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Safety, health and environment

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Our safety and sustainable development governance model begins with meeting legislative requirements as a minimum standard. Sophisticated risk management systems and processes are then modelled around key risks for implementation at operational level. A risk-based approach also informs the way resources are allocated and used in the group to ensure ongoing progress towards and beyond legal compliance.

During the reporting period, no fines or sanctions for non-compliance with environmental laws and regulations were imposed on any Exxaro operation.

ISO/OHSAS certification

In 2009, four operations obtained both international health and safety accreditation (OHSAS 18001) and environmental accreditation (ISO 14001) – Matla, North Block Complex, Inyanda and AlloyStream. This takes the total to 13 of 17 operations accredited to date. Another four operations have been scheduled for accreditation in 2010.

Notably, AlloyStream was certified for the occupational health and safety management system according to the BS OHSAS 18001:2007 standard, for environmental management systems according to the ISO 14001:2004 standard and recertified for the updated quality management systems according to the ISO 9001:2008 standard. In the ISO 14001 audit, AlloyStream received the highest score of all companies from 27 countries included in the 2009 audit.

Notably, Namakwa Sands achieved OHSAS 18001:2004 certification, and was the first operation in the Western Cape to achieve OHSAS 18001:2007 certification. Namakwa Sands has also consistently retained ISO 14001, ISO 9001 and ISO 17025 certifications.

Safety

Highlights

• In 2009 Exxaro ended the year with an LTIFR of 0,33, a 15% improvement on the 0,39 recorded in 2008 but disappointingly higher than the target of 0,21.
• Tshikondeni improved its safety per-formance in 2009, recording only seven LTIs and 24 minor injuries. This is a 60% improvement in LTIFR and 27% improvement in minor injuries on 2008.

Safety always, all the way
In October 2009, Exxaro held its second CEO Safety Summit under the theme Safety always, all the way to report back on issues highlighted at the inaugural summit in March when the group identified challenges that presented barriers to sound safety practices. The summits involved a range of stakeholders to identify key areas that will make a tangible difference to safety performance, including consequence management, safety training, culture (the Exxaro safety way of life), mini-HIRA (hazard identification and risk assessment) and communication. Task teams are driving a broad spectrum of action plans in these areas. Exxaro has had the support of government, the Chamber of Mines and its recognised unions in implementing its safety improvement plan, which includes:

• Leadership in making safety a way of life
  Exxaro’s leaders will set the example for safe behaviour (visible felt leadership) by being directly involved in safety visits, and ensuring compliance to safe work practices.
• Zero-tolerance approach
  Exxaro introduced the 13 zero-tolerance safety rules that will become part of every employee’s conditions of service. Employees who violate or ignore these rules will be investigated and disciplinary action taken where necessary. Only by adopting a consistent zero-tolerance approach to safety violations, with consistent consequences, can Exxaro effectively protect the lives of employees.
• Knowledge — training for life
  Exxaro will establish a standard safety training programme across the group, for all job categories. Training will become an ongoing sustainable process to ensure every employee can identify and respond to a dangerous situation.
• Identifying risks — formal process
  Reinforcing the need to take two minutes to conduct a mini-HIRA — a task that could prevent injury or save a life by becoming a conscious action, not just a thoughtless habit. The mini-HIRA standard will be revised and training material developed to ensure all employees understand how to conduct one.
• Communication — daily
  Talking about safety and having the tools to keep safety at top-of-mind awareness are key to ensuring safety practices become a way of life for group employees.

The 13 zero-tolerance safety rules relate to:

• Being under the influence of drugs or alcohol at the workplace
• Lifting heavy equipment
• Roof support in underground mines
• Confined spaces
• Working at heights
• Energy and machine isolation
• Vehicle safety and operating a vehicle, equipment or machinery without authorisation
• Explosives
• Working with electricity
• Gas explosion and gas areas
• Safety devices
• Permit work
• Site-specific rules.

Safety pledge
Signed by Exxaro stakeholders in March 2009
We, at the Exxaro Resources group of companies, and all our stakeholders, in a relationship of mutual trust and respect, will further evolve our safety culture of zero harm in which we, while consciously learning from our own and others’ mistakes and caring for each other, lead with safety excellence, benchmarked against industry best practices.

