Environment
GRI 103-2, 103-3 SDG 11.6

Operating our units responsibly, preventing impacts on the environment and using natural resources consciously, are some of the actions we are taking to be a company recognized for its sustainable conduct. Moreover, it forms the basis for building the mining of the future, integrated with the demands of the communities and sharing value with our stakeholders. We want to be eco-efficient, producing more and producing it better, with fewer resources and less waste generation and water consumption. We seek to achieve the best environmental performance possible, whether in our administrative centers, mines or smelters. Our environmental goals are:

75% of recirculation and lower specific use of water;

Reduce the specific emission of greenhouse gases by 5%;

Decrease the disposal of tailings in dams and reduction by 50% in the specific generation of mining and smelting waste;

Ensure that 100% of the units have a pre-prepared future-use alternative study and an updated decommissioning plan, in line with the sector’s benchmark standards.

Our integrated management system, based on an Integrated Policy, establishes the guidelines that govern the conduct of the businesses, with a focus on quality management of environmental, health and workplace safety and social responsibility issues. In addition, we strictly follow all environmental laws and regulations pertaining to our business in each country where we operate. SDG 13.2

All of our operating units are ISO 14001 certified and, hence, follow globally recognized systems and compliance standards that support us to meet our goals. Every year, each unit undergoes an assessment to assure compliance with legislation and environmental commitments, conducted by an outside company. Every two years, the units’ Environmental Management System is audited internally. Moreover, each year, a self-assessment is carried out to identify opportunities for improvement and, following the Precautionary Principle, to ensure that we adopt appropriate measures to prevent environmental degradation. GRI 102-11

Environmental investments SDG 7.a

Aware of our role in helping to minimize the effects of climate change, we invest in programs that seek to lower carbon emissions, reduce energy consumption and optimize water use. We continuously seek innovative projects that bring improvements in equipment and processes, with significant gains for the environmental area.

We also believe in the strength of Environmental Education Programs (PEAs), which have trained environmental monitors in Três Marias for 13 years, contributing to the greater awareness of the population, especially young people, about environmental causes. In this year’s edition of the Young Scientists program, one of the actions was focused on water monitoring. Another outstanding project is Vazante Verde, executed in partnership with Vazante Municipality and Legado Verdes do Cerrado, which seeks to encourage the preservation of native species from the Brazilian cerrado (savannah lands) and foster the well-being of the population. Since 2018, 843 seedlings of angico, aroeira, jenipapo and ipê-Amarelo species were planted, within the overall goal of planting 10 thousand new trees by 2023.

In 2019, our investments in the environment totaled US$ 89 million. Of this amount, 36% went toward waste disposal projects, 24% for environmental management and 31% for wastewater treatment.

Environmental Investments GRI 103-2

Environmental Expenses (Capex and Opex) GRI 103-2

Material Topic
Waste
GRI 103-2, 103-3 SDG 9.4, 12.4, 12.5

Dry stacking in Cerro Lindo

The generation of solid waste is a matter of global concern. Being aware of the impact of mining and our business, we are maintaining our commitment to develop new technologies allowing us to reduce our volumes of waste and transform them into secondary products that can be sold.

In 2019, our operations generated about 21 million tonnes of mining and smelting waste, 90.2% of which were hazardous and 9.8% non-hazardous, an addition of 8.9% compared to 2018. In the last year, we have observed a subtle decrease in the volume of waste per tonne produced, which went from 10.61 to 10.57 tonnes due to the proportional increase in production in our smelters. GRI MM3

We have examples of several products under development, such as the production of sulfoaluminous pre-clinker for application in concrete and synthetic granite for civil construction, that is produced from the waste from the Três Marias unit; and the separation of hematite from Vazante tailings for use in the steel industry (For more details acces the chapter Technology, automation and innovation).

Recovery and reprocessing

Among the projects that we have developed in recent years is the recovery of barity from zinc mining waste in Cerro Lindo. In 2019, pilot tests were carried out in the United States for optimizing the consumption of reagents and boosting barity recovery. The concentrate produced was sent for analysis in two laboratories certified by the American Petroleum Institute (API), with excellent results in terms of chemical and physical purities. We completed the basic engineering of the demonstration unit with a waste handling capacity of 100 tonnes per day. The next steps are related to the validation of the price of barity concentrate, subsequently updating the project’s financial model to take a final decision on the effective implementation of the project.

