurance program assesses our tailings storage in line with international leading practices.
Sherritt’s assets are required to assess natural phenomena such as extreme flooding and seismic events, as well as operational criteria, and incorporate these factors into their TMF designs.
There are at least six levels of governance and assurance that Sherritt advocates its assets undertake on TMFs.
- Regular surveillance – Operations are expected to monitor their TMFs on an ongoing basis using piezometers, inclinometers, pressure gauges, remote sensing and other technologies to monitor tailings dams, abutments, natural slopes and water levels. The results are assessed by the management team of the operation.
- Annual dam safety inspections (DSI) – Formal dam safety inspections are conducted annually by an external Engineer of Record for operating assets. A DSI evaluates and observes potential deficiencies in a TMF’s current and past condition, performance and operation. DSI findings are overseen by the operation’s management team.
- Dam safety audits – Knight Piésold, one of the world’s leading TMF experts, audits the integrity and safety of our TMFs. The results of these audits are reported to the Moa Joint Venture management and Board of Directors, Sherritt’s senior management and the EHS&S Committee of Sherritt’s Board of Directors. Findings are followed up through regular independent verification audits.
- Independent tailings review boards – The Moa Nickel Site has a Tailings Review Board made up of independent experts who conduct annual third-party reviews of design, operation, surveillance and maintenance.
- Internal governance reviews – Sherritt’s COO conducts internal management reviews of Sherritt’s tailings facilities on a regular basis. Summaries are reported to the EHS&S Committee of Sherritt’s Board of Directors.
- Staff inspections – Tailings management facilities are inspected by trained operators and expert technical staff as frequently as several times daily, with formal staff inspections at the Moa Nickel Site at least once per month.
The different levels of assurance are undertaken on the basis of national regulations, as well as, where appropriate, criteria aligned with international guidelines from the Canadian Dam Association and the International Commission on Large Dams.
In addition, where appropriate, the Moa Nickel Site conducts periodic dam safety reviews, which include reviewing maintenance, surveillance and monitoring, failure impact assessments, emergency management procedures, public safety and environmental management. The results are shared with the operation’s management and reviewed as part of the dam safety audits.
Tailings Management Standard
Sherritt has had an internal tailings management standard in place since 2018. Management at the Moa Nickel Site has adopted this standard and is in the process of implementing it. The standard aligns with the Mining Association of Canada’s Towards Sustainable Mining Tailings Management Protocol and supports Sherritt’s goal of designing, constructing, operating, decommissioning and closing tailings facilities in such a manner that all structures are stable, all solids and water are managed within designated areas, and all management practices conform with regulatory requirements, sound engineering principles and good practice. Sherritt continues to review and evaluate monitoring systems and risk assessments to ensure the approach is robust and current.
Engaging with Communities
Sherritt advocates that its assets undertake proactive stakeholder and community engagement across a broad range of operational topics, including TMFs where appropriate.
We require our assets, and those of our joint ventures and subsidiaries, to develop and maintain emergency preparedness and response plans, and to communicate these plans with relevant stakeholders. Where appropriate, operations may also engage with local and regional emergency response services in scenario planning and practice exercises.
Sherritt is committed to continually reviewing its joint venture facilities and procedures to maintain the highest standard of safety at its operations. Following the tailings failure at Vale’s Feijão mine in Brazil, Sherritt initiated a special review of its tailings facilities and procedures.
Sherritt also works in partnership with local, national and international organizations to support improvements in tailings management across the industry, including the Mining Association of Canada (MAC), a national association that promotes the development of Canada’s mining and mineral processing industry. With the assistance of MAC, Sherritt is implementing the Towards Sustainable Mining (TSM) program in wholly owned operations and working with our partners to implement it in joint ventures, which aids in improving industry performance.
A more detailed disclosure on tailings facilities and management, including disclosures aligned with the Church of England Pensions Board’s tailings questionnaire, can be found in our Tailings Management Report.
|2019||Fort Site||Moa Nickel Site||OGP|
|Total amount of overburden, rock, tailings and sludge (tonnes)||Not applicable||15,338,449||Not applicable|
There are no tailings produced at the Fort Site or the OGP sites.
The tailings management facilities at the Moa Nickel Site are reviewed regularly, both internally and by third parties, for structural integrity and the effectiveness of management systems, and all recommendations are reviewed by Moa Nickel Site management and plans are developed to address them. There have been no incidents at the tailings management facilities. Sherritt management continues to work with its joint venture partners to ensure employees have the skills required to manage the facilities effectively.
