Climate Modelling and the Future of Mining

For many years, climate discussions have focused on emissions reduction and net-zero commitments. But increasingly, companies and investors are asking a different question: how will a changing climate affect the places where we operate, the materials we produce, and the communities and supply chains that support them?

This episode explores how climate models, emissions scenarios and site-level hazard data can be combined with operational vulnerability assessments to identify physical climate risks, understand how they may evolve over time, prioritise adaptation and support more resilient investment and business decisions.

Through their partnership on TDi’s digital platform, TDi Sustainability and AXA Climate are translating this climate data into practical, asset-level intelligence that helps companies identify risk hotspots, prioritise vulnerable operations and strengthen resilience across mineral value chains.

Speakers include:

Christelle Castet – Head of Science, AXA Climate

Clàudia Ylla Arbós – Flood and Climate Risk Expert, AXA Climate

Charlotte Selvey Miller - Head of Innovation and Productisation, TDi

Christelle Castet leads the development of climate risk models and adaptation indicators, where she helps organisations understand and respond to the physical impacts of climate change. Working at the intersection of climate science, risk analytics and business decision-making, she oversees a multidisciplinary team of experts in geosciences, agronomy and data science, ensuring that the latest scientific research is translated into practical insights for industry and communities.

Clàudia Ylla Arbós specialises in the assessment and modelling of physical climate risks and their implications for businesses, infrastructure and communities. Her work focuses on translating complex climate and hydrological data into actionable insights that help organisations understand their exposure to future climate hazards and strengthen long-term resilience strategies.

Transcript

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00:00  |  Introduction: Climate risk and the mining sector

Charlotte Selby-Miller: Hello and welcome to Suits and Boots, the TDi podcast series. I’m Charlotte Selby-Miller, Head of Innovation at TDi Sustainability. In this episode, we’ll be exploring one of the most significant challenges facing the mining and metals sector: understanding and preparing for the physical impacts of climate change.

Charlotte Selby-Miller: For many years, climate discussions have focused on emissions reductions and net-zero commitments. Increasingly, however, companies and investors are asking a different question: how will a changing climate affect the places where we operate, the materials we produce, and the communities and supply chains that support them?

Charlotte Selby-Miller: We are focusing on mining as a strategic industry, both today and for the transition to renewable energy. The European Union aims to be the world’s first climate-neutral continent by 2050, now a legally binding commitment under the European Climate Law.

Charlotte Selby-Miller: The world is already deeply dependent on mining outputs. Our power grids, electrical infrastructure, automotive, electronics, construction and infrastructure industries all rely on them. We are also seeing huge investment in digital infrastructure such as data centres, with the expansion of AI only increasing this need.

Charlotte Selby-Miller: Although the energy transition did not create this dependency on mined materials, it will accelerate it, especially for metals such as copper, steel and aluminium. Many mining facilities were originally designed for climate extremes expected once in a century, yet these events are becoming far more frequent, leaving historic designs inadequate for the new climate reality.

Charlotte Selby-Miller: Together, these pressures underline the urgent need for updated climate-adaptation planning, robust risk assessments and more resilient infrastructure across the mining sector, alongside more transparent climate-risk assessments that enable investment firms to invest more confidently in mining companies operating in unstable climate zones.

Charlotte Selby-Miller: To better understand these challenges, TDi Sustainability and AXA Climate have formed a partnership to bring climate-risk intelligence into the mining and metals sectors. Today, we’ll discuss the science behind climate-risk modelling, how climate data is translated into practical business insights, what we’ve learned from analysing mining operations around the world, and how mining companies, investors, OEMs and other stakeholders across metals and minerals value chains can use these insights to strengthen resilience and support long-term decision-making.

Charlotte Selby-Miller: Joining me are Christelle Castet, Head of Science at AXA Climate, and Claudia Ylla Arbos, Flood and Climate Risk Expert at AXA Climate. Christelle leads the development of climate-risk models and adaptation indicators that help organisations understand and respond to the physical impacts of climate change. Claudia specialises in assessing and modelling physical climate risks and translating complex climate and hydrological data into actionable insights. Welcome, Claudia and Christelle. It’s really nice to have you here.

Claudia Ylla Arbos: Hi, thanks for having us.

Christelle Castet: Hi, Charlotte. Happy to be here.

