Miners are targeting massive carbon reductions over the next 10 to 15 years on the path to achieving net-zero emissions by 2050, with equity research company Jefferies warning that this implies higher costs and capital expenditure (capex), but also a trend of less supply, higher commodity prices, higher free cash flow and higher share prices.
The commitment to net-zero emissions is a result of mining companies coming under increasing pressure to make explicit and sizable capital commitments for initiatives that target the reduction of greenhouse-gas (GHG) emissions in line with global plans to meet the Paris Agreement target of limiting global warming.
Some miners – like Fortescue, Rio Tinto, BHP, Newmont and Vale – have given explicit guidance about investment in such initiatives, Jefferies says in its equity research report for metals and mining, published on January 6. Continue Reading →