In 2019, the annual Independent Tailings Review Board recommended that the consequence classification for two TMFs be changed to extreme, in line with the other TMFs. It also identified some concerns with the foundation of the North Extension TMF. Moa Nickel Site management has started to action the recommendations, all of which are targeted for completion in 2020.
In 2019, the Moa Nickel Site also completed a self-assessment against MAC’s TSM Tailings Management Protocol and assessed itself at level B. This means that some actions are not consistent or documented and that systems/processes are planned and being developed. The self-assessment identified some management system gaps, including the need to update the Operations Maintenance and Surveillance (OMS) manual and the Emergency Preparedness Plan (EPP).
Long-term Tailings Disposal
Conceptual studies of future tailings disposal sites were completed by Knight Piésold (KP) in the past year. As shown in the figure below, a proposed sequence of tailings developments has been developed that will allow tailings disposal as follows:
- The North Extension – 2019 through 2022
- Area 22, Stage 3 – late 2022 through late 2024
- Reject Valley – mid-2024 through 2029
- Los Lirios – 2029, for up to 12 years
Figure: Proposed Sequence of Tailings Management Facility Development at the Moa Nickel Site
|Closure of ALTF||Closure Construction||Closure|
|The North Extension||Operation||Future Stages|
|South Extension – Area 22, Stage 3||Construction||Operation|
|Los Lirios (Initial Stage)/Reject Valley||Construction|
The Acid Leach Tailings Facility (ALTF): Closure and stabilization work continued in 2019. Monitoring activities are ongoing and informing the closure plans.
The North Extension: As the ALTF approached capacity, the Moa Nickel Site retained Knight Piésold, an internationally respected engineering firm, to design an extension that would ensure continued capacity to store tailings there until 2022. In 2019, operations and staged construction began in the North Extension.
Area 22: Detailed design and permitting of this multi-phased short-term tailings solution are in progress. This project will allow for tailings storage from December 2022 to December 2024. Micro-localization, environmental impact study and permit applications are underway, and the final construction permit is expected in August 2020. Construction execution has started, with completion expected in December 2021.
Los Lirios/Reject Valley: A longer-term storage option at Los Lirios and the Reject Valley are currently being designed by Knight Piésold in consultation with the Moa Joint Venture partner. Permitting and studies are underway for both.
“The EHS&S Committee of Sherritt’s Board of Directors devotes considerable attention to the Moa Nickel Site’s tailings management, with a clear desire to align with international standards and good practice. Standards at the site continue to improve as management works with Knight Piésold and the site team to ensure adequate tailings management facility design, construction and management. The Independent Tailings Review Board (ITRB), which was initiated at the request of the Sherritt EHS&S Committee, provides annual reports to the Committee, and these recommendations help drive ongoing improvements.”
– Tim Baker, Chair, Environment, Health, Safety and Sustainability Committee of the Board of Directors
Update on Remediation of Obed Containment Pond Breach
As was reported in previous sustainability reports, on October 31, 2013, a breach occurred, due to a geotechnical slump, in an on-site water containment pond at the Obed Mountain mine, then owned by Sherritt, which resulted in a significant release of mud, clay, coal particles and approximately 670,000 m3 of water into nearby creeks and the Athabasca River. We quickly mobilized our response team, working with regulatory bodies, and began engaging extensively with First Nations and local stakeholders to keep them informed and to address their concerns. After the sale of our coal operations to Westmoreland Coal Company in April 2014, we retained the environmental remediation and financial obligations associated with the breach, and have continued to work co-operatively with the Alberta regulator to address the impacts of the incident.
In 2018, approval of the final remediation design was received from the Alberta Energy Regulator in April and from the Department of Fisheries and Oceans in July. Remediation of the upper reaches began in mid-July; because of a shorter construction season due to the approval date, the remainder of the remediation work continued in 2019.
In 2019, we continued environmental monitoring of water quality, fish habitat, wildlife and vegetation. The region is showing high levels of natural restoration and dense vegetation growth. The data collected in 2019 continues to demonstrate that the breach and the resulting release of water and sediments had only short-term physical impacts on water quality and fish habitat, and that there are no residual effects on water, aquatic habitat or fish in any of the nearby creeks or in the Athabasca River. The approved remediation design will provide aquatic habitat enhancements and stabilize reaches of the nearby creek that were physically impacted.
