Climate change has come to be understood as a deleterious phenomenon, which threatens business, society and ecological systems, thus making it imperative to understand its impact on human, social and economic activities as well as the impact of these activities on climate change. Against this background, this research sought to determine climate change intervention strategies in the mining supply chain in general, specifically focussing on opencast mining contracting and plant hire companies’ practices. This focus on the mining industry was driven by its importance in South Africa and globally, despite its significant direct and indirect contribution to climatic changes. The mixed-methods multiple case study focused on the climate change management of the Mutual Construction Company Group of Companies (MCCGC), an open cast toll mining firm and equipment supplier. Limited to two sites, Pilanesberg Platinum Mines (PPM) and Tharisa Minerals (Tharisa) Mines, the researcher gathered data through interviews, questionnaires, observations and document review. Data was analysed through deductive content analysis. The research made three major findings: (i) the MCCGC, like its principals PPM and Tharisa, does not have an explicit climate change management strategy. Instead, climate change is managed indirectly through implicit strategies seeking to manage environment, health and safety concerns of the mines, (ii) as a contractor, the MCCGC has had to adopt PPM and Tharisa’s implicit approach to climate change management strategies to meet contractual obligations, instead of an explicit approach and, (iii) the MCCGC and its principals’ commitment to environment, health and safety management, and implicitly climate change management, is not mere rhetoric but is being put into practice. The research concluded that MCCGC’s lack of expressed climate change management intentions and practices exposed the firm to climate change risks, most notably financial risks and reputation risks. Financial risks arise from possible ex post climate change liability. In addition, MCCGC is risking its contract tenures, particularly if the two mines change ownership and the new owners insist on an explicit rather than implied climate change strategy with all its suppliers. Reputational risks arise from the possible failure to attract new clientele and investors who may perceive MCCGC as a risky partner, due to an inept climate change intervention strategy / College of Agriculture and Environmental Sciences / M. Sc. (Environmental Management)

One of the greatest challenges facing the world today is integrating industrial activities such as mining with environmental integrity and social concerns. Monitoring is fundamental to environmental management, both to assess the adherence to standards and to allow environmental managers to learn from practical experiences. However, a problem arises when the regulatory authorities cannot keep up with their mandate of enforcement and compliance monitoring. This research examined how the Department of Minerals and Energy (DME) implements the concept of sustainable development in the mining sector of the Eastern Cape (EC) and, more specifically, the extent to which the Mine Environmental Management (MEM) section is able to effectively monitor compliance of mining operations with environmental legislation. This was the first systematic compilation of statistical data for the DME, and presents the first study in the EC regional office in terms of environmental sustainability. Results indicate that there has been a sustained increase in mining activity over the past three years, possibly as a result of the boom in the construction industry and the accelerated road maintenance and improvement programmes in the Eastern Cape. Mining applications received by the DME have increased by 47% from 2006 to 2007 (January-May) and by a further 100% from 2007 to 2008. In addition to the increasing number of mining concerns being established, 98 mining concerns will need to apply for the conversion of their old order rights to new order rights by the 1st May 2009. Mining in the province is predominantly small scale with mining permits (mined areas less than 1.5Ha) making up 52.3% of all applications, with larger mining concerns contributing 29.3% and prospecting contributing the remaining 18.4%. In terms of compliance inspections, the EC regional office is required to conduct 120 environmental compliance inspections annually in terms of contributing to sustainable development. The MEM section exceeded this target since 2003. However, when the number of operational mines is considered, 120 inspections per year equates to one mine being visited, on average once every four years (based on 2008 data). Based on projected figures (number of compliance audits and number of operational mines) for 2009, the DME’s target of 150 inspections for 2009/10 combined with the limited staff D. Watkins – MBA Dissertation 2008 capacity will, at best, mean that mines would be inspected once in seven years. However, the target of 150 inspections will not actually even cover the expected number of EMP evaluation inspections. This has serious implications in terms of regulating the compliance of the mining concerns with their EMPR’s. The low level of compliance monitoring can be directly related to staff capacity and logistics problems at the regional office as well as provincial targets being based on staff capacity rather than the number of operational mines. Thus, considering potential environmental damage associated with mining operations and the capacity constraints of the MEM to conduct frequent compliance audits, it is likely that mining operations will have negative implications for sustainable development in the region. Currently there are many challenges facing the DME in terms of contributing positively to sustainability in the mining sector and there is a need to base future actions on the idea of continuous improvement and ultimately progress.

Location is a critical component of business decisions. A firm's location decision may be influenced not only by market forces, such as the location of input suppliers, output processors and competitors, but also by government policies if such policies impact their expected profits and are applied non-uniformly across space. Likewise, a firm may adjust its business strategy, including opening and closing establishments and laying off employees as responses to changes in environmental regulations. In certain polluting industries, location decisions may include choosing potential storage sites for geologic carbon sequestration or finding landfills for industrial solid waste. There is extensive literature discussing the effects of environmental regulations or agglomeration economies on firm location decisions but few studies analyze the interactive effect of environmental regulations and agglomeration economies across regions in the United States. The potential consequences of changes in environmental regulations may include loss of polluting establishments, jobs, and income. Geological carbon sequestration offers long term storage opportunities to mitigate greenhouse gases (GHGs). Incorporating environmental risk into economic assessments of geological sequestration choices is crucial for finding optimal strategies in using alternative carbon storage sites with limited capacity. This dissertation consists of three essays that address the above issues. The first essay examines the interactive effects of air quality regulation and agglomeration economies on polluting firms' location decisions in the United States. Newly available annual (1989-2006) county-level manufacturing plant location data for the United States on seven pollution intensive manufacturing industries are applied in the analysis. Conditional Poisson and negative binomial models are estimated, an efficient GMM estimator is also employed to control for endogenous regulatory and agglomeration variables. Results indicate that births of pollution intensive manufacturers are deterred by stricter environmental regulation; and are attracted by local agglomeration economies. County attainment/nonattainment designations can impose heterogeneous impacts over space and across industries. The magnitude of the regulatory effect depends on the level of local agglomeration. Urbanization economies offset the negative impacts of environmental regulation, whereas localization economies can reinforce or offset the negative impacts of environmental regulation, depending on the industry. The second essay analyzes the effect of changes in regulatory environmental standards on the total stocks of establishments and local jobs and income Results indicate the effects vary across counties in the United States. When the standards were raised to 80 percent of the current level, from 2007 to 2009, the affected counties would lose a total of 326 establishments, 14,711 jobs with $705 million U.S. dollars of income each year. At the national economy level, the impacts of tightening environmental regulations are relatively small. The third essay constructs a dynamic optimization framework that deals with optimal utilization of alternative nonrenewable resource sites (geological formations) with possible negative externalities. We apply the model to an optimal usage problem of alternative long term CO₂ geologic storage sites for carbon. The storage sites are different in terms of capacity and potential leakage after CO₂ injection; the problem is determining the minimum cost for storing a fixed amount of CO₂ (sequestered) within a certain time period. Analytical solutions show the decision rule depends on the discount rate, storage capacities, marginal CO₂ storage costs, and environmental damage costs associated with CO₂ leakage from alternative sinks. The framework provides critical information about the optimal timing of switching from one resource sequestration site to another. / Graduation date: 2013 / Access restricted to the OSU Community at author's request from Feb. 1, 2013 - Feb. 1, 2015