of water per kilogram of ore (m3/kg), whereas cobalt, copper and nickel use 0.03-0.06 m3/kg, and iron requires 0.001 m3/kg.137 Water use across a range of upstream input industries is also material, including the energy, chemicals, construction machinery, heavy trucks and rubber sectors.138 Overall, mining accounts for 2-4.5% of global freshwater use139 and can have a significant impact on water resources at a local and regional level,140 both directly and cumulatively. As a result, water abstraction creates competition for water availability with local industries and communities, which can lead to displacement or conflict. The impacts of mining on nature and people are magnified where ore deposits lie in arid places – the World Resources Institute (WRI) found that 16% of critical mineral mines, deposits and districts are in highly water-stressed areas, and in these locations, at least 40% of water supply is required to meet existing demand each year. For example, in Chile’s Salar de Atacama, part of the “lithium triangle” in Latin America, which contains 60% global lithium supply,141 lithium and copper extraction have reportedly already consumed over 65% of the local water supply, and operations are expanding at a rate of 7% per year.142,143 The reduction in the availability of local freshwater can put company operations at risk. Water basins in China, the US, Australia and Russia emerge as the highest risk globally.144 Mining companies are starting to make progress towards improving water stewardship by completing water footprint assessments, setting contextual targets and taking actions such as increasing water recycling and using alternative water sources, like greywater or seawater. For example, Anglo American aim to reduce freshwater withdrawal by 50% in water- scarce areas from 2015 to 2030.145 Similarly, Teck Resources plans to design all development projects in water-scarce regions with a seawater or low-quality water source from 2025 and transition to seawater or low-quality water sources for all operations by 2040.146 Pressure to improve water stewardship is growing. Regulators are increasingly introducing requirements for businesses to safeguard the availability of freshwater, such as in Mexico, where new laws require companies to bid for water allocation and submit monthly water consumption reports.147 2.5 Greenhouse gas emissions The mining and metals sector is responsible for 2-3% of global GHG emissions.148 This share can rise significantly in countries where the mining sector represents a large part of the economy.149 Emissions intensity can vary by region, commodity and across mines, depending on power sources, production pathways and operational practices.150 For example, within copper and iron ore, there is a twentyfold variation in the emissions intensity of mines.151 Within mining operations today, 40-50% of Scope 1 and 2 carbon dioxide (CO2) emissions come from diesel used in mobile equipment, and another 30-35% come from the use of non-renewable electricity.152 Following this, the next main source of emissions is comminution, given the energy required to crush ores before processing.153 Iron and steel production is responsible for an additional 7% of global GHG emissions.154 Emissions are primarily generated by energy- intensive processes, such as smelting, and the use of coke coal as a reductant in steel production. It takes approximately 770 kg of coal to make one ton of steel.155 Looking across the value chain, transport is also a major emissions driver, particularly as international shipping accounts for 2% of global emissions156 and mined commodities make up over 20% of global maritime trade.157 The sector is already taking action to tackle its emissions, engaging in both climate mitigation and adaptation. Companies and industry associations are setting and making progress towards emissions reduction targets. For example, ICMM members have committed to net-zero Scope 1 and 2 GHG emissions by 2050 or sooner, while accelerating action to address Scope 3 emissions.158 Individual companies have gone further, including Rio Tinto, who have committed to reducing Scope 1 and 2 emissions by 50% by 2030.159 The Minerals Council of Australia have also identified 30 actions in their 2020 Climate Action Plan and reported that member companies had reduced their Scope 1 and 2 emissions by 4.7% between 2021 and 2022.160 Similarly, over 40 World Steel Association members have committed to nine principles as part of their Sustainability Charter. More broadly, members responsible for over 50% of global crude steel production report data on sustainability indicators each year to support the monitoring and reporting of industry performance.161 Given emissions are spread across the value chain, collaborative action with suppliers and customers is essential to achieving Scope 1, 2 and 3 emissions reductions. In Chile’s Salar de Atacama, lithium and copper extraction have reportedly already consumed over 65% of the local water supply, and operations are expanding at a rate of 7% per year. Nature Positive: Role of the Mining and Metals Sector 26

Nature Positive Role of the Mining and Metals Sector