Flooding in late June and early July 2019 caused erosion in a wetland and a recently constructed portion of one of the remediation channels, which has since been repaired. Remediation work will continue into 2020, including further natural channel remediation, reseeding, and planting of spruce seedlings and live cuttings where required.
Biodiversity and Land
Sherritt’s operations are found in diverse locations, ranging from island environments to industrial zones. Our approach to managing biodiversity is tailored to the context of each operating site.
In Canada and Cuba, Sherritt conducts environmental baseline studies and impact assessments, and implements biodiversity management plans as required by regulation. As a member of the Mining Association of Canada, we are working to implement the Towards Sustainable Mining Biodiversity Conservation Management Protocol at our operations. In addition, as part of our Sustainability Framework we have developed a standard for biodiversity and land management that aligns with TSM and provides additional guidance to Sherritt’s divisions. It provides us with a consistent set of requirements for identifying and managing biodiversity impacts. All sites have completed gap analyses against this standard and are implementing multi-year plans to align systems and performance.
Management has systems in place to detect and report spills to land and water. At Sherritt, these are classified as minor, reportable or high-severity environmental incidents. All identified incidents or spills are investigated and steps are taken to prevent recurrence. There were no significant environmental incidents reported in 2019.
We recognize that the land entrusted to us is a valuable resource. We work with authorities and other organizations to manage and reclaim disturbed land during active mining and post operation. This is demonstrated by our longstanding record of reclamation and remediation activities. The Moa Nickel Site in Cuba progressively rehabilitates land and regularly monitors progress against rehabilitation plans with the regulatory authorities.
The OGP operating sites in Cuba are committed to ongoing environmental protection while routinely mitigating impacts of oil exploration and recovery activities. Drill sites are cleaned, topsoil is replaced and the land is returned to conditions similar to those that existed before drilling commenced. In accordance with the requirements of our operating permits, the land will be returned to the Cuban state after expiry of the term of the contract.
The Fort Site manages land issues within its government-approved operating permit, which includes discrete requirements for soil management.
Biodiversity Management at Moa Nickel
Our open pit nickel mine near Moa, Cuba, is located approximately 15 km north of Alejandro de Humboldt National Park, a UNESCO World Heritage Site particularly known for its extensive suite of endemic species of flora. The Moa Nickel Site has long partnered with the Cuban authorities for the restoration and protection of these lands. For more information, refer to this case study.
In 2017, the reforestation program in the park concluded and the Moa Nickel Site received recognition from the environmental regulator, CITMA, for its achievements. In 2019, the Moa Nickel Site supported the government by undertaking ecological monitoring activities of the reforested area. The ecological monitoring carried out in 2019 showed a favourable evolution of rehabilitated areas, including abundant species of flora and fauna.
Biodiversity Management Elsewhere
In Canada, our refinery’s impacts on biodiversity are minimal, given that it is located on previously disturbed land in an industrial zone within the city limits of Fort Saskatchewan. As part of Sherritt’s implementation of the TSM biodiversity protocol, the Fort Site completed a biodiversity assessment in late 2019, which established baseline information on landscape integrity, habitat composition, suitability, and species diversity. The assessment also identified potential significant biodiversity aspects to be managed at the Fort Site (including aquatic ecosystems like wetlands and creeks). Based on the results of the assessment, the site is in the process of drafting a biodiversity conservation plan.
Our energy operations in Cuba also have minimal impacts on biodiversity, given the small footprint and the nature of our activities. In 2019, no significant conservation activities were required or undertaken at these sites.
Our Block 10 oil drilling program, which began in 2016, is taking place adjacent to a protected mangrove site. To minimize our impacts, we are drilling from a previously disturbed footprint, while working in close consultation with Cuba’s environmental regulator. Sherritt completed drilling on Block 10 in December 2019, reaching the target depth of approximately 5,700 metres, and preliminary testing continues in 2020.
In 2019, the Moa Nickel Site practised progressive reclamation in accordance with its operating permits and commitments. The total amount of newly disturbed land at the Moa Nickel Site in 2019 was 18% higher than in 2018 due to a significant increase in the tailings storage capacity and area required for the TMFs to accommodate production and enhance safety. Rehabilitated land during the year was about 3% higher, mainly due to increased rehabilitation efforts. There were no changes to the operational footprint of the Fort Saskatchewan refinery (COREFCO) or the OGP operations in Cuba.
