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LIFE CYCLE ASSESSMENT OF NICKEL PRODUCTS FINAL REPORT

Prepared for: Nickel Industry LCA Group

____________________ Prepared by: Ecobalance, Inc. 7101 Wisconsin Avenue, Suite 700 Bethesda, MD 20814

November 2000

CONTENTS INTRODUCTION AND GOAL.............................................................................................................................................. 1 INTRODUCTION AND GOAL OF THE STUDY ............................................................................................................................. 1 GOAL AND INTENDED USES .................................................................................................................................................... 1 Goal of the Study ................................................................................................................................................................ 1 Intended Uses...................................................................................................................................................................... 2 SCOPE DEFINITION AND METHODOLOGY ................................................................................................................. 4 LIFE CYCLE ASSESSMENT PRINCIPLES AND TERMINOLOGY .................................................................................................. 4 FUNCTION AND FUNCTIONAL UNIT ........................................................................................................................................ 6 Introduction to the Function .............................................................................................................................................. 6 Function and Functional Unit............................................................................................................................................ 6 Nickel Products Defined..................................................................................................................................................... 6 SYSTEM BOUNDARIES ............................................................................................................................................................. 7 General Process Overview................................................................................................................................................. 7 Cut-off Criteria ................................................................................................................................................................... 8 Final Product Packaging ................................................................................................................................................... 8 Exclusion of Data from the System Boundaries ................................................................................................................ 9 DATA CATEGORIES DISCUSSION: IMPACT ASSESSMENT AND DATA CATEGORIES ............................................................. 10 General ISO Background................................................................................................................................................. 10 Intrinsic Limitations of LCIA ........................................................................................................................................... 12 General Environmental Values Associated with LCIA ................................................................................................... 12 Relationships Between the Inventory and Impact Assessment Phases........................................................................... 13 Conclusion on Category Indicators and Data Categories ............................................................................................. 13 IMPACT ASSESSMENT METHODOLOGY ................................................................................................................................. 14 Introduction ...................................................................................................................................................................... 14 Global Warming Potential ............................................................................................................................................... 16 Acidification Potential...................................................................................................................................................... 17 Stratospheric Ozone Depletion Potential ........................................................................................................................ 18 Photochemical Ozone Creation Potential (POCP)......................................................................................................... 19 Eco- and Human-Toxicity ................................................................................................................................................ 21 Water Eutrophication ....................................................................................................................................................... 22 Solid Materials ................................................................................................................................................................. 24 Natural Resources Depletion ........................................................................................................................................... 24 Alienation of Land ............................................................................................................................................................ 27 Biodiversity ....................................................................................................................................................................... 28 Conclusion: Inclusion and Exclusion of Impact Indicator Categories .......................................................................... 28 INVENTORY DATA CATEGORIES ........................................................................................................................................... 29 Introduction to the Data Categories................................................................................................................................ 29 Energy and Material Input Category .............................................................................................................................. 29 Air Emission Category ..................................................................................................................................................... 30 Water Effluent Category................................................................................................................................................... 31 Solid Material Category................................................................................................................................................... 32 Energy Accounting Category ........................................................................................................................................... 32 Reporting Units................................................................................................................................................................. 32 DATA QUALITY REQUIREMENTS........................................................................................................................................... 32 Source of the Data ............................................................................................................................................................ 32 Geographical, Technological and Temporal Requirements........................................................................................... 33 Additional Data Quality Requirements ........................................................................................................................... 34 ALLOCATION ......................................................................................................................................................................... 35 Dealing with Coproducts ................................................................................................................................................. 35

