Yancoal Australia
GovernanceGovernance
Governance body oversight and management's role
Our Board is responsible for our overall corporate governance and leadership, including directing company affairs, setting and monitoring our risk management strategy (including climate-related risks and opportunities), and overseeing the appointment, remuneration and performance of senior executives.
The Board may, from time-to-time, establish appropriate committees to assist in the discharge of its responsibilities. The Board has established four standing committees: Audit and Risk Management Committee; Health, Safety, Environment and Community Committee; Nomination and Remuneration Committee; and Strategy and Development Committee.
Audit and Risk Management Committee (ARMC)
The Board's Audit and Risk Management Committee (ARMC), assists the Board in relation to the reporting of financial and sustainability information, with satisfying itself that a sound system of risk oversight and management exists, that internal controls are effective, and for setting the risk appetite within which the Board expects management to operate.
The ARMC meets at least four times annually with duties and responsibilities that include reviewing and evaluating whether Yancoal has any material exposure to business risks, including financial and non-financial risks (including climate-related risks), environmental risks, social risks and, if it does, how Yancoal manages or intends to manage those risks. The Board has ultimate responsibility for the oversight of setting and monitoring Yancoal's risk management strategy (including ESG and climate risks).
Health, Safety, Environment and Community (HSEC) Committee
The Board's Health, Safety, Environment and Community (HSEC) Committee, which meets at least four times annually, assists the Board with:
- Fulfilling its responsibilities in relation to the health, safety, environment and community (collectively HSEC) matters arising from Yancoal's activities.
- Considering, assessing and monitoring whether or not Yancoal has in place the appropriate policies, standards, systems and resources required to meet our HSEC commitments.
- Providing necessary focus and guidance on HSEC matters across the organisation.
- Assess whether Yancoal has any material exposure to environmental, social and climate change risks, considering climate-related matters and issues, including climate-related risks and opportunities (CRROs) and evaluating and determining the Company's HSEC-related risks and opportunities.
- Monitoring the implementation of Yancoal's P4 Change 4 Tomorrow Strategy.
Sustainability Working Group (SWG)
Reporting to the HSEC Committee, the Sustainability Working Group (SWG) supports Yancoal to integrate strategic sustainability priorities into core operations, and to develop, implement and monitor sustainability initiatives. The scope of the SWG includes several climate-related matters such as energy and resource efficiency and emissions abatement (including mitigation and offsets). The SWG meets quarterly and is comprised of representatives from various departments and levels within Yancoal. The SWG reports its activities and progress regularly to the HSEC Committee and other relevant stakeholders.
Management's role
Each of the P4 pillars has an assigned Executive Sponsor, with representatives from relevant functional areas to support its implementation. Together, these sponsors and representatives form part of the SWG. The Sustainability Governance Framework is intended to strengthen how sustainability-matters inform strategic planning, operational decision-making and performance monitoring.
StrategyStrategy
Climate-related risks and opportunities
From an EROMF perspective, our assessment indicates that Yancoal's most material climate-related exposures relate to transitional risks associated with the move toward a lower-carbon economy. These include policy and regulatory changes, carbon pricing, evolving market demand, access to finance and insurance, and broader energy system dynamics. Opportunities relating to electrification and fuel switching were also identified through this assessment. Physical risks, including increased frequency and severity of extreme rainfall, storms, flooding and drought, remain relevant for some operations and are being monitored through our Climate Scenario Analysis work.
Physical risks: more frequent and severe extreme weather events
Transition risks: changes in policy, carbon costs, market demand and access to finance
Our Climate Scenario Analysis aligns with the latest international agreement on climate change, covering both 1.5°C and 2°C warming scenarios directly required by AASB S2 and reflecting the temperature goals of the Paris Agreement. The Climate Scenario Analysis was undertaken during the 2023–2024 period.
Business model and value chain
Physical risks, including increased frequency and severity of extreme rainfall, storms, flooding and drought, remain relevant for some operations and are being monitored through our Climate Scenario Analysis work.
Understanding these risks and opportunities supports strategic decision-making and capital allocation, including opportunities to improve operational efficiency, deploy new technologies and strengthen resilience across our asset base and supply chain.
