Post on 10-Mar-2020
Sustainability
Oxfam Cambodia, May 2016
Adrian Bell
PanAust General Manager Human Resources & Risk Management
About PanAust
• PanAust is a leading copper and gold producer
in Laos with pre-development and exploration
opportunities in Laos, Papua New Guinea,
Myanmar and Chile: corporate headquarters in
Brisbane, Australia
• 2015 was a pivotal year for PanAust; moved
to ownership by Chinese state-owned
enterprise, GRAM; de-listed from the ASX
• The combination of operational excellence and
total commitment to sustainability’ is the
foundation of our success
Operations and projects Laos/PNG
• PanAust’s producing assets are the:
– Phu Kham Copper-Gold Operation
– Ban Houayxai Gold-Silver Operation
• Both are located in the Company’s 2,600
square kilometre Phu Bia Contract Area
in Laos
• PanAust owns an 80 per cent interest in
the Frieda River Copper-Gold Project in
Papua New Guinea with the remaining
20 held by Higlands Pacific
Frieda River
Brisbane Office
Phu Kham
Ban Houayxai
Committed to sustainable development
Underpins PanAust’s growth strategy
Is essential for ongoing success
The effective management of
sustainability risks makes good
business sense
This video highlights PanAust’s
commitment to sustainable
development
GovernanceSocial PerformanceEnvironment
Health and Safety People Performance
Our Values
Leveraging culture
through sustainability
EY M&M sector top-ten risks 7 year comparison
Rank 2008 2011 2012 2013 2014
1 Skills shortageResource
Nationalism
Resource
NationalismCapital management
Productivity
Improvements
2Industry
consolidationSkills shortage Skills shortage Margins / productivity
Capital Dilemmas –
allocation and access
3 Infrastructure access Infrastructure access Infrastructure accessResource
Nationalism
Social License to
Operate
4Maintain Social
License to Operate
Maintain Social
License to OperateCost inflation
Social License to
Operate
Resource
Nationalism
5Climate change
concernsProject execution Project execution Skills shortage Capital Projects
6 Cost inflation Market volatilityMaintain Social
Licence to OperateMarket volatility
Price and Currency
Volatility
7 Pipeline shrinkage Capital management Market volatility Project execution Infrastructure Access
8Resource
NationalismCost inflation Capital management Sharing benefits Sharing benefits
9 Energy security Supply interruptions Sharing benefits Infrastructure accessBalancing talent
needs
10 Increased regulation Fraud & corruption Fraud & corruption Threat of substitutesAccess to water and
energy
Sustainability Report
• Second mining Company to achieve new
Global Reporting Initiative (GRI) G4,
reporting framework
• Report to an A+ Application Level
• External verification (Beca Consulting)
prior to publication
• Focuses on the issues that are material
to our business
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Current Group risks
Risk
No.Risk Owner Risk Description
Risk
Score
Risk
Goal
Committee
Oversight
1EGM Project
Development
Failure to deliver Board approved development
projects within design, budget and schedule.H M Board
2 Chief Financial Officer
Financing risks associated with a breach in
parameters that the Board has endorsed
(through the capital management plan).
H M Board
3General Manager HR
and Risk ManagementAbility to attract and retain people. H M Sustainability
4 EGM PanAust AsiaSignificant safety, environment, or social
incident affecting the corporate reputation.H M Sustainability
5 EGM PanAust Asia Business Interruption. M M Board
6 Managing Director Loss of MD with EGM's or MD/CFO M M Board
7 Managing DirectorProduction Gap - PBM Closure and Frieda
Start-up. H L Board
Governance
• Signatories to Minerals Council of Australia’s
Enduring Value framework
• Signatory to the Voluntary Principles on Security
and Human Rights
• The GM, HR and Risk oversees the integration
of sustainability and group targets
• Enterprise Risk Management - risk and
opportunity management integrated into all
business processes, at all levels, through a set
of common tools (risk register)
• Sustainability Standards
• Auditing and Benchmarking (IFC Audit, Socio-
Economic and Health Surveys, Beca Assurance
GRI, ISO 18001 & 14001, E3 etc.)
