Responsibility

Mining vanadium responsibly

CEO
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For Largo, corporate social responsibility means keeping our people safe and healthy. It means minimizing and mitigating our impacts on the environment and practicing continual reclamation of affected land. It means sharing the benefits of mining with the communities in which we live and operate. It means acting ethically, as a company and as individuals.

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Our people

Our people icon

We seek to recruit the best, and to train our employees for rewarding careers with Largo. We take great care in the employment process, with an emphasis on equality, diversity, workplace safety and employee welfare.

The success of our business depends on our ability to recruit and retain the most promising employees – people who share our commitment to safe, sustainable development that benefits all stakeholders.

The vast majority of the employees at head office and at our mine and projects are employed full-time. Our mine workers are unionized, and the collective bargaining agreement is negotiated annually. We actively pursue the hiring of local people, in support of our efforts to develop and maintain positive relationships with nearby communities. Nearly the entire staff at the Maracás Menchen Mine is Brazilian and more than three-quarters of the workers are from Bahia province.

We put a priority on using locally sourced products and services whenever practical, to benefit the local and regional economy. We wish to ensure that our presence in the local and regional economy provides the maximum in direct economic and social benefits to individuals, their families and other community members.

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EMPLOYEES AND CONTRACTORS
MARACÁS MENCHEN MINE

Employees
2016 2017 2018
329 338 358
Contractors
2016 2017 2018
309 435 463
*As of Dec 31 of the year
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STAFF, GENDER AND ENTRY-LEVEL WAGES, 2018

Total employees
(Head office and mine)
390* including interns and apprentices
Gender distribution Male: 89%, Female: 11%
Standard entry-level wage (compared to local minimum) Male: 52% above local minimum
Female: 52% above local minimum
Number of new employees (2018) 21
Employees dismissed (2018) 6
Parental leave provided? Yes
*As of Dec 31 of the year

MEASURING PERFORMANCE
AT THE MARACÁS MENCHEN MINE

We believe an engaged workforce drives performance. Twice a year, every employee meets with their manager for a performance and career development review. After these reviews, employees may be selected for additional training to upgrade their skills and improve their careers.

TRAINING AND DEVELOPMENT

Every new employee receives introductory and safety training. On an ongoing basis employees receive additional training and professional development – on average employees receive 48 hours of internal training per year. If employees wish to pursue additional company-related skills upgrading or education, the Company will pay up to 70% of the tuition (on approval).

HUMAN RIGHTS, DIVERSITY
AND NON-DISCRIMINATION

Largo does not discriminate on the basis of race, religion, ethnicity, national origin, colour, gender, age, sexual orientation, citizenship, veteran status, marital status or disability or any other grounds prohibited by law. Harassment, including sexual, physical and verbal, is prohibited. We treat our people fairly and without discrimination, with full regard for their human rights. There were no incidents of discrimination reported to the Company in 2018. We do not allow forced or compulsory labour, nor will we knowingly employ a person who is under the legal age of employment.

In 2019, we plan to formalize our human rights training and include human rights topics in our introductory training for new hires, including security staff, and also include human rights topics in employees’ annual training updates.

Human Rights and our Supply Chain

All suppliers and contractors that interact with the Maracás Menchen Mine are required to sign its Terms of Business Commitment, which obligates them to follow strict Brazilian legislation and adhere to good practices of social responsibility. These practices include non-discrimination, respect for human rights, the obligation to provide a safe and healthy working environment for their people, and respect for the safety codes and policies in place at the mine.

Ethics and Corruption

Largo has strong policies regarding ethics and corruption, and maintains anonymous channels for complaints. No legal actions have ever been taken against Largo or its subsidiaries in relation to anti-competitive or anti-trust behaviour.

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Health and safety

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Our health and safety mission:
to ensure a safe work environment where each person returns home healthy.

Building and maintaining a safety culture is a continuous process, and we invest heavily in creating a safe, healthy working environment at our mine.

Our health and safety mission: to ensure a safe work environment where each person returns home healthy.

Our health and safety vision: to control all activities of high potential risk and to achieve “zero damage” to our people’s health.

Our safety mission begins before an employee’s first day of work in the mine: before they can start work, every mine employee completes a safety program, with training on the risks and hazards of the job and essential safety knowledge and practices, such as respiratory protection, safety equipment and emergency planning.

All employees are frequently given medical checks to track their occupational and general health. Annually, and during maintenance periods, employees are given blood tests to monitor levels of vanadium exposure.

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Our strong safety culture has delivered consistent results: since 2015 Lost Time Incidents (LTIs) have dropped by more than 70%, and in 2018 the mine broke all company safety records to date.