Keeping our people safe
Our ultimate target remains zero injuries and, therefore, zero fatalities. To reach this goal, we have an incremental target of a 30% improvement in safety performance each year. We aim to achieve this through stringent application of management protocols, programmes and systems. Formal management-worker health and safety committees are in place at all operations, and meet regularly to ensure we reach our targets.

The strategic review of our safety practices highlighted key risks facing our group, particularly limited hazard awareness, varied safety competency and non-adherence to corporate safety standards. Collectively, these may result in the perception of Exxaro being an unsafe business — a perception that carries material risk to our sustainability.

Accordingly, we have developed a timeline to Exxaro’s desirable state that includes:

• Zero fatalities
• Zero lost-time injuries
• Visible, felt leadership as a key driver of safety excellence in Exxaro
• Zero repeat incidents.

Timeline to desirable state
2009			2010 — 2011			2012 — 2015
CEO Safety Summit outcomes: 1 Set up task teams to address focus areas 2 Develop safety communication strategy 3 Consistent disciplinary code applied equally across all levels 4 Revised HIRA standard to be understood and applied by all 5 Revised visible felt leadership standard consistently applied across Exxaro 6 Safety improvement plans as a result of first summit 7 Standardised incident investigation process			Review priorities 1 Review safety improvement plans (SIPs) 2 Set up and train peer review teams 3 Conduct group-wide peer reviews to promote implementation of SIPs 4 SIP progress reports every quarter 5 CEO safety summit 2010 to discuss progress and challenges 6 Continue benchmarking and sourcing best practices			Review priorities 1 Annual CEO safety summit to challenge safety performance 2 Annual revision of SIPs 3 Periodic peer reviews

Although key risks differ by operation, the group’s major challenges are vehicle incidents, energy and machinery isolation, and risk awareness and discipline at all levels. Skills shortages continue to magnify these challenges and, accordingly, ensuring the group has sufficient trained people remains a priority.

Improving safety performance extends to contractors at all Exxaro operations as part of a formal programme:

• Contractors are managed as part of Exxaro’s workforce
• Adherence to corporate contractor management standards is enforced by each operation’s contractor manager
• Monthly inspections ensure compliance
• Induction and medical examinations are required by all contractors before starting work
• Contractors participate in monthly SHE meetings at operations.

Exxaro has a policy in place that details the group’s approach to identifying, preparing for and responding to emergency situations affecting employees and surrounding communities. This spans all known types of emergency including fire, flood, bomb threats, etc. Emergency situations that have occurred have been well handled, demonstrating the comprehensiveness of both policy and training. A good example is the intervention to address risks associated with the outbreak of H1N1 — as a result, the outbreak had no impact on any of Exxaro’s operations.

All lost-time injuries are investigated by the relevant business unit manager, while all fatalities are investigated by a committee with the appropriate skills, headed by an independent chairman. Each business unit tracks its adherence to standards and legislation through a programme of self-assessments and corporate audits.

Exxaro set a target of zero fatalities, and an LTIFR (lost-time injury frequency rate per 200 000 hours worked) of 0,21 for 2009. Despite a steady reduction in the LTIFR from 0,52 in 2005 to 0,36 in 2007, actual performance was 0,33 in 2009. This is a 15% improvement on the LTIFR of 0,39 recorded in 2008. In risk-specific terms, the leading cause of injury was lifting and material handling. The safety of our people is fundamental to our business, and we will not rest until we achieve our safety goals through collective responsibility, commitment and ongoing focus.

The fatality frequency rate per million man-hours worked in 2009 was 0,07, compared to 0,13 in 2008. Our target remains zero, as no death is acceptable. Despite excellent safety performances at several mines, we regrettably lost three contractors during the year in an explosion at a contractor’s site at Zincor, and a colleague in a non-reportable vehicle fatality at Arnot. This case was thoroughly investigated, and the lessons learned incorporated into our safety programmes to create an injury-free work environment.

