As competition for water heats up, it’s more important than ever the industry inject transparency into water, both quantity and quality. By Richard Collins.

Australia’s water reform is in trouble, confirmed a damning assessment by the National Water Commission in October. Chairman Ken Matthews, pulling no punches, said “the pace of water reform has slowed on almost every front” – and it is going to get harder thanks to climate change.

“In its most disturbing finding, the report concludes that governments will not meet the central commitment they made under the National Water Initiative to ‘fix’ over-allocation by 2010,” he said.

“Government commitments to tackle over-allocation date back to at least 1994.”

It is unwelcome – though hardly surprising – news for the mining industry, which has been working hard to secure its water access rights. It uses less than 3% of national water resources, and according to the Minerals Council of Australia’s Jason Cummings is the highest value and most efficient user of water in Australia.

The MCA’s assistant director of environment policy said the report showed, despite those facts, that the industry was still not appropriately integrated into water markets and planning efforts.

However, he said its “recommendations for consistent and secure water access entitlements for the minerals sector are welcomed and we recommended they be adopted without delay”.

Part of industry efforts to prove its bona fides is the water accounting methodology for minesites being developed in conjunction with the Sustainable Minerals Institute at the University of Queensland.

The Water Accounting Framework is the first attempt by any Australian industry to accurately and consistently measure and account for its water use.

While all operations provide detailed water information to state governments each year, it is not reported in a consistent way that can be aggregated. What one mine calls raw water another calls fresh. What one calls run-off another claims is reuse. Sometimes it is not even consistent across divisions within a company.

“The framework establishes a consistent approach for quantifying flows into, and out of, minerals operations,” Cummings told Licence to Operate.

It is also comparable to the Preliminary Australian Water Accounting Standard, which in time will make it possible to benchmark use and value creation across different sectors.

Cummings suggests that will enhance public and investor confidence in the industry’s ability to access and use water sustainably, which “has reputational benefits and potentially positive business outcomes as greater emphasis is placed on ethical investment practices”.

A question of quality
The accounting framework is pretty well bedded down and Cummings hopes companies will pick it up. The MCA is looking to the next steps.

A pilot project in central western NSW this year applied the framework for the first time to a regional scale, involving four minesites.

“It put our use in context,” Cummings said. “Cadia, which is the biggest gold mine in NSW, used one per cent of the Lachlan’s total water use.

“Giving us the accounts allowed us to make some quite powerful observations in a transparent context.”

It also brought all the players together to discuss the water system in a holistic approach. For example, climate models used to design dams are not usually built into a site’s water accounting framework, reflecting room to improve in data management with operations.

The most interesting of the next research phases is to broaden out the accounts to include quality issues.

“The next stage is mainly aimed at how to consistently communicate water quality, not only the water quality that we are sourcing but the water quality that is leaving a mining operation,” Cummings said.

He wants to be able to demonstrate that much of the water used in mining is low quality, sometimes even water that no one else could use, such as the hypersaline flows around Kalgoorlie.

“The big leveraging point for us is describing the fact that we don’t use high-quality water in many instances,” Cummings said. “So we need to get a consistent way to describe water quality and report that.”

It would be based on either biophysical parameters such as Total Dissolved Solids or the water’s value to the surrounding region. A quality measurement based on value may label water that can be used by other stakeholders for irrigation or livestock as high quality, whereas water that can only be used by the industry would be low quality. If there is no use for the water then it is actually a liability. This could also play into the water market.

“One reason we want to incorporate quality into the framework is so we do not pay extra for low-quality water. A price differential would mean there is actually an incentive to access low-quality water rather than fresh water, and that drives internal recycling as well,” Cummings said.

“If any of the stakeholders are looking to sell water it would also let them describe exactly what is in it.”

More at www.wateraccounting.net.au