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Allocation Procedure ....................................................................................................................................................... 35 Allocation Decisions Made for this Study ....................................................................................................................... 35 CRITICAL REVIEW ................................................................................................................................................................. 36 Scope ................................................................................................................................................................................. 36 Involvement....................................................................................................................................................................... 36 MODELING ............................................................................................................................................................................ 38 PROCESS STAGE GROUPING TO DEFINE THE QUESTIONNAIRES........................................................................................... 38 ALLOCATION RULES APPLIED TO THE NICKEL STUDY ........................................................................................................ 40 “Mass” Coproducts found in Mining and Beneficiation ................................................................................................ 40 Metal Coproducts in Primary Extraction and Refining: ................................................................................................ 40 Non-Metal Coproducts in Primary Extraction and Refining.......................................................................................... 40 DATA CATEGORIES MODELING CONSIDERATIONS............................................................................................................... 43 Energy and Material Inputs ............................................................................................................................................. 43 Air Emission Data Category ............................................................................................................................................ 44 Water Effluents Data Category........................................................................................................................................ 46 Waste and Solid Materials Data Category (Non-recovered and Recovered)................................................................ 47 Transportation .................................................................................................................................................................. 47 MINING UNIT PROCESS STAGE ............................................................................................................................................. 48 BENEFICIATION UNIT PROCESS STAGE ................................................................................................................................. 49 ORE PREPARATION UNIT PROCESS STAGE ........................................................................................................................... 51 PRIMARY EXTRACTION UNIT PROCESS STAGE..................................................................................................................... 52 Pyrometallurgy of Oxidic Ores........................................................................................................................................ 52 Pyrometallurgy of Sulfidic Ores ...................................................................................................................................... 54 Hydrometallurgy of Oxidic Ores ..................................................................................................................................... 57 Hydrometallurgy of Sulfidic Ores.................................................................................................................................... 58 REFINING UNIT PROCESS STAGE........................................................................................................................................... 60 Matte refining into Class I Nickel.................................................................................................................................... 60 Hydrosulfidic Refining ..................................................................................................................................................... 61 Caron Process .................................................................................................................................................................. 66 Carbonyl Process ............................................................................................................................................................. 67 Pyrometallurgical Refining of NiO.................................................................................................................................. 68 TREATMENT OF SHARED PROCESSES AT THE SAME FACILITY............................................................................................. 68 Introduction ...................................................................................................................................................................... 68 Allocation of Shared Processes to Each Unit Process.................................................................................................... 68 MODELING IN TEAMTM ........................................................................................................................................................ 69 Modeling the Products in TEAMTM.................................................................................................................................. 69 Type of Averaging............................................................................................................................................................. 69 Ferronickel ....................................................................................................................................................................... 69 Nickel Oxide...................................................................................................................................................................... 70 Class 1 Nickel ................................................................................................................................................................... 72 DATA QUALITY EVALUATION ....................................................................................................................................... 75 DATA COMPLETENESS AND REPRESENTATIVENESS ............................................................................................................. 75 Geographical Representation .......................................................................................................................................... 75 Temporal and Technological Representation ................................................................................................................. 76 Upstream Materials Production ...................................................................................................................................... 76 CUT-OFF CRITERIA ................................................................................................................................................................ 77 DATA CONSISTENCY ............................................................................................................................................................. 77 “Macro-level” Consistency ............................................................................................................................................. 77 “Micro-level” Consistency .............................................................................................................................................. 78 Questionnaire Exception .................................................................................................................................................. 80 DATA AGGREGATION ............................................................................................................................................................ 80 Preliminary check............................................................................................................................................................. 80 Data Summary Sheets....................................................................................................................................................... 81 DATA CROSS-CHECKING ....................................................................................................................................................... 82