Health and hygiene

Highlights

• Major HIV/Aids training, counselling and testing drive at 11 business units – with 83% of employees who attended training sessions electing to be tested. This represents 58% of the Exxaro workforce, against the group target of 50%
• Of 6 684 employees tested (half had not tested before), 12% were HIV positive
• 299 HIV-positive people are enrolled on the company’s HIV management programme
• 161 people are on ART (anti-retroviral treatment)
• 224 peer educators were trained (against group target of 200)
• New holistic occupational TB standard
• New standard on managing hazardous chemical substances.

Reducing employee exposure to health risks remains a priority for Exxaro. Our risks are typical of a mining group. Business units identify, rank and quantify their risks, and then implement programmes to mitigate the impact. Workplace exposures are linked to individuals and this forms the basis of the medical surveillance programme.

The occupational health risks to which most Exxaro employees are exposed are noise and dust, and this is reflected in the occupational disease profile. Newly diagnosed cases are submitted to the compensation authorities for confirmation that they are work-related, and serve as an early indicator of the possible occupational disease burden. Accepted cases are awarded compensation.

Our targets are to:

• Reduce NIHL (noise-induced hearing loss) to less than 10% loss of hearing (shift from baseline) per individual by 2013
• Reduce compensation costs for occupational diseases
• Reduce incidence of HIV
• Raise awareness of health and hygiene programme.

Timeline to desirable state
2009			2010 — 2011			2012 — 2015
1 Status report on noise and dust-control programmes 2 50% VCT 3 A total of 200 peer educators trained 4 Implement TB standard at three business units			Review priorities 1 Track cases with >5% loss of hearing (shift from baseline) 2 Reduce percentage of employees exposed to OEL dust and fumes 3 70% VCT and 50% retention on treatment programme 4 TB treatment provided at 50% of business units 5 Occupational risk and exposure profiling standard 6 Baseline study of indirect costs of HIV/Aids 7 Awareness campaign on noise, dust and thermal stress at all business units			Review priorities 1 No cases >10% NIHL 2 >80% VCT; >70% retention on treatment programme 3 >85% TB cases complete treatment 4 Reduce new HIV infections by 5% 5 Reduce indirect costs due to HIV/Aids by 5% from baseline
Key: OEL — occupational exposure limit; VCT — voluntary counselling and testing

Meeting mining sector targets
Dust and noise-reduction targets set by the mining industry aim to reduce the number of NIHL and silicosis cases. This depends on:

• Minimising noise and dust exposure to below occupational exposure levels (OEL)
• Reducing the time spent by employees in noisy and dusty areas
• Proper use of personal protective equipment.

Initiatives to reduce noise include:

• Enclosing machines with open cabins
• Boxing work benches
• Installing silencers on auxiliary fans
• Training.

Initiatives to reduce dust include:

• Removal of coal crusher at one of our sites
• Extraction fans at primary and secondary crushers
• Use of water in stockpile areas
• Dust suppression on opencast surface roads
• Increased ventilation in underground sections
• Wet plants
• Training.

Occupational diseases
Reported cases are those newly diagnosed and submitted to the compensation authorities to confirm that they are work related and eligible for compensation. In 2009 Exxaro reported 90 occupational diseases: this is an early indicator of the possible occupational disease burden. Tracking this data indicates potential cases that could be compensated and provides an opportunity to reinforce preventive programmes.

In 2009, Exxaro had 20 occupational disease cases accepted for compensation: 11 cases of NIHL, two cases of pneumo-coniosis, one of occupational lung disease and six of occupational TB.

There has been a general decrease in occupational diseases, except for NIHL and occupational TB. Efforts to reduce employees’ high noise exposure continue. There is also increased susceptibility to TB possibly fuelled by individuals with compromised immune systems. There have been no cases of silicosis.

Tuberculosis
New cases of non-occupational TB increased from 2008 (63) to 2009 (83 out of 11 180 employees). A new TB standard was issued for the group to ensure uniform and comprehensive management of employees with TB. The risks of TB include:

• Spread of TB in the communities where employees and contractors live
• Significant risk of co-worker infection (10 to 18 people are infected by one active TB patient)
• The high prevalence rate of HIV (which compromises individual immune systems) is a known risk factor for developing TB, therefore TB and HIV/Aids programmes need to be reinforced
• Workplace exposure to mining dust is a contributing factor to TB.