04:20  |  How climate hazards disrupt mining operations

Charlotte Selby-Miller: We know demand is rising for the different minerals needed for the energy transition. One of the latest UNEP-WCMC forecasts shows that we need 300 new mines and processing facilities by 2030 to meet demand, even taking recycled materials into account. What happens when climate affects the mines themselves, especially in operational terms?

Christelle Castet: We are entering a phase where every asset that extracts and processes critical materials is becoming increasingly exposed to climate disruption. Heat affects worker health, safety and productivity, as well as equipment and electrical systems, and creates additional cooling costs. Water stress directly limits the processing capacity of water-intensive operations and can fuel conflict over competing demands. Extreme rainfall and flooding damage equipment and block access to sites.

Christelle Castet: These climate hazards affect not only mining sites themselves, but also the infrastructure on which they rely. They therefore affect the entire supply chain beyond the site.

05:44  |  Climate disruption is already happening

Charlotte Selby-Miller: We must already be feeling these climate disruptions now, or is this still more of a future concern?

Claudia Ylla Arbos: We are certainly already affected. Flooding in Queensland, Australia, has been an issue for many years. In 2010–2011, La Niña combined with tropical cyclones and flooded many mines. Around 25% were inoperable and 60% were operating under restrictions because of flood damage.

Claudia Ylla Arbos: About 46 mines were affected, 91% of coal exports were impacted, and coal-industry losses were estimated at around one billion dollars, with recovery taking months. It is not easy to pump water out of mines because environmental restrictions govern how much water can be redistributed into river systems.

Claudia Ylla Arbos: The impact on individual mines depended greatly on their location, the flood-adaptation measures they had in place and whether supporting infrastructure such as railways and roads was flooded.

Claudia Ylla Arbos: It is not just flooding. Terrible wildfires in Canada in 2023 and 2024, especially in Quebec, affected several mines and caused evacuations, delays and production stoppages. Again, operations took months to resume. Water stress and drought are also major issues in countries such as Chile.

Claudia Ylla Arbos: Climate change will make these hazards and their associated impacts more frequent and intense. An aggravating factor is that minerals are often geographically concentrated. When a region is affected by a particular hazard, many mines in that area may be affected by the same issue.

Claudia Ylla Arbos: This is not just an environmental issue. It is a question of operational continuity, cost volatility and long-term asset resilience—and it is already happening.

Charlotte Selby-Miller: That is particularly important because a mine cannot be moved; it is tied to the ore body in the ground. A company cannot simply decide to operate somewhere less affected by climate change.

Charlotte Selby-Miller: A 2024 UNEP Finance Initiative report also describes flash flooding and mudslides in Indonesia that cut quarterly copper sales by 8% and gold sales by 10%. That equated to approximately 338.5 million dollars in lost sales. The financial impacts of flooding, wildfires and droughts can be enormous.

08:47  |  The TDi and AXA Climate pilot project

Charlotte Selby-Miller: AXA Climate and TDi have been running a pilot project covering just over 100 mine sites worldwide. It includes open-pit and underground mines across an array of metals and minerals. We wanted to understand the climate risks surrounding these sites and how they might jeopardise operations, potentially slowing or stopping production. What has the study concluded so far?

Christelle Castet: What we found is that exposure to climate risk is not marginal; it is systemic. By 2050, one in three sites is expected to face a high or very high risk of extreme heat, while 77% of the sites are exposed to extreme water stress. The numbers are quite overwhelming.

10:22  |  Prioritising risk across multiple assets

Charlotte Selby-Miller: What does that mean for companies managing multiple assets?

Christelle Castet: The challenge is no longer simply to identify whether a risk exists, because the risks are systemic. It is to understand where to focus first: which regions are most affected by which hazards, and which assets are most critical to the supply chain. That is where capital should be allocated most effectively.

11:02  |  Turning climate science into actionable insights

Charlotte Selby-Miller: How can we anticipate the future climate, and how do you translate complicated climate science into something actionable that industries can use when making decisions?

Christelle Castet: We rely on climate-model outputs. These models are run under different greenhouse-gas emissions scenarios, which climate scientists call shared socioeconomic pathways, or SSPs. You can think of them as different possible futures depending on how much the world manages to cut emissions.

Christelle Castet: We examine the data across multiple time horizons, including 2030 and 2050, to see how climate hazards are expected to shift over time. We then look at the location of each site and extract the climate data at site level.

13:18  |  Combining climate hazards with operational vulnerability

Christelle Castet: We combine climate hazards—for instance, temperature or rainfall data—with operational vulnerability. An open-pit mine and an underground mine have different activities and may extract different minerals. Heat will affect a person working outside differently from an underground operation that relies on cooling and ventilation systems.