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Nickel Balance.................................................................................................................................................................. 82 Energy Quantification ...................................................................................................................................................... 82 RESULTS AND DISCUSSION ............................................................................................................................................. 83 RESULTS INTERPRETATION ................................................................................................................................................... 83 EXPLANATION OF FLOW TYPES ............................................................................................................................................ 83 Inflows............................................................................................................................................................................... 83 Outflows ............................................................................................................................................................................ 83 Energy ............................................................................................................................................................................... 85 PRODUCT OVERALL INVENTORIES........................................................................................................................................ 85 Inventory Tables ............................................................................................................................................................... 85 LCIA Results Presented with the Inventory Tables......................................................................................................... 86 Land Alienation ................................................................................................................................................................ 87 CLASS 1 NICKEL METAL ....................................................................................................................................................... 87 Gate-to-gate detailed breakdown results ........................................................................................................................ 87 NICKEL OXIDE ....................................................................................................................................................................... 89 FERRONICKEL ........................................................................................................................................................................ 89 ADDITIONAL RESULTS .......................................................................................................................................................... 89 SENSITIVITY ANALYSES .................................................................................................................................................. 90 PACKAGING OF FINAL PRODUCTS ......................................................................................................................................... 90 AMSUL ALLOCATION .......................................................................................................................................................... 90 ALLOCATION BY METAL VALUE: REASONS NOT PERFORMED ............................................................................................ 90 LIMITATIONS ....................................................................................................................................................................... 92 MISCELLANEOUS NICKEL INPUT ........................................................................................................................................... 92 MINING .................................................................................................................................................................................. 92 APPENDIX .............................................................................................................................................................................. 93 IMPACT ASSESSMENT WEIGHTING FACTORS ....................................................................................................................... 94 Global Warming Potential ............................................................................................................................................... 94 Air Acidification Potential ............................................................................................................................................... 95 Eutrophication Potential .................................................................................................................................................. 95 Photochemical Ozone Formation Potential .................................................................................................................... 96 Natural Resource Depletion Index .................................................................................................................................. 96 TRANSPORTATION MODELS .................................................................................................................................................. 97 Truck ................................................................................................................................................................................. 97 Rail .................................................................................................................................................................................... 97 Sea (Tanker)...................................................................................................................................................................... 98 Diesel and Heavy Fuel Oil production and consumption............................................................................................... 98 FIRST-ROUND DATA CHECKING OF QUESTIONNAIRES: MAIN CHECKLIST ......................................................................... 99

Proprietary Information Statement

Ecobalance, Inc.

The information in this document is the property of the companies that collaborated in the development of the study and of the Nickel Development Institute. It may be duplicated, used, or disclosed in support of research activities. The owners of the document would appreciate appropriate citation being made in any published study.