Given the dramatic increase in TB rates in South Africa and in the mining industry in recent years (below), it is important to manage TB and HIV holistically through better surveillance, diagnosis, treatment and monitoring. At each business unit, TB education initiatives reach employees at least once a year. These include information on symptoms and the importance of early diagnosis for effective treatment. Adhering to this new standard is expected to reduce the risk of developing, contracting and spreading multiple- and extensively drug-resistant TB in Exxaro.

Hazardous chemical substances
A new hazardous chemicals standard was issued to the group in 2009 in compliance with legislative (Hazardous Substances Act 15 of 1973) and international requirements (such as OHSAS 18001; ISO 14001; SANS 10232, 10234 and 10238). In terms of this standard, each business unit has to develop a site-specific procedure, database and training programme to eliminate and reduce the possibility of harm to Exxaro employees and contractors by the end of 2010.

H1N1 (swine flu)
There was minimal impact of H1N1 on Exxaro, with only three cases reported across the group and the individuals recovered fully. Exxaro will continue to monitor and manage potential risks as the flu season approaches.

HIV/Aids
The prevalence of HIV/Aids across Exxaro is currently estimated at 12%. At the end of 2009, 58% of our employees had participated in voluntary counselling and testing. This compares very favourably with our target to get at least 50% of all employees at each site to test for HIV.

A major awareness campaign during the year helped group employees understand the importance of their HIV status and provided information to help them make appropriate lifestyle choices such as joining a treatment programme or keeping their status negative. Exxaro’s HIV/Aids service offers employees support focused on four key areas:

Prevention:

• Employees are trained and offered the opportunity to test for HIV
• Peer educators are trained and supervised in conducting prevention programmes and providing information to colleagues
• Condoms are distributed.

Detection:

• Voluntary HIV testing.

Treatment:

• Employees who test positive for HIV can enrol on a treatment programme through their own medical aid, or through Exxaro’s outsourced service provider.

Care and support:

• A service provider call centre stays in touch with people registered on the programme
• Trained peer educators provide information about HIV/Aids to colleagues
• Health professionals are available on site to provide technical support to peer educators.

Environmental management

Highlights

• Exxaro ranks among the leaders in carbon disclosure standards in South Africa
• Water efficiency investigation under way
• Electricity usage baseline established for all operations.

Exxaro’s core focus is on conserving natural resources and reducing the burden of pollutants on the environment by:

• Complying with all applicable environmental legislation — as a starting point. Our aim is to exceed compliance
• Developing innovative policies and programmes for addressing environmental impacts.

All South African operations have environmental management programmes (EMPs) as required under the Mineral and Petroleum Resources Development Act (MPRDA) and the National Environmental Management Act (NEMA). North Block Complex’s EMP expired and is being updated, while the EMP amendment to Arnot’s Mooifontein is also under way. All EMPs are key indicators in ensuring that Exxaro becomes a sustainable business. Exxaro also adopts the precautionary approach recommended by NEMA in evaluating the environmental impacts of business opportunities.

To enhance implementation of these legal requirements and the sustainable use of natural resources, standards for air quality management, water management, biodiversity management and rehabilitation management have been completed and will be implemented in 2010.

The in-house environmental specialist unit has increased its scope of services by dedicating a resource to oversee the environmental authorisation process.

Key risks and management activities

A strategic review of key environmental risks from Exxaro’s mining activities during the year highlighted:

• Air pollution, water pollution, water-supply security and surface disturbance
• Cost of, and provision for, environmental liabilities
• Compliance to statutory and non-statutory environmental requirements.

As such, we have developed a timeline to Exxaro’s desirable state that includes:

• Sustainable ecological systems at all Exxaro operations
• Stable rehabilitation fund with a gradual decline in environmental liabilities as these liabilities are addressed during active operation
• Full environmental compliance to sustainable development requirements
• No asset risk and reduction in land-holding costs.