Christelle Castet: These are different types of vulnerability depending on the mine being operated. If an operation relies on water, the impact will also differ according to the mineral being extracted and the processes being used.

Charlotte Selby-Miller: Heat is a particularly useful example because people do not always think about it as an extreme event. Workers on mine sites can be severely affected by heat, which can interrupt processes and production through worker vulnerability. It is important that this is included in the analysis.

14:35  |  Chilean copper mining: A water-stress case study

Charlotte Selby-Miller: Claudia, can you take us through a real-world example of how this applies?

Claudia Ylla Arbos: Let’s take Chile. Chile is a global producer of copper and accounts for almost 25% of worldwide production. Copper is essential for electrification and industrial systems, yet production is located in regions heavily affected by water scarcity. In risk terms, Chile has high exposure to water stress.

Claudia Ylla Arbos: Chile is already suffering from a prolonged drought now in its fourteenth year. Reservoirs are at record lows, at approximately 30% of capacity. The stakes are high because water is a critical operational input used in ore processing, dust suppression, equipment cooling and even the transport of material as slurry.

Claudia Ylla Arbos: Alternative ways of securing water may be needed, but they can be ten times more costly. We therefore need to examine how water stress will evolve to understand what measures will be required and where priorities should be set.

Charlotte Selby-Miller: What did the analysis reveal about water stress at Chilean mines?

Claudia Ylla Arbos: At some Chilean mining sites, our data shows that water demand is already around four times greater than available water resources. By 2050, that gap could exceed nine times the available water. Resources are being consumed much faster than they can be replenished or regenerated.

16:20  |  The operational and community impacts of water scarcity

Charlotte Selby-Miller: What does this water imbalance mean in practice for communities and mining companies?

Claudia Ylla Arbos: It increases pressure on mining operations and translates into many different effects. There are higher costs to secure water because of the infrastructure needed for water recycling or desalination. There may also be increasing tension with local stakeholders because water use must be shared. Restrictions may apply differently to different sectors, with essential needs covered first.

Claudia Ylla Arbos: For mining, this will certainly create production constraints. There are examples of mine output declining significantly following regulatory restrictions on groundwater extraction. These restrictions protect certain users, nearby wetlands and domestic water use. At other mines, production has fallen by as much as 44%, directly linked to reduced water availability during prolonged droughts.

Claudia Ylla Arbos: This raises questions about the long-term viability of certain sites. Desalination of seawater is becoming one of the industry’s primary long-term responses, but it is highly energy-intensive and can cost up to ten times as much as extracting groundwater. That puts pressure on the entire mining supply chain.

Claudia Ylla Arbos: It is estimated that by 2035 almost three-quarters of mining water in Chile might come from seawater rather than continental sources. That raises significant questions about feasibility and cost.

Charlotte Selby-Miller: There is also a circular challenge: more minerals and metals will be needed for solar panels and other infrastructure to produce the electricity required to run desalination plants.

Charlotte Selby-Miller: Water shortages have immediate financial consequences. A potash miner in Germany had to close because of water shortages at a cost of two million dollars per day. This is an expensive risk that is already materialising.

19:18  |  Understanding compound climate hazards

Charlotte Selby-Miller: Is climate risk at a mine mainly about one hazard, or can sites face multiple hazards at once?

Christelle Castet: Sites can definitely face multiple hazards. Northern Chile is a very dry region, but it can also experience extreme rainfall and flooding. In March 2015, extreme rainfall hit the north of Chile. Because the soil was hard and parched by drought, it could not absorb the water, which turned into thick, muddy torrents carrying debris.

Christelle Castet: A single site can therefore face drought and flooding, together with other perils such as wildfire and smoke. It is a very complex system. These hazards can be interconnected; we call these compound events.

Christelle Castet: Hazards can occur simultaneously. A windstorm, for example, may bring heavy precipitation, so wind and rain create damage together. They may also occur consecutively, such as flooding after a wildfire has stripped vegetation from a hillside and increased the risk of landslides. The combined impact can be greater than the impact of each hazard considered individually.

21:08  |  Where companies should begin building resilience

Charlotte Selby-Miller: Where should companies begin when dealing with these compound events?

Christelle Castet: Companies should not begin by commissioning detailed engineering studies at every individual site. They should first prioritise where adaptation will be most efficient. That requires a genuine understanding of each climate risk and how the risks correlate, based on models grounded in solid science.

