In 2020, investors highlighted water scarcity as one of the largest increasing risks to the mining and metals sector they expected to face by 2025 (Fitch, 2020). With 2025 now here, water scarcity is not only a pressing environmental issue, but an operational challenge for the mining industry, which requires a reliable water supply to create salable product from ore. The impact to bottom line is significant. `
In response to these challenges, the International Council of Mining and Metals (ICMM) introduced its Water Stewardship Framework in 2017. This framework urges mining companies to improve water management practices, focusing on increasing water recycling, reducing withdrawals, and using lower-quality water where possible. Since then, most ICMM members have committed to these goals, with sustainability reports showcasing significant efforts to enhance water efficiency (Robertson 2024).
However, achieving water efficiency is not one-size-fits-all. Every mining operation is unique, facing specific water challenges based on location, geology, and operational needs. Some sites may not be recycling water efficiency, while a site recycling water at a high rate may benefit more from making its processing plant more efficient. An operation relying on high-quality groundwater might have access to lower-quality surface water, which could offset freshwater usage. Mines in water-surplus regions may focus less on reuse and more on managing excess water to avoid environmental and operational risks.
Understanding how your operation ranks in water management compared to similar mines allows you to pinpoint the most impactful areas for improvement.
To help mines assess and improve their water management practices, SRK Consulting has developed a comprehensive database and benchmarking tool. This tool evaluates key water management metrics across the industry, leveraging widely recognized ICMM and GRI water accounting standards. The key metrics in the benchmarking tool include:
- Water Withdrawals: How much water is brought on to site for operational usage
- Recycle/Reuse Rate: How much water is used more than once for operational usage
- Water Discharged: How much water is released to the environment
- Other Water Managed: Water that is managed on site but not actively used
- Water Consumed: How much water is lost to the environment through leaks, evaporation, or entrainment
- Water Replacement Ratio: The amount of water that is withdrawn and replenished to the environment
Each metric is broken down by water quality (high or low) and source (surface water, groundwater, seawater, or third-party water). This granular approach allows mines to compare their performance with others and identify specific areas for improvement.
A meaningful benchmark considers the unique characteristics of each operation. For example, an open-pit copper mine in a dry climate will have different needs than an underground gold mine in a tropical region. The SRK tool allows users to apply filters—such as mine type, location, climate, and processing methods—to ensure a like-for-like comparison.
Let’s consider an anonymous open-pit copper mine in Chile that withdraws 1.62 m3/tonne ore processed. When benchmarked against all mines, it ranks in the 38th percentile for water withdrawals, indicating it withdraws less water than 62% of mines. This may seem efficient. However, when compared only to other open-pit copper mines in dry climates, it ranks in the 64th percentile, suggesting there is room for improvement.
This is because copper mines generally withdraw less water per tonne of ore than gold mines. Additionally, open-pit copper mines can recycle more water than underground mines, and mines in dry climates typically use less water than those in wetter regions. Factors such as ore grade, tailings type, geology, and processing pathways also influence water usage.
By considering these nuances, benchmarking reveals that this mine could reduce water withdrawals further. It could also draw inspiration from other operations with similar characteristics that manage to withdraw less water.
Benchmarking is just the starting point for improving water efficiency. Once an operation identifies its rankings, it is critical to understand the factors driving its performance. For example, water that is consumed may be lost in different ways, such as through evaporation or entrainment in tailings. Addressing evaporation losses might involve minimizing surface exposure, while entrainment losses could be reduced through adjustments in tailings management practices. Similarly, high water withdrawals may not always indicate inefficiency. In some cases, they could reflect process requirements, such as the need to manage ores with high impurity levels. Understanding whether a high metric results from operational inefficiencies or process needs is key to selecting the right interventions.
The insights gained from benchmarking can form the basis of the improvement process, and tools like marginal abatement cost curves and multiple accounts analyses can be used to prioritize high impact low cost opportunities for improvement
Like any tool, benchmarking has its limitations. The SRK database relies on self-reported data, which can introduce inaccuracies. While about 90% of companies adhere to ICMM and GRI standards, there is no universal method to verify the data. Additionally, the tool compares operations to industry norms rather than theoretical maximum efficiencies, and regional reporting standards can vary.
Despite these challenges, benchmarking provides invaluable insights. By identifying areas of improvement, operations can reduce both their environmental impact and the risks associated with water scarcity.
Water scarcity remains a critical risk to the global mining industry, but our pathway to improved water efficiency is attainable. Benchmarking offers a practical starting point for mines to assess their performance and prioritize actions. By leveraging data and learning from peers, mining operations can take meaningful steps toward sustainable water management—ensuring both their operational resilience and their environmental stewardship for decades to come.