Strategy and decision-making
Climate change is a core performance category within Yancoal's Planet pillar of the P4 Change 4 Tomorrow Strategy, and we continue to manage climate-related risks and opportunities (CRROs) as part of our broader strategic and risk management approach.
Our capital allocation processes incorporate an assessment of factors such as coal demand outlook, regulatory developments and carbon cost implications.
Operational emissions remain a key focus area within the Yancoal P4 Change 4 Tomorrow Sustainability Strategy. Scope 1 emissions are released into the atmosphere as a direct result of an activity, or series of activities at a facility. Our predominant Scope 1 emissions are fugitive emissions released during the extraction of coal and diesel fuel combustion. Scope 2 emissions primarily result from the consumption of purchased electricity.
One of our primary environmental challenges involves addressing fugitive emissions. In response to this critical issue, we have embarked on several investigations across our operations to identify technologies and processes that can reduce fugitive emissions and whether there are parts of Yancoal's business that will still have significant fugitive emissions due to a lack of available technology in the medium to long term.
We are also focused on diesel emissions, another significant contributor to our operational carbon footprint. Supplier engagement also forms part of our approach. Sustainability workshops with key suppliers continue to explore emissions reduction opportunities and emerging technologies. Yancoal also remains a participant in Caterpillar's Pathways to Sustainability program, which provides industry insights on potential future energy transition pathways.
We continue to work towards reducing Scope 1 and Scope 2 absolute emissions across our operations including, where technically and economically feasible, targeting fugitive and diesel consumption based emissions. We are working to map and define our Scope 3 emissions profile.
We continued to invest in rehabilitation, progressive closure planning and engagement with equipment manufacturers to explore potential decarbonisation pathways, including fleet efficiency, electrification and low-carbon fuels. Over time, these initiatives will support cost-effective emissions reduction in line with our regulatory obligations.
During 2025, we advanced fleet decarbonisation planning with Caterpillar, applying optimisation modelling at one of our open-cut operations to quantify and test efficiency improvement options. The four-step technical assessment covered: baseline emissions' analysis; short-term operational optimisation; route and cycle-time calibration; and decarbonisation opportunity simulations. The next phase will run scenario analyses for key enabling infrastructure and models that could support decarbonisation pathways, including implications for equipment selection, maintenance processes and energy consumption.
At Moolarben, work to improve cooling-system performance progressed, with a modified fan hub and updated controller and software installed in 2025, indicating a further reduction of around 2% in fuel-burn. Fuel-calibration optimisation also continued during 2025, following trials in 2024 that achieved an approximate 2% reduction in fuel burn; updated calibration settings were rolled out across both MTW and Moolarben.
A group-wide strategy and Cost-Out Program was implemented with major OEMs to continuously analyse condition-monitoring reports, focused on achieving full lifecycle from critical components and extending component life.
A strategic collaboration with one of our OEM providers continued, including a structured learning and capability-building program designed to equip teams with skills needed to support emerging transition technologies that align with evolving industry demands.
We do not currently have emissions reduction target(s); emissions target(s) will be considered as part of our Sustainability Strategy.
Financial position, financial performance and cash flows
Current financial effects
In 2025, the value of our direct economic contribution was $5.2 billion ($5.5 billion in 2024). This reduction is due to lower coal prices impacting revenues, royalties and tax payments. Overall contribution to state and federal government revenues in 2025 decreased by 30% compared to 2024, totalling $0.9 billion.
Yancoal has surrendered sufficient ACCUs to meet its compliance obligations under the Safeguard Mechanism for FY25. In FY25, with the exception of Moolarben, all Yancoal-managed Safeguard facilities exceeded their baselines, resulting in total exceedances of: Ashton: 488,761 tCO2-e; Premier: 6,030 tCO2-e; Warkworth: 301,673 tCO2-e; Yarrabee: 40,317 tCO2-e. Moolarben generated 39,794 SMCs, which may be used to offset future emissions obligations or sold to other Safeguard entities.
Anticipated financial effects
Our approach to reserves valuation and capital expenditures reflects a commitment to balancing economic opportunity with the evolving dynamics of global markets and climate policy. Coal price trends, demand fluctuations and climate-related regulations influence our strategies for exploration, development and asset planning.
