Russia’s Nornickel, the world’s largest producer of palladium and high-grade nickel, has launched an environmental risk management review in order to identify and better manage new climate change risks that are emerging.
The announcement of a risk management review follows an independent report by consultancy ERM on its findings about what led to the May 2020 fuel spill incident in Norilsk.
"Regardless of the causes of the incident, the company takes responsibility for the full clean-up. ERM's findings confirmed that the new climate change risks are emerging and we should improve our risk management in order to mitigate them more efficiently,” said first VP and COO Sergey Dyachenko.
He said several new corporate governance instruments had already been introduced, including a risk management committee chaired by the company's president.
In terms of physical risks, Nornickel has a 100-billion rouble infrastructure budget to improve industrial safety of infrastructure in Norilsk.
The group is upgrading its permafrost monitoring service and designing a foundations monitoring system. The monitoring project includes satellite imaging, monitoring of supporting piles and soil temperature by means of confirmative geological drilling, installation of strain gauges and temperature sensors, and an upgrade of the Polar division's diagnostic centre and the permafrost laboratory.
Nornickel chairperson Gareth Penny said ERM’s report was insightful and that it had delivered important recommendations.
“It was important that a globally recognised and respected firm such as ERM has undertaken an independent review of events and the clean-up efforts by the company. Important progress has been made, but with much that must still be achieved. Nornickel remains fully committed to making the necessary progress in environmental affairs to ensure its operations adhere to world-class standards."
Nornickel has set aside 148-billion roubles after Russia’s ecological watchdog asked it to pay for the damage caused by the spill of about 150 000 bbl of diesel from a storage tank into a river system. The miner is challenging the size of the fine, saying the watchdog used the highest damage coefficient, which assumes the company did nothing to mitigate the impact of the spill.