PRINCIPAL RISKS

Fire incidents at operational sites pose a danger to life, as well as property and equipment on site.

Mitigation Plan

• Fire extinguishers and suppression systems installed across all locations, alongside 24x7 availability of firefighters and rescue teams
• Barriers and protection equipment, including multipurpose tender, hydrant points, sprinkler systems, CO₂ flooding systems, foam pouring systems, and liquefied petroleum gas (LPG) sensors, in place to avoid aggravation of fire incidents
• New solutions being continuously explored, such as new-age fire fighting vehicles, powder-based and foam-based auto fire suppression systems, fire hydrant lines, early fire detection system for conveyors, fire banks, fire walls in existing equipment, conveyor belts in mills and diesel handling stations and sub-stations for underground mines
• Planned enhancements of fire safety mechanisms, such as alarms, sensors and nitrogen purging systems to prevent fire-related accidents in smelters
• Fire safety training and awareness programmes, SOPs and fatality and serious injury prevention plan (FSIPP) for all workers in place at all locations
• Storage vessel and piping system used for high-speed diesel (HSD), light diesel oil (LDO) and other fuel storages are grounded and equipped with lightning arrestors, with regular checks on earth connections and resistances
• Ensuring maintenance of the health of slurry tanks, earthing, and periodic testing in the Purification Plant at CLZS Hydro 2

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Failures in structure or equipment (acid tank and roaster dam collapses, smelting furnace and shaft failures) from excessive wear and tear, ageing of asset and improper/inadequate maintenance, may cause injuries, fatalities and operational disruptions.

Mitigation Plan

• SOPs defined for permissible limits and usage of plant equipment
• Planned maintenance shutdowns done for repair and replacement of ageing/malfunctioning parts
• Upgradation, repair and redesigning of existing equipment at mining and smelting sites Replacement of older equipment with the latest and more robust equipment - featuring enhancement in design, material of construction (MOC), safety and corrosion resistance
• Planned implementation of remote-controlled operations to reduce manual intervention in structures, such as acid tanks
• Use of digital initiatives for real-time analysis of indicators signalling equipment degradation and distributed control systems (DCSs) for process parameter monitoring
• Regular training sessions for operators covering operating equipment methods, maintenance requirements, and troubleshooting minor defects at site
• Use of DCS technology to monitor parameters and health of various sections of the plant

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Non-adherence to safety protocols or errors in judgement by employees/contract workers (man-machine or machine-machine interactions, electrocution, fall from height, explosives handling), may lead to injuries and fatalities.

Mitigation Plan

• Robust safety processes implemented across all sites including critical risk management (CRM) and critical control management, such as FSIPP, to identify high-risk hazards and hazard identification and risk assessment framework
• Implemented digital technologies, such as proximity sensors for heavy earth moving machinery (HEMM), CCTV surveillance, automation and remote operations in mines, mills and smelters, and proximity warning and anti-collision system, to prevent machine-machine and man-machine interactions
• Upgradation and replacement of outdated systems and equipment
• Equipment and machinery trainings conducted for business partners; safety trainings conducted on monthly basis and life saving rules (LSR) in place
• Earth-leakage circuit breaker (ELCB) implementation and neutral grounding resistance for transformers
• Implemented best practices for vehicular safety, such as constructing underground workshops to manage and minimise vehicular movement, enforcing a “Zero” vehicle reversal policy and NO-GO criteria, and designating parking areas and pedestrian pathways
• Remote operations for stope bogging across all mines

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Instances of fall of ground (FOG) due to poor geo-tech conditions or heightened seismicity may lead to fatalities, damage to assets such as shafts and equipment, and operational disruptions.

Mitigation Plan

• Integrated safety measures like micro-seismic monitoring and critical control management plans, such as FSIPP, across all sites
• Monthly safety trainings and skill upgradation of geo-tech engineers
• Multi-faceted approach to maintain the structural stability of mines: strict adherence to the Ground Control Management Plan (GCMP), annual reviews and implementation of Structural Stability Report (SSR) recommendations, and undertaking regular inspections, damage mapping, timely rehabilitation, and advanced footwall drive cable bottling
• Planned implementation of new-age solutions, such as tele-remote operations of the loaders and drill machine, for production and development
• Smooth wall blasting practices in place and slope stability radar implemented
• Action plans for FOG under CRM implemented in first phase
• Mechanism in place to achieve void reduction followed by paste-fill optimisation
• Implemented usage of rock breaker in stopes across all locations

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Any overtopping of tailings, water accumulation during heavy rainfall, increased tailings from declining ore grades, and land acquisition issues necessitating raising dam height can trigger tailings dam collapse.

Mitigation Plan

• Implementation of dry tailings technology supported by engagement with expert agencies for suggestions
• Bi-annual tailings dam structural stability study and ongoing geo-tech monitoring to identify abnormal pressure in embankments
• Regular reclamation and evaporation of water from the tailings dam
• Construction of additional reservoirs to hold excess water and relieve pressure from tailings dam; procuring new land for expanding tailings storage facilities
• Use of high-density polyethylene (HDPE) membrane to avoid seepage in the upstream side
• Maintaining design free board of 1 metre to avoid any spillover and to maintain buffer space

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Exposure to sulphuric acid fumes and hazardous gases, such as carbon monoxide (CO), lead and metal dust, sulphur dioxide (SO2), chlorine and propane, can pose a serious occupational risk.

