Big miners have trouble joining technology revolution
Major obstacle is massive upfront cost for innovation of mines, in contrast to incremental upgrades in mobile phones
Mining companies chasing the kind of technological breakthroughs made long ago in the manufacture of cars and mobile phones have unveiled eye-catching innovations ranging from vast drills and remotecontrolled trucks to second-bysecond data analysis.
Behind the scenes, however, there has so far been limited progress towards a transformation the companies say is more and more vital to their survival.
They are being jolted into action by volatile commodity prices and the increasing difficulty and danger of accessing remaining reserves in hot, narrow seams several kilometres below ground.
“There’a a big awakening in mining. The time is ripe for things to begin to change,” Anglo American’s head of technology development Donovan Waller said by telephone.
A major obstacle is the massive upfront cost for innovation that firms such as Anglo, BHP Billiton and Rio Tinto must pay off over the life of a mine in contrast to incremental upgrades common to mobile phones.
Sandvik, one of the world’s biggest suppliers of mining equipment, told Reuters it had doubled its installation of automation systems between 2015 and 2016.
But, asked what proportion of the loaders and trucks it sells are fully automated, it gave an estimate of 5 per cent.
While automation represents a potential threat to jobs the world over, it is particularly sensitive in an industry employing hundreds of thousands of blue-collar workers in nations where mining represents a major chunk of GDP.
South Africa’s South Deep started ahead of the pack back in 2008. Now the only fully mechanised large underground gold mine in South Africa, it broke even for the first time last year after years of losses and unveiled a new turnaround plan in February which cut production targets. At a national level, mining unions will not discuss mechanisation. “We won’t participate in talks about mechanization because it will lead to job losses,” said National Union of Mineworkers spokesman Livhuwani Mammburu. “They (the mine owners) must not rush only to make profits.”
The chamber says some job losses are inevitable, but that without technology to extend the life of mines, some 200,000 people would lose their jobs by 2025, affecting 2 million people via families or related industries.
Starting this month Pretoria is providing funding to develop ore processing techniques and related manufacturing to make up for lost jobs. But the sum, 150 million rand ($11 million) over three years, is modest.
In Chile, the copper industry faces wage talks overshadowed by a long strike at BHP Billiton’s Escondida mine, alongside other challenges.
Unexpected outages for maintenance can make a 30 percent difference to productivity and cost. The remote Pilbara region of Australia has already entered the space age as autonomous trucks the size of houses trundle through vast open pits controlled by operators more than 1,000 km away in Perth.
Rio says the change has improved productivity and put an end for many to a so-called fly-in, fly-out lifestyle as highlypaid workers were flown in to work the iron ore pits far from their homes. But the next stage — Rio’s $518 million autonomous train plan, under development since 2012 — has yet to be fully rolled out because of technical glitches, although Rio says it is confident it can expand use of autonomous trains this year.