The table below shows the amount of land (owned or leased, and managed for production activities or extractive use) disturbed and rehabilitated in 2019.
|2019||Fort Site||Moa Nickel Site1, 2||OGP||Total|
|Total amount of land disturbed and not yet rehabilitated (ha)||131||832||54||1,017|
|Total amount of land newly disturbed within 2019 (ha)||0||57||0||57|
|Total amount of land newly rehabilitated within 2019 to the agreed end use (ha)||Not applicable||21||Not applicable||21|
1 Data reported for the Moa Nickel Site represents land disturbance that occurred from 1994 onwards – or the years that the Moa Joint Venture between Sherritt and the Cuban state has been in place. The data do not reflect any mining activity at the site that pre-dates the joint venture.
2 Data reported for total amount of land disturbed and not yet rehabilitated at the Moa Nickel Site for 2019 were revised to include disturbed and rehabilitated tailings dam areas.
The growing global population is putting pressure on fresh water availability and quality, and these concerns are expected to increase due to climate change. We understand and share these emerging concerns. Water is central to our metallurgical process for producing nickel and to the generation of steam at Energas, and it is managed carefully. Where feasible, process water is recycled or reused within the process itself. Runoff is controlled through diversions and catchments to minimize any release to the environment. At each operating site, baseline studies are conducted, risks are assessed and stakeholders are engaged to involve them in the water management planning.
Pumping water for use in our processes takes a considerable amount of energy, and Sherritt’s operations are continually taking steps to identify how to optimize practices and minimize the amount of water and energy we use.
Sherritt’s operations also conduct monitoring to help ensure that they are not contaminating surface water or groundwater resources with process discharges. All of the water discharges comply with the appropriate jurisdictional regulatory requirements and are monitored and controlled as necessary to ensure compliance and to protect the receiving environment. The monitoring programs are also designed to help detect any unanticipated problems and manage risk beyond regulatory obligations.
Sherritt’s approach to water management varies across its operations, depending on technical requirements, local climate, water bodies and stakeholder interests. Building on the range of water management practices and initiatives in place, Sherritt is developing a corporate Water Standard that will apply across the company.
|2019||Fort Site||Moa Nickel Site||OGP||Total|
|Total water withdrawal (million m3)||2.37||14.88||4.91||22.16|
The Fort Site withdraws water from the North Saskatchewan River under provincial licences for process use. Current total industrial use is a small percentage of total flow, and therefore water restrictions are not anticipated. We purchase potable water from the local municipality. The total water withdrawal for the Fort Site in 2019 was slightly lower than in previous years: 2.4 million m3, including 2.3 million m3 taken from the river and 0.1 million m3 of purchased potable water. We report our water withdrawal monitoring results to the provincial regulator monthly. Process effluent and stormwater (snowmelt/rainwater) collected on our site are treated to meet contractual water quality guidelines. This water is then transferred to the municipal wastewater collection system, where it is treated further and then discharged into the surrounding environment along with wastewater from the municipality.
At the Fort Site, we operate a joint water management system with neighbouring industrial companies, and we are in periodic discussions with our neighbours and local business development authorities on the potential to support other business activities through our water management systems, meeting the environment regulator’s objectives of constraining the number of river withdrawal systems.
The Moa Nickel Site in Cuba withdrew approximately 14.9 million m3 of water for its processes in 2019. This is slightly lower than the previous year and was due to processing requirements. Water is collected in the adjacent reservoir and treated before use.
In 2019, OGP reported total water withdrawal of 4.9 million m3, which is slightly higher than 2018. The increase is due to the fresh water flush done on the Varadero Aquifer and hydrotests completed on three new condensate tanks in Varadero. Water is drawn primarily from saltwater sources and some municipal sources. Oil & Gas service rigs use recycled water only, resulting in a net effect of zero on the water supply.
At the Fort Site, we monitor water quality at several locations within the site’s treatment system, and review the results to ensure compliance before the release of water into the municipal collection system. We reported our water quality results to the municipality monthly and to the Alberta regulator on an annual basis. At the Fort Site, there were no water quality non-compliance events sourced to Sherritt in 2019.
