Interview with Joseph Sam, Chief Business Officer at Exclusive Quarries Group
Joseph (Joe) Sam is the Chief Business Officer of the Exclusive Quarries Group in India and the Founding Partner of the Dubai & India-based Global Natural Resources Advisory Group. He is an Engineer with a double Post Graduation & is pursuing his Post Graduation in ‘Environmental Law’ from the National Law School of India University. He has led various companies in the Retail, Consulting, Design & Building Materials industries prior to entering the Mining & Metals industry 7 years back.
He is also a Certified Corporate Director from the Institute of Directors and is Certified (from various institutions) additionally in Negotiation, Conflict Management, Entrepreneurship Development, Investment Law & Institutional Finance and in the Business of Mining. He moves between India, South East Asia, and the GCC working on assignments in Mining, Metals & Commodity trading and is married to Ritika Maheshwari his wife of a decade with 2 spritely & restless boys.
How can mining and the targets of COP26 co-exist
Joseph Sam: “It’s time to say “enough”. Enough of brutalizing biodiversity. Enough of killing ourselves with carbon. Enough of treating nature like a toilet. Enough of burning and drilling and mining our way deeper. We are digging our own graves.” – UN Secretary-General António Guterres at the World Leaders Summit, COP26, Glasgow.
This statement reverberated throughout the world in the days to come post the COP26 Summit held in November 2021 and the word MINING which was already seen with a fair amount of anger & disdain became an anathema all of a sudden but the truth is that some element or output of mining is present in almost every object, product or service that we see around us or use every day and neither the General Secretary, the UN or its various bodies, Climate Activists or anyone in the Global community has a sudden solution as an alternative to the elements or products that are mined.
Yes Climate change is real and the effects of global warming visible with the erratic weather changes worldwide but we have no choice but to reach a stage of Net Zero emission in every possible industry along with taking corrective action in ensuring that the carbon content in the environment is reduced so that global warming abates & the effects of it neutralized if not reversed.
While we can endlessly debate climate policy, any approach to penalizing the Mining Industry in a haphazard & reactive manner can mean a full stop to every form of development be it infrastructure, renewable energy, space & automotive technology, construction, urbanization & real estate development, transportation, the consumer industry, the engineering industry etc.
What needs to be brought in is a framework on Environmental, Social & Governance (ESG) standards for the Mining industry (across the board & globally) with the focus on better mining practices, application of zero-carbon technology, usage of green fuels, development of biodiversity ecosystems along with the mining areas, restoration of the mined areas (including afforestation & recharge of water bodies) and finding better ways to manage or use the discharge or effluence from the mining activity.
The Mining industry (except Fossil Fuel mining) is responsible for 5 to 7% of the global greenhouse gas emissions of which 1% is on account of direct mining operations & the balance attributed to the release of trapped methane.
The fossil fuel mining industry contributes to over 50% of the global greenhouse emissions which means there is a need to approach mining as an activity in 3 distinct ways:
The need to identify minerals & metals that are absolutely vital for the future generations & how it can be the only viable & sustainable alternative to any other product till something else is discovered. The ESG standards should be implemented in these mines in the next 3 to 5 years.
The need to ‘phase out fossil fuel mining’ unless a revolutionary technology evolves where emissions from it are minimized to a single digit if not eradicated. One should co-opt the OPEC, International Gas Union & World Coal Association in this activity as otherwise there will be various interests working at cross purposes.
The need to find substitutes that are environment friendly, biodegradable and reusable to the other mined minerals & metals and this includes artisanal mining. This process should be ingrained in the educational & research curriculum by every signatory member nation so that awareness & activism is supplemented by a pragmatic approach to problem solving rather than passing the buck.
While the COP26 focused on mitigation, adaptation, finance & collaboration the areas where it affects the mining sector are:
- Collaborative Effort: Most economies that are developed or developing aggressively have had the mining industry contributing significantly to the GDP growth & employment which means the Government, NGOs, Industry, Society, Infrastructure creators & most other stakeholders need the Mining industry for its sustenance. This implies the need for collaboration to find new ways to mitigate & eliminate the effects of Climate Change on account of the Mining industry.
