Executive Summary
- Australia’s mandatory climate reporting from 2025 requires climate scenario analysis across short, medium, and long terms.
- Mine closure and post-closure phases are materially affected by climate risks and must be included in corporate disclosures.
- Climate scenario modelling can strengthen closure plans by anticipating environmental changes, improving cost estimates, and building regulatory and community trust.
- GIS technology and climate data allow mining companies to spatially model the impacts of climate scenarios on closure outcomes.
- Risks extend beyond the mine lease boundary, impacting regional land uses, ecosystems, and transition economies.
- Mining companies that embed climate resilience into closure planning will lead on ESG performance, risk management, and investor confidence.
Introduction
Mine closure is often thought of as the final act of mining — a technical and regulatory exercise to rehabilitate disturbed land. But Australia’s incoming mandatory climate-related financial disclosure framework, starting from January 2025, changes that paradigm completely.
Under the new regime, mining companies must analyse and disclose how climate change impacts their entire business model — not just their operating mines, but also their closure plans, post-closure obligations, and even legacy sites. Climate scenario modelling — a key feature of the reporting standards — offers an essential tool to stress-test closure strategies and embed climate resilience into the heart of mine lifecycle planning.
In this article, we explore why closure planning cannot be left out of mandatory climate reporting and how scenario analysis can create stronger, smarter, and more trusted mine closure outcomes.
Mandatory Climate Reporting: A New Reality
Australia’s Sustainability Reporting Standards, particularly AASB S2, require entities to disclose:
- Climate-related risks and opportunities,
- Their financial impacts over the short, medium, and long term,
- The outcomes of climate scenario analysis,
- And the governance and risk management structures that support climate resilience.
Importantly, these obligations apply to the entire business, not just current operations. Closure and post-closure liabilities, environmental risks, and social transition risks are all firmly in scope.
Why Closure Planning Must Evolve
Closure is a Material Risk
Mine closure carries long-tail risks:
- Environmental liabilities (erosion, acid mine drainage, vegetation failure),
- Financial liabilities (rehabilitation funds, maintenance of water treatment facilities),
- Social risks (community transition failure, reputational damage).
These risks have the potential to be exacerbated by climate change — and therefore must be identified, quantified, and disclosed under the new standards.
Scenario Modelling Strengthens Closure Planning
Climate scenario analysis enhances closure planning in multiple ways:
- Environmental Resilience: Stress-tests rehabilitation success under hotter, drier, or more extreme rainfall conditions.
- Financial Resilience: Identifies potential cost escalations, informing more accurate financial provisioning and assurance.
- Strategic Resilience: Tests the viability of post-mining land uses under changing climates, improving transition planning.
- Governance Resilience: Integrates closure risks into board-level risk management and sustainability strategies.
Closure plans built without climate scenario modelling risk being outdated the moment they are completed.
Climate Risks Extend Beyond the Mine Lease
Closure-phase climate risks do not respect lease boundaries. They affect:
- Neighbouring ecosystems and landholders (e.g., water flows, dust, fire risk),
- Regional economies (e.g., transition to agriculture or carbon farming),
- Cumulative impacts across landscapes, particularly in mining-intensive regions.
In this context, climate-resilient closure is not just an operational task — it’s an essential part of corporate ESG strategy and regional sustainability leadership.
The Critical Role of GIS and Climate Data in Scenario Modelling
A powerful enabler of effective climate scenario analysis is the integration of Geographic Information Systems (GIS) and high-resolution climate data. This spatial approach adds a critical dimension to mine closure planning:
- Mapping Vulnerabilities: GIS allows companies to visualize how temperature increases, rainfall shifts, flood risks, and fire hazards might spatially impact rehabilitation areas, tailings storage facilities, and final landforms.
- Predicting Erosion and Stability Risks: By overlaying climate models onto topography and soil data, companies can predict future erosion patterns and slope stability under different climate scenarios.
- Designing Adaptive Landforms: Spatial models can inform the design of landforms and drainage systems that are more resilient to altered hydrology and extreme weather events.
- Optimizing Post-Mining Land Use: GIS analysis helps evaluate future land suitability for agriculture, conservation, or carbon offsetting based on changing climate conditions.
- Communicating with Stakeholders: Spatial climate models offer intuitive visualizations for engaging regulators, communities, and investors in understanding climate-related closure risks and mitigation strategies.
By harnessing GIS and climate data together, mining companies move from conceptual to evidence-based, spatially explicit closure strategies — strengthening compliance, resilience, and stakeholder confidence.
Practical Steps to Embed Climate Scenario Modelling into Closure
Mining companies should:
- Select relevant climate scenarios (aligned with IPCC pathways) for each region and asset.
- Integrate climate datasets with GIS layers of environmental and rehabilitation features.
- Quantify climate impacts spatially on landforms, hydrology, vegetation, and infrastructure.
- Model financial implications for closure and post-closure liabilities under different scenarios.
- Document and disclose assumptions, methodologies, and risk mitigation strategies transparently.
- Continuously update closure strategies as climate projections evolve.
Early adopters will be better positioned to demonstrate leadership to regulators, investors, and communities.
The Strategic Advantage
Companies that integrate climate scenario analysis and spatial modelling into closure planning:
- Build more resilient and cost-effective rehabilitation solutions,
- Enhance investor confidence through transparent risk management,
- Strengthen regulatory trust by anticipating future challenges,
- Maintain social license by demonstrating responsible, forward-looking closure outcomes.
Mine closure is no longer simply an environmental compliance obligation — it’s a strategic ESG and financial priority.
Take homes……
As mandatory climate reporting becomes reality, the mining sector must broaden its view: Mine closure and post-closure periods are at the very center of climate risk exposure — and opportunity.
Climate scenario modelling, combined with GIS-based spatial analysis, offers the tools to future-proof closure plans, protect financial resources, and strengthen corporate sustainability narratives.
The companies that act now will not only meet compliance — they will lead the transition to a more resilient, trusted, and sustainable mining sector.