Summary
Facing mounting pressure from water scarcity, stricter regulations, and rising stakeholder expectations, mining companies are adopting contextual water targets to ensure operational continuity and compliance. To support this shift, Waterplan partners with leading multinational miners to identify site-specific water risks using high-quality local data and scenario modeling. This enables them to proactively mitigate risks, meet internal and regulatory targets, and prevent costly disruptions across global operations.
Mining Industry Context
Water is a critical resource for the mining industry. It is used for various operational activities: separating minerals, dust suppression, cooling systems, slurry transport, mine dewatering. Since demand for key minerals like copper, nickel, aluminum and lithium is surging, water use in mining is taking center stage.
Driven by global energy transition efforts and industrial growth, by 2040 demand for lithium and nickel is projected to quadruple, and for copper to double. In 2025, Goldman Sachs raised its aluminum price forecast by 6.3%, citing higher demand potential in China, its dominant consumer. The escalating production of electric vehicles, solar panels and battery storage is leading countries like Chile, a region struggling with severe water scarcity, to consume more than 50% of their regional water supplies in mining activities.
The industry stands to face significant water risks: 16% of critical mineral mines are located in areas with high water scarcity. Mines' water consumption and use can severely affect nearby communities, from dwindling supplies to heavy metal pollution, which is why water management in mining is subject to stringent regulations in major mining jurisdictions. Countries with significant mining sectors have developed regulatory frameworks to ensure responsible water use, often aligning with global best practices. For instance:
In Australia, mining companies must adhere to the Water Accounting Framework (WAF), a standardized approach to water reporting developed by the Minerals Council of Australia.
Canada’s Towards Sustainable Mining (TSM) Water Stewardship Protocol sets performance expectations for water governance, watershed-scale planning, and water reporting.
South Africa mandates compliance with water conservation and demand management strategies outlined by the Minerals Council of South Africa.
At a global level, the Initiative for Responsible Mining Assurance (IRMA) Standard establishes broad sustainability principles that incorporate water stewardship considerations
Mining companies bring significant value to local communities: in British Columbia, mineral operations support over 35,000 jobs with an average annual salary of nearly $139,000. For communities located in isolated rural areas, mining creates jobs and business opportunities. However, there are tradoffs. By 2025, it is expected that 20% of critical mineral sites will be located in water scarce areas, an increase from the current 16%. Overuse of scarce resources can lead to conflicts with local populations and authorities.
Effective water management is crucial in the mining industry due to the potential risks associated with floods and water scarcity. Poor water management can lead to increased production costs, environmental damage, negative impact on local communities and reputational damage.
As such, the Companies are committed to ensuring their water use and discharge is efficient and safe in accordance with both local guidelines and the standards of the International Council on Mining and Metals (ICMM), and therefore aims to optimize water operations to achieve sustainable and efficient resource management. Its focus is on minimizing risk and ensuring business continuity across all operations.
The Partnership with Waterplan
The Companies have partnered with Wateplan to assess their site-specific water risks leveraging Wateplan's proprietary risk framework and advanced AI capabilities. The resulting insights inform mitigation strategies, powered by the establishment of clear water targets that enable structured and proactive water management.
However, setting accurate and ambitious water targets is no small feat. Waterplan's work with mining companies often addresses the following challenges:
Time-consuming water data collection processes: Mining operations are often spread across remote locations and work with diverse data sources, including hydrological and hydrogeological assessments and mine operational plans, making it especially challenging and time-consuming to collect and consolidate data consistently.
Uncertainty over water risk prioritization: Setting risk mitigation priorities requires a deep understanding of site risk characteristics, including quantifying value at risk according to varying risk scenarios. Since mining sites often have unique environmental conditions, lack of standardized tools and methodologies to model risk scenarios can lead to inconsistencies in reporting and management practices.
Difficulty setting water targets: Defining achievable site and catchment specific targets requires high-quality local data and water expertise to interpret it. Close monitoring is then essential to ensure goals are met, which require regularly updated information and streamlined reporting.
Multiple reporting requirements make compliance resource-intensive: Mining companies often operate in multiple jurisdictions, each with its own set of mandatory and voluntary reporting frameworks, each with their own definitions, disclosure thresholds, and data requirements. Tailoring reports for each standard demands duplication of efforts.
