By Joe Keenan, Chief Executive Officer, BME
Far-sighted mining houses are delving deeper into the technology resources of their suppliers, aiming more than ever to leverage outside innovation for their own productivity.
|Joe Keenan sees mining innovation as a necessity for successful operations|
Protracted pressure on margins over many years has put miners’ focus squarely on productivity. Lower commodity prices with a steadily rising cost base and growing compliance requirements have created a perfect storm. Africa has not been left behind in terms of technology-focused efforts to raise productivity, with the development of one of the world’s first automated mines in Mali. To pursue this direction, mines are getting closer to suppliers, to better understand what they have to offer – both now and in the future.
Making this possible is the continuous advance in digital technology and data management. For success depends not just on engaging a supplier’s new technology; it must integrate – preferably seamlessly – with the mine’s ever more complex system of planning, monitoring and reporting.
The traditional ‘commodity bid’ by a mining company’s procurement department is becoming less and less useful to a corporate productivity strategy. When a mine places an order for the supply of emulsion explosive, for instance, the tender may have traditionally prioritised the price element. If a mine has a strategic focus on raising its milling efficiency, however, it will be looking beyond the emulsion as a commodity. It will rather be looking at how the supplier can contribute to better blasting methods – to optimise key blasting outcomes like fragmentation. Underground mines will also want to quantify the benefits of emulsions in terms of shaft efficiency, as emulsions do not require dedicated shaft times and can even be dropped into underground workings via dedicated pipelines. In this way, larger miners are increasingly wanting to know about how a supplier’s technology offering will promote long-term productivity gains.
This means that any supplier that talks about ‘partnership’ with mining customers has to put their money where their mouth is – to ensure they have the capacity to integrate their technology systems with mining operations. Only then can mines get the full operational benefit, while properly tracking and quantifying its impact on the whole enterprise.
Mines are looking for productivity tools that integrate with their mine systems. The ‘Internet of Things’ now makes this possible – and technology partners are soon going to be required to connect their solutions with mines’ open data systems.
This trend is demanding greater transparency from both sides. Some of the larger mining players are bringing suppliers into their confidence about strategic intentions going forward. At the same time, they are wanting more detail on what is in suppliers’ technology pipelines.
Beyond the demand for outcomes-based technology – where the solution performs its current role – mines are increasingly looking for future improvements. This search even includes applied research, exploring completely different ways of doing things.
Innovation track record
Here, the capacity of the supplier to initiate and follow through on applied research is becoming more of a consideration for the mining majors. A supplier’s track record in the ideation and commercialisation of productivity-enhancing technology is likely to become more valued.
The beauty of big data in this context is that suppliers’ impact on productivity could be better gauged, even beyond their specific aspect of a mine’s value chain. As growing volumes of data are collected on each aspect of a mine operation, there are increasingly sophisticated analytical tools to make the data meaningful. This includes drawing links between cause and effect – where improvements in one aspect of mine activity lead to savings or better performance in another.
The growing interest shown by mines in the technology pipelines of their supply partners is an encouraging trend. The insights that this provides will hopefully feed the mining industry’s vision of what may be technologically possible going forward. It will also help guide the direction of much-needed research and development – on which narrow margins have had a depressing effect in recent years.
*Article published in the July-September 2019 issue of The Asia Miner