Our steel plant in Ostrava, in the Czech Republic, is a major source of employment for the local area. In the past it was also one of the major contributors of dust emissions in the city, and our reputation with local stakeholders suffered greatly as a result.
By 2012, the steel plant was compliant with EU regulations, but ArcelorMittal committed to going further.
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Why this is important for ArcelorMittal
Our neighbours are acutely sensitive to changes in the quality of the resources that we share with them. Mining sites cover large tracts of land, and need a lot of restoration work after a mine closes. Steelmaking requires large amounts of water, though this shouldn’t have negative impacts where water availability is high, and the quality of the water discharged is managed appropriately. Other aspects that need constant management include dust, noise, vibration, and the risk of soil pollution.
We are operating in the context of a rising world population and increasing demands on the planet’s finite natural resources. ‘Natural capital’ as it’s often now called is a key focus of the new UN Sustainable Development Goals. Regulators, customers, investors and other groups all expect much more information about exactly what companies’ emissions and impacts are, and are demanding ever higher standards. A case in point is the Industrial Emissions Directive in Europe, which aims to protect the environment through advocating the use of best available techniques in industry. There has also been new legislation on biodiversity in France, and changes to the Forest Code in Brazil.
It’s important we get these things right, because when we don’t, our business is disrupted, our reputation damaged, and our licence to operate threatened. On the other hand, making sure we do get it right is increasingly important to our customers. Company procurement policies now include more stringent sustainability criteria, and we are seeing a growth in the number of product certification schemes that audit a company’s responsible management of resources.
A challenge and an opportunity
Biodiversity is an issue for us across the whole business, but especially in mining. Some of our mining sites are in sensitive and protected areas, like the Liberian rainforest or the Arctic tundra of Baffinland, while steel mills are often in urban areas. Some of our steel sites are very large, but only use a small proportion of that land for our operations. Some 55% of our 3,367 hectares in Tubarão, Brazil, for example, and 22% of Dunkerque, France’s 450 acres, are devoted to green spaces. In some countries the issue is the vast number of local endangered species (as in Liberia), while in others there are fewer species but these are internationally important (as with polar bears and narwhals in Baffinland). If we damage rich and pristine natural landscapes, we will rightly face criticism, especially in environmentally-sensitive areas.
We’re increasingly finding that international bodies are looking to companies like ArcelorMittal to set and observe high environmental standards in emerging countries where these issues are not high on the national agenda. This is yet another example of a sustainability challenge that is also an opportunity: to demonstrate our support for local stakeholders’ interests, contribute valuable scientific insights, and improve our relations with governments and regulators in a tangible way. Our biodiversity work in Liberia and our Sustain our Great Lakes programme in North America are great examples of this.
Developing our stakeholders’ trust
Certification schemes for our products are one way that is available to us to demonstrate that we are using resources responsibly; we also need to build trust in more informal ways, by showing people that we understand the emissions we make, and that we’re doing everything we can to minimise them. Whenever we develop a new mine or steel plant, we carry out detailed environmental impact assessments beforehand, and establish an environmental management plan. This covers both the operational life of the site, and what will happen to the land when the site eventually closes. 98% of our steel operations comply with the environmental management standard ISO 14001, and we’re working towards that in mining too.
Honest, transparent, two-way communication is a big part of that, and the only real way to build long-term trust. We monitor our use of air, land and water at all our production sites, and we publish information on this in line with Global Reporting Initiative guidelines on our website, and in our local sustainable development reports. It’s also important that we work alongside our communities, NGOs and other groups to protect the natural habitats we all depend on.
This outcome is sponsored at group level by Karl Buttiens, who has worked on environmental aspects of our operations for more than 20 years, and is the head of environment across ArcelorMittal.
Investing in technology
Air quality is one of the most immediate issues for our local communities, so it has always been a major priority for us. After an extensive investment programme, our dust emissions per tonne of steel have steadily fallen since 2010, but in 2015 we saw a slight increase again. This is partly due to the increase in the share of blast furnace production last year, and partly because those new de-dusting facilities installed in 2015 have yet to impact on the yearly data. Overall the reduction since 2010 is nonetheless 21%. We observe a similar evolution for NOx and SOx: a reduction of 11% and 24% respectively over the same period. During 2015, we allocated over $99 million to further air-related environmental improvement projects and we expect our emissions to improve further in the coming years.
We are planning the installation of a significant project to improve dust controls at the Zenica plant in Bosnia & Herzegovina, using the best available technology. Meanwhile our R&D team is working with a number of partners to test new filter technologies which could reduce both dust and other emissions, such as SOx and NOx, and we have small-scale pilot projects under way at our sinter plants in Gijón, Spain, and Dunkerque, France.
Being open with our stakeholders about this issue is key. In Ukraine, for example, we display real-time air emissions in a digital display outside our Kryvyi Rih steel mill. Over recent years we have learned how important it is to listen and respond honestly and constructively, and how much progress can be made if we do. Even where we’ve invested heavily in solutions to limit our emissions, or our plants are not the main cause of air quality problems, people will only believe that if they trust what we say. You can read more about the benefits of this approach in the case study on Ostrava.