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FIGURES FIGURE 1 EXTENDING SYSTEM BOUNDARIES ............................................................................................................................. 5 FIGURE 2 OVERALL PROJECT SYSTEM BOUNDARIES ................................................................................................................ 7 FIGURE 3 LINKED LCIA CONCEPTS .......................................................................................................................................... 10 FIGURE 4 MANDATORY AND OPTIONAL ELEMENTS OF AN LCIA............................................................................................ 12 FIGURE 5 LCI AND LCIA CATEGORIES SELECTION ................................................................................................................. 14 FIGURE 6 ENVIRONMENTAL ISSUES AND THEIR CATEGORIES OF RELEVANCE ....................................................................... 15 FIGURE 7 FLOWCHART-TO-QUESTIONNAIRE ........................................................................................................................... 39 FIGURE 8 PARTITIONING OF METAL COPRODUCTS................................................................................................................... 40 FIGURE 9 INCLUSION OF H2SO4 PRODUCTION WITH SMELTING............................................................................................... 41 FIGURE 10 AMMONIUM SULFATE PRODUCTION ...................................................................................................................... 42 FIGURE 11 SYSTEM EXPANSION METHOD APPLIED TO AMMONIUM SULFATE PRODUCTION ................................................. 42 FIGURE 12 WATER USE WITHIN THE SYSTEM BOUNDARIES ................................................................................................... 43 FIGURE 13 AIR EMISSION DATA QUALITY .............................................................................................................................. 44 FIGURE 14 TRANSPORTATION TABLE FROM QUESTIONNAIRE ................................................................................................ 48 FIGURE 15 MINING SYSTEM ..................................................................................................................................................... 48 FIGURE 16 BENEFICIATION SYSTEM 1 ..................................................................................................................................... 49 FIGURE 17 BENEFICIATION SYSTEM 2 ..................................................................................................................................... 50 FIGURE 18 WATER EFFLUENTS FROM A TAILINGS PILE ........................................................................................................... 51 FIGURE 19 ORE PREPARATION ................................................................................................................................................. 51 FIGURE 20 PRIMARY EXTRACTION (PYROMETALLURGY): NICKEL MATTE PRODUCTION FROM OXIDIC ORES ..................... 52 FIGURE 21 PRIMARY EXTRACTION (PYROMETALLURGY): FERRONICKEL PRODUCTION FROM OXIDIC ORES ....................... 53 FIGURE 22 PRIMARY EXTRACTION (PYROMETALLURGY): FERRONICKEL AND MATTE PRODUCTION FROM OXIDIC ORES .. 54 FIGURE 23 PRIMARY EXTRACTION (PYROMETALLURGY): NI MATTE PRODUCTION FROM SULFIDIC ORES .......................... 55 FIGURE 24 PRIMARY EXTRACTION (PYROMETALLURGY): NI AND CU MATTE PRODUCTION FROM SULFIDIC ORES ............ 56 FIGURE 25 PRIMARY EXTRACTION (PYROMETALLURGY): NIO, AND NI/CU METALLICS PRODUCTION FROM SULFIDIC ORES .................................................................................................................................................................................. 56 FIGURE 26 PRIMARY EXTRACTION (HYDROMETALLURGY): NICKEL COBALT LIQUOR PRODUCTION FROM OXIDIC ORE .... 57 FIGURE 27 PRIMARY EXTRACTION (HYDROMETALLURGY): NICKEL COBALT SULFIDE PRODUCTION FROM OXIDIC ORE ... 58 FIGURE 28 PRIMARY EXTRACTION (HYDROMETALLURGY): 97% NI METAL PRODUCTION FROM SULFIDIC ORES............... 59 FIGURE 29 REFINING: CLASS 1 NI PRODUCTION FROM MATTE (INTEGRATED FACILITY)..................................................... 60 FIGURE 30 REFINING: CLASS 1 NI PRODUCTION FROM MATTE (LESS INTEGRATED FACILITY)............................................. 61 FIGURE 31 REFINING (HYDROSULFIDIC): NI CATHODE PRODUCTION FROM NICKEL MATTE (PART 1) ................................. 62 FIGURE 32 REFINING (HYDROSULFIDIC): NI PRODUCTS PRODUCTION FROM NI CATHODES (PART 2) .................................. 62 FIGURE 33A AND B REFINING (HYDROSULFIDIC): NI PRODUCTS PRODUCTION FROM NICKEL COBALT SULFIDE AND NICKEL MATTE ................................................................................................................................................................. 63 FIGURE 34 REFINING (HYDROSULFIDIC): NI PRODUCTS PRODUCTION FROM NICKEL MATTE .............................................. 64 FIGURE 35 REFINING (HYDROSULFIDIC): NI PRODUCTS PRODUCTION FROM VARIOUS NICKEL FEEDS ............................... 65 FIGURE 36 CARON PROCESS: NI PRODUCTS PRODUCTION FROM NICKEL COBALT LIQUOR ................................................... 66 FIGURE 37 REFINING: CLASS 1 NI AND FENI PRODUCTION WITH CU/NI METALLICS AND NIO (CARBONYL PROCESS) ...... 67 FIGURE 38 REFINING (PYROMETALLURGICAL): CLASS 1 NI PRODUCTION FROM NIO ........................................................... 68 FIGURE 39 FERRONICKEL SYSTEM ........................................................................................................................................... 70 FIGURE 40 NICKEL OXIDE SYSTEM.......................................................................................................................................... 71 FIGURE 41 CLASS 1 NICKEL SYSTEM SHOWING SIMPLIFIED NICKEL INPUTS ........................................................................ 72 FIGURE 42 CLASS 1 NICKEL SYSTEM SHOWING ALL NICKEL INPUTS .................................................................................... 74 FIGURE 43 GATE-TO-GATE BREAKDOWN CONCEPT ................................................................................................................ 88