At our materials recycling unit in Juiz de Fora, we aim to increase the percentage of production from secondary materials to 33% in 2023 and 40% in 2025. In 2019, we recycled 16% of waste from Electric Steelmaking Powder, 0.13% from brass oxide, 1.2% from imported Waelz oxide and 0.7% from low-grade silicate.

In Morro Agudo, we transformed all the tailings into a secondary product, calcareous agricultural powder, a raw material for Zincal200. The tailings from the operation is sedimented, part of which is reused in the plant, part of which is sold as Zincal, a product used in agriculture to lessen soil acidity and increase productivity. In 2019, we started to sell more Zincal than the volume produced at the unit, which allowed us to reduce the volume of old tailings that had been stored. In the last year, we surpassed the mark of 1 million tonnes of limestone sold and doubled the reprocessing of old tailings at the plant. In addition to representing revenues of some US$S 8.7 million (15% of the unit’s total), the process eliminates the need to build new containment structures, leading to economic and environmental gains. GRI 102-2

In Vazante, we developed the mechanized mining method and the mineral processing technology to produce zinc by rejecting the Aroeira dam. In 2019, approximately 46 thousand tons of tailings were reprocessed, generating approximately 1.5 thousand tons of zinc concentrate and 44 thousand tons of dry tailings. The extra zinc production contributed to the unit and the community of Vazante, generating more direct and indirect jobs. In this process, the tailings removed from the dam are transformed into concentrated zinc and part into dry waste disposed in a pile, hence safer and more sustainable process.

Volume of waste (thousand tonnes) GRI 306-2, MM3

16 The increase in volume reflects the uptick in shipping of this waste for recycling process

Dam management and tailings deposit

While we are aware that the management of dams and tailings deposits is one of the main risks associated with mining activity, and despite the fact that we already apply safe tailings disposal practices, in 2019 we conducted a new and thorough review of our dam management policy that goes beyond the requirements of Brazilian legislation. We included the installation of sirens and ran mandatory mass evacuation simulations with the population living in the surrounding areas of our operations and we speeded up the introduction of dry tailings deposits at the Vazante unit. In 2020, we will conduct a second audit of our dams to ensure that all safety rules are being observed.

We apply guidelines from the International Commission on Large Dams to control and monitor our 47 dams and tailings deposits (23 in Brazil and 24 in Peru). In addition, we have strengthened our governance model in dam management by establishing clear rules (the 6 Golden Rules for Management of Dams and Tailings Deposits), which are mandatory and shall take effect in beginnings of 2020. In the event of transgressions, each case will be evaluated by a local committee, which will decide the disciplinary measures to be adopted.

Currently, we use three methods of waste disposal in our operations: dams, dry stacking and return to the mine, filling the spaces from which the minerals have been removed (backfill). For all methods of control and monitoring we follow the laws in force in each country where we operate.

Some operations may combine one or more disposal methods. In the Atacocha, El Porvenir and Cerro Lindo units in Peru, we adopted the backfill system, whereby 46% of the tailings return to the Pasco Complex (Atacocha and El Porvenir) mines and 38% to the Cerro Lindo mine, in which part of the waste is filtered, separating water and solids. The water is recirculated, whereby the filtered waste is sent to the piles to be compacted. This same model will be adopted in the Aripuanã operation, under construction. At the Vazante mine, we began to use the dry stacking method, reducing environmental impacts and risks to the operation. And we already have a dam decommissioning plan for this unit, described on Decommissioning.

Prioritization

Of our 47 dams, 24 are either paralyzed or in the decommissioning phase. We prioritize the reuse of the materials, through new technologies. When this is not technologically applicable, the material is disposed of in such a way as to reduce the environmental impact and represent less risk to the population, such as its return to the pit or dry stacking. Dams are resources that we avoid using and, when necessary, we build in a single stage, through the downstream elevation or center line models. Currently, about 85% of the tailing generated by Nexa in Brazil and Peru is not destined for dams, and other disposal technologies are used.

