Environment

Although we do not operate in regions of water stress, our mining operations rely on water and they discharge treated water. Ensuring the right water balance means monitoring, metering and auditing our water use, while also carefully managing discharge water quality. The majority of our water is consumed by our plants during ore processing. We continue to minimise our fresh water withdrawal by extracting water from runoff that has naturally seeped into our mines or drainage systems and recycling it.

When additional supplies are required, we may purchase from local utility companies. As a last resort, we utilise local or state authority permits to extract limited quantities from rivers, dams and groundwater aquifers. However, we never withdraw water from surface sources in environmentally sensitive areas, or where water is of great importance to local or indigenous communities.

We are committed to gradually increasing the share of water reused in our processing cycle, having set a goal to reduce fresh water use for processing each tonne of ore by at least 11% by 2023, compared to 2018. In 2019, we managed to decrease this indicator by 10% compared to 2018. On average, approximately 87% of our water is recycled and reused.

Waste is an inherent by-product of the entire mining industry, resulting in significant quantities of mineral waste. Therefore, waste management has become a fundamental part of our environmental program. While applying rigorous management systems to prevent environmental contamination from waste disposal, our focus is primarily on reusing it when possible, and disposing of remaining products in a way that will not pose a risk to the ecosystem.

We set our corporate goal to increase the share of reused waste by 2 percentage points at each mining site by 2023, compared to 2019. To achieve this target, we have developed unique strategies for the alternative usage of overburden and waste rock, such as for backfill in developed champers, for the construction and maintenance of roads, for construction sites preparation as well as for the reinforcement and construction of tailing dams.

We operate nine tailings dams in Russia and Kazakhstan and each is rigorously monitored and each is inspected daily, with checks on pipelines, pump stations, water levels and dams. Our investigations confirmed that any emergency failure at our dams would have no impact on settlements, buildings, structures or facilities where communities or employees may be present. However, in light of incidents in our wider industry, in 2019 we published our first TSF disclosure.

• Please see full disclosure on our TSF management (pdf)

As is unavoidable with all mining projects, our core activities generate air emissions, including carbon dioxide, nitrogen, sulphur oxides, and inorganic dust, which is the primary type of emissions pollutant produced throughout our activities.

Our EMS includes robust systems that continually monitor these gases and particulates, as well as enabling us to continually refine our processes to ensure high air quality standards. For instance, around our mining sites, we continually improve irrigation, dust separation and shield technologies to minimise local impact. In 2017 we set a corporate-wide goal to decrease sulphur dioxide emissions intensity by at least 1% in 2020 compared to 2016, and are glad to report that we had achieved a 14% decrease by 2019.

We are committed to treading lightly in the regions where we operate and work hard to minimise our impact on local biodiversity. To this end, as a matter of policy we do not operate in or adjacent to protected or vulnerable areas. We respect, and will not encroach upon, land that has particular value — natural, historical or cultural — for Indigenous Minorities of the North (IMN). We also engage in comprehensive land rehabilitation once we have finished working in a particular area, focusing on the reparation of any environmental damage that our operations may have caused.

Measuring and managing our biodiversity impact

We determine our biodiversity impacts through our regular site-specific biodiversity management surveys. They imply regular studies and monitoring of our mining sites and adjacent areas, which we conduct in collaboration with local scientific institutions.

In addition to scientific monitoring, we have developed a framework to promptly report on any cases related to biodiversity, focusing on those that lead to any wildlife harm or mortalities. This complements annual biodiversity reports prepared at every site within the Environmental Management System. The report includes the list of rare and hunted species found at our mining site or adjacent territories during the year. According to the reports, the most common wild animals species encountered near our mining sites are brown bear, fox, hare, musk deer, duck, capercaillie, mountain sheep, lynx.

Altogether, this helps us analyse our environmental impact on fauna and flora and plan further activities, prioritizing preventive measures over compensatory ones:

• avoiding building on migratory routes or close to environmentally-protected or indigenous peoples’ territories;
• minimising impact to existing sites by adopting safe and clean technologies, such as dry stacking of tailings;
• installing bird deterrents at waste polygons and tailing storage facilities;
• surrounding our open pits with waste rock walls to prevent animals from falling in;
• installing road signs that warn about wild animals;
• planning proper mine closure activities and land rehabilitation;
• planting perennial herbs and trees in adjacent territories;
• educating and engaging employees and communities.

Stakeholder engagement in biodiversity conservation

To increase efficiency of our Environmental Management Program on biodiversity and to identify threats to biodiversity loss, at all stages of mine life, we cooperate, exchange knowledge and experience with local, national and international scientific and expert centers, local communities, state authorities in the regions where we operate. We commit to transparency and open communication while complying with applicable legal requirements.