Timeline to desirable state
2009			2010 — 2011			2012 — 2015
1 Develop and implement air quality management plans – Inyanda, KZN Sands and Zincor 2 EIA-EMP amendments (14)* 3 Eight site-closure reviews 4 Ferroland divestment (Gravelotte and Hlobane) 5 Approval of closure EMPR for Hlobane 6 Develop and implement integrated water-use licence (Glen Douglas, Tshikondeni opencast and Eerstelingsfontein project)* 7 Assurance preparedness – all findings 8 Biodiversity action plans			Review priorities			Review priorities
			1 Review performance on air-quality management plans for Grootegeluk, New Clydesdale, Matla 2 Review performance on integrated water-use licence for Namakwa Sands, Arnot, North Block Complex, Glisa, Grootegeluk and selected projects 3 EIA-EMP amendments 4 Ferroland divestment from Durnacol, Manketti 5 Biodiversity action plans – Arnot-Matla, North Block Complex, Grootegeluk, KZN Sands, Namakwa Sands, Rosh Pinah 6 Water business case investigation 7 Implementation of closure activities at Northfields and KZN Sands according to plan			1 Exxaro-wide strategic environmental risk assessment 2 Water business case implementation 3 Review implementation of closure activities at mines in closure 4 Environmental liability management process (EERF, Arnot-Matla)
* Most of these have at least a 12-month cycle
Key: EIA — environmental impact assessment; EMP — environmental management plan; EMPR — environmental management plan report; EERF — Exxaro environmental rehabilitation fund

Water and waste management

To manage Exxaro’s waste water risks, the following management actions were taken during the review period:

• Integrated water and waste management plans were developed, reviewed and updated for Glen Douglas, Tshikondeni, Leeuwpan and Grootegeluk water treatment plant
• Water balances were developed, revised and updated for Tshikondeni, Grootegeluk, Leeuwpan, North Block Complex Eerstelingsfontein project, Glen Douglas, Matla and KZN Sands central processing complex (CPC).

Integrated water management

Exxaro is committed to best-practice guidelines developed by the Department of Water Affairs in 2008/9 and the following measures, among others, are constantly implemented at all business units:

• Dirty water areas are identified and demarcated
• Dirty water is captured from dedicated areas and stored in suitable holding facilities
• Concurrent rehabilitation efforts ensure maximum clean water run-off
• Dirty water areas are kept to a minimum
• Erosion protection on water conveyance systems
• Re-use and reclamation of water in the dirty-water system.

Water-use definitions have been standardised across business units via the Exxaro water management standard. This group-wide standard guides business units in tracking compliance against legal and reporting requirements for water.

Water efficiency projects at Exxaro These projects have been integrated into the new Exxaro water-efficiency project scheduled for completion in 2010.
Business unit		Description
Grootegeluk		In pit storage of stormwater run-off for plant utilisation (after pH neutralisation plant to avoid corrosion) Dewatering of the Basalt aquifer and re-use as process water The Basalt aquifer is fed mainly by seepage from the unlined pollution control dams, stockpile areas and slimes facility Water recovery from the slimes disposal facility is re-used as process water
Matla		Excess water from underground is being considered for distribution to Eskom as process water
Arnot		No formal water reclamation used in plant plan in place
Leeuwpan		Water recovery from the slimes disposal facility Storm water run-off recycled and re-used via the process water dams
Inyanda		Water reclamation from the slimes facility is used as process water Stormwater run-off from the plant area is captured and returned to the plant for re-use Pit water from groundwater flow and run-off is pumped back to the dirty-water facilities for re-use
Tshikondeni		Co-disposal facility with water reclamation which is re-used in the plant Stormwater run-off collected in lined pollution control dams at shaft areas and re-used as process water
New Clydesdale		Slimes disposal with percolated water recovery for re-use in the plant area Stormwater run-off at the plant area is recycled back as process water Pit stormwater run-off is used for dust suppression
North Block Complex		Excess water from pit and stormwater run-off is collected in pollution control dams for dust suppression
Zincor		Rainwater collection from roofs is used to augment process water Borehole abstraction used to draw back pollution plume and augment process water
Glen Douglas		Stormwater run-off into opencast areas used as process water in the plant area
KZN Sands		Reclamation of rainwater to augment water from Umgeni Water Seepage and run-off at CPC is collected and used as process water
Namakwa Sands		Seawater is used as process water Process water is recycled from the disposal facilities and re-used in the plant