During 2025, we enhanced this process through the use of a carbon-pricing analytics platform, which provides market data and forward-looking insights to support Life of Mine planning and internal project evaluation. This information is considered alongside scenario-based price projections, including those that incorporate a carbon price.
Carbon market data and forward-looking pricing insights continue to inform long-term planning. In 2025, Yancoal's adopted carbon price prediction was informed by data from a leading carbon pricing platform and considered within Life-of-Mine Planning models. This information, including current ACCU market prices, forward curves, and high/mid/low pricing scenarios, supported carbon cost considerations and was applied in project and cost evaluation processes.
We also estimate the GHG emissions embedded in our proven coal reserves for internal evaluation, recognising the environmental context and its implications for long-term resource management.
Climate resilience and scenario analysis
With the introduction of AASB S2, the P4 Report now provides a high-level summary of this work. The detailed climate-related disclosures are presented separately in the Sustainability Report.
During the year, we enhanced our understanding of CRROs in line with AASB S2. This included progressing our phased Climate Scenario Analysis program, supported by external experts, to help assess the potential impacts of both physical and transition-related risks across a range of hypothetical future scenarios.
Our Climate Scenario Analysis aligns with the latest international agreement on climate change, covering both 1.5°C and 2°C warming scenarios directly required by AASB S2 and reflecting the temperature goals of the Paris Agreement.
The Climate Scenario Analysis was undertaken during the 2023–2024 period. Further detail on this work, including the underlying methodology, assumptions and the full set of CRROs, is provided in the Sustainability Report.
Over the past 12 months, we have focused on shifting from planning to execution - strengthening our governance, improving data quality, and advancing the practical initiatives that support long-term resilience and value creation... we completed detailed data mapping across our operations, improved internal processes, and expanded the scope of climate-related modelling to include drought, bushfire, extreme rainfall and cyclone assessments for applicable sites. These insights will inform ongoing mitigation and adaptation planning to address identified climate-related physical and transitional risks.
Risk ManagementRisk Management
Processes for identifying, assessing and managing climate-related risks
Yancoal's Enterprise Risk and Opportunity Management Framework (EROMF) establishes a link between business objectives, strategy and risk, and opportunity management activities. It provides the foundation for managing uncertainty through a structured and consistent approach. The framework sets out the minimum requirements for identifying, assessing and managing risks and opportunities across the business, including those related to ESG and climate.
Our risk identification activities are guided by ISO 31000 Risk Management, and are undertaken on a periodic basis, with analysis performed at specific functional and mine-site levels.
Our risk management policies and procedures have been designed and implemented to identify, assess and manage any material exposure to risks. Yancoal is subject to a range of sustainability risks, including climate-related, environmental and social risks. These include, but are not limited to, those related to: transition to a lower carbon economy; and climate-related risks (among other listed risk categories).
CRROs are managed through our Enterprise Risk and Opportunity Management Framework (EROMF), which integrates climate considerations into the broader enterprise approach to identifying, assessing and responding to risk.
During the year, we enhanced our understanding of CRROs in line with AASB S2. This included progressing our phased Climate Scenario Analysis program, supported by external experts, to help assess the potential impacts of both physical and transition-related risks across a range of hypothetical future scenarios.
The Audit and Risk Management Committee (ARMC) annually reviews Yancoal's risk management framework to satisfy itself that it continues to be sound and that the entity is operating with due regard to the risk appetite set by the Board. The ARMC annually reports on this review to the Board.
Metrics & TargetsMetrics and Targets
Climate-related metrics
Greenhouse gas emissions
Yancoal reports its greenhouse gas (GHG) emissions and energy consumption in accordance with the Australian Government's National Greenhouse and Energy Reporting Act 2007 (Cth) (NGER Act). Yancoal submitted its annual emissions and energy report under Section 19 of the NGER Act (s19 report) for the reporting period of 1 July 2024 - 30 June 2025 (FY25). The s19 report sets out our total Scope 1 and Scope 2 emissions, which are reported by 'facility' having regard to those facilities that Yancoal has operational control of.