Centralizing Local Water Risk Mining Data
Mining companies often operate in regions characterized by highly variable rainfall and increasing water stress, similar to conditions found in Australia, Chile, and South Africa. As is typical in the mining sector, these companies operate across multiple remote sites, each with its own data collection systems and protocols.
This decentralization leads to fragmented and disconnected datasets, making it difficult to consolidate and manage data effectively. The industry relies on a wide range of data sources, like monitoring stations, site studies and research papers which generate vast amounts of data that exist in various formats (PDF, images, spreadsheets, etc.), making manual processes particularly error-prone. To ensure an accurate analysis, data processing and standardization is required for meaningful analysis.
Waterplan’s platform leverages AI to scale water risk analysis by collecting, validating and centralizing vast amounts of public and site data, yet fragmented, water data. Our models process diverse sources, like high-quality local basin data, site vulnerability data, satellite imagery, IoT sensors and GRACE and GLoFAS global datasets to extract relevant insights, ensuring all relevant information about our clients' water data is standardized and stored in one place. Data mapped for each risk category includes:
Physical: Hydrological and hydrogeological assessments, basin management plans, water service provider plans, environmental impact assessments, climate change projections, hydrological surveys, geochemical models, catchment supply and quality statistics and local municipality documents.
Regulatory: National, regional, and local government regulations, catchment management institutions, and development plans.
Reputational: Catchment forums, local government databases, perception surveys, local media, and municipal forums.
Infrastructure: Regarding internal infrastructure, mine operational plans, water resources management strategies and plans, operational plans and existing risk assessments and mine operational and closure plans. Regarding external infrastructure to deliver water to the mines, desalination plants, tailing dams, stormwater management systems and water conveyance systems.
Waterplan’s Risk Framework & A Site’s Risk Profile
Our clients partner with us to conduct a dynamic water risk assessment, continuously accessible through our platform. This assessment is grounded in our proprietary risk framework, which integrates hazard mapping with site-specific vulnerability analysis to provide a comprehensive view of water risks across their facilities.
Waterplan’s AI models analyze, classify and summarize all collected data into a single, actionable risk score that measures scarcity, flooding, quality, regulatory, reputational, and infrastructure risk for each site. Hazards mapping considers a site's local basin risk, whereas vulnerability assessments consist of remotely gathering a site's water data, bridging the site-global information gap by accessing categorized site-specific vulnerability data.
Afterward, sites and risk drivers within each site are prioritized for mitigation with Waterplan’s prioritization matrix. This data is constantly updated for integral monitoring and assessment, and is mapped by type of risk.
The reputational risk analysis is crucial for mining companies. Due to the impact they have on shared water resources, their operations often lead to tense relations with local communities. Waterplan’s AI analyses the media sentiment on a monthly basis by identifying and classifying water-related articles targeting a business, boosting team awareness of global pressures. This evidence supports company-wide water stewardship initiatives and provides regularly updated data for quick action.
As per Waterplan’s analysis of various mining operations, two major water risks emerged as the most threatening to mining operations: quality and scarcity.
Our analysis of mining sites found two common challenges:
Quality risk: elevated nutrient levels in local waterways—due to agricultural activity and modified drainage systems—posed a quality risk, particularly in the absence of adequate wastewater treatment.
Scarcity risk: The region’s increasing aridity and prolonged dry summer months, combined with the absence of a contingency plan, significantly heightened the site’s exposure to water scarcity risk.
We then went on to map the financial implications of potential scenarios, in order to accurately assess mitigation strategies.
Scenario Modeling, Financial Quantification & Mitigation Strategies for Risk Prioritization
Using predictive models and working alongside site managers, Waterplan simulated “what-if” scenarios to forecast potential risks and quantify their financial impact—from operational disruptions and regulatory fines to supply chain interruptions. These simulations estimate the value at risk by factoring in both the likelihood of each scenario occurring and the projected costs of the recommended mitigation measures.
Taking into account mining operations' common challenges around water quality, we modeled a scenario where groundwater contamination occurred at the site due to leaks from residue storage areas and/or surface water drainage issues. This scenario risked non-compliance with local regulations, and included around $10 million in remediation costs and reduced operations.
Four potential mitigation strategies were presented:
Implementing water discharge standards: This strategy ensures compliance and avoids fines by upgrading spillway capacity during extreme weather, while expanding water recycling reduces reliance on surface sources and helps maintain stable operations.
