Moscow, 14 December 2023 — Nornickel, the world’s largest producer of palladium and high-grade nickel and a major producer of platinum and copper, has issued its first climate change report.

The Company disclosed information on its climate change response and adaptation initiatives from 2021 to date, its risk management system, and the resilience of the Company’s strategy to three climate scenarios. The Report was prepared in accordance with the TCFD recommendations and audited by JSC Kept, an independent external auditor.

To assess climate-related risks, the Company selected three global climate scenarios (SSP1-2.6, SSP2-4.5, SSP5-8.5). Experts from Obukhov Institute of Atmospheric Physics of the Russian Academy of Sciences helped the Company to localise the scenarios across its regions of operation, identify key climate risk factors, and analyse their impact on production assets.

To adapt to climate change, the Norilsk Industrial District deployed a system to monitor the condition of bases and foundations of buildings and structures located in permafrost areas. As at the end of 2023, the system covered 17 of the Company’s entities and over 950 facilities, including 218 equipped with automated sensors.

In 2022, with the support of the Institute of Economic Forecasting of the Russian Academy of Sciences, the Company developed its own global economy and climate change scenarios: “Rapid Transition”, “Sustainable Palladium” and “Global Growth” aligned with the selected climate scenarios. Based on the scenario analysis of the consolidated financial and economic model through 2050 the Company believes that the Global Growth scenario is the most favourable.

By now, Nornickel has identified key risks and opportunities arising from global energy transition and obtained the first results of assessing their impact on the Company’s operations.

To mitigate carbon regulation risks, we started tests of internal carbon pricing in the assessment of investment projects.

Nornickel’s Scope 1 and 2 GHG emissions of 9.9 million tonnes of CO₂e are among the lowest among the global M&M leaders, considering the expected emissions of 2.2 million tonnes of CO₂e resulting from the Sulphur Programme. For the first time in 2022, Nornickel also quantified Upstream Scope 3 GHG emissions, which amounted to 1.8 million tonnes of CO₂e in addition to the Downstream Scope 3 emissions of 3.9 million tonnes of CO₂e.

The carbon footprint of metallic nickel produced by the Company stood at 8.3 kg of CO₂e per kg of product, while that of nickel sulphate was 1.8, one of the lowest in the global nickel industry, which constitutes an important competitive strength in the context of tighter carbon regulations.

Nornickel’s GHG emissions are low both in absolute terms and per unit of output thanks to the high share of renewable electricity, which totalled 51% in 2022, while nearly all the remaining energy comes from a low-carbon fuel — natural gas.

In 2022, CAPEX and OPEX to finance climate change activities totalled RUB 8.9 bn, including energy efficiency efforts and further deployment of the system to monitor bases and foundations of buildings and structures located in permafrost areas of the Norilsk Industrial District.

Vladimir Zhukov, Vice President for Investor Relations and Sustainable Development, commented:

“Climate agenda remains one of our sustainability priorities. The publication of a standalone climate change report takes Nornickel to a whole new level of climate information disclosure in line with international best practices.

This report helps us tell all stakeholders how the Company is adapting to climate change and what steps it takes to mitigate its own climate impact, in the most transparent way. The report also reveals how changes in the global economy in the three climate scenarios will affect demand for the Company’s products and its financial performance through 2050.”

Full report is available on Nornickel’s website.

Nornickel publishes first-ever climate change report