The Executive Board regularly monitors the subject, receiving structure stability reports presented at regularly scheduled meetings. We have adopted processes and procedures that form the Integrated Dam Management System (SIGBar) and an Integrated Deposit Management System (SIGDep), permanently monitored by an independent company, which receives inspection data every 15 and 30 days, respectively, to prepare its reports.

In 2019, we installed the most modern siren system (ZAS – Self-Rescue Zone Alarm System, with a sound intensity of 70 dB) in all units in Brazil, and we conducted simulations with local communities to prove its effectiveness. We verify that they are working in accordance with the requirements of the new Brazilian legislation, which provides for a range within a radius of 10 kilometers or a flood wave equal to 30 minutes. We currently are in the process of automating the monitoring of geotechnical instruments. In addition to the online monitoring required by law, we carry out biweekly on-site inspections. In Peru, in the face of the social and legal context, we are evaluating the forms of mass communication for communities. However, all our dams already have an Emergency Action Plan for critical situations.

Vazante unit

Material Topic
Water
GRI 103-2, 103-3 SDG 6.a, 9.4

Employee from Vazante

The water topic remains at the center of our concerns and is addressed in our Sustainability Master Plan, which outlines the guidelines for the conscious use of the resource. We have goals for continuous water use reduction improvement in all of our operations. We intend to achieve a 75% recirculation percentage by 2025. GRI 303-2

In 2019, we reached a rate of 67%, one percentage point above the previous year, gradually moving toward reaching our target. The indicators of the percentage of recirculation and specific use of new water (m3/ t) are being systematically monitored in an integrated corporate database. Our consumption increased by 3% in the year, justified by the installation of flow monitoring equipment, making the extraction of more assertive values possible.

Among the next steps to improve our index is to start up Vazante’s dry stacking of tailings. The technique will allow the adoption of alternatives to recirculate more water or segregate contact water from water that is not used in the unit.

Recirculation

One of the examples of a high rate of water recirculation (about 90%) is the Cerro Lindo unit: all of this resource used comes from recirculation or the sea. The operation has a desalination plant, which extracts salt by reverse osmosis and pumps it to the plant, at an altitude of 2.2 thousand meters. In an area where there is a scarcity of water resources, this technology is important to avoid competing with the population in demand for water. In addition, we encourage and orient the community in the region to store rainwater. GRI 303-1 SDG 6.4

We continually invest in efficient water recirculation programs, since they contribute both to lower new water intake as well as reduce effluent volumes and the environmental impact of disposal. To ensure that our effluents are disposed of after proper treatment, we allocate 26% of the funds destined for environmental expenses for this purpose. SDG 6.3

To improve our water management, we entered a partnership with the University of Queensland to use its methodology to measure our water balance and to assist us in increasing our water recirculation rates at the units.

Basic sanitation

Our new projects, like Aripuanã, are already brought into existence with the objective of starting operations with 100% water recirculation. We also started a work on diagnosing water use in the region, together with the Trat Brazil Institute, to support the municipality in solving basic sanitation issues. In addition to Aripuanã, this diagnosis is underway in all of our units in Brazil and Peru, part of our commitment to create a legacy in the communities surrounding our operations, reducing social and environmental impacts with selfsustainable and long-term solutions (more information about our social management is available on Society).

Capture in Vazante SDG 11.6, 15.1

We are paying special attention in the Vazante region, not only due to the reduction of rainfall volume in the Santa Catarina River basin, the lowest level in the last decades, but also because of the dolination phenomenon, consisting of depressions with characteristic occurrence in karstic soils (rich in limestone). Hence, we routinely monitor the flow of the Santa Catarina River, conduct piezometric monitoring and we have prepared a dolomitic risk management plan.

We also support the study being carried out by the Technological Research Institute (IPT) to evaluate the impact of river drainage in the region, a job designated by the Public Prosecutor’s Office (MP) through a Term of Commitment agreement we entered into. In 2019, our responsibility actions were carried out in the project schedule, with the IPT producing and presenting three partial reports to the MP and to us.