In 2019, Sherritt continued its participation in the Capital Region Water Management Framework’s Steering Committee through the Northeast Capital Industrial Association (NCIA). The goals of the framework are to maintain or improve the quality of the water in the North Saskatchewan River, manage the impact on water quantity, and implement a science-based and world-class water management framework. In 2019, Sherritt’s environmental advisors continued discussions with the Alberta Capital Region Wastewater Commission and the City of Fort Saskatchewan regarding their proposed new water discharge permit. The new permit seeks to replace the current contract, which has been in place since 1999 and which details effluent quantity and quality requirements. Discussions regarding the permit will continue into 2020.
In the 2010s, the Alberta provincial government increased its focus on cumulative effects and started development of the North Saskatchewan Regional Plan (NSRP). This plan included the completion of a detailed chemical characterization study of industrial discharge sources to the river; however, as of December 31, 2019, the study had not been published. We continue to work through the NCIA to increase understanding of the relative impact of industrial operations on the North Saskatchewan River and to ensure that appropriate plans and policies are developed by the Alberta government. Approximately 20 years ago, an operational decision was made to ensure a high level of water treatment of our effluent by contracting the municipality to do the secondary treatment while we continue to do primary treatment on site.
When we invested in the Moa Nickel Site more than 20 years ago, we inherited a legacy water management issue, which has affected water quality in a nearby river. Over the years, we have been working with our Cuban partners and the regulatory agency to address this issue. In 2017, we agreed to a phased approach to developing long-term treatment options for water management. During 2019, the first phase was completed, which involved relocating the effluent discharge to support river rehabilitation and diminish impacts on the local community. The Moa Nickel Site also focused on erosion control in areas around the mine to prevent sediments from reaching the rivers and the Moa Bay.
In 2019, Sherritt had one reportable water-related incident at the Moa Nickel Site. The tailings management facility return water pond overflowed due to lower return water consumption in the plant. The incident was reported to the Ministry of Science, Technology and Environment (CICA). It was a low-severity incident with no lasting impacts and no environmental damage. No employees or community members were harmed during the incident or while it was being addressed.
There were no significant water quality issues recorded at OGP in 2019. OGP is currently investigating a program to reduce its use of potable water.
Sherritt produces two broad types of waste: mining waste and solid waste. Mining waste generally includes waste rock and tailings, which are produced as by-products. Solid waste consists of hazardous waste and non-hazardous waste. Hazardous wastes are identified by their chemical and physical properties, and regulations prescribe their classification, handling, disposal and storage requirements. Non-hazardous solid waste consists of materials that we use and produce that can be disposed of in municipal landfills, and is not considered material for the purposes of this report.
Regulations around waste management vary across jurisdictions and are dependent on the supporting infrastructure in the region or country. Sherritt is currently developing a management standard to set minimum expectations for all operations regarding waste management, including disposal and recycling.
|2019||Fort Site||Moa Nickel Site||OGP|
|Total waste (tonnes)||2,744||16,837||8,964|
|Waste recycled – includes recyclables sent off site (batteries, plastics, electronics, etc.)||99||692||225|
|Waste sent to landfill||2,682||13,746||3,408|
In 2018, waste was included for the first time in Sherritt’s Demonstrating Environmental Responsibility pillar for the purposes of reporting. It is expected the quality of disclosure on this topic will improve over time with the implementation of the forthcoming Waste Management Standard.
At the Fort Site, a significant decrease from 2018 in both hazardous and total waste was observed in 2019. Hazardous and total waste decreased by 81% and 68%, respectively, at the Fort Site. The decrease in hazardous and total waste was largely due to lower capital spending and austerity measures at the Fort Site compared to the previous year, resulting in significantly reduced construction activities. Waste quantities are expected to fluctuate, primarily based on facility demolition and construction activities.
At the Moa Nickel Site, there was a decrease in both hazardous waste (56% reduction) and total waste (16% reduction) in 2019 compared to 2018. This decrease is largely attributable to an anomalous generation of sulphur-contaminated soil in 2018. Although waste sorting improved, the total amount of recyclable waste collected decreased due to a decrease in ferrous scrap. The overall quantity of waste sent to landfill stayed relatively constant.
At OGP, there was a significant increase in total waste generated due to the replacement of three large condensate tanks, and decommissioning of some sections of the Varadero facility.
