On the Company’s environmental priorities for the near future

Environmental policy is one of Ferrexpo’s top priorities. Our Company pays close attention to environmental protection and minimization of impacts of production processes. One of Ferrexpo’s strategic goals is СО2-free production of iron ore pellets.

We fully share the view that climate change and greenhouse gas emissions are critical for modern society. Therefore, Ferrexpo always emphasizes the importance of reducing the carbon footprint. The Company is active in implementing new technologies: it replaces engines, uses solar energy, autonomous trucks, implements many other projects to increase efficiency and replace energy-intensive raw materials with more environmentally friendly ones.

All the Company’s projects are implemented in accordance with investment, social and environmental programs approved by the Board of Directors of Ferrexpo. The budget of Ferrexpo’s ongoing environmental projects for 2020 is $9.1 million. In addition, the Company carries out many small projects on environmental improvements, with a planned investment of $500 thousand.

In 2018–2019 and H1 2020, Ferrexpo invested a total of more than ₴891 million (over $35 million) in environmental activities.

Action plan

Companies of the Ferrexpo Group are also constantly striving to minimize environmental impacts. In this regard, programs to improve the environmental situation were launched in September 2019. Their elements in particular incorporate:

І. Improvements system and emission control:

  • Automated online emission monitoring includes the installation of monitoring posts at process furnaces and control posts at the border of the sanitary protection zone (SPZ) in the vicinity of ​​Gorishni Plavni. A pilot project on the construction of a technological line and a post at the SPZ border is scheduled for 2020;
  • A biodiversity project involves tracking changes in biodiversity and identifying work processes to be modified to mitigate negative impacts and enhance the positive trend (identify and preserve rare species). This year, we have conducted research to study winter aspects of ornithologic fauna of Ferrexpo’s business region. As a result, eight rare birds listed in the Red Book of Ukraine were identified. In the future, it is planned to determine the species abundance, stability and balance of ecosystems and habitats;
  • The Green Office project involves the launch of ‘green procurements’ marked with environmental labels. This will make it possible to use materials with the best environmental properties;
  • Water resources management. This year, it is planned to analyze the operation of bioengineering facilities, used to treat unbalanced waters of the tailing dam of Poltava Mining before their discharge into the Kamenka reservoir. A program for testing constructions has been launched. The tests are to be carried out at different periods of the year.

ІІ. Waste control:

  • Analysis of savings divided into resources and non-resources. In 2020, a separate collection of office waste is to be launched: paper, glass, plastic, batteries and mixed waste;
  • Introduction of standards for hazardous waste management. All standards are developed according to the requirements of the international standard ISO 14001: 2015 Environmental Management System.

ІІІ. Greenhouse gas reduction program, Zero CO2, in accordance with the best world practices:

  1. Electrification of domestic railway transport is one of the stages of transition to ‘zero’ CO2. Ferrexpo has been systematically expanding its rock transportation network for many years. Earlier, the main means of transport was diesel locomotives with high diesel fuel consumption. Now the Company is actively developing a network of electric traction transportation, gradually moving away from the use of diesel fuel and increasing the number of electric locomotives. This reduces fuel consumption and minimizes emissions into the atmosphere. In the future, Ferrexpo plans to completely abandon diesel fuel and electrify its entire railway fleet as much as possible.
  2. Energy efficient engines with low energy consumption. Ferrexpo is currently implementing a project to replace old bulky engines, used since the 1980s, in crushing and beneficiation equipment and in the pellet production shop with new, energy-efficient units produced by world leaders in accordance with the European IE3 standards. This project not only reduces energy consumption and enhances equipment reliability, but also significantly curtails greenhouse gas emissions from electricity generation. It also makes Ferrexpo production more long-term predictable and attracts world’s best consumers, thus contributing to Ukraine’s GDP.

A comprehensive engine replacement program was launched in 2017 and is expected to last until 2025. Annual investment in this project exceeds $2 million, and the cost totals more than $15 million. More than 335 engine units have been replaced thus far. Until the end of 2020, the first phase of the project, the replacement of 450 engines, is planned to be implemented. The pace of the project implementation is expected to be retained, with all engines replaced until the end of 2024–2025.

The project helps reduce not only energy consumption, but also greenhouse gas emissions. At the end of project implementation, electricity consumption is expected to be reduced by 10% (at least by 3% during implementation), while CO2 emissions will decrease by 60 thousand tons per annum.

Environmental effects

According to the data of the Central Geophysical Observatory named after B. Sreznevskyi, Gorishni Plavni tops the list of the least polluted industrial cities of Ukraine by the environmental pollution index. The study evaluated air pollution for 22 pollutants, including eight heavy metals. This status has been achieved partly due to huge investment in environmental projects.