Mitigation Plan

• Inspection of structures with internal and external structural integrity audits and non-destructive testing (NDT) in all smelters
• Installation of online monitoring sensors for hazardous gases like chlorine, LPG, SO2, etc. across all smelters, supported by work zone monitoring (cameras) and personal monitoring (attaching sensors on employees for continuous reading) to detect leaks
• Installation of air filters on all equipment having the potential to cause harmful emissions, and employing tail gas treatment (TGT) systems to reduce emissions of poisonous gases
• Stringent adherence to the use of personal protective equipment (PPE), including gas masks, eye protection and gloves by employees during operations
• Investments in new technologies, such as powered air purifying respirators (PAPR), equipment for manpower, safety showers and diphtheriae kit in acid plants and auto cut-off systems for chlorine tonner leakage

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Failure to comply with regulatory norms on emissions (SOx, NOx, PM), waste management (hazardous waste, jarofix), effluents management, noise and green belt area pose significant risk to the business.

Mitigation Plan

• Mechanisms in place for tracking and monitoring compliances and norms in the mining and smelting industry
• Investment in new technologies to minimise emissions and waste generation from mines and smelters
• Waste management techniques, such as dry tailings stacking, in place of wet disposal methods
• Processing of jarosite with quick lime for sale to the cement industry implemented in CLZS mine
• Upgradation and installation of new systems for statutory licence compliance - new dust extraction system and crusher revamping at mills, and installation of additional wastewater treatment facility at locations

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Adverse movement in the commodity prices on the London Metal Exchange (LME) and London Bullion Market Association (LBMA) may impact profitability.

Mitigation Plan

• Hedging strategy implemented as per hedge policy to maintain monthly average LME price on shipments
• Pursuing cost-efficiency initiatives to reduce structural costs, and negotiating with customers for higher premiums
• Deploying strategies aimed at enhancing domestic market share
• Introduction of go-to-market changes via an e-commerce platform to move 100% of sales to the online platform
• Set up of treatment plant for minor metals for better metal recoveries

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Social discontentment, agitations, public protests and disputes can potentially disrupt business operations and impact profitability.

Mitigation Plan

• Robust social strategy encompassing active engagements with communities around operational sites and deploying impactful programmes encompassing education, sustainable livelihood, women empowerment, health, water and sanitation, infrastructure development and environment
• Established a network with law enforcement and local administration
• Monitoring the local ecosystem for potential community discontentment supported by a structured grievance mechanism
• Implemented a crisis communication protocol and escalation matrix for effective crisis response
• Augmented security measures at gates and critical/ vital installations

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Cyber-attacks (malware, phishing, ransomware), security breaches of information technology/operational technology (IT/OT) systems and loss of confidential/sensitive data such as unpublished price sensitive information (UPSI), generation data, personally identifiable information (PII), pose a danger to operational continuity.

Mitigation Plan

• Incident response and security information and event management (SIEM) implemented to support threat detection, compliance, and security incident management
• Third-party risk management (TPRM) protocols and cyber insurance in place
• ISO 27001/27701/22301/31000 certification compliant
• Compliance with the organisation’s data classification policy
• Data loss prevention (DLP) mechanisms implemented including e-mail DLP, end-point DLP and monitoring, etc.
• Periodic training, workshops and seminars on organisational policies, IT/OT security and cybersecurity
• Up-to-date endpoint security with regular antivirus, patches and firewall updates and continuous monitoring of traffic
• Annual Certified Security Analyst (CSA)/Vulnerability Assessment and Penetration Testing (VAPT) assessments and IT infosec infrastructure configuration reviews
• Manual tagging and control of confidential data, reinforced by BP confidentiality agreements to prevent leaks
• Measures like cloud proxy solutions, endpoint detection and response (EDR) and IT systems hosting on Azure or other cloud systems
• Mandatory virtual private network log-in for employees working remotely and contract staff, ensuring restricted network and database access with multiple security layers

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Volatility in coal prices, supply shortages (critical spares, HEMM equipment, explosives, fuel) and disruptions in shipping and railway services due to geo-political issues, dependency on critical business partners, and infrastructure constraints pose a serious business risk.

Mitigation Plan

• Coal: Secured coal availability with a strong BP base of direct coal miners, long-term fuel supply agreement with Coal India subsidiaries to cover 30% coal requirement, and practice of maintaining sufficient safety stock. Adoption of alternate fuels like lignite and biomass, process modification supporting greater domestic coal consumption, coal-blending initiatives and focus on renewable energy reduces dependence on coal.
• Explosives: Long-term contracts with major explosives BPs and expanding collaboration with alternate BPs
• Tyres: Development of alternate BPs and R&D projects for optimising the operating life of tyres
• Exploring engagements with new BPs to mitigate the shortage of coal and other supplies

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