There’s more on our approach to air quality on our website.
Shared value on our sites
In 2015 we set up a network across our sites to discuss issues relating to natural capital for our operations. These issues are not new to us, but we are redoubling our efforts to address them in the face of increasing regulations designed to protect these vital habitats. We want to look at ways to combine our commercial and sustainability objectives through the ‘greening’ of our sites: in Tubarão, Brazil, for example, we’ve planted more than a million trees, and this green belt has helped reduce dust emissions. Here we have also helped the local community to cultivate fish and make honey on our non-production land. This helps maintain the livelihoods of people in rural areas and contributes to improving relations with local communities.
Conserving natural capital
We continued to invest in the Baffinland Mary River Project, which is located in the Canadian Arctic. Stewardship for the surrounding natural environment has been and will continue to be a priority for the project, given the sensitivity of the region. A huge amount of environmental assessment work was done before the project began, in conjunction with people locally, and we are continuing to carry out extensive stakeholder consultations. Our mining operation in Liberia is also in an environmentally-sensitive region, and we are funding major biodiversity projects as part of our investment in the local area, so we can make a positive impact and compensate for the loss of biodiversity resulting from mining operations. There is more detail on both Liberia and Baffinland in our Mining segment report.
Managing our tailings dams
The rupture of the tailings dam at Samarco mine in Brazil, owned by Vale and BHP Billiton, was one of the biggest environmental disasters for the mining industry in many years. In mining, tailings are the residues left over when ore has been processed, and dams are constructed to ensure the waste remains stable. In 2012, we commissioned an independent structural assessment of our own tailings dams, and by 2014 these had been carried out in Ukraine, the USA, Mexico, Brazil, Kazakhstan, Canada, and Bosnia. Last year, we commissioned follow-up third-party audits in Mexico, Brazil, Kazakhstan and Ukraine, and as a result we allocated over $44 million in investments to improve our management of tailings in those countries. New audits in Canada and the USA will follow in 2016. As a result of this work we have established a new corporate standard for how we monitor these dams, and a task force to ensure that we follow up these audits with the right actions to ensure the dams’ continued stability.
There’s more on our approach to land management on our website.
We have two water-related issues: the amount of water we use and how we reduce it; and how we manage our wastewater, so it doesn’t cause a problem with pollution.
Reducing the amount we consume
Water resources under strain can take different forms. Whilst in some parts of the world we must respond to excessive water supplies – Liberia, for example, frequently suffers floods – in others a lack of water is the pressing issue. Brazil has had a severe drought since 2013, and in 2015 we had to respond quickly to a severe water shortage at Tubarão, and managed to cut water use by 30% in just 15 days. There’s more on this in the Brazil segment section.
Where water resources might come under strain, steel plants are designed not to rely on groundwater or municipal water sources. In fact, the water we withdrew from groundwater sources made up just 0.4% of our water intake in 2015. Steel plants are also designed to treat and recycle water – often thousands of times, so that actual volumes used are far higher than those withdrawn.
Where the availability of water is not an issue, such as around the Great Lakes, our water withdrawal is much higher since the steel plants located there are not designed to recycle water. These figures influence our data at global level, and so our consolidated water data does not give a meaningful picture of how well we manage water as a scarce resource. 2015 is a case in point. Due to an increase in extraction at our NAFTA sites on the Great Lakes, our water intake across all sites in 2015 increased 3% over the previous year, to 24 cubic metres per tonne of steel produced.
Most of the water we withdraw is also discharged, and only a small amount is lost to evaporation: our net consumption of water in 2015, across the world, was 5.1 cubic metres per tonne. We’ve disclosed information on our water use to the Carbon Disclosure Project since 2010, and our local sustainable development reports give more specific detail at local level.
We need a lot of water, but it doesn’t have to be of drinkable standard. So we are also looking at alternative sources, such as seawater, rainwater, and the re-use of wastewater from local water treatment plants.
The regulations governing the quality of discharge water are becoming stricter, and we need to ensure we comply. The best ways to do that are to use less water in the first place, to monitor its quality, and to find more environmentally-friendly ways to deal with the discharge.
In steelmaking, we use water for cooling and cleaning, and the wastewater that’s generated must be treated before discharge because of the pollutants it contains. In many plants we recycle water numerous times in our processes, and so it is typically treated numerous times too to avoid corrosion of our equipment. This means that when we discharge it, it may actually be cleaner than when we first extracted it. We also use a lot of water to dampen down dust in mining.
The environmental team at our global R&D centre in Asturias, Spain, has been looking at a number of different approaches to treating pollutants in the waste water from our blast furnaces, assessing and testing them from a technical, economic, environmental, and safety perspective. As a result, we’ve now developed two new processes that both cut the costs of wastewater treatment and reduce the use of hazardous chemicals in the process.
There’s more on our approach to water on our website.