LTI - Frequency Rate

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Creating culture of safety

CREATING A CULTURE OF SAFETY

Our Safety Leadership program is an integral component of our safety culture. Every safety leader (whether an employee or a contractor) participates in this continuous improvement program. Risk analyses are performed on a regular basis, contractors are audited for their safety standards, and mine management do regular “Safety Walks.”

Throughout the mine, signage campaigns reinforce the importance of proper dress and attire. Signage emphasizes the Five Golden Rules of Safety (relating to the activities with the greatest risk or injury profiles) with penalties for those who fail to follow procedures.

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Get permission from authorized staff before performing specialized tasks

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Be trained and authorized before operating mobile equipment and vehicles

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Lock off the power before doing maintenance on equipment

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Be trained and tested before working at height

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Lift loads safely and don’t injure yourself or others

Our communities

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At Largo, we understand the social and economic influence of the Maracás Menchen Mine in the local region. At all times we strive to operate in a manner that respects local communities and supports local culture and identity, while strengthening regional socio-economic development.

Supporting Local Businesses

We are committed to promoting the economic development of the region, with a focus on businesses and skills that will continue after the mine ceases to operate.

In 2018, 65% of the mine’s purchases of materials and services were invested within the state of Bahia. From over 4,000 approved suppliers to the mine, 44% are located in Bahia.

Building Infrastructure for Housing, Health and Education

In recent years, the Maracás Menchen Mine has funded, or provided buildings, facilities and equipment, to aid the community of Maracás and the surrounding region. Our contributions include renovations to the police stations in Porto Alegre and Maracás, and vehicles, including a police car and an ambulance.

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The Maracás Lodge is a building that we renovated and donated in 2014. It is used by local associations and social programs, including:

  • Projeto Jequiriça - Judo and Jiu Jitsu
  • AMARR - which helps families of recovering dependents to generate income
  • AMAA - the Animal Protection Association
  • Active Women sewing project, to which we donated sewing machines
  • Flores e Guardões - a sport and cycling association to which we donate sports clothing and provide sponsorships

In 2018 we donated a second company building, which will be used as the Porto Alegre Lodge. Renovations on the lodge will begin in June of 2019. The Porto Alegre Lodge will include spaces for local women, fishermen and farmers, where they will be able to improve their income generation potential.

There will also be a nursery for local children. The combined value of the Maracás and Porto Alegre Lodges was R$ 11.1 million.

In the Água Branca community, we invested R$ 0.3 million in a new water treatment plant that will provide clean water for 350 people.

In 2019, contributions for the communities near the mine will include a mobile Intensive Care Unit, a mobile dental office, a Civil Guard vehicle and a pipe truck. We will donate ambulances to the villages of Pé de Serra and Porto Alegre. And, working with the Community Association of Pé de Serra, we will develop a sewing project for local women to generate income.

In 2019, we will begin a Management Plan for the source of the Jiquiriçá River, and rehabilitation work in the eucalyptus forest in Maracás.

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Training and Education for the Workforce

To support the economies of our local communities, we offer skills training to help community members improve their qualifications for long-term employment. Our “Employment and Income” includes courses and technical training, including an apprentice program, educational incentives for students in the community, and workforce training to help community members enter the labour market.

Highlights

  • Electromechanical Technician Course: Graduated 200 students.
  • Beekeeping: Since 2015 we have supported the beekeepers association (the Maracaense Association of Beekeepers and Environmental Meliponicultores) and recently helped add 30 new apiarists to the association. We have improved their facilities, donated equipment and materials, provided a transport truck for hives and honey, and hired consultants.
  • Active Women: We taught nearly 70 women in three communities the skills for running a sewing business: the multi-phase project included the donation of sewing machines and equipment, renovating workshop spaces, and providing instruction in sewing and cutting,

entrepreneurship and marketing. This is a component of the AMARR project, which helps women provide for themselves and their families while men are recovering from dependency.

  • ExpoMARACÁS: An annual three-day event with over two thousand participants, ExpoMARACÁS provides lectures on farming, banking and government financing and agribusiness; it is held by the Municipal Department of Agriculture and Environment. The event had not been held for six years, but it has returned with Largo’s sponsorship and support.
  • Recycling: To assist local recyclers, we donated a truck, press and electric treadmill, and hired a consultant to the Maracaense Association of Recyclable Material Collectors, which improved its status and eliminated middlemen in recycling.
  • Farmers and fishers of Porto Alegre: To assist local producers improve standards and professionalize their Association of Rural Producers of Porto Alegre, we donated equipment – forage, planting and bagging equipment for farmers, and a filleting table and stainless-steel tables for fishermen. In a second phase, we will assist in consulting with the city hall and other institutions.

Supporting Public Education

Our Maracás Educational Development Program is intended to help raise educational standards and assist students, families and teachers in public and private schools of all levels. In 2018, our funding supported 242 school-age students and 268 adults (mine employees) in improving their education. 55% of the students were from Maracás and 45% from other nearby communities.

