Water crises beset the globe. Water is a strategic resource for the Group. Without it we can’t operate. Too much of it can impact on safety and production. Water is also a primary concern of communities around us. Water costs are rising and pollution and inadequate supply can lead to conflict, fines and clean-up costs.

Performance

During 2006, we used 582 million m3 of water (616 million m3 in 2005) for primary activities. The Group was affected by extremes. In Australia, prolonged drought remains a point of major concern and at Collahuasi, in water-stressed northern Chile, the authorities have imposed a limit on water consumption. In southern Africa, summer rains affected coal production and platinum mining in some areas while others experienced significant water constraints.

Consumption is likely to be notably reduced in 2007, following the sale of Hippo Valley sugar estate in Zimbabwe to our independently managed subsidiary, Tongaat- Hulett, as part of our strategic focus on the core mining businesses. Hippo Valley consumed 194 million m3 of water in 2006. However, future water consumption numbers may vary due to procedures to ensure more systematic reporting of all uses, both primary and secondary.

As a result of monitoring constraints, Anglo Platinum’s consumption figure of 28 million m3 includes its full allocation of waste water from the Rustenburg sewage works, even though this was not fully used. The business unit is exploring further means to use waste water in its production processes.

Anglo Coal’s water efficiency targets were not met in Australia nor in South Africa as more water was lost to evaporation and used for dust suppression. Audits of the water management systems were carried out at Australia’s Drayton and Moranbah North mines during 2006. Anglo Industrial Minerals has achieved a progressive reduction in the use of potable water, with a 3.7% reduction in 2006 off a 2004 baseline.

Incidents

Many of the Level 2 environmental incidents reported in 2006 were water- related. Business units are required to implement remedial and preventive actions following a Level 2 incident.

At Anglo Platinum’s Amandelbult mine in South Africa, sewage seeped through containment dams and flowed into a stream after a breakdown at the pump station. Dilution of the contaminated stream was achieved by diverting excess mine discharge water to the area. New containment dams were built and a programme has been initiated to investigate all sewage pump stations.

A mist trap for harvesting water at Chañaral in Chile’s Atacama desert.

At Anglo Base Metals’ operations, most of the 90 Level 2 incidents were related to emissions or potential emissions to water. Most of these refer to a small number of repeat problems which are monitored and reported monthly until solutions have been implemented. The Lisheen mine in Ireland has been working with authorities to resolve a local water pollution problem. Some revision of the licence requirements by the Environmental Protection Agency is expected.

Mondi reported 11 Level 2 incidents. In Austria, there was a release of 25 litres of oil into the Ybbs River following a technical problem. Swift response prevented further flow into the river and the spread of the oil, thereby ensuring no material damage to the environment. In Slovakia, the company was fined for not having the required chemical storage tank containment system. At Frantschach, 10 m3 of black liquor leaked in the mechanical waste water treatment plant, resulting in total chemical oxygen demand (COD) levels exceeding permissible levels for one day. The Syktyvkar mill in Russia reported eight water-related Level 2 incidents.

Capital expenditure projects have been proposed to resolve these problems.

Improvement

The continuing focus is on driving improvement in water management systems and procedures and ensuring that all business units have updated water balances and information systems. Anglo Technical Division is assisting operations and developing capacity. A global shortage of specialists with water management skills gives cause for concern.

Extensive negotiations with stakeholders and authorities on the implementation of the South African legislation on water discharge charges, demand and efficiency strategies and the catchment management agencies were undertaken. Water-use licence applications for a number of operations have not been processed by the authorities.

Progress was made with the mine-water treatment plants which are an essential longterm management requirement at operations.

During 2006, further research was undertaken by Anglo Research and Anglo Technical Division into water use in mineral processing plants. The Group will be working with the International Network for Acid Prevention (INAP) on the development of a Guideline for Acid Rock Drainage, which will be released through the ICMM. Contributions are also being made to a Global Water Inventory Tool being developed by the WBCSD.

Looking forward

During 2007, all water definitions and policies will be revised in line with emerging best practice and reporting guidelines. Guidelines to produce integrated mine water management plans will be rolled out across the Group.

Further changes will be needed to improve the accuracy of total water use numbers and water efficiency numbers, in line with the current global drive towards better stewardship of water resources. Estimates for calculating recycled or reused water, according to approved methodologies, will have to be introduced.

An analysis of the operations’ impact on water catchments will also have to be undertaken.

Mantoverde mist traps

At Chañaral, a community close to the Mantoverde copper mine in Chile’s Atacama desert, ingenuity has contributed to overcoming poverty and a lack of resources.

A project, which started in 1998, is harvesting water from mist traps and using it to grow vegetables and provide purified water to promote tourism in this arid zone. Water is currently piped 180 kilometres from the city of Copiapó. The perception of many local people is that the quality of the piped water is not good and bottled water is consumed by those who can afford it.

Staff from Mantoverde worked with a local anthropologist, environmental organisations, the borough council and the Australian embassy to study the mist and the potential to harvest it to grow produce. The methodology involves installing a series of vertical mesh curtains. The mist settles on these and the droplets of water are collected in catch-troughs and pipes.

Using grants from the private sector and the government, water storage tanks and other equipment, such as black mesh, were purchased. Members of the community built the mist traps and access roads. Further mist traps will be built in 2007 and the existing traps repaired and maintained.

WATER RESOURCE MANAGEMENT AND REPORTING FRAMEWORK

Rainwater used at Tarmac

Tarmac is saving 40,000 litres of water and up to £50 ($93) a day by using rainwater to suppress dust at its Chatburn site in the UK.

Dust from handling products such as sands, gravels and stone can become a nuisance in dry weather. Rainwater running off the site’s buildings is collected and stored in plastic containers. It is then used on dry days to tackle dust raised by heavy vehicles.

The containers of rainwater are raised on to one of the site’s forklift trucks. The water is spread through a specially designed sprayer, replacing the need for a water tanker to provide the service.

A forklift is used to distribute rainwater collected off the buildings at Tarmac’s Chatburn, UK, site with a saving in water and costs.