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TABLES

TABLE 1 SAMPLE GWP CALCULATION .................................................................................................................................... 16 TABLE 2 SUMMARY OF INDICATOR CATEGORIES RETAINED .................................................................................................. 28 TABLE 3 ELEMENTARY INPUTS ................................................................................................................................................ 29 TABLE 4 AIR EMISSIONS........................................................................................................................................................... 30 TABLE 5 WATER EFFLUENTS.................................................................................................................................................... 31 TABLE 6 SOLID MATERIALS CATEGORIES ............................................................................................................................... 32 TABLE 7 FUEL USE REPARTITION ASSUMPTIONS .................................................................................................................... 45 TABLE 8 SAMPLE OF THE SOLID MATERIALS CATEGORIES FOUND IN THE QUESTIONNAIRES ............................................... 47 TABLE 9 ALLOCATION PROCEDURE OF WASTEWATER TREATMENT ...................................................................................... 69 TABLE 10 GEOGRAPHICAL LOCATION OF PRIMARY DATA COLLECTION SITES ..................................................................... 75 TABLE 11 CUT-OFF CRITERIA ANALYSIS ................................................................................................................................ 77 TABLE 12 DATA AVAILABILITY TABLE ................................................................................................................................... 79 TABLE 13 DATA SUMMARY SHEET EXAMPLE .......................................................................................................................... 81 TABLE 14 UPSTREAM MATERIALS AIR CATEGORIES GROUPED INTO INVENTORY AIR CATEGORIES ................................... 83 TABLE 15 SOLID MATERIALS AGGREGATED ........................................................................................................................... 84 TABLE 16 LAND ALIENATION IMPACT ASSESSMENT RESULTS............................................................................................... 87 TABLE 17 METAL VALUES ........................................................................................................................................................ 91 TABLE 18 MASS ALLOCATION VS. ECONOMIC ALLOCATION .................................................................................................. 91 TABLE 19 GLOBAL WARMING POTENTIAL SAMPLE CALCULATION ........................................................................................ 94

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GLOSSARY OF TERMS

Calcination

(2) Heating of a solid to a temperature below its melting point to bring about a state of thermal decomposition; sulfur is driven off from nickel sulfide but agglomeration of fine particles does not occur

Category Endpoint

(1) Attribute or aspect of natural environment, human health or resources, identifying an environmental issue of concern

Category Indicator

(1) Quantifiable representation of an impact category

Characterization

Calculation of category indicator results

Characterization factor

(1) Factor derived from a characterization model which is applied to convert the assigned LCI results to the common unit of the category indicator

Class 1 Nickel

Nickel product containing over 99% nickel by mass.

Class 2 Nickel

Nickel product containing less than 99% nickel by mass.

Classification

Assignment of LCI results to impact categories

Converting

(2) Removal of iron from molten sulfides by oxidation and concentration in a slag phase; also includes the elimination of sulfur as SO2 which controls the amount of sulfur fed to further downstream processing.

Electrorefining

(2) Refining of crude nickel introduced into the electrolytic cell as (soluble) anodes.

Ferronickel (FeNi)

Nickel product categorised under Class 2 nickel that aids in the manufacture of alloy steels and stainless steels

Hydrometallurgy

(2) A series of metallurgical operations practiced in aqueous medium which can be used either as an equivalent to primary smelting (term used by extension from pyrometallurgy) and leading to a concentrate, or at the refining level

Impact category

(1) Class representing environmental issues of concern to which LCI results may be assigned

Leaching

(2) Hydrometallurgical operation by which the ore or the concentrate is submitted to water or to an aqueous solution of a chemical reactant (acid, alkaline or complexing agent) in order to selectively solubilize the nickel and other valuable metals.

Matte

(2) A crude mixture formed from smelting sulfide ores

Nickel Oxide (NiO)

Nickel compound categorised under Class 2 nickel that is used as a charge nickel in the manufacture of alloy steels and stainless steels

Oxidic nickel

(2) Generic qualification of chemical forms (or species) of nickel chemically bound to oxygen (NiO, (Ni, CuO), etc.)