Total waste remained relatively consistent year over year, with a significant reduction in hazardous waste (68% decrease).
Energy and Climate Change
Sherritt operates an energy-intensive business. Energy consumption is a major input to our processes across the company, and energy-related costs constitute one of our largest unit operating costs. These realities mean that we are motivated to reduce energy consumption and maximize efficiencies at every stage of our production cycle, from mining and oil recovery through to processing, refining and shipping finished products, and generating electricity. Concerns about the impacts of climate change on the planet increase the urgency of this issue for us, and affirm our role in contributing to global efforts to reduce greenhouse gas (GHG) emissions.
We are implementing the Mining Association of Canada’s Towards Sustainable Mining Energy and Greenhouse Gas Emissions Management Protocol across our operations, and in 2019 Sherritt started working on a corporate standard in alignment with TSM.
The Fort Site operates under a provincial GHG regulatory system. In 2019, the Fort Site created an Energy and Greenhouse Gas Improvement Plan. This plan evaluated several energy reduction projects to assess feasibility and value to the company.
In 2019, Sherritt joined a Strategic Energy Management Program in partnership with CLEAResult, a leader in energy efficiency. The program is sponsored by Natural Resources Canada and supported by Energy Efficiency Alberta. The goal of the program is to develop and apply an energy management system to identify and implement energy improvement opportunities. CLEAResult provided technical expertise to develop an energy model for Sherritt and conduct an on-site energy scan.
Managing air quality around our operations is an important element of our environmental programs company-wide. We are conscious of the potential impacts of our operations and take great care to ensure that all applicable air quality regulations are properly followed.
Air emissions generally comprise two types of sources. The first type includes specific discharges of gases from our process stacks and vents – such as sulphur oxides (SOx), hydrogen sulphide (H2S) and nitrogen oxides (NOx). When emitted into the air, these compounds can pose risks to human health and lead to environmental degradation. The second type of air emission includes small airborne particles generated from activities in the open environment, called particulate matter (PM). PM is predominantly produced from traffic on unpaved roads at our facilities, excavation activities at our mines, and fertilizer production at our refineries. We have strict safeguards in place at all sites to minimize the risk of air releases, and we regularly review and revise processes to minimize the release of PM through our activities.
The Fort Site is a member of the Fort Air Partnership (FAP), which collects, records and manages air quality data within the Fort Saskatchewan air shed. Sherritt works alongside other industrial representatives in FAP to collect and report reliable, independent and transparent air quality data 24 hours a day, seven days a week. In December 2019, Sherritt finalized its Air Emission Reduction Plan. This plan identifies sources and opportunities for improvement of TPM, SO2, NH3 and VOC emissions; a separate plan that addresses NOx was finalized in 2018. It includes a strategy for prioritizing reductions as well as a timeline. Two NOx reduction projects are also included in the Long-Range Plan. Air and other emissions are a topic of interest to regulators in Alberta and the company.
In recent years, Sherritt has made continuous improvements to air emissions management. We have been investing in updates to aging infrastructure, working to identify and mitigate point sources, and putting initiatives in place to reduce emissions exceedances. Continuous and discrete emissions monitoring occurs at the Fort Site, and emissions reporting continues to improve in Cuba. Efforts are underway to implement ISO 14001 at the Moa Nickel and Fort Sites and process safety management systems at the Fort Site and OGP, to ensure that significant emissions risks are identified and controlled, and air quality management continues to improve. In 2020, Sherritt will develop an Air Standard as part of its Sustainability Framework.
GHG Emissions and Energy Consumption
|2019||Fort Site||Moa Nickel Site||OGP||Total|
|Scope 1 GHG emissions(kt CO2e)||335||556||1,402||2,293|
|Scope 2 GHG emissions(kt CO2e)||59||60||–||119|
At the Fort Site, GHG emissions remain regulated under the Alberta Carbon Competitiveness Incentive Regulation (CCIR), a carbon pricing mechanism for industrial operations. In 2019, Sherritt complied with CCIR by purchasing offset credits and technology fund credits paid to the province, supporting further reductions in Alberta. CCIR will be replaced by the Technology Innovation and Emissions Reduction (TIER) Regulation, which came into effect on January 1, 2020 and will apply to 2020 emissions.