Total water withdrawal by source  

	North Block Complex	Tshikondeni	Glen Douglas	Rosh Pinah	Zincor	KZN Sands	Namakwa Sands
Source	Municipal	Unwa Dam, boreholes	Municipal	NAM-Water	Municipal, boreholes, rainwater harvest	Municipal	Olifants River (Western Cape), seawater
	Arnot	Glisa	Grootegeluk	Inyanda	Leeuwpan	Matla	New Clydesdale
Source	Eskom	Mokolo Dam, boreholes, pit water	Mokolo Dam boreholes	Olifants River (Mpumalanga), boreholes	Boreholes	Eskom	Olifants River (Mpumalanga)

Percentages have been rounded

The business case for water management

Exxaro has embarked on a three-phased process to develop a strategic water management plan for all business units, spanning water efficiency, water reclamation and water re-use initiatives. In finding a solution that benefits our group, government and communities alike, the strategic drivers behind this project include:

• The limited water resources available in certain parts of South Africa to support new or expanding mining and mineral projects
• High cost of inter-basin transfer of water to support development projects (R5-10/m3 and increasing)
• Compliance requirements — water-use licensing requires re-use as per the Department of Water Affairs’ hierarchy of water management on mining and industrial facilities
• Avoiding negative environmental impact or damage
• Manage, minimise or eliminate post-closure liability: proactive positioning to make water available to other water users
• Offset against anticipated waste discharge changes
• Profile of water being elevated in feasibility assessments as a sensitive parameter.

Phase 1 began in November 2009 and was rolled forward to 2010. Data listed below is being gathered as part of the phase 1 investigation:

• Geographical and water-related location of each operation
• Water efficiency, both in terms of use and development as a resource
• Water infrastructure and related investment
• Legal and regulatory requirements and compliance for operational and closure phases
• Financial resources allocated to water management:
  • Purchase of water
  • Water management
  • Water release/discharge
• Water-related financial liabilities for operational and closure phases.

Although this process is still in its infancy, the outcome from the first phase of data analysis will assist in identifying gaps, risks and assessing different business units’ water-use patterns, available water resources, and potential for developing water reclamation schemes. Phase 1 will be completed in July 2010

Waste management

A group-wide policy on waste manage-ment that will address material issues related to waste streams, such as disposal of hazardous as well as general waste generated from Exxaro operations, has been prioritised for 2010.

Developing a strategic water management plan
	Phase 1		Phase 2		Phase 3
	Company-wide assessment of water supply, water management and water liabilities to establish the size of the water resource that may be available to the water business.		Water market and business opportunities. Learning from worldwide trends. This will establish local and regional demand for water by users able to purchase the water.		Business case for Exxaro entering the water market as a viable enterprise development.

Air quality management

Exxaro has implemented an air quality management framework for quantifying and determining the impact of our ambient emissions, and managing non-compliance and continuous improvement (below). This approach, which is aligned to the requirements of the 2007 national framework for air quality management in South Africa, provides a standardised methodology across the group for quantifying emissions and determines the appropriate action in mitigating their impact.

In applying this framework, particularly the emission inventory step, across our operations, it is evident that most of our ambient pollution impacts associated with emissions are particulate matter or dust from mining activities. In addition, Exxaro also operates smelting operations in its mineral sands and base metals commodity businesses. Emissions from these smelters are regulated by a registration certificate issued by the chief air pollution control officer in the Department of Water and Environmental Affairs (DWEA). Emissions of concern from these smelters are particulate matter (represented as PM10), sulphur dioxide (SO2) and nitrogen oxide
(NOx).

Emissions from mining operations

Dust-generating activities (ie blasting, vehicle entrainment and wind erosion of exposed operational areas) are challenges the group addresses daily through environmental management measures such as dust-suppressant agents (eg Dust-A-Side) on haul roads, applying water to secondary unpaved operational roads and vegetating topsoil and overburden material.

All our mining operations monitor daily fallout dust rates and results are assessed against the national standards (SANS) set out in figure 1.