We have also equipped two computer labs in rural schools (to the benefit of over 500 students) and provided 14 computers for schools serving special-needs students.

Supporting Sport, Entertainment and Culture

Projeto Jequiriça (housed in the Maracás Lodge), is a hub of Judo and Jiu Jitsu instruction which has helped over 150 children, including the current state Jiu Jitsu champion, 16-year-old Luã Matos. In 2018, we sponsored, among other successful projects, a course on Citizenship and Public Policy; a renewed Civic Parade celebrating the history of Maracás, which had not been held for 13 years; a drawing and writing contest; and we helped publish two books written by students of the Porto Alegre Community.

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Environmental Performance

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At Largo, we strive for responsible stewardship of the land, air and water in every aspect of our business. Since the Maracás Menchen Mine began operating in 2014, we have met or exceeded all applicable environmental standards and regulations.

At Largo, we strive for responsible stewardship of the land, air and water in every aspect of our business. Since the Maracás Menchen Mine began operating in 2014, we have met or exceeded all applicable environmental standards and regulations. There have been no fines or other legal actions against the mine for environmental issues.

Carbon Emissions and Climate Change

We recognize the reality of climate change and our responsibilities, as an extractive industry, to take proactive measures to minimize emissions of greenhouse gases (GHGs). We include energy efficiency and emissions as serious considerations in our decision-making criteria.

Water Stewardship

To any mining operation – as well as to nearby communities – water management is of primary concern. Water for the Maracás Menchen Mine comes from one source, the reservoir of the Pedra Hydroelectric Power Plant, in the Rio de Contas River. The mine’s average consumption for processing is 60 m3 per hour, which is far lower than the 300 m3 allowed by the mine’s concession.

Energy consumed by weight or volume

Heavy Fuel Oil (HFO) 45 tonnes/day*
Diesel 24 tonnes/day*
(considering the ampunt used in mine operations + induatrial usage)
Liquefied Petroleum Gas (LPG) 2,700 kg/month
Electrical power 4,000 MW/h
*25% of HFO consumed is recycled from the Maracás Menchen Mine's thermoelectric power plant
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At the Maracás Menchen Mine, between 91% and 96% of the water drawn is reused, depending on evaporation.

The mine does not discharge any liquid effluent. We are stringent in our water reuse policies, and all discharge, whether from rain or possible discharge from the processing plant, flows into a tank (with a capacity of 23,000 m3) and is reused in the processing plant. Between 91% and 96% of the water drawn is reused, depending on evaporation.

In accordance with legislation, we test local water quality for any possible pollution. Surface water quality is monitored from 15 test points, groundwater quality from 12 wells. Reports from our water quality monitoring are prepared for INEMA, the Instituto do Meio Ambiente e Recursos Hidricos (Institute of Environment and Water Resources) under the terms of our operating license.

Tailings and Waste Management

In recent years, tailings management has come under increased scrutiny throughout the mining industry. The tailings facilities at the Maracás Menchen Mine meet or exceed all applicable standards.

Every six months an independent inspector evaluates the tailings ponds. The last inspection was in March 2019. Inspection results are available for viewing on the ANM (Brazilian Mining Department) website. ANM also inspects the entire mine site at least once a year. The last inspection was in August 2018.

Vanadium processing at the Maracás Menchen Mine generates four types of tailings:

  • Waste from dry magnetic separation: The ore is first crushed and then separated in a dry magnetic process. Non-magnetic waste, which is primarily silicates, is trucked to a controlled tailing pile.
  • Non-magnetic waste: After grinding, vanadium ore is separated in a wet-magnetic process. The non-magnetic waste is piped to a tailings facility.
  • Calcined waste: Ore passes through calcination and then to a leaching process, after which it is filtered and washed. The solid calcined waste is sent to a tailing dump for calcined waste. This waste contains hematite, an iron ore that may be recovered and sold in the future.
  • Chloride waste: Liquid and solid wastes from the vanadium chemical treatment plant are sent to a chloride tailings facility.

Management of Hazardous and
Non-Hazardous Waste

Our waste management systems are designed and operated with the objective of reducing waste to landfill and reducing volumes of waste stockpiled over time. Whether the waste is classified as hazardous or non-hazardous, it is disposed of according to applicable environmental regulations. No waste of any kind is shipped internationally.

Non-hazardous waste

Waste rock from the open pit mine is trucked and stored in controlled piles (following all environmental regulations related to drainage distances) and will ultimately be recovered and re-vegetated. Process waste (from dry magnetic separation) is stored in piles, similar to waste rock. Other non-hazardous waste products – from uncontaminated metallic waste and rubber from conveyor belts to cardboard, paper and plastics – are sold or donated to recyclers from the Maracaense Association of Recyclable Material Collectors.

