Environment

We consider our most important responsibility to our stakeholders to be our responsibility to the global community. We feel the best way to measure this is in terms of our contribution to global CO₂e reduction. Developing innovative products that enable the reduction of CO₂e across the diverse industries we serve is fundamental to AMG’s business strategy. As we carry out this critical work, we closely monitor the emissions that result from our activities and strive for year-over-year reduction in emissions. AMG reports on our facilities’ emissions of both Scope 1 and Scope 2 greenhouse gases (GHGs) and other permitted air emissions, including SOx, NOx, and particulate matter.

Scope 1 GHG emissions result primarily from the combustion of carbon-containing materials as part of the metallurgical process, such as using coke as a reductant. They also result from the generation of heat, such as burning natural gas in a furnace. GHGs from processes other than combustion are minimal. Our innovative production practices for metallurgical processing require significant heat generation from the use of electricity, which is the largest source of AMG’s Scope 2 GHG emissions. In 2021, AMG total CO₂e emissions were calculated using Scope 1 GHG and Scope 2 Market Based GHG emissions to reflect renewable energy power purchase agreements. In 2021 AMG’s total Scope 1 and 2 GHG emissions have been calculated based on an operational control approach in accordance with the Greenhouse Gas Protocol Corporate Accounting and Reporting Standard.

Emissions of ozone-depleting substances are generally immaterial for AMG. However, in 2021, AMG Critical Materials Technologies reported air emissions from refrigerants to be 108 metric tons of CO₂e. Other pollutant air emissions that result from minor sources, such as heating and hot water boilers, remain immaterial. High-intensity production practices are common in our industry, making it a challenge to reduce emissions substantially. AMG is proud of our management of air emissions and will continue to seek year-over-year reduction in all areas.

Air emissions data from our Environment, Social, Governance, Products Dashboard is shown below.

Improving energy efficiency is an operational priority at AMG that results in environmental and economic benefit. At AMG, electricity and natural gas are the two most significant sources of energy. Seven of AMG’s facilities with the most energy-intensive activities are currently certified to the ISO 50001 standard for energy management systems. Energy management systems provide a formal structure for managing energy use. By promoting energy efficiency, energy management systems help AMG conserve resources, address climate change, and save money.

Energy consumption within the organization, using data from our Environment, Social, Governance, Products Dashboard, is shown below.

1. Calculated in accordance with GRI 302-1,2

At AMG, we look for ways to eliminate waste and use recycled materials as product inputs to enable the growth of a circular economy. In particular, we innovate processes that allow us to take what was once waste, such as spent refinery catalyst, and extract the critical materials necessary to make our products.

AMG also proactively reviews our manufacturing processes to identify non-sellable product streams for opportunities to innovate these materials into products our customers need. We understand that resource efficiency not only creates good outcomes for our customers but is also far better for our environment. Identifying opportunities for innovation and efficiency is a strategic focus at AMG. We strive to improve and optimize our processes to achieve year-over-year resource efficiency improvements.

AMG believes in the responsible and sustainable management of hazardous and non-hazardous waste streams generated by our segments. Our manufacturing sites reuse and recycle waste to conserve natural resources and reduce pollution, but also to create cost-saving opportunities for our business. Waste that is unable to be recycled is disposed in accordance with regulatory requirements at facilities licensed or approved to handle final disposal (e.g., landfill, destruction, etc.) of the specific waste material.

As noted above, AMG processes spent catalyst that was once waste by transforming it into valuable goods which largely eliminates long-term environmental liability for refineries and, so long as it is done appropriately, can eliminate human health, financial, and reputational risks as well. AMG has designed its processes to achieve over 99% conversion of oil refinery wastes to saleable finished goods, while generating no process wastewater. This is likely to eliminate more of the environmental risks associated with land disposal. For spent catalysts in particular, this permanent disposition is much safer than landfill solutions.

Waste within the organization, using data from our Environment, Social, Governance, Products Dashboard, is shown below.

AMG views water consumption and water scarcity as global trends that are important to monitor, though AMG’s activities are not significantly water intensive. Using WRI Aqueduct, AMG performed a water risk review of our facilities in 2021 and determined that our site locations are in areas unaffected by significant water scarcity concerns. We plan to revisit this assessment as potential risks emerge to determine if further analysis is required for our facilities in more arid climates.

AMG uses water throughout the mining process as part of mineral extraction and processing activities. After mining activities, most of AMG’s water is used for non-contact cooling purposes and therefore produces clean water discharges.

AMG will continue to look for opportunities to reduce our water consumption year-over-year. Overall, we view the conservation of water in the same way we view all resource reduction: take only what we need. Additionally, minimizing waste is both economically and environmentally beneficial for our Company and our stakeholders. Water usage within the organization, using data from our Environmental, Social & Governance Performance Dashboard, is shown below.

AMG closely monitors wastewater discharges from its mining operations in order to manage quality and volume. AMG facilities record the volumes of aqueous effluents to local water sources, including process water and non-sanitary sewer discharges. AMG uses chemical analysis of the effluent to determine the primary constituents of the water discharges.

AMG makes an effort to comply with all regulatory requirements and implements industry best practices to manage our wastewater and avoid negative impacts on local communities. As with our other environmental compliance obligations, wastewater activities are managed at the site level by compliance specialists who remain up to date on local regulations. AMG has 12 facilities with permitted wastewater activities and our risks are managed through our effective permitted wastewater controls. In 2021, there were no wastewater impacts on local communities or significant spills (defined as a spill that would affect the Company’s financial statements because of the ensuing liability) at any AMG site.

Most of AMG’s water discharge results from global mining operations in AMG Critical Minerals and AMG Clean Energy Materials. The balance of AMG’s water is used for cooling purposes and therefore produces clean (non-hazardous) water discharges that are released in accordance with local regulations. Some processes generate aqueous waste streams, including cooling water used by the silicon metal furnaces and mine water from dewatering pumps. In several locations, mine water is utilized for process water before final discharge.