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Unlocking Earth’s Treasures with Mineral Exploration

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The following content is sponsored by Skeena Resources Ltd.

Skeena Resources: Unlocking Earth's Vault

Natural Wealth

Unlocking Earth’s Treasures with Mineral Exploration

There are untold treasures of gold, silver, copper, and much more that lie beneath the Earth’s surface, awaiting discovery—and it takes mineral exploration and the right team to unlock this hidden wealth from the depths.

Mining exploration company Skeena Resources is opening the vault to the treasures of British Columbia’s Golden Triangle at the famous Eskay Creek property.

Following in footsteps of other successful mineral exploration efforts, Skeena is proving there is more value to unlock at Eskay Creek. The Golden Triangle is already home to some of the most productive mines in the world.

Keys to the Vault: Turning Discoveries into Resources

A mineral exploration company such as Skeena conducts geological studies to turn a discovery into a mineable resource. As each mineral deposit becomes better understood, new value is unlocked and its economic value increases.

The mining industry uses three resource classifications for a mineral discovery, based on the amount and proximity of drill holes.

  1. Inferred
  2. Indicated
  3. Measured

Each one of these categories represent the confidence with which an economic source of minerals exists. The “Inferred” classification is the lowest level of confidence that a certain amount of ore exists in a location while “Measured” is the highest.

Companies drill holes and pull out small samples of the ground in order to discover and measure the continuity and grade of a mineral occurrence. The results of drilling provide more and more data for improving the understanding of a deposit. Each study eventually cuts the key to unlock the treasure below.

Grade is King: The Higher the Grade, The Lower the Costs

In order for a mineral deposit to be valuable it must pass the grade. The amount of the sought-after mineral within a particular amount of rock is known as the ore grade. Typically, the higher the ore grade, the more profitable a mine can be.

Skeena Resource’s Eskay Creek has a grade of 4.3 grams per tonne ‘g/t’, making it 3x higher than the global average grade of open pit mining projects. This could potentially make it all the more unique and valuable to investors.

Unlocking the Vault

Gold’s value is in part due to its rarity. The precious metal cannot be artificially produced and is only found deep inside the vault that is the Earth’s crust. This makes mineral exploration an extremely rewarding business if a discovery is made.

In terms of statistics, the odds are 1 in 10,000 that greenfield exploration produces a profitable mine—and odds are even more remote for a mineral occurrence to become a world-class mine. Further, if a gold deposit is actually found, there is only a 10% chance it will have enough gold justify further development.

Through targeted mineral exploration, Skeena Resources is proving there is more golden treasure to uncover at the legendary Eskay Creek.

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Green Investing: How to Align Your Portfolio With the Paris Agreement

MSCI’s Climate Paris Aligned Indexes are designed to reduce risk exposure and capture green investing opportunities using 4 main objectives.

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Green Investing

Green Investing: The Paris Agreement and Your Portfolio

In Part 1 of the Paris Agreement series, we showed that the world is on track for 3.5 degrees Celsius global warming by 2100—far from the 1.5 degree goal. We also explained what could happen if the signing nations fall short, including annual economic losses of up to $400 billion in the United States.

How can you act on this information to implement a green investing strategy? This graphic from MSCI is part 2 of the series, and it explains how investors can align their investment portfolios with the Paris Agreement.

Alignment Through Indexing

When investors are building a portfolio, they typically choose to align their portfolio with benchmark indexes. For example, investors looking to build a global equity portfolio could align with the MSCI All Country World Index.

The same principle applies for climate-minded investors, who can benchmark against MSCI’s Climate Paris Aligned Indexes. These indexes are designed to reduce risk exposure and capture green investing opportunities using 4 main objectives.

1.5 Degree Alignment

The key element is determining if a company is aligned with 1.5 degree warming compared to pre-industrial levels. To accomplish this, data is collected on company climate targets, emissions data, and estimates of current and future green revenues. Then, the indexes include companies with a 10% year-on-year decarbonization rate to drive temperature alignment.

Green Opportunity

Environmentally-friendly companies may have promising potential. For instance, the global clean technology market is expected to grow from $285 billion in 2020 to $453 billion in 2027. The MSCI Climate Paris Aligned Indexes shift the weight of their constituents from “brown” companies that cause environmental damage to “green” companies providing sustainable solutions.

Transition Risk

Some companies are poorly positioned for the transition to a green economy, such as oil & gas businesses in the energy sector. In fact, a third of the current value of big oil & gas companies could evaporate if 1.5 degree alignment is aggressively pursued. To help manage this risk, the indexes aim to underweight high carbon emitters and lower their fossil fuel exposure.