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Hazardous waste

Waste from the Maracás Menchen Mine’s industrial processes are classified as Class I and Class II Hazardous Waste. Any hazardous waste requiring transport is transported by legally and environmentally accredited service providers.

Separate tailings ponds are used for the wet waste products. Following environmental regulations, these ponds are located 200m from drainage and protected areas and are sealed and lined. Waste from wet-magnetic separation is first pumped to a tailings pond and the water is recirculated for re-use in the mill. Waste from calcine, leaching and filtering is deposited in a “dry-stacking” procedure in a tailings facility, and chemical plant (chloride process) waste is stored in separate tailings ponds.

Other waste, such as pallets, metal parts and chemically contaminated materials are shipped to a certified industrial landfill.

Waste products by volume,
per year (approximate)

Waste rock 7,000,000 tonnes
Dry non-magnetic waste 300,000 m3 (600,000 tonnes)
Wet non-magnetic waste 300,000 m3 (540,000 tonnes)
Calcined waste 200,000 m3 (500,000 tonnes)
Chemical waste (chloride) 25,000 m3

Waste From Non-Industrial Processes

Waste from food preparation, administration, recreation facilities, etc. is composted when appropriate, or made available to recyclers from the Maracaense Association of Recyclable Material Collectors or trucked to the city of Maracás landfill. Medical waste is disposed of by accredited providers.

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Air Quality and Emissions

In accordance to INEMA legislation, the Company monitors, and provides monthly reports on emissions from its six chimneys. In addition, there are four remote monitoring stations located:

  • 3 km to the east
  • 4 km to the west
  • within the mine’s industrial area
  • in the community of Água Branca

Airborne articles below 10 μm, particulates greater than 10 μm, SOX, NOX, NH3, total vanadium and vanadium oxide are monitored.

Other Impacts

On a regular basis, mine staff monitors, and reports on a broad variety of possible indicators of any impacts that could affect the ecosystem or local communities. Because dust from mining and trucking in and out of the mine is a concern, the mine has a watering program to minimize dust rising from unpaved roads.

Protecting Biodiversity

The Maracás Menchen Mine is within the Caatinga biome, a semi-arid Brazilian biome of high biodiversity value which is protected by Brazilian legislation. Near the mine, river banks that are designated as Permanent Preservation Areas (APPs) are being preserved and actively re-vegetated, as many were deforested by previous activity. The Caatinga region includes a number of bird species and flora that are listed as in various stages of threat of extinction.

At Largo, we are committed to protecting and preserving the unique ecosystems of the Caatinga. We operate a comprehensive “Program for the Recovery of Degraded Areas” which includes studies and action plans for minimizing our environmental impacts and restoring affected areas for future use and/or environmental stability. Already, several areas have been successfully restored. In 2018, the program focused on topographically contouring and then landscaping a closed tailings pile and tailings ponds.

We have preserved several areas of virgin Caatinga ecosystem, notably the San Conrado Reserve and the São Conrado farm, near where the open pit and mine processing is located.

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Wilderness Preserve within The San Conrado Farm

The Wilderness Preserve near the Jiquiriçá Valley contains 1,200 hectares of native forest. Here we monitor the quality of soil, water, air, and strike to maintain native flora and fauna. Wild animals found near our mine or exploration activities are captured and released in the reserve. The legal reserve is home to 150 protected plant species, 30 species of amphibians, 15 species of reptiles, 140 different bird species and ten species of mammals.

The Wilderness Preserve is overseen by INEMA and any transportation of plant life or animal species must be approved prior to transport. When our mining activity requires the removal of plants, typical specimens are removed from the mining area and preserved in our nursery of native plants for use in future re-vegetation. Our greenhouse has the capacity to produce 20,000 trees, which are being cultivated for the reforestation of the surrounding area. In the first years of managing the legal reserve, over R$ 1 million has been invested in environmental projects.

Celebrating the Area’s Natural Wonders in a Book

Over six years, the mine’s Environmental Responsibility team partnered with local biologists, authors and organizers to research, write and publish a comprehensive reference book on the flora and fauna of the Caatinga region. The book, entitled A Fauna e a Flora na Área de Vanádio de Maracás highlights the uniqueness of the area’s plant and wildlife and what is being done to preserve its natural wealth and beauty. It is now a valuable resource for the entire community.

Mine Closure and Reclamation

Because all mines have a finite life, Largo maintains and regularly updates a closure plan for the Maracás Menchen Mine. The plan provides guidelines and financial expectations for the eventual closure of the mine, the decommissioning of its assets and the environmental recovery, reclamation of the affected areas and post-closure reclamation.

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