PM10

Particulate matter of less than 10 microns

Pyrometallurgy

Metallurgy using high temperatures (i.e., smelting, roasting, etc.) for the extraction of metals from the ore

Reduction (i.e., of nickel)

(2) Conversion of nickel compounds or aqueous ions to nickel metal

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Smelting

(2) The partial recovery of metal in molten form from processed ores

Sulfidic ore

(2) Generic qualification of chemical forms (or species) of nickel chemically bound to sulfur as sulfides (Ni3S2, NiS, etc.)

Western World

“Western World”, in the context of nickel production, encompasses worldwide production of nickel minus the former Soviet Union, China, and former COMECON members (with the exception of Cuba in this study).

(1) Definitions from ISO 14042:2000(E). (2) Definitions from UNEP, 1993. Technical Report no. 15: Environmental Management of Nickel Production: A Technical Guide.

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GLOSSARY OF ACRONYMS

AMSUL

Ammonium sulfate

AP

Acidification potential

BOD

Biochemical Oxygen Demand

CFC

Chlorofluorocarbon

CML

Centre of Environmental Science, The Netherlands

COD

Chemical Oxygen Demand

COMMPS

Combined Monitoring-Based and Modeling-Based Priority Setting Scheme

CRP

Critical Review Panel

CST

Critical surface time

DEAM

TM

TM

database contained in TEAM : Database for Environmental Analysis and Management

DOE

United States Department of Energy

DSS

Data Summary Sheet

EPA

United States Environmental Protection Agency

EIA

U.S. Department of Energy, Energy Information Administration

ETH

Swiss Federal Institute of Technology Zurich

GWP

Global Warming Potential

INSG

International Nickel Study Group

IPCC

Intergovernmental Panel on Climate Change

ISO

International Standards Organization

LCA

Life Cycle Assessment

LCI

Life Cycle Inventory

LCIA

Life Cycle Impact Assessment

MIR

Maximum Incremental Reactivity

NiDI

Nickel Development Institute

NG

Natural gas

OD

Stratospheric ozone depletion

POCP

Photochemical Ozone Creation Potential

PSC

polar stratospheric clouds

SETAC

Society for Environmental Toxicology and Chemistry

TEAM

TM

TDS

Ecobalance, Inc.

Tool for Environmental Analysis and Management, LCA software tool used for the calculations Total dissolved solids

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TSS

Total suspended solids

UNEP

United Nations Environment Programme

USES

Uniform System for the Evaluation of Substances

WMO

World Meteorological Organization

WTE

Waste-to-energy

WWTP

Wastewater treatment plant

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SECTION 1

Introduction and Goal Introduction and Goal of the Study Over the past 15 years, environmental issues have assumed an increasing priority for both government and industry alike. In North America as well as in Europe, the emphasis has gradually broadened from a site specific focus to include product attributes. Several regulations and schemes have been progressively implemented that address environmental issues regarding products. Similarly, product related environmental information is an increasing part of many companies’ decision-making process and is often shared with these companies’ customers. Life Cycle Assessment (LCA), and especially its most developed component, Life Cycle Inventory analysis (LCI), is a tool that provides quantitative and scientific analyses of the environmental impacts of products and their associated industrial systems. By providing an unbiased analysis of entire industrial systems, LCA has shown that the reality behind widely held beliefs regarding “green” issues was often more complex than expected. In order for LCA to be an effective and well accepted approach, standard LCA guidelines have been developed: 1 first by the Society for Environmental Toxicology and Chemistry (SETAC) then by the United States 2 Environmental Protection Agency (EPA) and most recently by the International Standards Organization (ISO) 3 Standards 14040 and 14041 . Among the points emphasized by these guidelines is the need to clearly list all the assumptions and data sources used in the LCA in an objective and transparent manner. Several member companies of the Nickel Development Institute (NiDI) and Societe ERAMET (collectively known in this study as the Nickel Industry) have commissioned Ecobalance to perform a Life Cycle Assessment (LCA) on selected nickel products. Specifically, two components of an LCA, Life Cycle Inventory (LCI) and Life Cycle Impact Assessment (LCIA), are carried out on these products.