- Green Mining: Ambitious targets to reduce emissions & focus on energy efficiency in mining operations (clean energy to power mining ops, clean sources & clean operating methods).
- Critical Minerals: The need to achieve net zero through the mining of identified critical minerals such as copper, lithium, nickel, cobalt, aluminium, iron & rare earths for ‘renewables’, ‘electric vehicles’ & ‘other vital technologies.
- Green Financing: The need to refocus financing of fossil fuel mining into: (i) emission reduction technologies in mining (ii) methods to alleviate or eliminate the after effects or output of the mining activity (iii) green tech to power the mining industry.
- Phasing out of fossil fuels for power generation and scaling up of green power (solar, wind, etc) as well as stopping the finance of thermal projects.
Can we balance the impact of mining with the impetus on establishing larger biodiversity parks in the vicinity, micro businesses for supporting the local economy and establish schools & healthcare for the local communities?
Joseph Sam: Going ahead, post the Paris Climate Agreement & COP26 and the visibly disastrous consequences of climate change, the focus for the Mining Industry globally should be on the implementation of Environmental, Social & Governance standards.
This would entail your question on balancing the impact of mining on a microlevel as well as the macrolevel though it needs to be started & done at a much faster pace than what we anticipated (2030 instead of 2050).
When the process of mining starts & expands in operations what happens to the local biodiversity is that it affects:
- The flora & fauna (displacement, eradication & disruption)
- The local population/ community (health, indigenous economy & practises and proliferation of social evils)
- The topography (forest, water bodies, hill structure, ground water levels, etc)
Mining has even found to have changed microclimatic conditions by contaminating the air, water and soil considerably hence there has to be a different & proactive perspective applied to the business of mining. What conventionally means ‘reacting to change that is effected due to mining’ has to be replaced by ‘anticipating for those changes.
Hence CSR cannot be a fallout of mining but budgeted as a parallel activity. The World Economic Forum estimates that more than 50% of global GDP (USD 44 trillion) “is moderately or highly dependent on nature and its services,” and therefore exposed to biodiversity loss. Future investments & Government support in mining is increasingly going to depend on how it threatens biodiversity or environments that need to be conserved at any cost.
With modern mining damaging habitats (of even micro-organisms) & degrading local environments (above & below the soil) the industry faces increased risk of legislative roadblocks, activism, stakeholder concerns & not being lucrative for investors anymore.
It has been found that when mining projects are of very large scale, be it a single large lease or multiple leases in the same vicinity or area there has been considerable biodiversity loss, displacement of the local economy & once the operations are wrapped up the entire area ends up exploited and uninhabitable.
Mining Companies, Associations & Industry bodies should work with their respective Government’s (Federal & State) and collaborate with NGO’s and conservationists in ‘anticipating the change in the ecosystem’ in the course of the mining period & assess.
5 key impacts at the level of the mining activity:
During the study phase prior to the submission of the mining plan (or development plan for a mining basin) every Government at the central and federal level should co-opt Conservationists, Environmentalists, Social Scientists, Economists and other related Stakeholders to understand the above 5 impacts in detail.
Most assume ‘Biodiversity” means local flora & fauna without understanding that it extends to “Genetic Material” of indigenously growing plants, animals & birds which are specific to a certain region. This genetic material could be used in R&D for the pharma industry, healthcare and other related industries impacting the cost of medical treatment, food security, agriculture, indigenous knowledge & even restoration of the degraded environment.
The traditional livelihoods of millions of communities globally from the Amazonian basin to the river basins & forests of India to the mountainous regions of the Himalayas and Central Asia rely on the rich biodiversity for their sustenance and Mining companies assume that merely compensating them using financial incentives or alternate habitations or giving them jobs or building a school or hospital can make up for the loss of biodiversity which is a fallacy.