Charlotte Selby-Miller: Was that the purpose of the pilot project?

Christelle Castet: Yes. The pilot provides a first level of screening to identify high-risk zones, such as the drought-affected parts of South America, and priority assets. This enables companies to do three things: prioritise where to adapt and begin building resilience across the value chain; target sites that need local, in-depth assessments of hazard levels and vulnerabilities; and support informed investment decisions.

22:12  |  Climate disruption across global value chains

Charlotte Selby-Miller: Why should companies outside mining care about this, and which other sectors should pay attention to this information?

Claudia Ylla Arbos: Their operations depend on stable access to materials, and climate change has cascading effects. A disruption upstream in the value chain creates ripple effects downstream.

Claudia Ylla Arbos: The impacts of the Queensland floods were felt globally. The affected Australian coal mines supplied China and the rest of Asia, which depend heavily on Australian coal to make steel and feed electric utilities. Those steel products are sold worldwide, so buyers of Asian steel were also affected. The result was higher prices caused by higher costs. The same applies to other minerals.

Claudia Ylla Arbos: Impacts are not only downstream of mining. A mine itself might escape a flood while the infrastructure supporting it does not. Damage to roads and railways can limit access to a mine, interrupt operations and restrict distribution further down the value chain.

Claudia Ylla Arbos: There is also reputational risk because this involves protecting people from climate perils and ensuring proper working conditions. In terms of which sectors should pay attention, it is essentially every sector. Operations involving physical work and operational sites experience direct effects, but cascading impacts mean that every sector is concerned.

25:12  |  Tailings dams, extreme weather and societal risk

Charlotte Selby-Miller: We have not yet spoken much about tailings dams. Although they are not operational mines, they form part of the mine ecosystem. Extreme weather is destabilising dams that were intended to last forever. Many were built when climatic events were less frequent, but are now being exposed to repeated flooding.

Charlotte Selby-Miller: The Brumadinho dam disaster killed 270 people. Beyond the devastating human cost, it created enormous reputational and financial damage. It reportedly caused the worst one-day loss in Brazilian stock-market history, erasing around 19 billion dollars in market value in a single trading day. The risks to wider society are enormous.

27:05  |  Key messages for business leaders

Charlotte Selby-Miller: What is the single most important message you would like senior management to take away from this episode?

Claudia Ylla Arbos: Climate risk in mining is no longer a peripheral sustainability issue. It is becoming a core industrial-resilience issue, regardless of whether one particular asset is directly affected.

Charlotte Selby-Miller: Christelle, what would your key takeaway be?

Christelle Castet: It is important to understand, based on scientific evidence, where risks are concentrated and where adaptation efforts will have the greatest impact. Multiple studies also confirm that adapting to future climate risk delivers a better return on investment than inaction.

28:12  |  Reasons for optimism

Charlotte Selby-Miller: To end on an optimistic note, what gives you hope for the future?

Christelle Castet: Having this podcast and discussing adaptation is itself a first step towards moving things in the right direction. We have seen many companies begin climate-risk screening, quantify their risks and prioritise action. I am hopeful that this trend will continue.

Claudia Ylla Arbos: Access to solid scientific information is becoming more widely available. More actors are beginning to use scientific evidence in their planning, which is a solid and sustainable way to approach future challenges.

Charlotte Selby-Miller: Exactly. Let’s not keep this information in academia; let’s get it out there to be used.

29:22  |  Closing remarks

Charlotte Selby-Miller: Thank you so much for joining me today. Climate change is no longer a distant or theoretical challenge for mining. It is already influencing operating conditions, resource availability, infrastructure resilience and long-term investment decisions across the globe.

Charlotte Selby-Miller: Understanding climate risk requires robust science, credible data and the ability to translate complex climate information into actionable insights that support better decision-making.

Charlotte Selby-Miller: My thanks go to our guests from AXA Climate, Claudia and Christelle, for sharing their expertise and helping us better understand the science behind climate modelling and risk assessment.

Charlotte Selby-Miller: Thank you to everyone listening. For further information and resources on climate risk in the mining and metals sector, the TDi Sustainability website is a great place to start. Please get in touch for a free demonstration of the digital platform, where you can see AXA Climate data in action.

Charlotte Selby-Miller: I’m Charlotte Selby-Miller. Thank you once again for joining us on this episode of Suits and Boots, the TDi Sustainability podcast series.