The transformation of mining is without doubt one of the most impressive feats among industries that have recently become ‘connected’. The gold rush era, when all kinds of ore was hacked out of the ground with a pick-axe, is long gone, at least in the most developed countries. Nearly 150 years after the publication of French author Emile Zola’s great novel Germinal, depicting the harsh lives of miners in northern France, the new digital technologies have now gained a strong foothold in this industry, helping to extract the minerals without which our society would look very different today. Mining is the primary industry par excellence – firstly because it supplies essential raw materials to so many manufacturing industries; and secondly because it provides the materials which, at the end of a long chain of production, go to create the connected world of the smartphone, the main building block underpinning those modern cities whose aim is to become ever ‘smarter’. Accordingly, mining companies have been making strenuous efforts to achieve a digital shift so as to improve both technological performance and safety and to customise the production of materials for which worldwide demand is extremely high. With the introduction of autonomous trucks, data collection and analysis, and even moves into asteroid mining, mining firms that were often starting to run out of steam have been seeking new horizons. So what are the short, medium, and long-term opportunities for the new-look mining conglomerates?
The short term: using robots in the production process
From extraction to delivery of the merchandise, a major challenge for the mining industry lies in being able to use robots to automate the entire production chain so as to achieve better yields and to increase on-site safety. Since mining first began, human beings have been trying to dig ever deeper, entailing countless fatal accidents. Even just a couple of months ago there was an explosion at a coal mine in Iran that caused the death of 14 miners.
FROM DETECTION TO EXTRACTION: DRONES
Automating extraction through robotisation would help to remove people from harm’s way and so reduce the number of accidents, fatal or otherwise. This is why robots and unmanned aerial systems , aka drones, are increasingly being used in the mining industry. In the mines at Pilbara in western Australia, drills and rock-breakers are now completely automated. Rock-crushers, the machines next in line in the production chain, are already semi-automated, and small drones are also sent flitting in and out of mines with the most difficult conditions for extraction – whether due to the depth of the mineral deposits, the narrow galleries, heat, fire-risk, escaping gas and so on – in order to reap the earth’s subterranean bounty. Meanwhile remote-controlled, sensitive, resilient drones are now serving as gold-diggers in the mines at West Driefontein, South Africa. And when it comes to delivery, autonomous trucks and trains are nowadays lending the human workforce a hand. At the Fortescue Metals mine at Pilbara, some 56 autonomous trucks are used to transport iron ore. Meanwhile Rio Tinto, which also mines iron ore in that region, is not only planning to automate its entire fleet of trucks in the long term but has also put into service a completely autonomous train, which moves the ore hundreds of kilometres from the mine to the nearest port.
These waves of automation improve productivity considerably. According to a recent report by consultancy firm McKinsey, Rio Tinto has seen its productivity increase by 10 to 20% due solely to the use of autonomous transportation. Overall, say analysts at PwC there was a step-up in activity in the minerals & mining products markets in 2016, when many companies started investing seriously in automation, compared to the preceding year.
Mining companies across the globe have seen a return to profitability, with net profits in the industry totalling $20 billion, compared with losses of $28 billion incurred in 2015. “Mining companies need to combine engineering excellence and know-how with a new open mindset so as to obtain advanced analyses, and they also need to adopt robotics technology and platforms that are fundamentally modernising practices which have remained unchanged for decades,” underlines Andries Rossouw, a partner in PwC’s energy and mining industry insurance practice.
The medium term: connecting mines
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One step behind robotics, data is now set to become a new goldmine for extraction firms. Bringing the Internet of Things into the industry, ‘connecting’ mines, should certainly lead to increased efficiency, speed and safety, but it will also help mining companies to tailor and customise their product range. Canadian mining company Goldcorp’s newly-opened mine, Eléonore, is a pioneer in this field. Goldcorp has installed WiFi hubs throughout the mine and most all the equipment is ‘connected’, which means that operators can see in real time where the machines are and what they are doing. In addition, in order to increase employee safety, those working underground are also equipped with an electronic chip that constantly signals their position and alert/alarm systems are now able to warn of any accident that occurs around 45 minutes earlier than used to be the case. Moreover, the ventilation system in the galleries is also calibrated on the basis of the chips, so as to adapt to the presence, and number, of workers in a given sector of the mine. This will help to achieve estimated energy savings worth in the order of $1.5 to 2.5 million per year. Drawing on such data will also enable mining companies to switch from remedial maintenance to predictive maintenance, with further attendant efficiency gains and cost savings.