The same way the destruction or harnessing of land/ hills for crushing stones, excavation of minerals and other mining has resulted in floods and droughts especially in the last 3 years confirming that mining has repercussions on the local “climate” as well. The recent foray into deep sea mining to excavate renewables has already sounded the knell on the aquatic biodiversity as well as release of trapped carbon dioxide and methane into the oceans resulting in multiple consequences from increase in acidity to changing ocean levels. The impact of Climatic change on account of Mining has to be studied assiduously & submitted in the Environmental Impact Assessment itself.
The third aspect of “Economic” impact has to be studied from the perspective of creating jobs, supporting businesses and creating sustainable employment including cross skilling, skill development and continuous learning. This has to take into consideration that by the end of the mining lease the children within the mining community/ zone would have become adults who would chose to migrate if the consequences are devastating or continue contributing if it has helped them evolve.
If most economic activity focusses merely around consumerism or catering to the mining staff & labor and capturing their earning within the ecosystem then by the time the mining lease gets over the number of businesses which would have proliferated recklessly without the potential to be sustainable is considerable & would overnight have to shut shop. What has to be done is to assist in establishing sustainable economies and encouraging a spirit of entrepreneurship that is dependent on the local biodiversity, arts & crafts and other resources as well.
The “Social” impact of Mining is rarely studied because most often these are traditional communities and what has been seen across decades is that it has resulted in imbalances especially amongst the sexes and created economic disparity affecting the social status.
While some Governments had allowed benefit sharing amongst the locals post the various UN initiatives & the evolution of civilized society itself most communities were virtually displaced and eliminated in the course of history. The exploitation of diamond & precious metal mining in Africa, rare earth minerals of South America, gold mining on the indigenous community lands in the United States & Australia and the ruby mines of Burma are examples of how mining has resulted in the destruction of the social fabric and even elimination of certain communities. With increasing global activism against this, this impact has been addressed with the focus on benefit sharing & societal preservation.
Finally, the “Demographic” impact has to be studied which is normally a consequence of the above 4 factors. There have been instances of how Mining has/had changed the demographic profile of a region so drastically that it has resulted in the growth of secessionist or anti-Government forces. In conclusion one should balance the impact of mining with relevant, sustainable and scalable initiatives that are an outcome of a well thought off study done prior to the mining activity itself.
How can we take the negative connotation out of the word MINING when its being blamed considerably for carbon & methane emissions?
Joseph Sam: A study published in the journal Nature in September 2021, found that nearly 60% of the planet’s “remaining” oil and natural gas and 90% of its coal reserves should remain in the ground by 2050 which means that fossil fuel exploitation should peak in a decade & start waning steeply after 2030.
Yet unless the Oil & Natural gas and Coal producing nations come up with alternatives including economic sustenance business models, mining as an activity will continue albeit with the potential to cause disruptions, conflicts and disastrous consequences especially escalating the refugee crisis due to climate change.
If the Mining industry detaches itself from the political led agenda of economic sustenance at any cost and unites in the effort to contribute to the reduction of greenhouse emission & alleviate erratic climate change, then the negative connotation & reverberation of it being an industry that has evil consequences can possibly be mitigated.
Most of the economies that have conventionally mined fossil fuel & gas (the Middle East, Iran, the United States, Venezuela, Russia, Kazakhstan, Australia etc.) have grown dependent (especially politically) on it so much so that they haven’t even developed alternative industries but have instead aligned its continuity using political rhetoric even on international platforms.
To ask these countries to reduce the exploitation of fossil fuel considering they are more suppliers than users would be halfhearted and instead the consuming nations of these fossil fuels should explore renewable energy & other innovative technologies to alleviate their dependence on fossil fuel.
Most of the industries that are mining led (minerals, metals, fossil fuels, natural stone & gems) are also the ones that have large associations or industry bodies (cartels & lobbies in some case) which represent their interests, output, prices, distribution etc. and the synergistic action by these along with the involvement of bodies like the UNEP, CBD, UNFCC, ICMM & other interested parties can lead to a larger positive outcome.
Getting these stakeholders of the global Mining industry together to lead a cohesive initiative to align its goals with that of the Paris Agreement & COP26 and at the same time ensuring that they cohesively promote the significance & need for the Mining Industry to meet various Environment, Economic & Social goals can remove the negative perception of mining within the coming decade.