Figure 1: National standards (SANS) 

Level	Dust fallout rate (mg/m2/day)			Permitted frequency
Target	300
Action residential	600			Three in any year, no sequential months
Action industrial	1 200			Three in any year, no sequential months
Alert threshold	2 400			None. First exceedance requires remediation and compulsory report to authorities

Figure 2: Results from Exxaro’s monitoring points  

	Points monitored with   single-unit fallout   dust bucket	Average number of exceedances – 2009
Operation		600mg/m2/day	As % of total
Coal	60	9	13
Mineral sands and base metals	36	3	8

Exxaro has implemented a management key performance indicator that tracks compliance against the “action residential limit”. Even though our operations are classified under industrial targets, we recognise that some operations are close to densely populated areas. Tracking compliance against the residential limit provides a standardised management approach that aims to move our operation into the long-term target of 300mg/m2/day (figure 2).

On average, the operations in the coal commodity business exceeded the 600mg/m2/day limit 13% of the time in 2009. Most of these exceedances were recorded in the winter and spring months. The mineral sands and base metals commodity business exceeded the limit 8% of the time.

Emissions from smelting operations

All our smelters have registration certificates issued in terms of section 10 of the Atmospheric Pollution Prevention Act, 1965 (Act 45 of 1965). These stipulate acceptable stack emissions for particulate matter at KZN Sands smelters; particulate matter, NOx and SO2 at Namakwa Sands; and SO2 at the zinc smelter. The table below shows the performance of our smelters against permit conditions (figure 3).

Biodiversity management

Global biodiversity is threatened by human development — including mining. Climate change is expected to exacerbate this effect. As such, conservation is becoming increasingly important. Exxaro-owned and -managed land has significant biodiversity given the wide geographical spread of the group’s operations.

As part of the process of developing biodiversity management plans for each business unit, a comprehensive study was undertaken to determine vegetation types on all land held by Exxaro and quantify greenhouse gas reduction as a result of vegetation.

The boundaries and vegetative mapping were completed in 2009 and preliminary tier 1 carbon values determined. Agriculture, forestry and other land-use practices were included to provide for a more accurate and complete carbon footprint, accounting for the various business units and the group as a whole. Based on aerial photographs and GIS land use and vegetation maps, a carbon vegetation type map for each operation (mines and smelters) was compiled.

The carbon quantities captured within the 32 types of vegetation in land under operational control are estimated to be around 30 million tonnes. The data on vegetative carbon stocks within various land use practices assists Exxaro’s environmental practitioners in executing their environmental and rehabilitation activities. A summary of biodiversity management is shown.

Figure 3: Performance of smelters
Business unit	No of points	Pollutant	Permitted emission rate	Units	Assessment frequency	Exceedance of permitted emission rate (2009)
Namakwa Sands	2	PM	30	mg/m3 (24hr average)	Bi-annually	0
	2	SO2	500	mg/m3 (1hr average)	Bi-annually	0
	2	NOx	700	mg/m3 (1hr average)	Bi-annually	0
KZN Sands	15	PM	50	mg/m3	Quarterly	5
Zincor	2	SO2	24	mg/m3	Continuous	1

Formal biodiversity management policy in place

Click here to view the Biodiversity management table.   

Mine rehabilitation

Exxaro’s mine rehabilitation policy and management standard is based on a legal and risk approach — a system of chronological steps to optimise ongoing rehabilitation from the feasibility stage of any mining operation through all operational phases and, ultimately, to prepare for efficient mine closure. This framework informs physical processes and financial provisions, including rehabilitation performance indicators.

Business units are already reporting on these indicators each quarter. By closely monitoring this data, rehabilitation backlogs are identified before undue financial liabilities occur. The goal of the environmental rehabilitation department is to report against set ongoing rehabilitation budgets per business unit, in terms of volumes and finance.

Exxaro contributed R38 million in 2009 and had R422 million in its trust fund at 31 December 2009 for mine closure activities. Updating rehabilitation provisions annually also informs potential rehabilitation optimisation alternatives that will decrease the closure liabilities of mines in the long term.

During the year, closure-cost reviews were completed at eight operations. Five inactive sites have been included in this review process. Performance assess-ments against EMPR (environmental management plan report) objectives were completed for four operations and submitted to DMR. Others are scheduled for 2010.