Physical Risk

Climate change is causing more frequent and severe weather events such as flooding, droughts and storms. For example, direct damage from climate disasters has cost $1.3 trillion over the last decade. MSCI’s Climate Paris Aligned Indexes aim to reduce physical risks by at least 50% compared to traditional indexes by reducing exposure in high-risk regions.

Together, these four considerations support a net zero strategy, where all emissions produced are in balance with those taken out of the atmosphere.

Green Investing in Practice

Climate change is one of the top themes that investors would like to include in their portfolios. As investors work to build portfolios and measure performance, these sustainable indexes can serve as a critical reference point.

Available for both equity and fixed income portfolios, the MSCI Climate Paris Aligned Indexes are a transparent way to implement a green investing strategy.

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Decarbonization 101: What Carbon Emissions Are Part Of Your Footprint?

What types of carbon emissions do companies need to be aware of to effectively decarbonize? Here are the 3 scopes of carbon emissions.

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Scopes of Carbon Emissions Share

What Carbon Emissions Are Part Of Your Footprint?

With many countries and companies formalizing commitments to meeting the Paris Agreement carbon emissions reduction goals, the pressure to decarbonize is on.

A common commitment from organizations is a “net-zero” pledge to both reduce and balance carbon emissions with carbon offsets. Germany, France and the UK have already signed net-zero emissions laws targeting 2050, and the U.S. and Canada recently committed to synchronize efforts towards the same net-zero goal by 2050.

As organizations face mounting pressure from governments and consumers to decarbonize, they need to define the carbon emissions that make up their carbon footprints in order to measure and minimize them.

This infographic from the National Public Utility Council highlights the three scopes of carbon emissions that make up a company’s carbon footprint.

The 3 Scopes of Carbon Emissions To Know

The most commonly used breakdown of a company’s carbon emissions are the three scopes defined by the Greenhouse Gas Protocol, a partnership between the World Resources Institute and Business Council for Sustainable Development.

The GHG Protocol separates carbon emissions into three buckets: emissions caused directly by the company, emissions caused by the company’s consumption of electricity, and emissions caused by activities in a company’s value chain.

Scope 1: Direct emissions

These emissions are direct GHG emissions that occur from sources owned or controlled by the company, and are generally the easiest to track and change. Scope 1 emissions include:

  • Factories
  • Facilities
  • Boilers
  • Furnaces
  • Company vehicles
  • Chemical production (not including biomass combustion)

Scope 2: Indirect electricity emissions

These emissions are indirect GHG emissions from the generation of purchased electricity consumed by the company, which requires tracking both your company’s energy consumption and the relevant electrical output type and emissions from the supplying utility. Scope 2 emissions include:

  • Electricity use (e.g. lights, computers, machinery, heating, steam, cooling)
  • Emissions occur at the facility where electricity is generated (fossil fuel combustion, etc.)

Scope 3: Value chain emissions

These emissions include all other indirect GHG emissions occurring as a consequence of a company’s activities both upstream and downstream. They aren’t controlled or owned by the company, and many reporting bodies consider them optional to track, but they are often the largest source of a company’s carbon footprint and can be impacted in many different ways. Scope 3 emissions include:

  • Purchased goods and services
  • Transportation and distribution
  • Investments
  • Employee commute
  • Business travel
  • Use and waste of products
  • Company waste disposal

The Carbon Emissions Not Measured

Most uses of the GHG Protocol by companies includes many of the most common and impactful greenhouse gases that were covered by the UN’s 1997 Kyoto Protocol. These include carbon dioxide, methane, and nitrous oxide, as well as other gases and carbon-based compounds.

But the standard doesn’t include other emissions that either act as minor greenhouse gases or are harmful to other aspects of life, such as general pollutants or ozone depletion.

These are emissions that companies aren’t required to track in the pressure to decarbonize, but are still impactful and helpful to reduce:

  • Chlorofluorocarbons (CFCs) and Hydrochlorofluorocarbons (HCFCS): These are greenhouse gases used mainly in refrigeration systems and in fire suppression systems (alongside halons) that are regulated by the Montreal Protocol due to their contribution to ozone depletion.
  • Nitrogen oxides (NOx): These gases include nitric oxide (NO) and nitrogen dioxide (NO2) and are caused by the combustion of fuels and act as a source of air pollution, contributing to the formation of smog and acid rain.
  • Halocarbons: These carbon-halogen compounds have been used historically as solvents, pesticides, refrigerants, adhesives, and plastics, and have been deemed a direct cause of global warming for their role in the depletion of the stratospheric ozone.

There are many different types of carbon emissions for companies (and governments) to consider, measure, and reduce on the path to decarbonization. But that means there are also many places to start.

National Public Utilities Council is the go-to resource for all things decarbonization in the utilities industry. Learn more.

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