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Community development
• PanAust’s community development program
aims to make meaningful contributions to
building long-term community capacity thereby
empowering people to determine and progress
their own development priorities beyond the life
of the Company’s mines
• Throughout 2015, small community businesses
collectively generated over US$1 million of
revenue for local families producing
consumables such as vegetables, drinking water,
eggs, cloth bags, fruit and fish
Community Development Fund
• In 2015, Community Development Funds in Laos
comprised 41 small-scale projects across rural
communities directly and indirectly affected by
PanAust’s activities
• Focus areas were education, healthcare,
agriculture, infrastructure, small business
development
• Since 2008, PanAust has invested more than
US$3.8 million in host communities through the
CDF programs
• Community development programs were also
extended to Papua New Guinea throughout the
year and were commensurate with our level of
activity at the Frieda River Project
Tailings and waste rock management
• Management of Acid Rock Drainage at Phu
Kham is a key issue
• Tailings Storage Facility (TSF):
– Evaluated as industry best-practice
– Integrated waste facility
– Waste is classified based on its acid rock
drainage potential
– Uses a simple ‘traffic-light’ management
plan – red, amber, green and blue
– High Potential Acid Forming (PAF) mineral
and disposed of underwater in TSF
– Fleet management system is used to strictly
manage quality control of sulphur grades
Tailings and waste rock monitoring
• Positive water balance
• During operations, approximately 95% of water
is sourced as recycled water from the TSF for
use in processing.at Phu Kham
• Excess water is discharged to the Nam Mo River
• Extensive monitoring is carried out within the
embankment, water body, point of discharge and
downstream of the receiving environment
• Multi-disciplinary team of internal and external
specialists oversees performance and
management
• At closure, all higher risk PAF to be placed under
a permanent water cover
Ban Houayxai cyanide management
What is the Cyanide Code?
– Administered by the International Cyanide
Management Institute (ICMI)
– Internationally recognised management
system
– A voluntary program
– 9 principles, 200 standards of practice
• Cyanide can be emotive issue
• PanAust signatory to the Code – we view the
code as the minimum to ensure the business,
environment and community are not put at risk
• All areas at Ban Houayxai where cyanide is
used or may be present are designed,
constructed and operated to Code
requirements or better
• Recertification in 2016
Safety performance
2013-2015 PanAust Group ReportableIncidents (Controlled Work Sites)
2013 2014 2015
Fatal injuries 0 2 0
TRIFR 1.72 0.88 0.62
DART
Frequency
0.37 0.22 0.16
LTIFR 0.31 0.15 0.16
• Safety performance continues to be better than
industry averages
• Low industry rates alone will not prevent future
significant incidents
• Contractor management most significant risk
• Identified and analysed trends and hot spot areas
• Lead indicator program has a strong focus on hot
spot areas
• Developed Significant Incident Senior
Management Taskforce
• Development of Visible Safety Leadership
Program (deep dives)
• Significant reduction in cardinal rules breaches
and vehicle incidents
Visible safety leadership
• Group Visible Safety Leadership Guideline
rolled out in 2015
• Set of expectations on types and duration
of leadership activities to be undertaken by
management everyday
• In 2015 there was a focus on Visible Safety
Leadership through lead indicator programs
that addressed safety hotspots and
implementing the deep dive review
program
• Deep dives are vertical layered reviews
lead by general managers; proactive
reviews focused on high-risk tasks and
areas of concern for senior management
Attraction and retention
• Five-year strategic plan
• PanAust’s people are skilled and motivated,
with good leadership and systems that provide
support for a high-performance resources
company and with people who are valued by
the company and rewarded for success
• Ensure Phu Kham is flagship – that it operates
to world-class standards-template for other
projects as the company grows
• No silver bullet – many different components
• Overarching – this is our Vision & Values
reinforced by the PanAust Way
What is “localisation”?
What?
• Common term in global mining – sometimes referred to as ‘nationalisation’
• Gradual replacement of expatriates with national staff
Why?
• Social licence to operate
• Skills development and capacity building
• Lower cost
• Lasting legacy for Lao PDR
It’s simply the right thing to do
…against the odds
• Immature mining industry
• Low education levels
• Lack of tertiary qualifications in some
key mining disciplines
• Language barrier
• Different perspective on risk and safety
• Cross-cultural challenges
• Growing economy and market =
increased competition for talent
Success…
• During 2015, our workforce in Laos for
the first time reached more than 90 per
cent localisation
• Many replacing – or being readied to
transition into – roles held by expatriate
employees.
• Diversity Committee (measurable
objectives) 20% women, Indigenous
Testing – Q Test
How have we done it?
Technical and Language Training
Graduate Program
Workforce/Localisation
Planning
Succession Planning
Mentoring Program
Recruitment & Selection
Leadership Development
Organisation Structure
Summary
• PanAust is a successful and competitive copper and gold producer with strong
cash flow to support growth initiatives
• We maintain a strong focus on sustainable outcomes for the communities within
which we operate
• Recognised as a leader in sustainability performance
• Use Enterprise Risk Management framework to identify opportunities for continual
improvement
• Well-established sustainability framework to be applied in other countries in the
future
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