Norilsk Nickel will produce the first batch of carbon-neutral nickel this year – 10 thousand tons, counts on a premium.
Russian mining giant Norilsk Nickel plans to release the first batch of carbon-neutral nickel this year, Norilsk Nickel Senior Vice President Sergey Dubovitsky told reporters.
In total, about 10 thousand tons of carbon-neutral nickel can be produced this year (in total, Norilsk Nickel plans to produce up to 200 thousand tons of nickel this year). The first batch of such metal will be released in the summer, the second – towards the end of the year.
Carbon neutral status will not be achieved by Norilsk Nickel’s purchase of quotas, but by offsetting measures, the effect of which will be verified by international auditors.
These measures include the modernization of power equipment – replacement of turbines with more efficient ones, which will increase the share of renewable sources in energy generation (now the share of electricity obtained from renewable sources is 46% in the Norilsk Nickel group). The company also announced an increase in energy efficiency and optimization of energy consumption.
In 2021-22, as a result of these measures, Norilsk Nickel expects to reduce emissions by 60-70 thousand tons of carbon dioxide.
The company plans to allocate these savings to two batches of carbon-neutral nickel with a total volume of about 10 thousand tons. To achieve this, the company verifies with an independent auditor the calculation methodology and the amount of C02 emissions per tonne of nickel.
“Each unit of such products will be associated with a lower level of emissions achieved through these offsetting measures,” explained Dubovitsky.
The program for the production of carbon-neutral nickel is not limited to the production of two pilot batches this year, given the fact that the effect of the commissioning of new units at the hydroelectric power station will contribute to the reduction of emissions during the entire period of its operation.
“We expect to reach a cumulative effect of reducing emissions of more than 350 thousand tons annually by 2025 and allocate them to nickel units in the same proportion,” he said.
Norilsk Nickel is counting on the premium status of carbon-neutral nickel.
“Since this product has additional value for customers and investors, it should be premium. It is difficult to say more specifically, we are only preparing to test this product with customers and do not set ourselves any price targets. Based on the release of a pilot batch, we will receive feedback from the market, ” he said.
“Without waiting for major technological breakthroughs in the field of reducing the carbon footprint, we focused on specific offsetting measures that we can implement now, having achieved a reduction in emissions,” explained Dubovitsky.
This is also facilitated by additional projects that could be operational by 2025, further reducing the carbon footprint. For example, the transition of a part of mining equipment to NGV fuel.
Norilsk Nickel is preparing to build an LNG plant. The project is expected to be completed within 3-4 years. The commissioning of the plant will be synchronized with the peak of the use of large equipment in mining pits in 2024-25.