There can be a cohesive effort by all the stakeholders on the following action points:
- Dissemination of the joint initiatives to assist the industry players in achieving the Net Zero Carbon emission targets.
- Research, Development & Application of the following in the business of mining:
- Clean technology
- Increasing the efficacy of mining operations
- Sharing of best practices especially in the areas of biodiversity & environmental sustainability & renewal
- Usage of clean energy
- Decarbonizing the atmosphere & reducing effluence especially of carbon & methane.
- Educating the General population, NGOs at the local level, federal Governments and other related stakeholders on the joint initiative by the Mining Associations & global stakeholders.
- Lobbying with Governments in both supplier & consumer nations to mitigate the fallout of the phasing out of fossil fuel & irrelevant mineral mining.
- To adopt a systemic & methodical global roadmap to mineral excavation which would avoid over exploitation & the sustenance of PROTECTED AREAS (8% of mineable area of earth’s surface), KEY BIODIVERSITY HOTSPOTS (7% of mineable area of earth’s surface) & WILDERNESS (16% of mineable area of earth’s surface).
While the negative connotation of mining goes beyond emissions what can also be supplemented with the above initiatives is how to make MINING a SUSTAINABLE industry in terms of its existence with the community, CSR, building microeconomies that live longer than the life of the mine’s, co-opting local stakeholders in the restoration of the ecological balance and leveraging biodiversity resources for greater access to benefit sharing with the local populace.
What is the role of innovation and creativity in the mining domain?
Joseph Sam: The Mining domain has considerable space for creativity & innovation considering what it faces as an industry are the stringent targets to meet Net Zero Carbon emission as well as scale down on fossil fuel extraction & increase exploration & mining of renewables including that in the sea-beds.
The next 2 to 3 decades will be replete with opportunities in prospecting, exploration & mining with increased opportunities in the application of AI, Automation & Robotics, Drone & Satellite Technology deployment, Equipment tech & management, Machine learning, Worker Infrastructure & Safety betterment & the efficient handling of the ores/elements.
This is an opportunity for institutions, universities, consulting firms and associations to participate not just in R&D but co-opting resources to participate in this transformation process.
The age of Smart Mining is going to see the convergence of the offline activity of mining reborn with the adoption of Artificial Intelligence, Analytics, Augmented Reality (for simulation), application of Geospatial technologies,
Digital technologies (for monitoring, safety, operations, capacity building, productivity & efficiency) and the Empowerment of employees, communities & stakeholders in ensuring that there is a coherence between the Economic, Community & Environmental objectives.
This will mean that Environmental, Social & Governance (ESG) standards will become more digitally and technologically enabled positively transforming the perception of the Mining Industry from that of pure corporate profit to that of holistic prosperity.
One of the key areas of innovation & creativity in the Mining industry that is going to play a very significant role in its scalability & business credibility is the application of the BLOCKCHAIN technology for 3 key functions:
- Traceability from ore to market place
- Authenticity of the product from the raw material stage
- Building cogency in the supply chain.
Though too early to say it is predicted that this could revolutionize the mining industry so drastically that the end consumer could find out at some point where and when each element in their product was mined from!
What has been the impact of Covid-19 on the mining industry in the last two years? And where do you see it going forward?
Joseph Sam: Covid 19 which has resonated in its mutated offerings over the last 2 years has disrupted global trade, economy and has overnight bankrupted leading players in industries such as Travel & Tourism, Airlines, Hospitality, Mining and Engineering.
Most of the artisanal mining companies shut shop and China, the world’s largest processing and manufacturing hub, stopped buying in bulk from most of the mining led economies.
In the last 2 years on account of the perception of China having controlled the destiny of global trade, especially after the speculation of the origin of the virus, many of the emerging and developed economies have started exploring the development of manufacturing and processing outside of China.