Environmental performance

To enhance environmental incidents management and reporting, Exxaro has introduced a standardised incident management system in all business units to ensure the effective management of all incidents, leading to a safer and more sustainable work environment. The system provides an integrated platform to track and manage incidents; identifies the root causes of incidents and ensures proper incident reporting and management. Environmental incidents are categorised as level 1, 2 and 3.

• Level 3 — Environmental incidents with irreversible on-site, immediate and remote-area impacts, will involve long-term clean-up activities and a negative impact on shareholder value (eg over R500 000 in damage has definitely occurred)
• Level 2 — Environmental incidents with reversible on-site and immediate surrounding impacts, will involve more than 48 hours in clean-up activities and a negative impact on shareholder value (eg R50 000 —
  500 000 in damage has definitely occurred)
• Level 1 — Environmental incidents with reversible on-site impacts, will involve immediate clean-up and a negative impact on shareholder value (eg under R50 000).

The table sets out reportable environmental incidents across the group. A total of 20 level 2 incidents were reported during 2009. All level 2 incidents were reported to the relevant regulatory authorities. Corrective actions to remedy the incidents and prevent them from recurring were approved by authorities prior to implementation. There were no significant (level 3) incidents reported in 2009.

Environmental incidents – level 2
	Business unit		Level		Description		Receiving environment
	Inyanda		2		Overflow of contaminated water into a clean water area		Water
	KZN Sands		2		Stacks exceeded APPA permit requirements		Air
	Grootegeluk		2		Pollution control dam not functioning well — spilling into clean areas		Water
	KZN Sands		2		Excessive visual smoke and particulate matter in atmosphere		Air
	Namakwa Sands		2		Contaminated water spillage into clean areas		Soil
	KZN Sands		2		Contaminated water overflow to a river due to blocked drainage trench		Water
	Grootegeluk		2		Pollution control dam overflow to clean areas		Water
	Inyanda		2		Soil pollution from coal spillage		Soil
	KZN Sands		2		Clogging of dewatering cyclones systems resulting in water pollution		Water
	KZN Sands		2		Stacks exceeded APPA permit requirements		Air
	KZN Sands		2		Overflow of contaminated water into surrounding community properties		Water/soil
	Namakwa Sands		2		Water and soil pollution caused by flooding of sewage treatment plant		Water/soil
	Namakwa Sands		2		Water from the mine damaged farm road on neighbouring farm		Soil
	KZN Sands		2		Stacks exceeded APPA permit requirements		Air
	KZN Sands		2		Leaching of run-of-mine pipeline — in situ material from the operation into a neighbour’s property		Water/soil
	KZN Sands		2		Water from the mine damaged neighbouring property		Water/soil
	Namakwa Sands		2		Erosion of sensitive area due to high rainfall		Soil
	KZN Sands		2		Release of rainwater in controlled manner into a river to prevent dam wall failure		Water
	Inyanda		2		Coal and hydrocarbon spillage		Soil
	Inyanda		2		Overflow of water from the dam to neighbouring properties		Water/soil

Environmental incidents – group  

	Level 1		Level 2		Level 3
Business unit	2009	2008	2009	2008	2009	2008
Coal	495	458	6	5	0	0
Arnot	75	88	0	0	0	0
Char Plant	23	n/a	0	n/a	0	n/a
Grootegeluk	135	208	2	3	0	0
Inyanda	37	n/a	4	n/a	0	n/a
Leeuwpan	28	27	0	0	0	0
Matla	51	26	0	0	0	0
New Clydesdale Colliery	72	99	0	0	0	0
North Block Complex	26	0	0	0	0	0
Tshikondeni	48	10	0	2	0	0
Mineral sands	339	201	14	10	0	0
KZN Sands	79	130	10	10	0	0
Namakwa Sands	260	71	4	0	0	0
Base metals and industrial minerals	527	338	0	12	0	0
Glen Douglas	47	36	0	0	0	0
Rosh Pinah	0	0	0	0	0	0
Zincor	141	101	0	2	0	0
Total	1 361	997	20	27	0	0

Level 1: Minor impact and/or non-compliance
Level 2: Intermediate impact and/or non-compliance
Level 3: Major impact and/or non-compliance  

Consumption per business unit 1 January – 31 December 2009
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