In 2019, the Fort Site reported GHG emissions of 335 kilotonnes (kt) of CO2 equivalent, which is slightly higher than 2018 emissions. Additionally, the Fort Site purchased 17 kt of credits (> 5% of total emissions) for its 2019 emissions to comply with provincial regulations. The Fort Site recorded a total energy consumption (including purchased electricity, fossil fuel and waste fuel consumption) of 5,100 terajoules (TJ) in 2019, which is a slight increase over the previous year.
For the 2019 reporting year, credits were accredited by the Alberta Carbon Registry and sourced as follows:
- Cap-Op Energy Emission Reductions from Pneumatic Devices (783 tonnes)
- Carbon Credit Solutions Inc. Tillage Project #24 (10,000 tonnes)
- Soderglen Windfarm Project (6,217 tonnes)
The Moa Nickel Site produced 556 kt of CO2 equivalent during 2019; this amount is comparable to the previous year. We consumed a total of 6,100 TJ of energy in 2019, including generated and purchased electricity as well as fossil fuel consumption (crude oil, diesel and natural gas). This represents a 3% increase over the previous year. In 2019, more power was consumed from the national grid at the Moa Nickel Site due to a turbogenerator (generates electricity from the steam) failure.
OGP reported the production of 1,402 kt of CO2 equivalent during 2019 from its Boca de Jaruco, Puerto Escondido and Varadero facilities. This is consistent with previous years. The OGP operations reported an increase in energy usage of 15% compared to 2018 (in 2018, OGP reported an 18% decrease in energy usage), totalling 30,000 TJ; this increase is attributable to the switching of wells and an increase in gas production. OGP also flared 91 million m3 of hydrocarbons associated with its oil production processes during the year, representing an increase of 61% from 2018. The volume of flared hydrocarbons increased because of the sulphur unit outage in Varadero.
OGP’s preventive maintenance program ensures optimal operation of our equipment, and we conduct quarterly monitoring of emissions from our key sources to verify proper combustion. Our Oil & Gas operations have additional reporting metrics under the Global Reporting Initiative; please refer to the Performance section for this information. Over the course of the year, Energas transitioned plant lighting to more energy-efficient bulbs.
Since 2007, Energas has generated well over one million Clean Development Mechanism (CDM) credits at the Varadero combined cycle power generation facility in recognition of its low GHG emissions relative to other sources of electricity in Cuba. While there are many benefits to the program, the relative administrative costs are significant and, due to Sherritt’s financial constraints, our participation has diminished in recent years. Read this case study for more information on our efforts to obtain CDM credits over the last few years.
Scope 2 emissions refer to indirect emissions generated from the purchase of electricity. Sherritt’s Scope 2 emissions are relatively low due to the significant generation of electricity at host sites in Cuba. Therefore, Scope 2 emissions are of a lower order than our Scope 1 emissions.
In 2019, Sherritt had one reportable air quality–related incident at the Fort Site. It involved a continuous emissions monitoring uptime failure on the sulphuric acid plant gas stack. It was a technical non-compliance with our licence where no exceedance of the emissions limit took place.
The Moa Nickel Site continued to focus on reducing fugitive H2S emissions, and the following actions were taken in 2019: gas ducting was fabricated and installed for fugitive gas collection, hermetic seals were improved to reduce ambient gas emissions, and operations were optimized to reduce total emissions. There are allocations in the Long-Range Plan and capital budget for further projects to mitigate the H2S emissions in the Sulfuros complex.
|2019||Fort Site||Moa Nickel Site||OGP|
|Air emissions – NOX (tonnes)||1,264||1,722||6,065|
|Air emissions – SOX (tonnes)||87||12,211||26,208|
|Air emissions – TPM (tonnes)||80||Not reported||Not reported|
Our air emissions are regulated under requirements in the jurisdictions where we operate.
The 2019 emissions at the Fort Site are consistent with historical levels. Most of the NOx and SOx emissions are from our utility generation (natural gas combustion) and fertilizer production (ammonia and sulphuric acid production). Ammonia is released primarily from ammonia scrubbers in the Fort Saskatchewan refinery, which uses an ammonia-based leaching process. PM is primarily generated from the production of ammonium sulphate fertilizer and from traffic on unpaved roads. Additional information on air quality in Fort Saskatchewan can be found on the Fort Air Partnership website.