- Scope 1 emissions arise directly from operational activities, including fugitive emissions from coal extraction and emissions from fuel combustion.
- Scope 2 emissions represent indirect emissions associated with purchased electricity.
Total Scope 1 and Scope 2 emissions for the 12-month period ending 30 June 2025 totalled 2,763,249 tonnes of carbon dioxide equivalent (tCO2-e), representing a 21% increase compared with the previous year (FY24). Of this, total Scope 1 emissions accounted for 90% at 2,476,890 tCO2-e, with the remaining 10% resulting from our Scope 2 emissions of 286,360 tCO2-e. Over the same period, total run of mine (ROM) coal production increased by 1%, resulting in an emissions intensity of 0.054 tCO2-e/ROM tonne, a 20% increase from FY24.
| Summary Greenhouse Gas Emissions | 2024/2025 | 2023/2024 | % VARIANCE |
|---|---|---|---|
| Scope 1 (tCO2-e) | 2,476,890 | 1,998,113 | 24% |
| Scope 2 (tCO2-e) | 286,360 | 287,771 | 0.5% |
| Total Scope 1 and 2 (tCO2-e) | 2,763,249 | 2,275,884 | 21% |
| ROM Coal (tonnes) | 51,126,351 | 50,586,652 | 1% |
| Emissions Intensity (tCO2-e/ROMt) | 0.054 | 0.045 | 20% |
The Safeguard Mechanism applies to facilities whose covered Scope 1 emissions exceed the Safeguard default threshold of 100,000 tCO2-e per year, with any emissions that exceed the facility's baseline to be offset by surrendering either Australian Carbon Credit Units (ACCUs) or Safeguard Mechanism Credits (SMCs). In FY25, with the exception of Moolarben, all Yancoal-managed Safeguard facilities exceeded their baselines. This resulted in total exceedances of: Ashton: 488,761 tCO2-e; Premier: 6,030 tCO2-e; Warkworth: 301,673 tCO2-e; Yarrabee: 40,317 tCO2-e. Yancoal has surrendered sufficient ACCUs to meet its compliance obligations under the Safeguard Mechanism for FY25. Moolarben generated 39,794 SMCs, which may be used to offset future emissions obligations or sold to other Safeguard entities.
We are working to map and define our Scope 3 emissions profile. (Note: per Appendix A, Yancoal has claimed transitional relief from disclosing Scope 3 emissions and comparative information in the first annual reporting period under AASB S2, per ASIC Regulatory Guide RG 280.107, and will report Scope 3 GHG emissions in the next annual reporting year.)
Energy consumption: Total energy consumption in FY25 increased in line with a rise in ROM production, driven predominantly by diesel fuel used in mining operations. Direct and indirect energy consumption across all sites totalled 3,976,601 MWh, a 2% increase compared with FY24 (3,881,913 MWh). Energy intensity for the reporting period was 0.08 MWh/ROMt, remaining consistent with the previous year.
Internal carbon prices
During 2025, we enhanced [capital prioritisation] through the use of a carbon-pricing analytics platform, which provides market data and forward-looking insights to support Life of Mine planning and internal project evaluation. This information is considered alongside scenario-based price projections, including those that incorporate a carbon price. In 2025, Yancoal's adopted carbon price prediction was informed by data from a leading carbon pricing platform and considered within Life-of-Mine Planning models, including current ACCU market prices, forward curves, and high/mid/low pricing scenarios.
Climate-related targets
We remain focused on strengthening our understanding of climate-related risks and opportunities, and improving the quality and completeness of our emissions data.
We continue to work towards reducing Scope 1 and Scope 2 absolute emissions across our operations including, where technically and economically feasible, targeting fugitive and diesel consumption based emissions. We are working to map and define our Scope 3 emissions profile. ... While we have not set emissions reduction targets, we continue to manage Scope 1 emissions through operational controls, monitoring of fugitive emissions, and efficiency measures associated with fuel and energy use. This approach supports the ongoing management of emissions intensity over time in line with operational, regulatory and safety considerations.
From Appendix A: "Yancoal does not currently have set emission target(s). Emissions target(s) will be considered as part of our Sustainability Strategy."