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Performance against KPIs

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Climate change and greenhouse gas emissions

Anglo American recognises that climate change is a serious international and community concern, as well as a risk to its business, and is committed to a 10% reduction in greenhouse gas (GHG) emissions per unit of production against a 2004 baseline.

One of the Company’s immediate responses has been its work on energy efficiency and energy management. Other commitments include collaboration in research and development programmes, incorporating climate change considerations into business planning and exploring market-based emissions-reduction mechanisms.

During 2008, the managed businesses emitted 19.8 million tonnes of carbon dioxide equivalents (CO2e) compared with 19.4 million tonnes on a like for like basis in 2007.

Methane

Anglo Coal’s efforts in Australia to generate electricity from waste mine methane has resulted in the establishment of two power stations. The 32 megawatt (MW) German Creek power station came on stream in early 2007 and a 45 MW power station was commissioned at Moranbah North in 2008. These power stations will reduce our greenhouse gas emissions by 2.5 million tonnes of CO2e each year.

As part of the Company’s collaboration with chemicals company Johnson Matthey (JM) to identify potential joint research opportunities in low-carbon technologies, and then develop and commercialise them, Anglo American signed an agreement with JM to develop technology that will mitigate the effects of methane from mine ventilation air.

Carbon capture and storage

In 2008, the difficult decision was taken to place the Australian Monash Energy brown coal-to-liquid and carbon capture and storage (CCS) project under review owing to unfavourable economic conditions and an uncertain regulatory environment for carbon sequestration. Anglo American was, however, pleased to announce its support as a founding member of the Global Carbon Capture and Storage Institute, based in Australia. The institute aims to accelerate the development and deployment of CCS projects.

Alternative energy

Anglo Base Metals has facilitated the establishment of a wind farm at its Lisheen zinc and lead mine, which will benefit the operation, its employees, and the community, and will leave a positive legacy after mine closure. Other initiatives within Anglo Base Metals include energy recovery, wind, solar alternatives and co-generation.

Australian carbon pollution reduction scheme

In 2008, the Australian government progressed a number of policies related to climate change – the key one being the Carbon Pollution Reduction Scheme. As a major energy producer and user, Anglo Coal Australia is working to inform policy, understand its implications for the business and explore GHG mitigation options.

Adaptation

Anglo American has formed a partnership with Imperial College in London on a climate change impact assessment project, which will enable the Company, as a first step, to establish a hazard inventory of its current and future operations around the world. The Company will then be in a position to implement appropriate adaptation strategies for high risk operations.

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CO2 equivalent emissions