Goal and Intended Uses Goal of the Study The aim of this study is to provide the Nickel Industry with a current LCA of three nickel products, using current, robust data on nickel production. The three products studied include: a) Class 1 nickel metal; b) Nickel oxide; and c) Ferronickel. These products are further defined in the Function and Functional Unit section (page 6).

1

Society of Environmental Toxicology and Chemistry, Guidelines for Life-Cycle Assessment: A “Code of Practice”, Edition 1, 1993. Life-Cycle Assessment: Inventory Guidelines and Principals (EPA/600/R-92/245 - February 1993). 3 International Standardization Organization (ISO) 14040:1997(E), ISO 14041:1998. 2

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Introduction and Goal

The LCA is “cradle to gate”, that is, from the point of extracting resources from the earth to the point where the nickel products are ready for shipment to customers. The LCA is based on current data on process technologies, energy and materials consumed, and environmental outputs. The study is designed so that the results may later be used for benchmarking purposes. The geographical scope of the study is largely former 4 western world production of nickel . This project adheres to the LCA guidelines summarized by ISO, which are widely acknowledged among the main practitioners in the U.S. and in Europe. The requirements of this study are summarized in the following: • ISO 14040:1997(E), the International Standard of the International Standardization Organization, Environmental management – Life cycle assessment – Principles and framework. • ISO 14041:1998(E), the International Standard of the International Standardization Organization, Environmental management – Life cycle assessment – Goal and scope definition and inventory analysis. • ISO 14042:2000(E), the International Standard of the International Standardization Organization, Environmental management – Life cycle assessment –Life cycle impact assessment. The study aims to meet the essential requirements formalized by these ISO standards. Specifically, • The project aims at taking an inventory of the environmental inflows and outflows associated with the cradle-to-gate production of a product; • The goal and scope of the project are precisely defined at the beginning of the project; • Assumptions are clearly stated, and the methodology is as transparent as allowed with protection of confidential data. System boundaries, functional unit, and allocation rules are rigorously defined and described; • Pertinent data are collected, and their quality is rigorously assessed; and • Reporting requirements are stated. The intended audience for this report includes the participating corporations (Inco Ltd, Falconbridge Ltd, Nippon Yakin Kogyo, Outokumpu OY, QNI Pty. Ltd, Sherritt International Corporation, Sumitomo Inc., WMC Pty. Ltd, Société Eramet) and the other non-participating member companies of NiDI (Centaur Mining and Exploration Ltd, Codemin S.A., Titan Resources N.L.). Two additional members of NiDI (Inco TNC Ltd and PT International Nickel) participated through their parent company, Inco Ltd. The participating corporations intend to make this report, including the LCI and LCIA results, available to all other interested parties by way of a controlled release system via the website of NiDI.

Intended Uses The results of this study have several intended uses. First, the overall inventory results will be provided to the 5 stainless steel industry as upstream nickel production data in their LCA study . Additional uses for the study include: •

Assist in identifying opportunities for process and product improvement;

•

Assist in supporting and improving Environmental Management Systems;

•

Establish a means to internal and industry-wide benchmarking of environmental performance.

4

The geographical representation of the nickel is further discussed in the Function and Functional Unit section. Note, however, that while the data on nickel products shall be used as an upstream input of stainless steel, the LCI data is not intended for or designed to be used to compare other alloying products used by the stainless steel industry. 5

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Introduction and Goal

•

Assist in improving data on environmental indicators;

•

Assist investment decision-making and the integration of environmental criteria to implement participating Steering Group members’ industrial policies; and

•

Provide information to customer, academic, authority, and other interested groups in order to support the sales and marketing of nickel products.

The study results should not be used or considered as: • The sole source of information if assertions are made on the environmental performance of nickel products vs. other products performing the same function; • The only tool for optimization of environmental performance of individual manufacturing processes, since plants are modeled as black boxes. This LCI will be the most comprehensive, current record of environmental inflows and outflows associated with nickel production. However, it should be borne in mind that this LCA, like any other scientific/quantitative study, is not completely free of some margin of error due to various limitations such as unavailability of some relevant data. Limitations to the study are highlighted in the Limitations section, page 92.