The challenge for the mining industry: tailoring production to precise needs
On top of all these benefits, data analysis will in the longer term allow mining firms to tailor their output to meet their customers’ specific needs, points out Laurence Contamina, industry specialist at L'Atelier BNP Paribas. “The factory of the future is the data factory. We’re now seeing factories moving from a 20th century approach, whereby they used to produce massive quantities of goods, to a ‘connected’ industry approach where production is highly specific, geared to customers’ exact needs in the required quantities. The challenge for the mining industry will be to tailor production to precise needs,” she foresees.
The long term: exploration in outer space and the oceans?
ON A SUBSEA OFFENSIVE
In the longer term, outer space and the oceans will without doubt provide ‘extra-terrestrial’ opportunities for the mining industry. Players such as Canadian seafloor exploration company Nautilus Minerals are already getting into this field. The company is due to begin in 2019 with sub-sea mining under 1600 metres of water off the coast of Papua New Guinea, in search of gold, silver and copper – much-prized ores that can only now be found under the earth in relatively small veins. The Solwara 1 deposit promises a copper grade of approximately 7%, compared with an average grade of 0.6% in land-based copper mines. However, this venture has raised environmental questions because in spite of the potential economic returns, the process of extracting ore in this location threatens to destroy the ambient biodiversity. Somewhat more acceptable from an environmental point of view, asteroid mining could well be a new way of obtaining fresh mineral resources. In a century that appears to have made the conquest of space a sine qua non for the survival of the human race, this prospect is no longer a futuristic dream.
In 2015, the United States government updated US commercial space legislation by passing the Spurring Private Aerospace Competitiveness and Entrepreneurship (SPACE) Act, which explicitly allows US citizens to "engage in the commercial exploration and exploitation of space resources". This pioneering legislation has potentially turned outer space into fertile ground for exploration, ownership and exploitation of extra-terrestrial resources, encouraging companies and other countries to look more closely at opportunities for mining on asteroids or on the moon, whose rocky terrain holds a wealth of diverse raw materials including water, gases, iron, nickel, cobalt and not least platinum. The price tag attached to these resources is huge. For instance, the asteroid Lutetia has huge platinum deposits, with a current estimated total value of close to €5,000 billion.
Quite apart from the financial aspect, there are also environmental arguments for encouraging miners to set their sights in future on the sky instead of the land. The world’s population is set to rise to 10 billion by 2050, increasing overall needs just as some key resources are becoming less plentiful. Planet earth is far from being a hopeless case, but we humans will certainly need to diversify the search for basic resources.
Deep Space Industries
At the moment the two countries gearing up for space mining action are the United States, with ventures such as Deep Space Industries and Planetary Resources, and a European rival, Luxembourg, which hosts the SpaceResources initiative. Nevertheless, between intention and extraction there is a very long journey, involving sending out a spacecraft, getting it to land successfully and moving equipment around so that it can extract the desired minerals optimally. There are then two basic options: using the mined materials out in space at the existing space stations, for instance to maintain space shuttles, or transporting them back to Earth. During the Rosetta mission, merely getting Philae to land on the comet turned out to be far more difficult than anticipated. And companies involved in space missions today are still having to overcome technical problems. In addition, the costs are very high. Nevertheless, this type of venture has come to symbolise national virility. One example is Hayabusa (Peregrine Falcon), an unmanned spacecraft developed by the Japan Aerospace Exploration Agency (JAXA) which returned to Earth in 2010 with 1500 grains of material from the small near-Earth asteroid Itokawa. The Japanese have since launched a second exploratory craft – Hayabusa2 – which is scheduled to arrive on the asteroid Ryugu in 2018 and return two years later.
So the immediate challenges for the mining industry are clearly marked: using robots for mineral extraction, tailoring output to individual customer needs and ‘connecting’ the industry. In the longer term, the aim must be to transform mining into a hotbed of innovation. Nevertheless, there are still many obstacles to overcome. In addition to the traditional environmental and health issues, which resurfaced recently when El Salvador made history as the first nation to impose a blanket ban on metals mining, ethical and social concerns are now arising over a situation in which human beings are likely to be less and less directly involved in the extraction process. However, French daily newspaper Le Monde argues: "The new technologies are leading to the creation of new kinds of jobs and bringing change to many others. Robotisation does not always mean destroying jobs. It forces us to think in terms of skills rather than jobs and tasks.” In fact, the economic cost of these huge investments is an obstacle that encourages the mining industry to continue using manpower, sometimes in contravention of basic human rights. It should not be forgotten that some mines in Africa are still perpetuating child labour. At the end of the day, investing in automation could help to reconcile ethics and economics, and put a stop to such human rights violations.