In Cuba, the Moa Nickel Site emits NOx and SOx from the powerhouse and the sulphuric acid plant. The 2019 volume of NOx represented an increase from 2018 due to an increase in the amount of fuel used, while SOx emissions decreased. The new operating standard approved in 2018 by the Environment Ministry for the Moa Nickel Site included a reduction in emissions for various effluent or gas streams (such as acid trains and neutralization stack) and liquid discharge limits (waste liquor). OGP’s NOx emissions also increased from the previous year, which is partially attributable to the gas turbine at Puerto Escondido, which ran for a greater number of hours compared to 2018.
Environmental Liabilities, Closure and Reclamation
We take seriously our responsibility to provide adequate financial resources to address the closure of our properties once reserves have been depleted.
As part of the permitting process in Canada, mining and energy companies are required to prepare closure plans with associated cost estimates, and to provide host governments with financial assurance to cover the costs of environmental remediation in case the company is no longer able to complete the work. In addition to these regulatory requirements, international accounting and securities exchange rules require public companies to account for the reasonably expected liabilities associated with the closure of mining and energy properties. These estimates, like those provided to host governments, are based on the closure plans and assumptions contained therein.
We comply with regulatory requirements regarding closure planning and related environmental rehabilitation obligations, cost estimates and financial assurance in each of the jurisdictions where we operate. We also meet the requirements of the Ontario Securities Commission, which obliges publicly listed companies in Ontario to estimate and disclose their environmental rehabilitation provisions. We review these provisions on a quarterly basis. Whenever possible, we engage in the progressive reclamation of our properties over the life of the operation, rather than initiate such activities at the time of closure.
The current estimate of Sherritt’s share of total anticipated future closure and reclamation costs to be incurred over the life of the company’s various assets and investments is approximately $140 million (excluding operating expenses). The decrease in anticipated costs compared to 2018 is mainly a result of changes in estimates rather than the completion of rehabilitation obligations.
In 2019, we continued to carry out our environmental liability obligations related to the containment pond breach at the Obed Mountain mine, a non-operational coal mine in Alberta that we owned at the time of the incident in 2013. Our remediation work is described under Tailings Management.
As part of our acquisition of the Dynatec Corporation in 2007, we inherited three closed assets from Highwood Resources Ltd.:
- Mineral King, a former lead-zinc and barite mine and processing facility near Invermere, British Columbia. In 2014, Sherritt completed the reclamation work plan as required by the provincial regulator. Portals for accessing the mine were covered and secured, coverage of the tailings pond with topsoil was completed, access roads were pulled back, and designated areas were seeded and fertilized. A 2015 inspection by British Columbia’s regulator required additional work on the portals and closure of the glory hole. The work was originally planned for 2017, but it was delayed due to weather and was completed in 2018. An inspection in 2019 resulted in additional requirements for risk assessment, invasive plant management and closure of subsidence openings. Once the completion of all closure plan requirements is verified by the government, Sherritt intends to sell the property.
- Parsons, a former barite mine and processing facility near Parson, British Columbia. In 2014, Sherritt completed the regulator’s reclamation work plan, which involved a general clean-up, monitoring, seeding and the removal of an invasive species. An inspection in 2019 resulted in additional requirements for risk assessment, soil characterization and invasive plant management.
- Canada Talc, a former talc mine in Madoc, Ontario, and processing facility near Marmora, Ontario, and associated claims areas. In 2012, remediation of the mine was completed and the processing facility was sold. The Ontario regulator retained a security deposit for further surface and groundwater sampling and geotechnical monitoring, which occurred in 2017; however, in early 2019 further sampling and monitoring was requested, so the planned request to release security will be delayed until completion and approval by the regulator.
Our mining assets that are currently operational have a minimum 15-year mine life of resources and production capacity in their lifecycles. Our mine has an up-to-date closure plan that meets host jurisdiction regulations and cost estimates that we believe reasonably and appropriately address the liabilities at the site.
In 2019, the Moa Nickel Site finalized a closure plan for a section of the tailings facility called the West Area and completed 25% of the closure and remediation actions. Work will continue in 2020.
At the Fort Site, the closure plan incorporates a set of robust considerations accounting for both likely and unlikely obligations that we may need to address, and our current cost estimates cover the reasonable obligations.
For the OGP operating sites, all assets will revert back to the Cuban state for closure, as outlined in our permits and related agreements.
For information on our reclamation activities in 2019, please refer to Performance in Biodiversity and Land.