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SECTION 2

Scope Definition and Methodology This section of the report presents all aspects of the scope of work for this study, and describes the general methodology used. Additional details of the methodology are presented in further detail in the Modeling section, starting on page 38.

Life Cycle Assessment Principles and Terminology Life Cycle Assessment (LCA) is an analytical tool used to comprehensively quantify and interpret the environmental flows (to and from the environment, including air emissions, water effluents, solid waste, and the consumption/depletion of energy and other resources), over the entire life cycle of a product or process. The life cycle is meant to be studied comprehensively as well, including production and extraction of raw materials, intermediate products manufacturing, transportation, distribution, use, and a final “end-of-life” stage which often includes multiple parallel paths such as recycling, incineration, landfilling, etc. This general principle for extending the system boundaries is illustrated in Figure 1.

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Scope Definition and Methodology

Extending System Boundaries Natural Resources Natural Resources Acquisition Materials Production Intermediate Products Manufacturing Assembly Manufacturing

Recycling

Use End-of-Life

Air Emissions

Water Effluents

Solid Waste

Figure 1 Extending System Boundaries

An LCA involves three main phases: 1. Life Cycle Inventory Analysis is the “phase of the LCA involving the compilation and 6 quantification of inputs and outputs, for a given product system throughout its life cycle.” This phase includes: • defining the project system boundaries (i.e., defining which steps are included in the system and which are not) as specified by the goal and scope of the project; • collecting data required for each step included in the system; • calculating the final inventory. The compiled flows result in an inventory which is classified into five main categories: raw material consumption, energy consumption, air emissions, water effluents and solid waste. 2. the Life Cycle Impact Assessment is the part of the LCA “aimed at understanding and evaluating 7 the magnitude and significance of the potential environmental impacts of a product system.” Examples of potential environmental impacts include natural resources depletion, global warming potential, and eutrophication potential. 3. the Life Cycle Interpretation is the LCA step in which the “findings of either the inventory analysis or the impact assessment, or both, are combined in line with the defined goal and scope in order to 8 reach conclusions and recommendations.” With the exception of limited interpretation of the

6

ISO 14040:1997(E), Section 3. ISO 14040:1997(E), Section 3. 8 ISO 14040:1997(E), Section 3. 7

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Scope Definition and Methodology

results to this study, this portion of an LCA was not performed, since the goal of the study was to 9 produce a set of baseline numbers . ISO’s representation of LCA actually indicates a four stage process, with Goal and Scope Definition preceding the inventory analysis phase. Individualizing Goal and Scope Definition as a separate stage is not a key methodological issue, but was specially intended as a reminder that the key project objective parameters should be carefully established and clearly stated at the outset of an LCA, and that they guide the subsequent stages. All stages of an LCA should be scoped by the particular use or uses for which the study is intended, and that use of the results may entail some results interpretation.

Function and Functional Unit Introduction to the Function All flows within the system boundaries are normalized to a unit summarizing the function of the system. This allows for the comparison of different industrial systems performing the same function. Once this shared function is defined, a functional unit, or reference flow, has to be chosen in order to compare the systems on the same quantitative basis. For example, comparison of different milk bottles (glass, plastics, etc.) would be made on the following basis: • Function: packaging of milk. • Functional unit: packaging of one liter of milk.

Function and Functional Unit The function of the system studied is the production of three nickel products. The functional unit, or reference flow, for each product studied is one kilogram of nickel in each product studied, i.e., one kilogram of nickel in the Class 1 nickel, the nickel oxide, and the ferronickel.

Nickel Products Defined The nickel products fall within two major classes of nickel. •

Class 1 Nickel, containing >99% nickel. Nickel metal is studied without distinction between specific products within the general category, such as nickel squares, powder, and briquettes.

•

Class 2 Nickel, containing