The first wave from the end of 2019 to the end of 2020 saw a massive disruption where the switch from the integrated method of working changed to working in silos which meant that while every nation put the brakes on every format of economic activity the opening of the economies were done on the basis of the impact of Covid to that specific economy. That was accentuated by the vaccination development and roll out which gave an advantage to countries like the United States, China, India, Russia & other pharma development centres.
This still didn’t help much as the “world being a global village” meant that most nations needed to reach a level of normalcy which was once again disrupted by the Delta Variant which proved to be even more fatal & saw every nation which opened up its borders during the plateau of 2020 once again gasping for oxygen.
This time the residual effect went beyond causalities to the resonance of an untold fear of how a small virus can continually evolve and bring the world to a standstill devastating the economy, communities and industries. During this time the Mining industry & its leadership learnt that besides conventional Covid protocol there also had to be a sense of “technology upgradation”, application of “remote monitoring & diagnostics” , the need to focus on “digitization of operations”, the emphasis on “predictive maintenance” so that expensive & heavy spares can be replenished at mining sites to avoid “downtime” and the need to “collaborate” rather than compete (on best practises, manpower, spares & consumables, buyer & vendor management etc).
The Mining industry is better prepared for the Omnicron variant now because of:
- The roll out of the vaccination programme worldwide with access to affected age groups.
- A developed resilience against the fatigue of seeing recurrent disruptions.
- The opportunity it has presented for the evolution of new technologies, systems and methods that can be applied across Industries.
- The opportunity for collaboration with non-Sector players such as the communities, NGOs & Civil society where a realization has set in that mining is a critical sector for socio economic development. They further understood that besides jobs to the local communities mining also provides livelihoods to the supporting businesses within a community.
- The clarity that has come into the sector aligning its goals with that of the world on the Environment related targets (especially after the COP26 in Glasgow) such as the achievement of Net Zero emissions, utilization of green & clean energy in the operations & subsequent supply chain and the management of effluence, water, biodiversity & other natural resources around the mining ecosystem.
- Refocus on mineral exploration & extraction of metals that can be used in renewables & contribution to sustainability.
- The supply disruptions are better planned now which makes the planning process proactive, effective & predictive. This includes raw material, power, spares, consumables, labor, machinery and other technology.
- Establishing of healthcare facilities including support personnel, supply of vaccines & medicines and oxygen plants in the proximity of mining sites & the communities.
- Transformation from the offline format of working to the online format including for business summits, exhibitions and expositions (using virtual & interactive formats). Even the equipment vendors, software providers and other suppliers started remote support with the help of video & audio solutions such as Zoom, Microsoft Teams, Google Meet and Cisco’s Webex.
- The Covid protocol of wearing masks, social distancing, sanitization of the body & equipment, isolation and treatment of infected personnel and labour management (working together, sleeping in dorms, eating together in canteens, using public space, movement in & out of mines etc) has become institutionalized in the work culture of most mining companies now.
- The Mining industry is here to stay, adapt and evolve into one of the most vital industries globally in terms of GDP contribution, Wealth creation, Employment generation, Community transformation and Technology evolution in almost every other industry.
- Going forward its evolution into a publicly accepted & acknowledged industry of vital importance is inevitable.
A thought provoking, well articulated article. Evidently, mining is facet that touches everyone’s lives in more ways than one and we have but a Hobson’s choice in accepting it. At least until credible alternatives for the natural resources are positively identified… Going behind the mining industry with punitive measures in terms of taxes or levies as a form of “reparation” would be tad impulsive and no doubt hurt so many sectors if not force the mining industry to come to a grinding halt. As Joe correctly brings out, the key lies in striking the right balance and a participative approach by all stakeholders. Aligning mining requirements, to the extent possible, in line with the goals of Paris Agreement & COP26 will undoubtedly require a concerted effort by all agencies to “walk the talk”. Often, the best laid plans are laid to waste because one too many didn’t do just that? After all, the smallest good deed is better than the greatest good “intent”? The article is a brilliant one that cries for attention of every well meaning stakeholder. I hope the readers take cognisance of the issues and suggested solutions that have been so well deliberated by Joe Sam.