Because the Santa Catarina River is one of the region’s main water courses, the Vazante Unit also initiated a major project to recover its headwater region, which covers an area of 50 thousand hectares and contains 134 springs. After the diagnosis of the hydrographic basin, made in 2018, we started the first stage — the recuperation of four springs of Córrego Guariroba, one of the Santa Catarina River’s main tributaries. In 2019, we proceeded with the construction of fences, totaling 21,855 meters. For 2020, the schedule calls for protecting 27 springs, with the construction of 19,900 meters of fences, to start the installation of flow monitoring points.

Total of water used by source (2019) 17

17 Top three water withdrawals

Cleanup of the Huallaga River

Concerned about contamination of the Huallaga River, we promoted a campaign to clean up the river through our volunteer program, involving 268 people from specialized companies, Nexa volunteers and local members of the communities surrounding the Pasco Complex in Peru. In five hours of efforts, we collected 30 tonnes of waste over 12.1 kilometers (from La Quinua to Malauchaca), which were transported to a local landfill.

Material Topic
Energy
GRI 103-2, 103-3 SDG 11.6, 13.2

Três Marias unit

We know that a low carbon economy allows us to contribute to minimizing climatic variations, avoiding, from the business point of view, changes to project schedules and higher operating costs. In addition, from a social point of view, we help to build an increasingly sustainable society. For this reason, we have set a goal to reduce greenhouse gas (GHG) emissions by 5% per ton of product by 2025.

One of the main actions in this regard is the operation, since 2017, of a biomass boiler at the Três Marias unit, replacing boilers powered by petroleumderived oil. The equipment provides savings of US$ 3.8 million per year, with a 30% reduction in greenhouse gas emissions and a 46% reduction in the cost of steam production. The structure uses eucalyptus wood chips produced in the region as fuel. The next step is to introduce the biomass into the unit’s operations for steam production. This model, proved efficient in Três Marias, and should be deployed at the Juiz de Fora unit. SDG 7.2, 9.4, 12.2

At the Cajamarquilla unit in Peru, we are investing in the replacement of diesel oil, fuel oil and LPG with natural gas. The conversion of diesel generators to natural gas also started testing in 2019, which should reduce emissions and fuel costs at the plant.

Energy sources

In the search for a cleaner energy matrix, we signed a new long-term energy contract with the Peruvian state-owned Electroperú S.A., which is expected to supply 240 MW of energy for seven years, starting from January 2020. Thus, we achieved a potential savings of up to US$ 50 million during the term of the contract and we guarantee that 98% of our energy needs in that country are met by a clean energy source.

In Brazil, we signed a new long-term contract with Furnas, of the companies hold by Eletrobras group, to serve the Aripuanã operation, under a 15-year contract, also starting in January 2020. In Brazilian operations, clean energy represents 74.1% of our consumption.

Energy consumption

We consumed 15,808,215 GJ of energy in our operations, an increase of 5.6% compared to 2018 (14,970,823 GJ), with 79.3% (12,530,144 GJ) from renewable sources. This proportion especially reflects the Brazilian and Peruvian electric power matrixes, since both of their bases have a higher share of hydropower sources.

In the year, electricity generation represented 25% of the total electricity consumed. Cogeneration is used for steam boilers and generation in power plants and small hydropower projects, managed by Votorantim Energia (which serves Votorantim S.A.’s subsidiaries and also outside clients).

Atmospheric emissions

Our greenhouse gas (GHG) emissions totaled 1,017,744 tCO2e, which meant a decrease of 19.8% compared to the previous year (1,269,674 tCO2e).

Emissions resulting from the consumption of electricity (Scope 2) corresponded to 62% of the total, and indirect emissions (Scope 3) totaled 132,997.15 tCO2e, or 13% of the total. Emissions intensity went from 1.15 tCO2e per tonne of zinc produced in 2018 to 0.950 tCO2e. GRI 305-1, 305-2, 305-3, 305-4

Energy consumption in and outside Nexa GRI 302-1, 302-2

GHG Emissions by scope – 2019 GRI 305-1, 305-2, 305-3

Energy intensity (Gj/t zinc) GRI 302-3

Intensity of GHG emissions (tCO²/t zinc) GRI 302-3

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