Slide 1: Evaluating Renewables for Gold Fields' Global Operations
Renewables and Mining Summit 2014 DUNCAN STEVENS AND MARTIN SPROTT Evaluating Renewables for Gold Fields’ Global Operations 23 June 2014
Slide 2: Overview
Overview ● Gold Fields renewable energy & carbon goals/commitments ● Methodologies for assessing feasibility of renewables ● Opportunities and barriers to incorporating renewables To be the Global Leader in Sustainable Gold Mining Evaluating Renewables for Gold Fields’ Global Operations | Duncan Ste
Slide 3: Fundamental Changes to Gold Fields
Fundamental Changes to Gold Fields Unlocking and Creating Value Unlocking and Creating Value Evaluating Renewables for Gold Fields’ Global Operations | Duncan Stevens and Martin Sprott | 23 June 2014 3
Slide 4: Fundamental Changes to Gold Fields
Fundamental Changes to Gold Fields Gold Fields has changed fundamentally over the past year ● From Top 4 to mid-tier mining company ● 43% of production from our Australian operations ● 13% of production from South Africa (46% pre-unbundling) ● Group wide restructuring 2013: A Year of Change Evaluati
Slide 5: New Operating Model and Structure
New Operating Model and Structure GFI Corporate Office South Africa West Africa Australasia South America Region Region Region Region South Deep Tarkwa Agnew/Lawlers Cerro Corona project Damang St Ives Darlot Granny Smith Regionally De-centralised Model Evaluating Renewables for Gold Fields’ Global
Slide 6: Gold Fields Commitment to Renewable Energy
Gold Fields Commitment to Renewable Energy Our Commitment Remains Unchanged: Strong Group Support ● Entrenched through our Group Carbon Policy and Guideline ● Supported at a Board and ExCo level ● Strong CEO commitment ● Group Energy and Carbon Management Strategy developed in 2012 ● Revision of the
Slide 7: Gold Fields Commitment to Renewable Energy
Gold Fields Commitment to Renewable Energy Group Strategic Renewable Energy Commitments 1. Review replacement of carbon-intense sources of energy with renewable energy or switch to less intense energy sources (taking security of supply or price demands into account) 2. No operation should go backwar
Slide 8: Integrated Energy and Carbon Management Strategy
Integrated Energy and Carbon Management Strategy Energy & Carbon strategy based on five strategic pillars and a set of enabling factors The “Plan” pillar entails embedding energy and carbon in all planning and stage gate processes. The “Replace” pillar centres on replacing carbon-intense energy with
Slide 9: Gold Fields Commitment to Renewable Energy
Gold Fields Commitment to Renewable Energy Transparent Reporting – Carbon Disclosure Leadership Index 2010 2011 2012 2013 Joint 1st 1st 2nd Joint 1st Committed to Low Carbon Energy Solutions Evaluating Renewables for Gold Fields’ Global Operations | Duncan Stevens and Martin Sprott | 23 June 2014 9
Slide 10: Why Renewable Energy?
Why Renewable Energy? Costs, Carbon Reduction and Energy Security ● Extremely energy and carbon intensive industry ● Key cost driver: 18% - 20% of our operational cost base ● Continued rising global costs due to increasing energy demand & supply constraints ● Strategic imperative to secure a sustain
Slide 11: Why Renewable Energy?
Why Renewable Energy? Costs, Carbon Reduction and Energy Security ● Increase in remote (off-grid) projects ● Could be a legacy asset for local communities after mine closure ● Price parity fast becoming a reality ● Significant technological advances in renewables “Oracle of Omaha to install 656 larg
Slide 12: Gold Fields Renewable Energy Journey
Gold Fields Renewable Energy Journey Renewable Energy Timeline 1 Journey started in 2006: Beatrix, 6 Carbon Finalise and Management 2 Q2 2014 Implement Strategy + CDP Gold Fields updated Strategy Integrated + External Energy and Review (Targets Carbon and Baselines) Management Strategy 3 Q4 2013 5 E
Slide 13: Energy Efficiency Initiatives
Energy Efficiency Initiatives 2013 Energy Efficiency Savings ● 25 group wide projects ● South Deep: 6.5% saving on average electricity consumption: R52 million (US$6 million) ● Australia: 7% improvement in energy efficiency: US$8 million ● West Africa: US$1.7 million. Ramped up to US$11.5 million (e
Slide 14: The total renewable energy landscape was reviewed for opportunities
The total renewable energy landscape was reviewed for opportunities relevant to Gold Fields Identify Renewable Energy Opportunities 1 Review all local RE sources 2 Methodology for Assessing Renewables Evaluating Renewables for Gold Fields’ Global Operations | Duncan Stevens and Martin Sprott | 23 Ju
Slide 15: Deep dives into the most relevant technologies and challenges
Deep dives were made into the most relevant technologies and challenges to implementation identified 3 Deep dives to consider most feasible 4 Consider challenges to implementation technologies Solar Power Volatility Ghana wind map SA wind map (MJ/day) 40 30 20 10 0 Jan Dec Wind Power Volatility (Win
Slide 16: Opportunities were modelled as part of a Gold Fields CO2 abatement curve
Opportunities were modelled as part of a Gold Fields CO2 abatement curve CO2 emissions - NPV abatement curves (US$ ‘000, MT - consolidated) NPV (‘000 US$) 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 -5,000 CO2 Emiss
Slide 17: A Parallel Grid System Among SA Mining Companies
A Parallel Grid System Among SA Mining Companies Unlocking Renewable Energy Potential Storage Roof Solar Hot Water Solar PV Farms Wind Power Site Accommodation Parallel- Grid Mining Operations Conventional Power Mining Operations Mining Diesel Macro grid Other Operations Backups Connection Parallel-
Slide 18: Global Opportunities
Global Opportunities Opportunities Assessed West Africa ● 30MW Tarkwa Biomass Power Plant project ● Biogas: Assess viability and potential to generate biogas out of sewage ● Replace diesel light plants with high efficient diesel or solar alternatives Australia ● Replacement of diesel lighting towers
Slide 19: Global Opportunities
Global Opportunities Opportunities Assessed South Africa ● Feasibility study on a biomass to energy project at KDC West - 5 MW in the first phase with the opportunity to generate up to 50 MW (discontinued operation) ● Beatrix Methane Project (discontinued operation): Officially began in 2006. Electr
Slide 20: Barriers to Incorporating Renewables
Barriers to Incorporating Renewables Barriers to Adopting Renewable Energy Solutions ● Life of mine ● Existing contracts ● Current lower prices of fossil fuel alternatives ● Cash constraints and availability of capital (ROI) ● Financial institutions expertise to assess renewable projects ● Regulator
Slide 21: Barriers to Incorporating Renewables
Barriers to Incorporating Renewables Barriers to Adopting Renewable Energy Solutions ● No IPP projects on the west rand yet ● South Africa does not currently allow for net-metering (barrier for grid-connected customers who would like to offset their energy consumption through renewable energy) Commi
Slide 22: Key Take Away Points
Key Take Away Points ● Strategic imperative to secure a sustainable future ● Gold Fields remains committed to renewable energy solutions ● Top level support and the right partners are essential ● Sound methodology for assessing renewables feasibility ● Realistic goals and targets ● Regional strategi
Slide 23: Thank You
Thank You Committed to Low Carbon Energy Solutions Evaluating Renewables for Gold Fields’ Global Operations | Duncan Stevens and Martin Sprott | 23 June 2014 23