Responsibility on biodiversity conservation lays primarily on environmental teams, operations management, relevant managers, and on the Safety and Sustainability Committee of the Board of Directors. Additionally, our communication teams are training and involving our employees and local communities in environmental and biodiversity awareness programs. See more here

Under the legal requirements of countries where Polymetal operates, we are not allowed to mine or produce metals in areas with the highest biodiversity value. Our operations are regularly monitored by state authorities responsible among others for biodiversity conservation and if they detect any negative impact on biodiversity, we will develop measures together with authorities to mitigate these impacts and achieve no net loss.

In recent years we have implemented a series of measures to both mitigate the impact of our operations local biodiversity as well as to commit to lasting environmental benefits in the regions in which we work. We have successfully initiated environmentally friendly programs to prevent wildlife such as deer and birds from coming into contact with waste and our pits and have begun to rejuvenate the flora and fauna in the areas which we work, such as through herb planting programs and the release of some 12,000 pink salmon into the Arman river as part of our Environmental Program.

Though less the case in underground mining, mining and the effects thereof nevertheless have an impact on the environment around our mines. This is caused by infrastructure such as storage, waste, tailings and roads. It is our priority to work with state bodies, local communities and our employees to mitigate the long-lasting effects of our operations after the closure of our mines.

Our long-term remediation obligations include fulfilling decommissioning and restoration liabilities and covering suspension or abandonment costs in compliance with national regulations and legislation. The Company covers these costs. We carry out geological, surveying and repair works to ensure that once a mine is suspended or abandoned, underground operations, drilling sites and buildings are not hazardous or dangerous. Additionally, we carry out necessary environmental rehabilitation.

Polymetal aims to minimize negative impacts on the environment and stakeholders by ensuring the safety and stability of sites and facilities after closure and ensures that they are left in a condition which is compatible with subsequent land uses for local communities in regions of our operation without threat to human health. In doing this, Polymetal adheres to a list of key principles in the course of mine closure:

• To disseminate effective and comprehensive closure planning practices for the Company
• To encourage employees, management and partners to demonstrate leadership
• To ensure that closure planning reflects legal and regulatory requirements
• To apply state-of-the-art technologies for the mine closure
• To ensure that adequate resources are available for the closure process
• During the operation stage, to rehabilitate as much land as possible prior to closure and to decrease the level of landscape alteration (use pit for waste rock and tailings storage, backfilling and use of waste rock for construction)
• To consider the concerns of stakeholders (local communities, governments, employees and landowners) in closure plans
• To conduct post-closure monitoring until the responsibilities are transferred to a third party

Polymetal takes responsibility for compliance with the requirements of applicable laws and strives to meet stakeholders’ expectations when closing a mine. For these reasons, our priorities of effective mine closure include:

• To provide timely and effective closure planning and implementation of related measures
• To reduce financial, social and environmental risks when the operation closes and optimize social, economic and cultural opportunities for the host community
• To ensure the safety and stability of structures and facilities during and after the closure and for further and subsequent use
• To ensure that adequate financial resources are available to meet the full cost of closure
• To ensure that business is conducted in a socially responsible way and that obligations towards the dismissed personnel are met

We aspire to a comprehensive approach to mine closure in cooperation with the relevant bodies, stakeholders, our employees and contractors, and local communities in order to effectively mitigate long-lasting environmental effects, while taking continued responsibility for the mine, the environment and our employees after closure.

In 2016, the European Bank for Reconstruction and Development (EBRD) and Wardell-Armstrong (WAI) completed a detailed review of the social and environmental issues linked to our Kyzyl gold project in north-eastern Kazakhstan.

Based on this review, a formal Environmental and Social Impact Assessment (ESIA) has been produced by WAI for meeting environmental and social requirements of the EBRD, which is considering the opportunity to finance the project.

The ESIA is a comprehensive analysis of any risks and opportunities linked to all key areas of the Kyzyl project, including its environmental, socio-economic and cultural effects.

Polymetal has also agreed with the EBRD on the Environmental and Social Action Plan (ESAP), which includes a series of actions that Polymetal will implement in order to avoid, reduce, control, or otherwise mitigate potential environmental, occupational health and safety and social impacts during Kyzyl construction and operation.

ESIA summary

• Executive Summary: Russian | English | Kazakh
• Supplementary Environmental and Social Report (SESR): Russian | English | Kazakh
• Environmental and Social Impact Assessment (ESIA): Russian | English | Kazakh
• Management Plans: Russian | English | Kazakh
• Stakeholder Engagement Plan: Russian | English | Kazakh
• Non-Technical Summary: Russian | English | Kazakh
• Environmental and Social Action Plan (ESAP): Russian | English | Kazakh