Develop a plan to address and remediate spill sources: Implement rapid containment measures with the right equipment and trained personnel can mitigate immediate damage, and installing groundwater containment systems around high-risk areas, particularly near aquifers, prevents further contamination.
Enhance contamination control and hazardous materials management: Revising protocols for handling, storage, and disposal reduces accidental spills, and adding buffer zones, impermeable liners, and leak detection systems in storage and residue areas safeguards both surface and groundwater sources.
Create a plan to mitigate reduced capacity: Phased remediation and buffer capacity help minimize operational downtime and financial losses, while supplementing water needs with external sources or trucking sustains production if capacity is temporarily reduced.
One of the modeled scenarios for scarcity risk was a lower rainfall than usual due to increased seasonal dryness. A simulated extreme hydrological year projected an over 40% reduction in precipitation and runoff withdrawals. Due to a decrease of surface water levels and, therefore, withdrawals, this could result in decreased production at 70% capacity during critical dry periods.
Three mitigation strategies were proposed:
Install floating covers or shade structures over ponds: Using modular floating covers or shade cloths made from UV-resistant materials reduces exposure to sunlight and wind, cutting evaporation by up to 70%. This approach conserves more water for critical refinery operations and improves water quality by limiting debris and algae growth.
Optimize rainwater capture and minimize evaporation losses: Upgrading rainwater harvesting systems with larger storage tanks, better catchment designs, and evaporation control measures ensures a more reliable supply during dry periods. These combined efforts can cut reliance on surface water by 10–15% and reduce evaporation losses by up to 30%.
Optimize water use during dry periods: Implementing a water efficiency program helps reduce overall demand by up to 20%, especially by upgrading to more water-efficient equipment, reusing process water, and scheduling high-demand activities in wetter months. This strategy maintains a more sustainable balance between operational needs and water availability.
The data used for these scenarios is being constantly updated, allowing our clients to adjust their strategies accordingly, as water risks vary significantly year over year due to extreme weather events, temperature and precipitation changes, urbanization, and other factors.
Some of the risk scenarios we modeled materialized. At one site, low river levels showed a significant increase in water scarcity risk. As maintaining port operations was critical to ensure business continuity, we identified that low river levels, alongside preexisting sediment buildup, would cause draft restrictions, impacting transportation and increased dredging. With no disclosed plan in place, we predicted the operational costs from halted operations could be in the millions of dollars, and the probability of this occurrence above 50%. After port operations were disturbed, we are now working on mitigation strategies for future occurrences to reduce potential scarcity-related damages.
Waterplan’s Support in Setting AI-Powered Contextual Targets
Thanks to the in-depth, granular understanding of risks that Waterplan’s analysis provides, we support our clients in establishing contextual water targets for their prioritized sites. We work closely with site managers and local facilities to ensure these targets are both actionable and aligned with on-the-ground realities. Common internal water targets for mining companies include the following:
To mitigate scarcity risk: Securing sustainable and diverse water supplies.
Completing a comprehensive options assessment to evaluate and prioritize strategies for improving water security, including optimized storage and management systems, alternative supplies and operational measures to mitigate water scarcity risk.
Finalize business cases for priority water management options, secure approvals and initiate implementation, establishing performance targets aligned with the approved solutions.
To mitigate quality risk: Water treatment and reuse for enhanced water quality and efficiency.
Evaluate and design a water treatment solution for caustic water reuse in the freshwater circuit, addressing operational inefficiencies
Implement a phased treatment solution at critical locations, reducing reliance on fresh water and ensuring a sustainable reuse framework
By setting realistic and achievable goals specific to each site’s local conditions, our clients' site managers and local stakeholders are more engaged, as the risks and mitigation strategies proposed are directly applicable to their day-to-day operations and challenges.
With the support of our platform and water experts, and to ensure target success, our clients can establish educational workshops, supporting global, regional and site teams by leveraging their engagement with their achievable and coherent targets.
Takeaways
Mining companies leverage Waterplan's technology to enable data-driven decision making. Leveraging Waterplan’s AI, the Companies enhanced risk identification, mitigation and reporting while setting contextual targets. This partnership enables the Companies to efficiently meet its water goals and expand the number of sites where water risks are assessed and managed within the platform. By continuing to expand Waterplan’s solution across additional sites, the Companies aim to proactively address water-related risks.
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