The global gold industry is broadly on track to align with the target of keeping the global average temperature rise on Earth at 2°C above pre-industrial levels by the end of the current decade. However, more action is required if the industry is to meet the 1.5°C mark, according to a report from Wood Mackenzie.
To assess the pace of the greening of gold, Wood Mackenzie’s analysis forecasts the progress of gold miners out to 2030 against the reduction in emissions required to align with the 2°C and 1.5°C targets.
According to estimates, the gold industry emitted over 55Mt of CO2 equivalent in 2019 in scope 1 and 2 emissions, which is approximately 0.2% of total global carbon emissions. Though this is small in comparison to other areas within the energy sector, gold miners must not become complacent in the drive towards a more sustainable mining sector.
Rory Townsend, Wood Mackenzie’s Head of Gold Research said: “Miners who are not striving to reduce their environmental footprints are likely to lose favour among investors and struggle to secure project financing.”
Though several carbon-intensive mines are due to go offline before 2030, recently mine life extensions are materialising alongside the elevated gold price. This might need more aggressive action to reduce emissions to align with the carbon reduction target.
To change the perception of the industry, however, it needs to be a collective effort. This is an opportunity for miners to boost their green credentials, particularly at a time when other asset classes, such as cryptocurrency, are having their sustainability commitments drawn into question, opines Townsend.
The gold industry in the report refers to 339 large-scale gold mines or 60% of the total gold mine supply. Gold production originating from primarily copper, zinc and nickel mines is excluded from this analysis. Additionally, this does not include an assumption for small-scale, informal, artisanal or illegal mining due to the opaque nature of supply.
Aruna Gaitonde, Editor in Chief of the Asian Bureau, Rough&Polished
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