Minerals, Wealth and Progress - Mining and the Environment: From Ore to Metal - page 18

FIGURE 1.5
Linear and Circular Economic Models

Human Capital Built Capital

The amount of outputs in the form of
raw materials and wastes will generally
equal the amount of natural resources
used. The primary reason is the First
Law of Thermodynamics, which states
that matter can neither be created nor
destroyed.
Source:
modifi ed from FEE 2003

Environment as a source

Production

Natural Capital

Goods

Recycling/Re-use

Wastes

Environment as a sink

Final waste disposal

Linear Model

and Turner 1990). The production process itself relies on natural, human, and built capi-
tal. Natural capital consists of minerals, fossil fuels, land, topsoil, and water. These can
be further divided into renewable resources such as forests, and non-renewables such as
minerals. In this model the environment is simply a source of production inputs, and no
allowance is made for the waste products that will be generated from all phases of both
production and consumption.
A circular economy/environment model (though simplified) is more useful when it
is desirable to capture the economic costs of waste streams (FEE 2003, Figure 1.5 ). The
First Law of Thermodynamics states that matter can neither be created nor destroyed.
Whatever is used up in the production process, however much modified, will eventually
end up in the environment. The efficiency of the production process (predominantly a
combination of cutoff grade, stripping ratio, and rate of recovery) will influence the rate
of consumption of natural resources per unit of target output. Inefficient production pro-
cesses will waste natural resource inputs. Inevitably, the natural environment becomes
a sink for waste products in the form of waste rock, tailings, effluents, and gaseous
emissions.
The major concern for efficient production is that the environment has a limit for
absorbing or 'assimilating' waste products. Recycling waste can help and is beneficial in
two ways: first, it can augment natural resources used in production and thus reduce the
raw natural resources required for the same level of output; second, recycling results in
reductions in waste volumes. Given technical and economic limits, even with optimal effi-
ciency in recycling, the environment will continue to act as a waste sink. Traditional linear
models neglect the externalities of environmental and social costs from waste streams; cir-
cular models integrate such externalities into production costs, thereby producing a more
accurate picture of the real cost of a mining operation.

The natural environment
becomes a sink for waste
products in the form of waste
rock, tailings, effl uents, and
gaseous emissions.